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SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K
CURRENT REPORT
Pursuant
to Section 13 or 15(d) of the
Securities Exchange Act of 1934
Date of Report (Date of earliest event reported: April 20, 1995)
BRUNO'S, INC.
(Exact name of registrant as specified in its charter)
Alabama
(State or other jurisdiction of incorporation)
0-6544 63-0411801
(Commission File Number) (I.R.S. Employer Identification No.)
800 Lakeshore Parkway
Birmingham, Alabama 35211
(Address of principal executive offices/Zip Code)
(205) 940-9400
(Registrant's telephone number, including area code)
N/A
(Former name or former address, if changed since last report)
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<PAGE>
Item 1. Changes in Control of Registrant.
--------------------------------
As previously reported in the Registrant's Current Report on Form 8-K, dated
April 27, 1995, as amended by the Current Report on Form 8-K/A, dated May 30,
1995, the Registrant entered into an Agreement and Plan of Merger, dated as of
April 20, 1995, and amended as of May 18, 1995, with respect to a merger
(the "Merger") between Crimson Acquisition Corp. ("Crimson"), a subsidiary of
Crimson Associates, L.P., a partnership organized by Kohlberg Kravis Roberts
& Co., and the Registrant, with the Registrant continuing as the surviving
corporation.
The Merger was consummated on August 18, 1995, at which time Crimson
Associates, L.P. and an affiliated entity (the "Partnerships") acquired
(i) 20,833,333 shares of common stock, par value $.01 per share ("Common
Stock"), of the Registrant and (ii) warrants (the "Warrants") to purchase up
to an additional 10,000,000 shares of Common Stock. Immediately following the
Merger, the Partnerships directly owned 83.33% of the Common Stock (and would
have owned approximately 88% of the Common Stock if the Partnerships exercised
the Warrants in full at such time). Please see the press release attached
hereto as Exhibit 99.1.
The amount and sources of funds used in connection with the Merger and related
transactions consisted of (i) borrowings of $485.1 million under a Senior
Secured Credit Facility, with the institutions and on the terms set forth in
Exhibit 10.1 attached hereto, (ii) the issuance of $400 million aggregate
principal amount of 10-1/2% Senior Subordinated Notes due 2005, on the terms
set forth in Exhibits 4.2 and 4.7 attached hereto, (iii) the contribution
of $250 million in equity by the Partnerships and (iv) the use by the Registrant
of $20 million of cash on hand. These amounts include funds for certain
Merger-related expenses which are expected to be paid in the future.
2
<PAGE>
Item 5. Other Events
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1. Following the Merger, the Common Stock was delisted from the Nasdaq
National Market System.
2. On August 21, 1995, William J. Bolton was appointed Chief Executive Officer
of the Registrant, was appointed to the Board of Directors of the Registrant
and was elected Chairman of the Board of Directors of the Registrant. See the
press release attached hereto as Exhibit 99.2.
3
<PAGE>
Item 7. Financial Statements, Pro Forma Financial Information
and Exhibits
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The following documents are filed as exhibits to this form 8-K:
99.1 Press Release - Merger of Crimson Acquisition Corp. with and
into the Registrant.
99.2 Press Release - Appointment of William J. Bolton as Chairman and
Chief Executive Officer of the Registrant.
The following documents are filed as Exhibits to the Registrant's
Registration Statement of Form S-3 (File No. 33-60161) (the "Registration
Statement"). Exhibits 4.2 and 12 attached hereto replace Exhibits 4.2 and 12
filed as exhibits to the Registration Statement on July 18, 1995. Exhibit 10.1
attached hereto replaces Exhibit 10.1 filed as an Exhibit to the Registration
Statement on August 15, 1995.
Exhibit
Number Description
------- -----------
4.2 Indenture dated as of August 18, 1995, between the
Registrant and Marine Midland Bank, as Trustee.
4.7 First Supplemental Indenture dated as of August 18,
1995, between the Registrant and Marine Midland Bank,
as Trustee, relating to the issuance and sale of
$400,000,000 aggregate principal amount of 10-1/2%
Senior Subordinated Notes due 2005.
5.3 Opinion of Sirote & Permutt, P.C., dated August 18,
1995.
5.4 Opinion of Simpson Thacher & Bartlett, dated August 18,
1995.
10.1 Credit Agreement, dated as of August 18, 1995,
among the Registrant, the several lenders from time to
time parties thereto and Chemical Bank, as
Administrative Agent.
12 Computation of Earnings to Fixed Charges
4
<PAGE>
Signature
Pursuant to the requirements of the Securities Exchange Act of 1934, the
Registrant has duly caused this report to be signed on its behalf by the
undersigned thereunto duly authorized.
Date: August 23, 1995
BRUNO'S, INC.
By: /s/ Glenn J. Griffin
Glenn J. Griffin,
Executive Vice President,
Chief Financial Officer,
Treasurer and Assistant
Secretary
5
<PAGE>
INDEX TO EXHIBITS
Exhibit
Number Description
------- -----------
4.2 Indenture dated as of August 18, 1995, between the
Registrant and Marine Midland Bank, as Trustee.
4.7 First Supplemental Indenture dated as of August 18,
1995, between the Registrant and Marine Midland Bank,
as Trustee, relating to the issuance and sale of
$400,000,000 aggregate principal amount of 10-1/2%
Senior Subordinated Notes due 2005
5.3 Opinion of Sirote & Permutt, P.C., dated August 18,
1995
5.4 Opinion of Simpson Thacher & Bartlett, dated August 18,
1995
10.1 Credit Agreement, dated as of August 18, 1995,
among the Registrant, the several lenders from time to
time parties thereto and Chemical Bank, as
Administrative Agent.
12 Computation of Earnings to Fixed Charges.
99.1 Press Release - Merger of Crimson Acquisition Corp. with and
into the Registrant.
99.2 Press Release - Appointment of William J. Bolton as Chairman and
Chief Executive Officer of the Registrant.
6
Exhibit 4.2
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BRUNO'S, INC.
To
MARINE MIDLAND BANK
Trustee
__________
Indenture
Dated as of August 18, 1995
__________
=================================================================
<PAGE>
TABLE OF CONTENTS
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Page
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ARTICLE ONE DEFINITIONS AND OTHER PROVISIONS
OF GENERAL APPLICATION . . . . . . . . . . . . . . . . . . . . . . . . 1
Section 1.01. Definitions . . . . . . . . . . . . . . . . . . . . . . 1
Section 1.02. Compliance Certificates and Opinions . . . . . . . . . 12
Section 1.03. Form of Documents Delivered to Trustee . . . . . . . . 13
Section 1.04. Notices, etc., to Trustee and Company . . . . . . . . . 13
Section 1.05. Notice to Holders; Waiver . . . . . . . . . . . . . . . 14
Section 1.06. Conflict with Trust Indenture Act . . . . . . . . . . . 14
Section 1.07. Effect of Headings and Table of Contents . . . . . . . 14
Section 1.08. Successors and Assigns . . . . . . . . . . . . . . . . 15
Section 1.09. Separability Clause . . . . . . . . . . . . . . . . . . 15
Section 1.10. Benefits of Indenture . . . . . . . . . . . . . . . . . 15
Section 1.11. Governing Law . . . . . . . . . . . . . . . . . . . . . 15
Section 1.12. Legal Holidays . . . . . . . . . . . . . . . . . . . . 15
Section 1.13. No Security Interest Created . . . . . . . . . . . . . 15
Section 1.14. Liability Solely Corporate . . . . . . . . . . . . . . 15
ARTICLE TWO DEBT SECURITY FORMS . . . . . . . . . . . . . . . . . . . . . 16
Section 2.01. Forms Generally . . . . . . . . . . . . . . . . . . . . 16
Section 2.02. Form of Trustee's Certificate of Authentication . . . . 17
Section 2.03. Securities in Global Form . . . . . . . . . . . . . . . 17
ARTICLE THREE THE DEBT SECURITIES . . . . . . . . . . . . . . . . . . . . 17
Section 3.01. Amount Unlimited; Issuable in Series . . . . . . . . . 17
Section 3.02. Denominations . . . . . . . . . . . . . . . . . . . . . 21
Section 3.03. Execution, Authentication, Delivery and Dating . . . . 21
Section 3.04. Temporary Debt Securities; Exchange of Temporary Global
Notes for Definitive Bearer Securities . . . . . . 23
Section 3.05. Registration, Transfer and Exchange . . . . . . . . . . 28
Section 3.06. Mutilated, Destroyed, Lost and Stolen Debt Securities . 30
Section 3.07. Payment of Interest; Interest Rights Preserved . . . . 31
Section 3.08. Cancellation . . . . . . . . . . . . . . . . . . . . . 32
Section 3.09. Computation of Interest . . . . . . . . . . . . . . . . 33
Section 3.10. Currency of Payments in Respect of Debt Securities . . 33
Section 3.11. Judgments . . . . . . . . . . . . . . . . . . . . . . . 36
Section 3.12. Exchange Upon Default . . . . . . . . . . . . . . . . . 36
ARTICLE FOUR SATISFACTION AND DISCHARGE . . . . . . . . . . . . . . . . . 37
Section 4.01. Satisfaction and Discharge of Indenture . . . . . . . . 37
Section 4.02. Application of Trust Money . . . . . . . . . . . . . . 38
ARTICLE FIVE REMEDIES . . . . . . . . . . . . . . . . . . . . . . . . . . 39
Section 5.01. Events of Default . . . . . . . . . . . . . . . . . . . 39
Section 5.02. Acceleration of Maturity; Rescission and Annulment . . 40
Section 5.03. Collection of Indebtedness and Suits for Enforcement by
Trustee . . . . . . . . . . . . . . . . . . . . . 41
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Section 5.04. Trustee May File Proofs of Claim . . . . . . . . . . . 42
Section 5.05. Trustee May Enforce Claims Without Possession of Debt
Securities. . . . . . . . . . . . . . . . . . . . 42
Section 5.06. Application of Money Collected . . . . . . . . . . . . 43
Section 5.07. Limitation on Suits . . . . . . . . . . . . . . . . . . 43
Section 5.08. Unconditional Right of Holders to Receive Principal,
Premium and Interest. . . . . . . . . . . . . . . 44
Section 5.09. Restoration of Rights and Remedies . . . . . . . . . . 44
Section 5.10. Rights and Remedies Cumulative . . . . . . . . . . . . 44
Section 5.11. Delay or Omission Not Waiver . . . . . . . . . . . . . 44
Section 5.12. Control by Holders . . . . . . . . . . . . . . . . . . 44
Section 5.13. Waiver of Past Defaults . . . . . . . . . . . . . . . . 45
Section 5.14. Undertaking for Costs . . . . . . . . . . . . . . . . . 45
Section 5.15. Waiver of Stay or Extension Laws . . . . . . . . . . . 45
ARTICLE SIX THE TRUSTEE . . . . . . . . . . . . . . . . . . . . . . . . . 46
Section 6.01. Certain Duties and Responsibilities . . . . . . . . . . 46
Section 6.02. Notice of Defaults . . . . . . . . . . . . . . . . . . 47
Section 6.03. Certain Rights of Trustee . . . . . . . . . . . . . . . 47
Section 6.04. Not Responsible for Recitals or Issuance of Debt
Securities . . . . . . . . . . . . . . . . . . . . 48
Section 6.05. May Hold Debt Securities . . . . . . . . . . . . . . . 48
Section 6.06. Money Held in Trust . . . . . . . . . . . . . . . . . . 49
Section 6.07. Compensation and Reimbursement . . . . . . . . . . . . 49
Section 6.08. Disqualification; Conflicting Interests . . . . . . . . 49
Section 6.09. Corporate Trustee Required; Eligibility . . . . . . . . 55
Section 6.10. Resignation and Removal; Appointment of Successor . . . 55
Section 6.11. Acceptance of Appointment by Successor . . . . . . . . 56
Section 6.12. Merger, Conversion, Consolidation or Succession to
Business . . . . . . . . . . . . . . . . . . . . . 57
Section 6.13. Preferential Collection of Claims Against Company . . . 57
Section 6.14. Appointment of Authenticating Agent . . . . . . . . . . 60
ARTICLE SEVEN HOLDERS' LISTS AND REPORTS BY TRUSTEE AND COMPANY . . . . . 62
Section 7.01. Company to Furnish Trustee Names and Addresses of
Holders . . . . . . . . . . . . . . . . . . . . . 62
Section 7.02. Preservation of Information; Communication to Holders . 63
Section 7.03. Reports by Trustee . . . . . . . . . . . . . . . . . . 64
Section 7.04. Reports by Company . . . . . . . . . . . . . . . . . . 65
ARTICLE EIGHT CONCERNING THE HOLDERS . . . . . . . . . . . . . . . . . . . 66
Section 8.01. Acts of Holders . . . . . . . . . . . . . . . . . . . . 66
Section 8.02. Proof of Ownership; Proof of Execution of Instruments
by Holder . . . . . . . . . . . . . . . . . . . . 67
Section 8.03. Persons Deemed Owners . . . . . . . . . . . . . . . . . 67
Section 8.04. Revocation of Consents; Future Holders Bound . . . . . 68
ARTICLE NINE HOLDERS' MEETINGS . . . . . . . . . . . . . . . . . . . . . . 68
Section 9.01. Purposes of Meetings . . . . . . . . . . . . . . . . . 68
Section 9.02. Call of Meetings by Trustee . . . . . . . . . . . . . . 69
Section 9.03. Call of Meetings by Company or Holders . . . . . . . . 69
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Page
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Section 9.04. Qualifications for Voting . . . . . . . . . . . . . . . 69
Section 9.05. Regulations . . . . . . . . . . . . . . . . . . . . . . 69
Section 9.06. Voting . . . . . . . . . . . . . . . . . . . . . . . . 70
Section 9.07. No Delay of Rights by Meeting . . . . . . . . . . . . . 70
ARTICLE TEN CONSOLIDATION, MERGER, CONVEYANCE, TRANSFER OR LEASE . . . . . 70
Section 10.01. Company May Consolidate, etc., Only on Certain Terms . 70
Section 10.02. Successor Corporation Substituted . . . . . . . . . . 71
ARTICLE ELEVEN SUPPLEMENTAL INDENTURES . . . . . . . . . . . . . . . . . . 71
Section 11.01. Supplemental Indentures Without Consent of Holders . . 71
Section 11.02. Supplemental Indentures With Consent of Holders . . . 73
Section 11.03. Execution of Supplemental Indentures . . . . . . . . . 74
Section 11.04. Effect of Supplemental Indentures . . . . . . . . . . 74
Section 11.05. Conformity with Trust Indenture Act . . . . . . . . . 74
Section 11.06. Reference in Debt Securities to Supplemental
Indentures . . . . . . . . . . . . . . . . . . . . 74
Section 11.07. Notice of Supplemental Indenture . . . . . . . . . . . 74
Section 11.08. Effect on Senior Indebtedness . . . . . . . . . . . . 75
ARTICLE TWELVE COVENANTS . . . . . . . . . . . . . . . . . . . . . . . . . 75
Section 12.01. Payment of Principal, Premium and Interest . . . . . . 75
Section 12.02. Officer's Certificate as to Default . . . . . . . . . 75
Section 12.03. Maintenance of Office or Agency . . . . . . . . . . . 75
Section 12.04. Money for Debt Securities; Payments To Be Held in
Trust . . . . . . . . . . . . . . . . . . . . . . 77
Section 12.05. Corporate Existence . . . . . . . . . . . . . . . . . 78
Section 12.06. Purchase of Debt Securities by Company . . . . . . . . 78
Section 12.07. Waiver of Certain Covenants . . . . . . . . . . . . . 78
ARTICLE THIRTEEN REDEMPTION OF DEBT SECURITIES . . . . . . . . . . . . . . 78
Section 13.01. Applicability of Article . . . . . . . . . . . . . . . 78
Section 13.02. Election to Redeem; Notice to Trustee . . . . . . . . 78
Section 13.03. Selection by Trustee of Debt Securities to Be
Redeemed . . . . . . . . . . . . . . . . . . . . . 79
Section 13.04. Notice of Redemption . . . . . . . . . . . . . . . . . 79
Section 13.05. Deposit of Redemption Price . . . . . . . . . . . . . 80
Section 13.06. Debt Securities Payable on Redemption Date . . . . . . 80
Section 13.07. Debt Securities Redeemed in Part . . . . . . . . . . . 81
ARTICLE FOURTEEN SINKING FUNDS . . . . . . . . . . . . . . . . . . . . . . 82
Section 14.01. Applicability of Article . . . . . . . . . . . . . . . 82
Section 14.02. Satisfaction of Mandatory Sinking Fund Payments with
Debt Securities . . . . . . . . . . . . . . . . . 82
Section 14.03. Redemption of Debt Securities for Sinking Fund . . . . 82
ARTICLE FIFTEEN DEFEASANCE . . . . . . . . . . . . . . . . . . . . . . . . 84
Section 15.01. Applicability of Article . . . . . . . . . . . . . . . 84
Section 15.02. Defeasance Upon Deposit of Moneys or U.S. Government
Obligations . . . . . . . . . . . . . . . . . . . 84
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Page
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Section 15.03. Deposited Moneys and U.S. Government Obligations to Be
Held in Trust . . . . . . . . . . . . . . . . . . 86
Section 15.04. Repayment to Company . . . . . . . . . . . . . . . . . 86
ARTICLE SIXTEEN SUBORDINATION . . . . . . . . . . . . . . . . . . . . . . 86
Section 16.01. Agreement to Subordinate . . . . . . . . . . . . . . . 86
Section 16.02. Distribution on Dissolution, Liquidation
and Reorganization; Subrogation of Debt Securities 86
Section 16.03. No Payment on Debt Securities in Event of Default
on Senior Indebtedness . . . . . . . . . . . . . . 88
Section 16.04. Payments on Debt Securities Permitted . . . . . . . . 88
Section 16.05. Authorization of Holders to Trustee to Effect
Subordination . . . . . . . . . . . . . . . . . . 88
Section 16.06. Notices to Trustee . . . . . . . . . . . . . . . . . . 88
Section 16.07. Trustee as Holder of Senior Indebtedness . . . . . . . 89
Section 16.08. Modification of Terms of Senior Indebtedness . . . . . 89
Section 16.09. Reliance on Judicial Order or Certificate of
Liquidation Agent . . . . . . . . . . . . . . . . 90
ARTICLE SEVENTEEN CONVERSION . . . . . . . . . . . . . . . . . . . . . . . 90
Section 17.01. Applicability; Conversion Privilege . . . . . . . . . 90
Section 17.02. Conversion Procedure; Conversion Price; Fractional
Shares . . . . . . . . . . . . . . . . . . . . . . 90
Section 17.03. Adjustment of Conversion Price for Common Stock . . . 92
Section 17.04. Consolidation or Merger of the Company . . . . . . . . 94
Section 17.05. Notice of Adjustment . . . . . . . . . . . . . . . . . 95
Section 17.06. Notice in Certain Events . . . . . . . . . . . . . . . 95
Section 17.07. Company to Reserve Stock; Registration; Listing . . . 96
Section 17.08. Taxes on Conversion . . . . . . . . . . . . . . . . . 96
Section 17.09. Conversion After Record Date . . . . . . . . . . . . . 96
Section 17.10. Company Determination Final . . . . . . . . . . . . . 97
Section 17.11. Trustee's Disclaimer . . . . . . . . . . . . . . . . . 97
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<PAGE>
Reconciliation and tie between Trust Indenture Act of 1939
and Indenture, dated as of August 18, 1995
Trust Indenture Act Section Indenture Section
Sec. 310 (a)(1) . . . . . . . . . . 6.09
(a)(2) . . . . . . . . . . 6.09
(a)(3) . . . . . . . . . . Not Applicable
(a)(4) . . . . . . . . . . Not Applicable
(a)(5) . . . . . . . . . . 6.09
(b) . . . . . . . . . . . . 6.08, 6.10
(c) . . . . . . . . . . . . Not Applicable
Sec. 311 (a) . . . . . . . . . . . . 6.13(a)
(b) . . . . . . . . . . . . 6.13(b)
(c) . . . . . . . . . . . . Not Applicable
Sec. 312 (a) . . . . . . . . . . . . 7.01, 7.02(a)
(b) . . . . . . . . . . . . 7.02(b)
(c) . . . . . . . . . . . . 7.02(c)
Sec. 313 (a) . . . . . . . . . . . . 7.03(a)
(b) . . . . . . . . . . . . 7.03(b)
(c) . . . . . . . . . . . . 7.03(a),
7.03(c)
(d) . . . . . . . . . . . . 7.03(d)
Sec. 314 (a) . . . . . . . . . . . . 7.04, 12.02
(b) . . . . . . . . . . . . Not Applicable
(c)(1) . . . . . . . . . . 1.02
(c)(2) . . . . . . . . . . 1.02
(c)(3) . . . . . . . . . . Not Applicable
(d) . . . . . . . . . . . . Not Applicable
(e) . . . . . . . . . . . . 1.02
Sec. 315 (a) . . . . . . . . . . . . 6.01(a),
6.01(c)
(b) . . . . . . . . . . . . 6.02,
7.03(a)(7)
(c) . . . . . . . . . . . . 6.01(b)
(d)(1) . . . . . . . . . . 6.01(a)
(d)(2) . . . . . . . . . . 6.01(c)(2)
(d)(3) . . . . . . . . . . 6.01(c)(3)
(e) . . . . . . . . . . . . 5.14
Sec. 316 (a)(1)(A) . . . . . . . . . 5.02, 5.12
(a)(1)(B) . . . . . . . . . 5.13
(a)(2) . . . . . . . . . . Not Applicable
(b) . . . . . . . . . . . . 5.08
(c) . . . . . . . . . . . . 9.06
<PAGE>
Sec. 317 (a)(1) . . . . . . . . . . 5.03
(a)(2) . . . . . . . . . . 5.04
(b) . . . . . . . . . . . . 12.04
Sec. 318 . . . . . . . . . . . . . 1.06
_______________
Note: This reconciliation and tie shall not, for any
purpose, be deemed to be a part of the
Indenture.
<PAGE>
INDENTURE dated as of August 18, 1995, between BRUNO'S, INC., an Alabama
corporation (hereinafter called the "Company"), having its principal executive
office at 800 Lakeshore Parkway, Birmingham, Alabama 35211 and Marine Midland
Bank, as Trustee (hereinafter called the "Trustee"), having its Corporate Trust
Office at 140 Broadway, 12th Floor, New York, New York 10005.
RECITALS OF THE COMPANY
The Company has duly authorized the execution and delivery of this
Indenture to provide for the issuance from time to time of its unsecured and
subordinated debentures, notes, bonds or other evidences of indebtedness (herein
generally called the "Debt Securities"), to be issued in one or more series, as
in this Indenture provided.
All things necessary have been done to make this Indenture a valid
agreement of the Company, in accordance with its terms.
NOW, THEREFORE, THIS INDENTURE WITNESSETH:
For and in consideration of the premises and the purchase of Debt
Securities by the Holders thereof, it is mutually covenanted and agreed, for the
equal and proportionate benefit of all Holders of Debt Securities or of Debt
Securities of any series, as follows:
ARTICLE ONE
DEFINITIONS AND OTHER PROVISIONS
OF GENERAL APPLICATION
Section 1.01. Definitions.
-----------
For all purposes of this Indenture, except as otherwise expressly
provided or unless the context otherwise requires:
(1) the terms defined in this Article have the meanings assigned to
them in this Article, and include the plural as well as the singular;
(2) all other terms used herein which are defined in the Trust
Indenture Act, either directly or by reference therein, have the meanings
assigned to them therein;
(3) all accounting terms not otherwise defined herein have the
meanings assigned to them in accordance with generally accepted accounting
principles or as provided with respect to any series of Debt Securities,
and, except as otherwise herein provided or as provided with respect to any
series of Debt Securities, the term "generally accepted accounting
principles" or "GAAP" with respect to any computation required or permitted
hereunder with respect to any series of Debt Securities, shall mean such as
set forth in the opinions and pronouncements of the Accounting Principles
Board of the American Institute of Certified Public Accountants and
statements and pronouncements of the Financial Accounting Standards Board
or in such other statements by such other entity as have been approved by a
significant segment of the accounting profession which are in effect as of
the issuance date of such series of Debt Securities; and
<PAGE>
(4) the words "herein," "hereof" and "hereunder" and other words of
similar import refer to this Indenture as a whole and not to any particular
Article, Section or other subdivision.
Certain terms, used principally in Article Three or Article Six, are defined in
those respective Articles.
"Act" when used with respect to any Holder, has the meaning
specified in Section 8.01.
"Affiliate" of any specified Person means any other Person
directly or indirectly controlling or controlled by or under direct or
indirect common control with such specified Person. For the purposes
of this definition, "control" (including, with correlative meanings,
the terms "controlling," "controlled by" and "under common control
with") as used with respect to any Person means the possession,
directly or indirectly, of the power to direct or cause the direction
of the management or policies of such Person, whether through the
ownership of voting securities, by agreement or otherwise, provided,
--------
however, that beneficial ownership of 10% or more of the voting
-------
securities of a Person shall be deemed to be control.
"Affiliated Corporation" means any corporation which is
controlled by the Company but which is not a Subsidiary of the Company
pursuant to the definition of the term "Subsidiary."
"Authenticating Agent" has the meaning specified in Section 6.14.
"Authorized Newspaper" means a newspaper in an official language
of the country of publication customarily published at least once a
day, and customarily published for at least five days in each calendar
week, and of general circulation in the place in connection with which
the term is used or in the financial community of such place. Where
successive publications are required to be made in Authorized
Newspapers, the successive publications may be made in the same or in
different newspapers in the same city meeting the foregoing
requirements and in each case on any Business Day in such city.
"Bearer Security" means any Debt Security (with or without
Coupons), in the form established pursuant to Section 2.01, which is
payable to bearer (including any Global Note payable to bearer) and
title to which passes by delivery only, but does not include any
Coupons.
"Board of Directors" means either the board of directors of the
Company, or any committee of that board duly authorized to act
hereunder or any director or directors and/or officer or officers of
the Company to whom that board or committee shall have delegated its
authority.
"Board Resolution" means a copy of a resolution certified by the
Secretary or an Assistant Secretary of the Company to have been duly
adopted by the Board of Directors and to be in full force and effect
on the date of such certification, and delivered to the Trustee.
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"Business Day" when used with respect to any Place of Payment or
any other particular location referred to in this Indenture or in the
Debt Securities means any day which is not a Saturday, a Sunday or a
legal holiday or a day on which banking institutions or trust
companies in that Place of Payment or other location are authorized or
obligated by law or executive order to close, except as otherwise
specified pursuant to Section 3.01.
"Capitalized Lease Obligation" means, at the time any determination
thereof is to be made, the amount of the liability in respect of a capital
lease that would at such time be required to be capitalized and reflected
as a liability on a balance sheet in accordance with GAAP.
"Capital Stock" means with respect to any Person, any and all shares,
interests, participations, rights or other equivalents (however designated)
of corporate stock of such Person, including, without limitation, if such
Person is a partnership, partnership interests (whether general or limited)
and 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, such partnership.
"CEDEL" means Cedel S.A.
"Closing Price" of the Common Stock shall mean the last reported
sale price of such stock (regular way) as shown on the Composite Tape
of the New York Stock Exchange (or, if such stock is not listed or
admitted to trading on the New York Stock Exchange, on the principal
national securities exchange on which such stock is listed or admitted
to trading), or, in case no such sale takes place on such day, the
average of the closing bid and asked prices on the New York Stock
Exchange (or, if such stock is not listed or admitted to trading on
the New York Stock Exchange, on the principal national securities
exchange on which such stock is listed or admitted to trading), or, if
it is not listed or admitted to trading on any national securities
exchange, the average of the closing bid and asked prices as reported
by the National Association of Securities Dealers Automated Quotation
System (NASDAQ), or if such stock is not so reported, the average of
the closing bid and asked prices as furnished by any member of the
National Association of Securities Dealers, Inc., selected from time
to time by the Company for that purpose.
"Code" means the Internal Revenue Code of 1986, as amended.
"Commission" means the Securities and Exchange Commission, as
from time to time constituted, created under the Securities Exchange
Act of 1934, as amended, or if at any time after the execution of this
instrument such Commission is not existing and performing the duties
now assigned to it under the Trust Indenture Act, then the body
performing such duties on such date.
"Common Stock" shall mean the class of Common Stock, par value $.01
per share, of the Company authorized at the date of this Indenture as
originally signed, or any other class of stock resulting from successive
changes or reclassifications of such Common Stock, and in any such case
including any shares thereof authorized after the date of this Indenture,
and any other shares of stock of the Company which do not have any priority
in the payment of dividends or upon liquidation over any other class of
stock.
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"Company" means the Person named as the "Company" in the first
paragraph of this instrument until a successor Person shall have
become such pursuant to the applicable provisions of this Indenture,
and thereafter "Company" shall mean such successor Person.
"Company Request" and "Company Order" mean, respectively, a
written request or order signed in the name of the Company by the
Chairman, a Vice Chairman, the President, the Chief Financial Officer
or a Vice President and by the Treasurer, an Assistant Treasurer, the
Controller, an Assistant Controller, the Secretary or an Assistant
Secretary of the Company, and delivered to the Trustee.
"Component Currency" has the meaning specified in Section
3.10(i).
"Conversion Agent" means any Person authorized by the Company to
receive Debt Securities to be converted into Common Stock on behalf of
the Company. The Company initially authorizes the Trustee to act as
Conversion Agent for the Debt Securities on its behalf. The Company
may at any time from time to time authorize one or more Persons to act
as Conversion Agent in addition to or in place of the Trustee with
respect to any series of Debt Securities issued under this Indenture.
"Conversion Date" has the meaning specified in Section 3.10(e).
"Conversion Event" means the cessation of (i) a Foreign Currency
to be used both by the government of the country which issued such
Currency and for the settlement of transactions by public institutions
of or within the international banking community, (ii) the ECU to be
used both within the European Monetary System and for the settlement
of transactions by public institutions of or within the European
Communities or (iii) any Currency unit other than the ECU to be used
for the purposes for which it was established.
"Conversion Price" means, with respect to any series of Debt
Securities which are convertible into Common Stock, the price per
share of Common Stock at which the Debt Securities of such series are
so convertible pursuant to Section 3.01 with respect to such series,
as the same may be adjusted from time to time in accordance with
Section 17.03.
"Corporate Trust Office" means the principal corporate trust
office of the Trustee at which at any particular time its corporate
trust business shall be administered, which office at the date of
execution of this instrument is located at 140 Broadway, 12th Floor,
New York, New York 10005, Attention: Corporate Trust Administration.
"Corporation" includes corporations, associations, companies and
business trusts.
"Coupon" means any interest coupon appertaining to any Debt
Security.
"Coupon Security" means any Bearer Security authenticated and
delivered with one or more Coupons appertaining thereto.
"Credit Facility" means, that certain credit facility, dated as of
August 18, 1995, among the Company and the lenders thereto, including any
related guarantees, collateral documents,
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instruments and agreements executed in connection therewith, and such
Credit Facility shall include any amendment, extension, renewal,
restatement or refunding thereof or any credit facility that replaces,
refunds or refinances any part of the loans or commitments thereunder.
"Currency" means Dollars or Foreign Currency.
"Currency Determination Agent" means the New York Clearing House
bank, if any, from time to time selected by the Trustee for purposes
of Section 3.10; provided that such agent shall accept such
--------
appointment in writing and the terms of such appointment shall be
acceptable to the Company and shall, in the opinion of the Company and
the Trustee at the time of such appointment, require such agent to
make the determinations required by this Indenture by a method
consistent with the method provided in this Indenture for the making
of such decision or determination.
"Current Market Price" on any date shall mean the average of the
daily Closing Prices per share of Common Stock for any thirty (30)
consecutive Trading Days selected by the Company prior to the date in
question, which thirty (30) consecutive Trading Day period shall not
commence more than forty-five (45) Trading Days prior to the day in
question; provided that with respect to Section 17.03(3), the "Current
Market Price" of the Common Stock shall mean the average of the daily
Closing Prices per share of Common Stock for the five (5) consecutive
Trading Days ending on the date of the distribution referred to in
Section 17.03(3) (or if such date shall not be a Trading Day, on the
Trading Day immediately preceding such date).
"Debt Securities" has the meaning stated in the first recital of
this Indenture and more particularly means any Debt Securities
(including any Global Notes) authenticated and delivered under this
Indenture.
"Defaulted Interest" has the meaning specified in Section 3.07.
"Discharged" has the meaning specified in Section 15.02.
"Discount Security" means any Debt Security which is issued with
"original issue discount" within the meaning of Section 1273(a) of the
Code (or any successor provision) and the regulations thereunder.
"Dollar" or "$" means a dollar or other equivalent unit in such
coin or currency of the United States as at the time of payment is
legal tender for the payment of public and private debts.
"Dollar Equivalent of the Currency Unit" has the meaning
specified in Section 3.10(h).
"Dollar Equivalent of the Foreign Currency" has the meaning
specified in Section 3.10(g).
"ECU" means the European Currency Unit as defined and revised
from time to time by the Council of the European Communities.
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"Election Date" has the meaning specified in Section 3.10(i).
"Euro-clear Operator" means Morgan Guaranty Trust Company of New
York, Brussels office, or its successor as operator of the Euro-clear
System.
"European Communities" means the European Economic Community, the
European Coal and Steel Community and the European Atomic Energy
Community.
"European Monetary System" means the European Monetary System
established by the Resolution of December 5, 1978 of the Council of
the European Communities.
"Event of Default" has the meaning specified in Section 5.01.
"Exchange Rate Officer's Certificate" means a telex or a
certificate setting forth (i) the applicable Market Exchange Rate and
(ii) the Dollar, Foreign Currency or Currency unit amounts of
principal, premium, if any, and any interest respectively (on an
aggregate basis and on the basis of a Debt Security having the lowest
denomination principal amount determined in accordance with Section
3.02 in the relevant Currency or Currency unit), payable on the basis
of such Market Exchange Rate sent (in the case of a telex) or signed
(in the case of a certificate) by the Treasurer or any Assistant
Treasurer of the Company.
"Fixed Rate Security" means a Debt Security which provides for
the payment of interest at a fixed rate.
"Floating Rate Security" means a Debt Security which provides for
the payment of interest at a variable rate determined periodically by
reference to an interest rate index or any other index specified
pursuant to Section 3.01.
"Foreign Currency" means a currency issued by the government of
any country other than the United States or a composite currency or
currency unit the value of which is determined by reference to the
values of the currencies of any group of countries.
"Global Note" means a Registered or Bearer Security evidencing
all or part of a series of Debt Securities, including, without
limitation, any temporary or permanent Global Note.
"Guarantee" means a guarantee (other than by endorsement of negotiable
instruments for collection in the ordinary course of business), direct or
indirect, in any manner (including, without limitation, letters of credit
and reimbursement agreements in respect thereof), of all or any part of any
Indebtedness or other obligations.
"Hedging Obligations" means, with respect to any Person, the
obligations of such Person under (i) currency exchange or interest rate
swap agreements, currency exchange or interest rate cap agreements and
currency exchange or interest rate collar agreements and (ii) other
agreements or arrangements designed to protect such Person against
fluctuations in currency exchange or interest rates.
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"Holder" means, with respect to a Registered Security, the
Registered Holder, and with respect to a Bearer Security or a Coupon,
the bearer thereof.
"Indebtedness" means, with respect to any Person, (a) any indebtedness
of such Person, whether or not contingent (i) in respect of borrowed money,
(ii) evidenced by bonds, notes, debentures or similar instruments or
letters of credit (or reimbursement agreements in respect thereof), (iii)
representing the balance deferred and unpaid of the purchase price of any
property (including Capitalized Lease Obligations), except any such balance
that constitutes an accrued expense or trade payable or any other monetary
obligation of a trade creditor (whether or not an Affiliate), or (iv)
representing any Hedging Obligations, if and to the extent of any of the
foregoing Indebtedness (other than letters of credit and Hedging
Obligations) that would appear as a liability upon a balance sheet of such
Person prepared in accordance with GAAP, (b) to the extent not otherwise
included, any obligation by such Person to be liable for, or to pay, as
obligor, guarantor or otherwise, on the Indebtedness of another Person
(other than by endorsement of negotiable instruments for collection in the
ordinary course of business) and (c) to the extent not otherwise included,
Indebtedness of another Person secured by a Lien on any asset owned by such
Person (whether or not such Indebtedness is assumed by such Person).
"Indenture" means this instrument as originally executed, or as
it may from time to time be supplemented or amended by one or more
indentures supplemental hereto entered into pursuant to the applicable
provisions hereof and, unless the context otherwise requires, shall
include the terms of a particular series of Debt Securities as
established pursuant to Section 3.01.
The term "interest," when used with respect to a Discount
Security which by its terms bears interest only on a certain date,
means interest payable after such date, and, when used with respect to
a Bearer Security, includes any additional amounts payable on such
Bearer Security, if so provided pursuant to Section 3.01.
"Interest Payment Date" with respect to any Debt Security means
the Stated Maturity of an installment of interest on such Debt
Security.
"Lien" means, with respect to any asset, any mortgage, lien, pledge,
charge, security interest or encumbrance of any kind in respect of such
asset, whether or not filed, recorded or otherwise perfected under
applicable law (including any conditional sale or other title retention
agreement, any lease in the nature thereof, any option or other agreement
to sell or give a security interest in and any filing of or agreement to
give any financing statement under the Uniform Commercial Code (or
equivalent statutes) of any jurisdiction); provided that in no event shall
an operating lease be deemed to constitute a Lien.
"Market Exchange Rate" means (i) for any conversion involving a
Currency unit on the one hand and Dollars or any Foreign Currency on
the other, the exchange rate between the relevant Currency unit and
Dollars or such Foreign Currency calculated by the method specified
pursuant to Section 3.01 for the securities of the relevant series,
(ii) for any conversion of Dollars into any Foreign Currency, the noon
(New York City time) buying rate for such Foreign Currency for cable
transfers quoted in New York City as certified for customs purposes by
the Federal Reserve Bank of New York and (iii) for any conversion of
one Foreign Currency into Dollars or another Foreign Currency, the
spot rate at noon local time in the relevant market at which, in
accordance with normal
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banking procedures, the Dollars or Foreign Currency into which conversion
is being made could be purchased with the Foreign Currency from which
conversion is being made from major banks located in either New York City,
London or any other principal market for Dollars or such purchased Foreign
Currency. In the event of the unavailability of any of the exchange rates
provided for in the foregoing clauses (i), (ii) and (iii) the Currency
Determination Agent, if any, or if there shall not be a Currency
Determination Agent, then the Trustee, shall use, in its sole discretion
and without liability on its part, such quotation of the Federal Reserve
Bank of New York as of the most recent available date, or quotations from
one or more major banks in New York City, London or other principal market
for such Currency or Currency unit in question, or such other quotations as
the Currency Determination Agent or the Trustee, as the case may be, shall
deem appropriate. Unless otherwise specified by the Currency Determination
Agent, if any, or if there shall not be a Currency Determination Agent,
then by the Trustee, if there is more than one market for dealing in any
Currency or Currency unit by reason of foreign exchange regulations or
otherwise, the market to be used in respect of such Currency or Currency
unit shall be that upon which a nonresident issuer of securities designated
in such Currency or Currency unit would purchase such Currency or Currency
unit in order to make payments in respect of such securities.
"Maturity" when used with respect to any Debt Security means the
date on which the principal of such Debt Security or an installment of
principal becomes due and payable as therein or herein provided,
whether at the Stated Maturity or by declaration of acceleration, call
for redemption, repayment or repurchase at the option of the Holder
thereof or otherwise.
"Officers' Certificate" means a certificate signed on behalf of
the Company or a Subsidiary Guarantor, as the case may be, by two
officers of the Company or a Subsidiary Guarantor, as the case may be,
one of whom must be the principal executive officer, the principal
financial officer, the treasurer or the principal accounting officer
of the Company or a Subsidiary Guarantor, as the case may be, that
meets the requirements set forth herein.
"Opinion of Counsel" means a written opinion of counsel, who may
be counsel to the Company (including an employee of the Company) and
who shall be satisfactory to the Trustee, which is delivered to the
Trustee.
"Outstanding" when used with respect to Debt Securities, means,
as of the date of determination, all Debt Securities theretofore
authenticated and delivered under this Indenture, except:
(i) Debt Securities theretofore cancelled by the Trustee or delivered
to the Trustee for cancellation;
(ii) Debt Securities for whose redemption money in the necessary
amount has been theretofore deposited with the Trustee or any Paying Agent
(other than the Company) in trust or set aside and segregated in trust by
the Company (if the Company shall act as its own Paying Agent) for the
Holders of such Debt Securities and any Coupons thereto pertaining;
provided, however, that if such Debt Securities are to be redeemed, notice
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of such redemption has been
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duly given pursuant to this Indenture or provision therefor satisfactory to
the Trustee has been made; and
(iii) Debt Securities which have been paid pursuant to Section 3.06
or in exchange for or in lieu of which other Debt Securities have been
authenticated and delivered pursuant to this Indenture, other than any such
Debt Securities in respect of which there shall have been presented to the
Trustee proof satisfactory to it that such Debt Securities are held by a
bona fide purchaser in whose hands such Debt Securities are valid
obligations of the Company; provided, however, that in determining whether
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the Holders of the requisite principal amount of Debt Securities
Outstanding have performed any Act hereunder, Debt Securities owned by the
Company or any other obligor upon the Debt Securities or any Affiliate of
the Company or of such other obligor shall be disregarded and deemed not to
be Outstanding (provided, that in connection with any offer by the Company
or any obligor to purchase Debt Securities, Debt Securities rendered by a
Holder shall be Outstanding until the date of purchase), except that, in
determining whether the Trustee shall be protected in relying upon any such
Act, only Debt Securities which the Trustee knows to be so owned shall be
so disregarded. Debt Securities so owned which have been pledged in good
faith may be regarded as Outstanding if the pledgee establishes to the
satisfaction of the Trustee the pledgee's right to act with respect to such
Debt Securities and that the pledgee is not the Company or any other
obligor upon the Debt Securities or any Affiliate of the Company or of such
other obligor. In determining whether the Holders of the requisite
principal amount of Outstanding Debt Securities have performed any Act
hereunder, the principal amount of a Discount Security that shall be deemed
to be Outstanding for such purpose shall be the amount of the principal
thereof that would be due and payable as of the date of such determination
upon a declaration of acceleration of the Maturity thereof pursuant to
Section 5.02 and the principal amount of a Debt Security denominated in a
Foreign Currency that shall be deemed to be Outstanding for such purpose
shall be the amount calculated pursuant to Section 3.10(k).
"Overdue Rate" when used with respect to any series of the Debt
Securities, means the rate designated as such in or pursuant to the
Board Resolution or the supplemental indenture, as the case may be,
relating to such series as contemplated by Section 3.01.
"Paying Agent" means any Person authorized by the Company to pay
the principal of (and premium, if any) or interest on any Debt
Securities on behalf of the Company.
"permanent Global Note" shall have the meaning given such term in
Section 3.04(b).
"Person" means any individual, corporation, partnership, joint
venture, association, joint-stock company, trust, unincorporated
organization, government or any agency or political subdivision
thereof or any other entity.
"Place of Payment" when used with respect to the Debt Securities
of any series means the place or places where the principal of (and
premium, if any) and interest on the Debt Securities of that series
are payable as specified pursuant to Section 3.01.
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"Predecessor Security" of any particular Debt Security means
every previous Debt Security evidencing all or a portion of the same
debt as that evidenced by such particular Debt Security; and, for the
purposes of this definition, any Debt Security authenticated and
delivered under Section 3.06 in lieu of a mutilated, lost, destroyed
or stolen Debt Security or a Debt Security to which a mutilated, lost,
destroyed or stolen Coupon appertains shall be deemed to evidence the
same debt as the mutilated, lost, destroyed or stolen Debt Security or
the Debt Security to which the mutilated, lost, destroyed or stolen
Coupon appertains, as the case may be.
"Redemption Date" means the date fixed for redemption of any Debt
Security pursuant to this Indenture which, in the case of a Floating
Rate Security, unless otherwise specified pursuant to Section 3.01,
shall be an Interest Payment Date only.
"Redemption Price" means, in the case of a Discount Security, the
amount of the principal thereof that would be due and payable as of
the Redemption Date upon a declaration of acceleration of the Maturity
thereof pursuant to Section 5.02, and in the case of any other Debt
Security, the principal amount thereof, plus, in each case, premium,
if any, and accrued and unpaid interest, if any, to the Redemption
Date.
"Registered Holder" means the Person in whose name a Registered
Security is registered in the Security Register.
"Registered Security" means any Debt Security in the form
established pursuant to Section 2.01 which is registered as to
principal and interest in the Security Register.
"Regular Record Date" for the interest payable on the Registered
Securities of any series on any Interest Payment Date means the date
specified for the purpose pursuant to Section 3.01 for such Interest
Payment Date.
"Responsible Officer" when used with respect to the Trustee means
any vice president, the secretary, any assistant secretary or any
assistant vice president or any other officer of the Trustee
customarily performing functions similar to those performed by any of
the above designated officers and also means, with respect to a
particular corporate trust matter, any other officer to whom such
matter is referred because of his knowledge of and familiarity with
the particular subject.
"Security Register" and "Security Registrar" have the respective
meanings specified in Section 3.05(a).
"Senior Indebtedness" means (i) the Indebtedness under the Credit
Facility and (ii) any other Indebtedness permitted to be incurred by
the Company under the terms of the Indenture, unless the instrument
under which such Indebtedness is incurred expressly provides that it
is on a parity with or subordinated in right of payment to the Debt
Securities or Coupons. Notwithstanding anything to the contrary in
the foregoing, Senior Indebtedness will not include (1) any liability
for federal, state, local or other taxes owed or owing by the Company,
(2) any obligation of the Company to any of its Subsidiaries, (3) any
accounts payable or trade liabilities arising in the ordinary course
of business (including instruments evidencing such liabilities), (4)
any Indebtedness that is incurred in violation of the Indenture, (5)
Indebtedness which, when incurred and without respect
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to any election under Section 1111(b) of Title 11, United States Code, is
without recourse to the Company, (6) any Indebtedness, Guarantee or
obligation of the Company which is subordinate or junior to any other
Indebtedness, Guarantee or obligation of the Company, (7) Indebtedness
evidenced by the Debt Securities or Coupons and (8) Capital Stock.
"Special Record Date" for the payment of any Defaulted Interest
means a date fixed by the Trustee pursuant to Section 3.07.
"Specified Amount" has the meaning specified in Section 3.10(i).
"Stated Maturity" when used with respect to any Debt Security or
any installment of principal thereof or premium thereon or interest
thereon means the date specified in such Debt Security or the Coupon,
if any, representing such installment of interest, as the date on
which the principal of such Debt Security or such installment of
principal, premium or interest is due and payable.
"Subsidiary" means, with respect to any Person, (i) any
corporation, association, or other business entity (other than a
partnership) of which more than 50% of the total voting power of
shares of Capital Stock entitled (without regard to the occurrence of
any contingency) to vote in the election of directors, managers or
trustees thereof is at the time of determination owned or controlled,
directly or indirectly, by such Person or one or more of the other
Subsidiaries of that Person or a combination thereof and (ii) any
partnership of which more than 50% of the partnership's capital
accounts, distribution rights or general or limited partnership
interests are owned or controlled, directly or indirectly, by such
Person or one or more of the other Subsidiaries of that Person or a
combination thereof.
"temporary Global Note" shall have the meaning given such term in
Section 3.04(b).
"Trading Day" shall mean, with respect to the Common Stock, so
long as the Common Stock is listed or admitted to trading on the New
York Stock Exchange, a day on which the New York Stock Exchange is
open for the transaction of business, or, if the Common Stock is not
listed or admitted to trading on the New York Stock Exchange, a day on
which the principal national securities exchange on which the Common
Stock is listed is open for the transaction of business, or, if the
Common Stock is not so listed or admitted for trading on any national
securities exchange, a day on which NASDAQ is open for the transaction
of business.
"Trustee" means the Person named as the "Trustee" in the first
paragraph of this instrument until a successor Trustee shall have
become such pursuant to the applicable provisions of this Indenture,
and thereafter "Trustee" shall mean or include each Person who is then
a Trustee hereunder, and if at any time there is more than one such
Person, "Trustee" as used with respect to the Debt Securities of any
series shall mean the Trustee with respect to Debt Securities of such
series.
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"Trust Indenture Act" means the Trust Indenture Act of 1939 as
amended and as in force at the date as of which this instrument was
executed, except as provided in Section 11.05.
"United States" means the United States of America (including the
States and the District of Columbia), and its possessions, which
include Puerto Rico, the U.S. Virgin Islands, Guam, American Samoa,
Wake Island and the Northern Mariana Islands.
"U.S. Depositary" means a clearing agency registered under the
Securities Exchange Act of 1934, as amended, or any successor thereto,
which shall in either case be designated by the Company pursuant to
Section 3.01 until a successor U.S. Depositary shall have become such
pursuant to the applicable provisions of this Indenture, and
thereafter "U.S. Depositary" shall mean or include each Person who is
then a U.S. Depositary hereunder, and if at any time there is more
than one such Person, "U.S. Depositary" as used with respect to the
Debt Securities of any series shall mean the U.S. Depositary with
respect to the Debt Securities of that series.
"U.S. Government Obligations" has the meaning specified in
Section 15.02.
"U.S. Person" means a citizen or resident of the United States, a
corporation, partnership or other entity created or organized in or
under the laws of the United States, or an estate or trust the income
of which is subject to United States Federal income taxation
regardless of its source.
"Valuation Date" has the meaning specified in Section 3.10(d).
"Vice President" includes with respect to the Company and the
Trustee, any Vice President of the Company or the Trustee, as the case
may be, whether or not designated by a number or word or words added
before or after the title "Vice President."
Section 1.02. Compliance Certificates and Opinions.
------------------------------------
Upon any application or request by the Company to the Trustee to take
any action under any provision of this Indenture, the Company shall furnish to
the Trustee an Officers' Certificate stating that all conditions precedent, if
any, provided for in this Indenture relating to the proposed action have been
complied with and an Opinion of Counsel stating that in the opinion of such
counsel all such conditions precedent, if any, have been complied with, except
that in the case of any such application or request as to which the furnishing
of such documents is specifically required by any provision of this Indenture
relating to such particular application or request, no additional certificate or
opinion need be furnished.
Every certificate or opinion with respect to compliance with a
condition or covenant provided for in this Indenture (other than certificates
provided pursuant to Section 12.02) shall include:
(1) a statement that each individual signing such certificate or
opinion has read such covenant or condition and the definitions herein
relating thereto;
(2) a brief statement as to the nature and scope of the examination
or investigation upon which the statements or opinions contained in such
certificate or opinion are based;
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(3) a statement that, in the opinion of each such individual, he has
made such examination or investigation as is necessary to enable him to
express an informed opinion as to whether or not such covenant or condition
has been complied with; and
(4) a statement as to whether, in the opinion of each such
individual, such condition or covenant has been complied with.
Section 1.03. Form of Documents Delivered to Trustee.
--------------------------------------
In any case where several matters are required to be certified by, or
covered by an opinion of, any specified Person, it is not necessary that all
such matters be certified by, or covered by the opinion of, only one such
Person, or that they be so certified or covered by only one document, but one
such Person may certify or give an opinion with respect to some matters and one
or more other such Persons as to other matters, and any such Person may certify
or give an opinion as to such matters in one or several documents.
Any certificate or opinion of an officer of the Company may be based,
insofar as it relates to legal matters, upon a certificate or opinion of, or
representations by, counsel, unless such officer knows, or in the exercise of
reasonable care should know, that the certificate or opinion or representations
with respect to the matters upon which his certificate or opinion is based are
erroneous. Any such certificate or Opinion of Counsel may be based, insofar as
it relates to factual matters, upon a certificate or opinion of, or repre-
sentations by, an officer or officers of the Company stating that the
information with respect to such factual matters is in the possession of the
Company, unless such counsel knows, or in the exercise of reasonable care should
know, that the certificate or opinion or representations with respect to such
matters are erroneous.
Where any Person is required to make, give or execute two or more
applications, requests, consents, certificates, statements, opinions or other
instruments under this Indenture, they may, but need not, be consolidated and
form one instrument.
Section 1.04. Notices, etc., to Trustee and Company.
-------------------------------------
Any Act of Holders or other document provided or permitted by this
Indenture to be made upon, given or furnished to, or filed with,
(1) the Trustee by any Holder or by the Company shall be sufficient
for every purpose hereunder (unless otherwise herein expressly provided) if
made, given, furnished or filed in writing to or with the Trustee and
received at its Corporate Trust Office, Attention: Corporate Trust
Department, or
(2) the Company by the Trustee or by any Holder shall be sufficient
for every purpose hereunder (unless otherwise herein expressly provided) if
in writing and mailed, first-class postage prepaid, or airmail postage
prepaid if sent from outside the United States, to the Company addressed to
it at the address of its principal office specified in the first paragraph
of this instrument, to the attention of its Treasurer, or at any other
address previously furnished in writing to the Trustee by the Company.
Any such Act or other document shall be in the English language,
except that any published notice may be in an official language of the country
of publication.
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Section 1.05. Notice to Holders; Waiver.
-------------------------
When this Indenture provides for notice to Holders of any event, (1)
such notice shall be sufficiently given to Registered Holders (unless otherwise
herein expressly provided) if in writing and mailed, first-class postage
prepaid, to such Registered Holders as their names and addresses appear in the
Security Register, within the time prescribed, and (2) such notice shall be
sufficiently given to Holders of Bearer Securities or Coupons (unless otherwise
herein expressly provided) if published at least twice in an Authorized
Newspaper or Newspapers in The City of New York and, if Debt Securities of such
series are then listed on The Stock Exchange of the United Kingdom and the
Republic of Ireland or the Luxembourg Stock Exchange or any other stock exchange
located outside the United States and such stock exchange shall so require, in a
daily newspaper in London or Luxembourg or in such other city or cities
specified pursuant to Section 3.01 or in any Debt Security on Business Days, the
first such publication to be not earlier than the earliest date and not later
than two Business Days prior to the latest date prescribed for the giving of
such notice; provided, however, that, in any case, any notice to Holders of
-------- -------
Floating Rate Securities regarding the determination of a periodic rate of
interest, if such notice is required pursuant to Section 3.01, shall be
sufficiently given if given in the manner specified pursuant to Section 3.01.
In the event of suspension of regular mail service or by reason of any
other cause it shall be impracticable to give notice by mail, such notification
as shall be given with the approval of the Trustee shall constitute sufficient
notice for every purpose hereunder.
In the event of suspension of publication of any Authorized Newspapers
or by reason of any other cause it shall be impracticable to give notice by
publication, such notification as shall be given with the approval of the
Trustee shall constitute sufficient notice for every purpose hereunder.
Where this Indenture provides for notice in any manner, such notice
may be waived in writing by the Person entitled to receive such notice, either
before or after the event, and such waiver shall be the equivalent of such
notice. Waivers of notice by Holders shall be filed with the Trustee, but such
filing shall not be a condition precedent to the validity of any action taken in
reliance on such waiver. In any case where notice to Holders is given by mail,
neither the failure to mail such notice nor any defect in any notice so mailed
to any particular Holder shall affect the sufficiency of such notice with
respect to other Holders, and any notice which is mailed in the manner herein
provided shall be conclusively presumed to have been duly given. In any case
where notice to Holders is given by publication, any defect in any notice so
published as to any particular Holder shall not affect the sufficiency of such
notice with respect to other Holders, and any notice which is published in the
manner herein provided shall be conclusively presumed to have been duly given.
Section 1.06. Conflict with Trust Indenture Act.
---------------------------------
If any provision hereof limits, qualifies or conflicts with the duties
imposed on any person by the provisions of Sections 310 to 317, inclusive, of
the Trust Indenture Act, such imposed duties shall control.
Section 1.07. Effect of Headings and Table of Contents.
----------------------------------------
The Article and Section headings herein and in the Table of Contents
are for convenience only and shall not affect the construction hereof.
14
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Section 1.08. Successors and Assigns.
----------------------
All covenants and agreements in this Indenture by the parties hereto
shall bind their respective successors and assigns and inure to the benefit of
their permitted successors and assigns, whether so expressed or not.
Section 1.09. Separability Clause.
-------------------
In case any provision in this Indenture or in the Debt Securities
shall be invalid, illegal or unenforceable, the validity, legality and
enforceability of the remaining provisions shall not in any way be affected or
impaired thereby.
Section 1.10. Benefits of Indenture.
---------------------
Nothing in this Indenture or in the Debt Securities, express or
implied, shall give to any Person, other than the parties hereto, any Security
Registrar, any Paying Agent and their successors hereunder, and the Holders, any
benefit or any legal or equitable right, remedy or claim under this Indenture.
Section 1.11. Governing Law.
-------------
This Indenture, the Debt Securities and the Coupons shall be deemed to
be contracts made and to be performed entirely in the State of New York, and for
all purposes shall be governed by and construed in accordance with the internal
laws of said State without regard to the conflicts of law rules of said State.
Section 1.12. Legal Holidays.
--------------
Unless otherwise specified pursuant to Section 3.01 or in any Debt
Security, in any case where any Interest Payment Date, Redemption Date or Stated
Maturity of any Debt Security of any series shall not be a Business Day at any
Place of Payment for the Debt Securities of that series, then (notwithstanding
any other provision of this Indenture or of the Debt Securities or Coupons)
payment of principal (and premium, if any) or interest need not be made at such
Place of Payment on such date, but may be made on the next succeeding Business
Day at such Place of Payment with the same force and effect as if made on the
Interest Payment Date, Redemption Date or at the Stated Maturity, and no
interest shall accrue on the amount so payable for the period from and after
such Interest Payment Date, Redemption Date or Stated Maturity, as the case may
be, to such Business Day if such payment is made or duly provided for on such
Business Day.
Section 1.13. No Security Interest Created.
----------------------------
Nothing in this Indenture or in the Debt Securities or Coupons,
express or implied, shall be construed to constitute a security interest under
the Uniform Commercial Code or similar legislation, as now or hereafter enacted
and in effect in any jurisdiction where property of the Company or its
Subsidiaries is or may be located.
Section 1.14. Liability Solely Corporate.
--------------------------
15
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No recourse shall be had for the payment of the principal of (or
premium, if any) or the interest on any Debt Securities or Coupons, or any part
thereof, or of the indebtedness represented thereby, or upon any obligation,
covenant or agreement of this Indenture, against any incorporator, or against
any stockholder, officer or director, as such, past, present or future, of the
Company (or any incorporator, stockholder, officer or director of any
predecessor or successor corporation), either directly or through the Company
(or any such predecessor or successor corporation), whether by virtue of any
constitution, statute or rule of law, or by the enforcement of any assessment or
penalty or otherwise; it being expressly agreed and understood that this
Indenture and all the Debt Securities and Coupons are solely corporate
obligations, and that no personal liability whatsoever shall attach to, or be
incurred by, any such incorporator, stockholder, officer or director, past,
present or future, of the Company (or any incorporator, stockholder, officer or
director of any such predecessor or successor corporation), either directly or
indirectly through the Company or any such predecessor or successor corporation,
because of the indebtedness hereby authorized or under or by reason of any of
the obligations, covenants, promises or agreements contained in this Indenture
or in any of the Debt Securities or Coupons or to be implied herefrom or
therefrom; and that any such personal liability is hereby expressly waived and
released as a condition of, and as part of the consideration for, the execution
of this Indenture and the issue of Debt Securities; provided, however, that
-------- -------
nothing herein or in the Debt Securities or Coupons contained shall be taken to
prevent recourse to and the enforcement of the liability, if any, of any
stockholder or subscriber to capital stock upon or in respect of the shares of
capital stock not fully paid.
ARTICLE TWO
DEBT SECURITY FORMS
Section 2.01. Forms Generally.
---------------
The Debt Securities and the Coupons, if any, of each series shall be
substantially in one of the forms (including global form) established in or
pursuant to a Board Resolution or one or more indentures supplemental hereto,
and shall have such appropriate insertions, omissions, substitutions and other
variations as are required or permitted by this Indenture, and may have such
letters, numbers or other marks of identification or designation and such
legends or endorsements placed thereon as the Company may deem appropriate and
as are not inconsistent with the provisions of this Indenture, or as may be
required to comply with any law or with any rule or regulation made pursuant
thereto or with any rule or regulation of any securities exchange on which any
series of the Debt Securities may be listed, or to conform to usage, all as
determined by the officers executing such Debt Securities and Coupons as
conclusively evidenced by their execution of such Debt Securities and Coupons.
If the form of a series of Debt Securities or Coupons (or any Global Note) is
established in or pursuant to a Board Resolution, a copy of such Board
Resolution shall be delivered to the Trustee, together with an Officers'
Certificate setting forth the form of such series, at or prior to the delivery
of the Company Order contemplated by Section 3.03 for the authentication and
delivery of such Debt Securities (or any such Global Note) or Coupons.
Unless otherwise specified as contemplated by Section 3.01, Debt
Securities in bearer form (other than in global form) shall have Coupons
attached.
The definitive Debt Securities and Coupons, if any, of each series
shall be printed, lithographed or engraved or produced by any combination of
these methods on steel engraved borders
16
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or may be produced in any other manner, all as determined by the officers
executing such Debt Securities and Coupons, as conclusively evidenced by their
execution of such Debt Securities and Coupons.
Section 2.02. Form of Trustee's Certificate of Authentication.
-----------------------------------------------
The form of the Trustee's certificate of authentication to be borne by
the Debt Securities shall be substantially as follows:
TRUSTEE'S CERTIFICATE OF AUTHENTICATION
This is one of the series of Debt Securities issued under the within
mentioned Indenture.
------------------------------
------------------------------
By
---------------------------
Authorized Signatory
Section 2.03. Securities in Global Form.
-------------------------
If any Debt Security of a series is issuable in global form (a "Global
Note"), such Global Note may provide that it shall represent the aggregate
amount of Outstanding Debt Securities from time to time endorsed thereon and may
also provide that the aggregate amount of Outstanding Debt Securities
represented thereby may from time to time be reduced to reflect exchanges. Any
endorsement of a Global Note to reflect the amount, or any increase or decrease
in the amount, of Outstanding Debt Securities represented thereby shall be made
by the Trustee and in such manner as shall be specified in such Global Note.
Any instructions by the Company with respect to a Global Note, after its initial
issuance, shall be in writing but need not comply with Section 1.02.
Global Notes may be issued in either registered or bearer form and in
either temporary or permanent form. Permanent Global Notes will be issued in
definitive form.
ARTICLE THREE
THE DEBT SECURITIES
Section 3.01. Amount Unlimited; Issuable in Series.
------------------------------------
The aggregate principal amount of Debt Securities which may be
authenticated and delivered under this Indenture is unlimited.
The Debt Securities may be issued in one or more series. There shall
be established in or pursuant to a Board Resolution and (subject to Section
3.03) set forth in an Officers' Certificate, or established in one or more
indentures supplemental hereto, prior to the issuance of Debt Securities of any
series:
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(1) the title of the Debt Securities of the series (which shall
distinguish the Debt Securities of such series from all other series of
Debt Securities);
(2) the aggregate principal amount of such series of Debt Securities
and any limit, on the aggregate principal amount of the Debt Securities of
the series which may be authenticated and delivered under this Indenture
(except for Debt Securities authenticated and delivered upon transfer of,
or in exchange for, or in lieu of, other Debt Securities of such series
pursuant to Sections 3.04, 3.05, 3.06, 11.06 or 13.07);
(3) the percentage of the principal amount at which the Debt
Securities of such series will be issued and, if other than the principal
amount thereof, the portion of the principal amount thereof payable upon
declaration of acceleration of the maturity or upon redemption thereof or
the method by which such portion shall be determined;
(4) the date or dates on which or periods during which the Debt
Securities of the series may be issued, and the date or dates or the method
by which such date or dates will be determined, on which the principal of
(and premium, if any, on) the Debt Securities of such series are or may be
payable (which, if so provided in such Board Resolution or supplemental
indenture, may be determined by the Company from time to time as set forth
in the Debt Securities of the series issued from time to time);
(5) the rate or rates (which may be variable or fixed) at which the
Debt Securities of the series shall bear interest, if any, or the method by
which such rate or rates shall be determined, the date or dates from which
such interest, if any, shall accrue or the method by which such date or
dates shall be determined (which, in either case or both, if so provided in
such Board Resolution or supplemental indenture, may be determined by the
Company from time to time and set forth in the Debt Securities of the
series issued from time to time); and the Interest Payment Dates on which
such interest shall be payable (or the method of determination thereof),
and the Regular Record Dates, if any, for the interest payable on such
Interest Payment Dates and the notice, if any, to Holders regarding the
determination of interest, the manner of giving such notice, the basis upon
which interest shall be calculated if other than that of a 360-day year of
twelve 30-day months and any conditions or contingencies as to the payment
of interest in cash or otherwise, if any;
(6) the place or places, if any, in addition to or instead of the
Corporate Trust Office of the Trustee (in the case of Registered
Securities) or the principal London office of the Trustee (in the case of
Bearer Securities), where the principal of (and premium, if any) and
interest on Debt Securities of the series shall be payable; the extent to
which, or the manner in which, any interest payable on any Global Note on
an Interest Payment Date will be paid, if other than in the manner provided
in Section 3.07; the extent, if any, to which the provisions of the last
sentence of Section 12.01 shall apply to the Debt Securities of the series;
and the manner in which any principal of, or premium, if any, on, any
Global Note will be paid, if other than as set forth elsewhere herein and
whether any Global Note will require any notation to evidence payment of
principal or interest;
(7) the obligation, if any, of the Company to redeem, repay, purchase
or offer to purchase Debt Securities of the series pursuant to any
mandatory redemption, sinking fund or analogous provisions or upon other
conditions or at the option of the Holder thereof and the period or periods
within which or the dates on which, the prices at which and the terms and
18
<PAGE>
conditions upon which the Debt Securities of the series shall be redeemed,
repaid, purchased or offered to be purchased, in whole or in part, pursuant
to such obligation;
(8) the right, if any, of the Company to redeem the Debt Securities
of such series at its option and the period or periods within which, or the
date or dates on which, the price or prices at which, and the terms and
conditions upon which such Debt Securities may be redeemed, if any, in
whole or in part, at the option of the Company or otherwise;
(9) if the coin or Currency in which the Debt Securities shall be
issuable is in Dollars, the denominations of such Debt Securities if other
than denominations of $1,000 and any integral multiple thereof (except as
provided in Section 3.04);
(10) whether the Debt Securities of the series are to be issued as
Discount Securities and the amount of discount with which such Debt
Securities may be issued and, if other than the principal amount thereof,
the portion of the principal amount of Debt Securities of the series which
shall be payable upon declaration of acceleration of the Maturity thereof
pursuant to Section 5.02;
(11) provisions, if any, for the defeasance or discharge of certain of
the Company's obligations with respect to Debt Securities of the series;
(12) whether Debt Securities of the series are to be issued as
Registered Securities or Bearer Securities or both, and, if Bearer
Securities are issued, whether Coupons will be attached thereto, whether
such Bearer Securities of the series may be exchanged for Registered
Securities of the series, as provided in Section 3.05(b) or otherwise and
the circumstances under which and the place or places at which any such
exchanges, if permitted, may be made;
(13) whether provisions for payment of additional amounts or tax
redemptions shall apply and, if such provisions shall apply, such
provisions; and, if Bearer Securities of the series are to be issued,
whether a procedure other than that set forth in Section 3.04(b) shall
apply and, if so, such other procedure, and if the procedure set forth in
Section 3.04(b) shall apply, the forms of certifications to be delivered
under such procedure;
(14) if other than Dollars, the Foreign Currency or Currencies in
which Debt Securities of the series shall be denominated or in which
payment of the principal of (and premium, if any) and interest on the Debt
Securities of the series may be made, and the particular provisions
applicable thereto and, if applicable, the amount of Debt Securities of the
series which entitles the Holder of a Debt Security of the series or its
proxy to one vote for purposes of Section 9.05;
(15) if the principal of (and premium, if any) or interest on Debt
Securities of the series are to be payable, at the election of the Company
or a Holder thereof, in a Currency other than that in which the Debt
Securities are denominated or payable without such election, in addition to
or in lieu of the provisions of Section 3.10, the period or periods within
which and the terms and conditions upon which, such election may be made
and the time and the manner of determining the exchange rate or rates
between the Currency or Currencies in which the Debt Securities are
denominated or payable without such election and the Currency or Currencies
in which the Debt Securities are to be paid if such election is made;
19
<PAGE>
(16) the date as of which any Debt Securities of the series shall be
dated, if other than as set forth in Section 3.03;
(17) if the amount of payments of principal of (and premium, if any)
or interest on the Debt Securities of the series may be determined with
reference to an index, including, but not limited to, an index based on a
Currency or Currencies other than that in which the Debt Securities are
denominated or payable, or any other type of index, the manner in which
such amounts shall be determined;
(18) if the Debt Securities of the series are denominated or payable
in a Foreign Currency, any other terms concerning the payment of principal
of (and premium, if any) or any interest on such Debt Securities (including
the Currency or Currencies of payment thereof);
(19) the designation of the original Currency Determination Agent, if
any;
(20) the applicable Overdue Rate, if any;
(21) if the Debt Securities of the series do not bear interest, the
applicable dates for purposes of Section 7.01;
(22) any addition to, or modification or deletion of, any Events of
Default, covenants or term of the subordination provided for with respect
to Debt Securities of the series;
(23) if Bearer Securities of the series are to be issued, (x) whether
interest in respect of any portion of a temporary Debt Security in global
form (representing all of the Outstanding Bearer Securities of the series)
payable in respect of any Interest Payment Date prior to the exchange of
such temporary Debt Security for definitive Debt Securities of the series
shall be paid to any clearing organization with respect to the portion of
such temporary Debt Security held for its account and, in such event, the
terms and conditions (including any certification requirements) upon which
any such interest payment received by a clearing organization will be
credited to the Persons entitled to interest payable on such Interest
Payment Date, (y) the terms upon which interests in such temporary Debt
Security in global form may be exchanged for interests in a permanent
Global Note or for definitive Debt Securities of the series and the terms
upon which interests in a permanent Global Note, if any, may be exchanged
for definitive Debt Securities of the series and (z) the cities and the
Authorized Newspapers designated for the purposes of giving notices to
Holders;
(24) whether the Debt Securities of the series shall be issued in
whole or in part in the form of one or more Global Notes and, in such case,
the U.S. Depositary or any Common Depositary for such Global Note or Notes;
and if the Debt Securities of the series are issuable only as Registered
Securities, the manner in which and the circumstances under which Global
Notes representing Debt Securities of the series may be exchanged for
Registered Securities in definitive form, if other than, or in addition to,
the manner and circumstances specified in Section 3.04(c);
(25) The designation, if any, of any depositaries, trustees (other
than the applicable Trustee), Paying Agents, Authenticating Agents,
Security Registrars (other than the Trustee) or other agents with respect
to the Debt Securities of such series;
20
<PAGE>
(26) If the Debt Securities of such series will be issuable in
definitive form only upon receipt of certain certificates or other
documents or upon satisfaction of certain conditions, the form and terms of
such certificates, documents or conditions;
(27) Whether the Debt Securities of such series will be convertible
into shares of Common Stock and, if so, the terms and conditions, which may
be in addition to or in lieu of the provisions contained in the Indenture,
upon which such Debt Securities will be so convertible, including the
conversion price and the conversion period;
(28) The portion of the principal amount of the Debt Securities which
will be payable upon declaration of acceleration of the maturity thereof,
if other than the principal amount thereof;
(29) The nature, content and date for reports by the Company to the
holders of the Offered Debt Securities; and
(30) any other terms of the series (which terms shall not be
inconsistent with the provisions of this Indenture).
All Debt Securities of any one series shall be substantially identical
except as to denomination, rate of interest, Stated Maturity and the date from
which interest, if any, shall accrue, which, as set forth above, may be
determined by the Company from time to time as to Debt Securities of a series if
so provided in or established pursuant to the authority granted in a Board
Resolution or in any such indenture supplemental hereto, and except as may
otherwise be provided in or pursuant to such Board Resolution and (subject to
Section 3.03) set forth in such Officers' Certificate, or in any such indenture
supplemental hereto. All Debt Securities of any one series need not be issued
at the same time, and unless otherwise provided, a series may be reopened for
issuance of additional Debt Securities of such series.
If any of the terms of a series of Debt Securities is established in
or pursuant to a Board Resolution, a copy of such Board Resolution shall be
certified by the Secretary or an Assistant Secretary of the Company and
delivered to the Trustee at or prior to the delivery of the Officers'
Certificate setting forth the terms of the series.
Section 3.02. Denominations.
-------------
In the absence of any specification pursuant to Section 3.01 with
respect to the Debt Securities of any series, the Debt Securities of such series
shall be issuable only as Registered Securities in denominations of $1,000 and
any integral multiple thereof and shall be payable only in Dollars.
Section 3.03. Execution, Authentication, Delivery and Dating.
----------------------------------------------
The Debt Securities and the Coupons, if any, of any series shall be
executed on behalf of the Company by its Chairman, a Vice Chairman, its
President, one of its Vice Presidents or its Treasurer, under its corporate seal
reproduced thereon and attested by its Secretary or one of its Assistant
Secretaries. The signature of any of these officers may be manual or facsimile.
Debt Securities and Coupons bearing the manual or facsimile signatures
of individuals who were at any time the proper officers of the Company shall
bind the Company, notwithstanding that
21
<PAGE>
such individuals or any of them have ceased to hold such offices prior to the
authentication and delivery of such Debt Securities and Coupons or did not hold
such offices at the date of such Debt Securities and Coupons.
At any time and from time to time after the execution and delivery of
this Indenture, the Company may deliver Debt Securities, with appropriate
Coupons, if any, of any series, executed by the Company, to the Trustee for
authentication, together with a Company Order for the authentication and
delivery of such Debt Securities and Coupons and the Trustee in accordance with
the Company Order shall authenticate and deliver such Debt Securities and
Coupons; provided, however, that, in connection with its sale during the
-------- -------
"restricted period" (as defined in Section 1.163-5(c)(2)(i)(D)(7) of the United
States Treasury Regulations), no Bearer Security shall be mailed or otherwise
delivered to any location in the United States; and provided, further, that a
-------- -------
Bearer Security (other than a temporary Global Note in bearer form) may be
delivered outside the United States in connection with its original issuance
only if the Person entitled to receive such Bearer Security shall have furnished
to the Euro-clear operator or to CEDEL a certificate substantially in the form
set forth in Exhibit A to this Indenture. If all the Debt Securities of any one
series are not to be issued at one time and if a Board Resolution or
supplemental indenture relating to such series shall so permit, such Company
Order may set forth procedures acceptable to the Trustee for the issuance of
such Debt Securities such as interest rate, Stated Maturity, date of issuance
and date from which interest, if any, shall accrue. If any Debt Security shall
be represented by a permanent Global Note, then, for purposes of this Section
and Section 3.04, the notation of a beneficial owner's interest therein upon
original issuance of such Debt Security or upon exchange of a portion of a
temporary Global Note shall be deemed to be delivery in connection with the
original issuance of such beneficial owner's interest in such permanent Global
Note. Except as permitted by Section 3.06 or 3.07, the Trustee shall not
authenticate and deliver any Bearer Security unless all Coupons for interest
then matured have been detached and cancelled.
The Trustee shall be entitled to receive, and (subject to Section
6.01) shall be fully protected in relying upon, prior to the authentication and
delivery of the Debt Securities and Coupons of such series, (i) the supplemental
indenture or the Board Resolution by or pursuant to which the form and terms of
such Debt Securities and Coupons have been approved and (ii) an Opinion of
Counsel substantially to the effect that:
(1) all instruments furnished by the Company to the Trustee in
connection with the authentication and delivery of such Debt Securities and
Coupons conform to the requirements of this Indenture and constitute
sufficient authority hereunder for the Trustee to authenticate and deliver
such Debt Securities and Coupons;
(2) the forms and terms of such Debt Securities and Coupons have been
established in conformity with the provisions of this Indenture;
(3) in the event that the forms or terms of such Debt Securities and
Coupons have been established in a supplemental indenture, the execution
and delivery of such supplemental indenture has been duly authorized by all
necessary corporate action of the Company, such supplemental indenture has
been duly executed and delivered by the Company and, assuming due
authorization, execution and delivery by the Trustee, is a valid and
binding obligation enforceable against the Company in accordance with its
terms, subject to applicable bankruptcy, insolvency and similar laws
affecting creditors' rights generally and subject, as to enforceability, to
general principles of equity (regardless of whether enforcement is sought
in a proceeding in equity or at law);
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(4) the execution and delivery of such Debt Securities and Coupons
have been duly authorized by all necessary corporate action of the Company
and such Debt Securities and Coupons have been duly executed by the Company
and, assuming due authentication by the Trustee and delivery by the
Company, are valid and binding obligations enforceable against the Company
in accordance with their terms, entitled to the benefit of the Indenture,
subject to applicable bankruptcy, insolvency and similar laws affecting
creditors' rights generally and subject, as to enforceability, to general
principles of equity (regardless of whether enforcement is sought in a
proceeding in equity or at law) and subject to such other exceptions as
counsel shall request and as to which the Trustee shall not reasonably
object; and
(5) the amount of Debt Securities Outstanding of such series,
together with the amount of such Debt Securities, does not exceed any limit
established under the terms of this Indenture on the amount of Debt
Securities of such series that may be authenticated and delivered.
The Trustee shall not be required to authenticate such Debt Securities
and Coupons if the issuance of such Debt Securities and Coupons pursuant to this
Indenture will affect the Trustee's own rights, duties or immunities under the
Debt Securities and this Indenture in a manner which is not reasonably
acceptable to the Trustee.
Each Registered Security shall be dated the date of its
authentication. Each Bearer Security (including any temporary or permanent or
other definitive Bearer Security in global form) shall be dated as of the date
of original issuance of the first Debt Security of such series to be issued,
except as otherwise provided pursuant to Section 3.01 with respect to the Bearer
Securities of any series.
No Debt Security shall be entitled to any benefit under this Indenture
or be valid or obligatory for any purpose unless there appears on such Debt
Security a certificate of authentication substantially in one of the forms
provided for herein duly executed by the Trustee or by an Authenticating Agent,
and such certificate upon any Debt Security shall be conclusive evidence, and
the only evidence, that such Debt Security has been duly authenticated and
delivered hereunder and is entitled to the benefits of this Indenture. Notwith-
standing the foregoing, if any Debt Security shall have been duly authenticated
and delivered hereunder but never issued and sold by the Company, and the
Company shall deliver such Debt Security to the Trustee for cancellation as
provided in Section 3.08 together with a written statement (which need not
comply with Section 1.02) stating that such Debt Security has never been issued
and sold by the Company, for all purposes of this Indenture such Debt Security
shall be deemed never to have been authenticated and delivered hereunder and
shall never be entitled to the benefits of this Indenture.
Section 3.04. Temporary Debt Securities; Exchange of Temporary Global
-------------------------------------------------------
Notes for Definitive Bearer Securities; Global Notes Representing Registered
----------------------------------------------------------------------------
Securities.
----------
(a) Pending the preparation of definitive Registered Securities of
any series, the Company may execute, and upon Company Order the Trustee shall
authenticate and deliver, temporary Registered Securities which are printed,
lithographed, typewritten, mimeographed or otherwise produced, in any authorized
denomination for Registered Securities of such series, substantially of the
tenor of the definitive Registered Securities in lieu of which they are issued
and with such appropriate insertions, omissions, substitutions and other
variations as the officers executing such Registered Securities may determine,
as conclusively evidenced by their execution of such Registered Securities.
Every such temporary Registered Security shall be executed by the Company and
shall be authenticated and delivered by the Trustee upon the same conditions and
in substantially the same manner, and with the same effect,
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as the definitive Registered Securities in lieu of which they are issued. In
the case of any series issuable as Bearer Securities, such temporary Debt
Securities may be in global form, representing such of the Outstanding Debt
Securities of such series as shall be specified therein.
Except in the case of temporary Debt Securities in global form (which
shall be exchanged in accordance with the provisions of the following
paragraphs), if temporary Debt Securities of any series are issued, the Company
will cause definitive Debt Securities of such series to be prepared without
unreasonable delay. After the preparation of definitive Debt Securities of such
series, the temporary Debt Securities of such series shall be exchangeable for
definitive Debt Securities of such series, of a like Stated Maturity and with
like terms and provisions, upon surrender of the temporary Debt Securities of
such series at the office or agency of the Company in a Place of Payment for
such series, without charge to the Holder, except as provided in Section 3.05 in
connection with a transfer. Upon surrender for cancellation of any one or more
temporary Debt Securities of any series (accompanied by any unmatured Coupons),
the Company shall execute and the Trustee shall authenticate and deliver in
exchange therefor a like principal amount of definitive Debt Securities of the
same series of authorized denominations and of a like Stated Maturity and like
terms and provisions; provided, however, that no definitive Bearer Security
-------- -------
shall be delivered in exchange for a temporary Registered Security; and
provided, further, that a definitive Bearer Security (including a permanent
-------- -------
Bearer Security in global form) shall be delivered in exchange for a temporary
Bearer Security only in compliance with the conditions set forth in Section
3.03. Until so exchanged, the temporary Registered Securities of any series
shall in all respects be entitled to the same benefits under this Indenture as
definitive Registered Securities of such series.
(b) Unless otherwise specified pursuant to Section 3.01, all Bearer
Securities of a series shall be initially issued in the form of a single
temporary Bearer Security in global form (a "temporary Global Note"). The
Company shall execute, and upon Company Order the Trustee shall authenticate,
any temporary Global Note and any permanent Bearer Security in global form (as
described below, a "permanent Global Note") upon the same conditions and in
substantially the same manner, and with the same effect, as definitive Bearer
Securities, and the temporary or permanent Global Note, as the case may be,
shall, unless otherwise specified therein, be delivered by the Trustee to the
London office of a depositary or common depositary (the "Common Depositary"),
for the benefit of the Euro-clear Operator or CEDEL, as the case may be, for
credit to the account of the Company (in the case of sales of Bearer Securities
by the Company directly to investors) or the managing underwriter (in the case
of sales of Bearer Securities by the Company to underwriters) or such other
accounts as the Company or the managing underwriter, respectively, may direct.
On or after the date specified in or determined pursuant to the terms
of any temporary Global Note which (subject to any applicable laws and
regulations) shall be at least 40 days after the issue date of a temporary
Global Note (the "Exchange Date"), the Debt Securities represented by such
temporary Global Note may be exchanged for definitive Debt Securities (subject
to the second succeeding paragraph) or Debt Securities to be represented
thereafter by one or more permanent Global Notes in definitive form without
interest coupons. On or after the Exchange Date such temporary Global Note
shall be surrendered by the Common Depositary to the Trustee, as the Company's
agent for such purpose, at its principal office in London (or at such other
place specified outside the United States pursuant to Section 3.01) and
following such surrender, the Trustee shall (1) endorse the temporary Global
Note to reflect the reduction of its principal amount by an equal aggregate
principal amount of such Debt Security, (2) endorse the applicable permanent
Global Note, if any, to reflect the initial amount, or an increase in the amount
of Debt Securities represented thereby, (3) manually authenticate such
definitive Debt Securities (including any permanent Global Note), (4) deliver
such definitive Debt Securities to the Holder thereof or, if such definitive
Debt Security is a permanent Global Note, deliver
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<PAGE>
such permanent Global Note to the Common Depositary to be held outside the
United States for the accounts of the Euro-clear Operator or CEDEL, as the case
may be, for credit to the respective accounts at Euro-clear Operator or CEDEL,
as the case may be, designated by or on behalf of the beneficial owners of such
Debt Securities (or to such other accounts as they may direct) and (5) redeliver
such temporary Global Note to the Common Depositary, unless such temporary
Global Note shall have been cancelled in accordance with Section 3.08 hereof;
provided, however, that, unless otherwise specified in such temporary Global
-------- -------
Note, upon such presentation by the Common Depositary, such temporary Global
Note shall be accompanied by a certificate dated the Exchange Date or a
subsequent date and signed by the Euro-clear Operator, as to the portion of such
temporary Global Note held for its account then to be exchanged for definitive
Debt Securities (including any permanent Global Note), and a certificate dated
the Exchange Date or a subsequent date and signed by CEDEL, as to the portion of
such temporary Global Note held for its account then to be exchanged for
definitive Debt Securities (including any permanent Global Note), each
substantially in the form set forth in Exhibit B to this Indenture. Each
certificate substantially in the form of Exhibit B hereto of the Euro-clear
Operator or CEDEL, as the case may be, shall be based on certificates of the
account holders listed in the records of the Euro-clear Operator or CEDEL, as
the case may be, as being entitled to all or any portion of the applicable
temporary Global Note. An account holder of the Euro-clear Operator or CEDEL,
as the case may be, desiring to effect the exchange of an interest in a
temporary Global Note for an interest in definitive Debt Securities (including
any permanent Global Note) shall instruct the Euro-clear Operator or CEDEL, as
the case may be, to request such exchange on its behalf and shall deliver to the
Euro-clear Operator or CEDEL, as the case may be, a certificate substantially in
the form of Exhibit A hereto and dated no earlier than 10 days prior to the
Exchange Date. Until so exchanged, temporary Global Notes shall in all respects
be entitled to the same benefits under this Indenture as definitive Debt
Securities (including any permanent Global Note) of the same series
authenticated and delivered hereunder, except as to payment of interest, if any.
The delivery to the Trustee by the Euro-clear Operator or CEDEL of any
certificate substantially in the form of Exhibit B hereto may be relied upon by
the Company and the Trustee as conclusive evidence that a corresponding
certificate or certificates has or have been delivered to the Euro-clear
Operator or CEDEL, as the case may be, pursuant to the terms of this Indenture.
On or prior to the Exchange Date, the Company shall deliver to the
Trustee definitive Debt Securities in an aggregate principal amount equal to the
principal amount of such temporary Global Note, executed by the Company. At any
time, on or after the Exchange Date, upon 30 days' notice to the Trustee by the
Euro-clear Operator or CEDEL, as the case may be, acting at the request of or on
behalf of the beneficial owner, a Debt Security represented by a temporary
Global Note or a permanent Global Note, as the case may be, may be exchanged, in
whole or from time to time in part, for definitive Debt Securities without
charge and the Trustee shall authenticate and deliver, in exchange for each
portion of such temporary Global Note or such permanent Global Note, an equal
aggregate principal amount of definitive Debt Securities of the same series of
authorized denominations and of a like Stated Maturity and with like terms and
conditions, as the portion of such temporary Global Note or such permanent
Global Note to be exchanged, which, unless the Debt Securities of the series are
not issuable both as Bearer Securities and as Registered Securities, as
contemplated by Section 3.01, shall be in the form of Bearer Securities or
Registered Securities, or any combination thereof, as shall be specified by the
beneficial owner thereof; provided, however, that definitive Bearer Securities
-------- -------
shall be delivered in exchange for a portion of the temporary Global Note or the
permanent Global Note only in compliance with the requirements of the second
preceding paragraph. On or prior to the forty-fifth day following receipt by
the Trustee of such notice with respect to a Debt Security, or, if such day is
not a Business Day, the next succeeding Business Day, the temporary Global Note
or the permanent Global Note, as
25
<PAGE>
the case may be, shall be surrendered by the Common Depositary to the Trustee,
as the Company's agent for such purpose, to be exchanged, in whole or from time
to time in part, for definitive Debt Securities without charge following such
surrender, upon the request of the Euro-clear Operator or CEDEL, as the case may
be, and the Trustee shall (1) endorse the applicable temporary Global Note or
the permanent Global Note to reflect the reduction of its principal amount by
the aggregate principal amount of such Debt Security, (2) cause the terms of
such Debt Security and Coupons, if any, to be entered on a definitive Debt
Security, (3) manually authenticate such definitive Debt Security, and (4) if a
Bearer Security is to be delivered, deliver such definitive Debt Security
outside the United States to the Euro-clear Operator or CEDEL, as the case may
be, for or on behalf of the beneficial owner thereof, in exchange for a portion
of such temporary Global Note or the permanent Global Note.
Unless otherwise specified in such temporary Global Note or the
permanent Global Note, any such exchange shall be made free of charge to the
beneficial owners of such temporary Global Note or the permanent Global Note,
except that a Person receiving definitive Debt Securities must bear the cost of
insurance, postage, transportation and the like in the event that such Person
does not take delivery of such definitive Debt Securities in person at the
offices of the Euro-clear Operator or CEDEL. Definitive Debt Securities in
bearer form to be delivered in exchange for any portion of a temporary Global
Note or the permanent Global Note shall be delivered only outside the United
States. Notwithstanding the foregoing, in the event of redemption or
acceleration of all or any part of a temporary Global Note prior to the Exchange
Date, a permanent Global Note or definitive Bearer Securities, as the case may
be, will not be issuable in respect of such temporary Global Note or such
portion thereof, and payment thereon will instead be made as provided in such
temporary Global Note.
Until exchanged in full as hereinabove provided, any temporary Global
Note or the permanent Global Note shall in all respects be entitled to the same
benefits under this Indenture as definitive Debt Securities of the same series
and tenor authenticated and delivered hereunder, except that, unless otherwise
specified as contemplated by Section 3.01, interest payable on such temporary
Global Note on an Interest Payment Date for Debt Securities of such series
occurring prior to the applicable Exchange Date shall be payable to the
Euro-clear Operator or CEDEL on such Interest Payment Date upon delivery by the
Euro-clear Operator or CEDEL to the Trustee of a certificate or certificates
substantially in the form set forth in Exhibit B to this Indenture, for credit
without further interest on or after such Interest Payment Date to the
respective accounts of the Persons who are the beneficial owners of such
temporary Global Note on such Interest Payment Date and who have each delivered
to the Euro-clear Operator or CEDEL, as the case may be, a certificate
substantially in the form set forth in Exhibit A to this Indenture.
Any definitive Bearer Security authenticated and delivered by the
Trustee in exchange for a portion of a temporary Global Note or the permanent
Global Note shall not bear a coupon for any interest which shall theretofore
have been duly paid by the Trustee to the Euro-clear Operator or CEDEL, or by
the Company to the Trustee in accordance with the provisions of this
Section 3.04.
With respect to Exhibits A and B to this Indenture, the Company may,
in its discretion and if required or desirable under applicable law or as set
forth in any Board Resolution or Supplemental Indenture with respect to any
Series of Debt Securities, substitute one or more other forms of such exhibits
for such exhibits, eliminate the requirement that any or all certificates be
provided, or change the time that any certificate may be required, provided that
such substitute form or forms or notice of elimination or change of such
certification requirement have theretofore been delivered to the Trustee with a
Company Request and such form or forms, elimination or change is reasonably
acceptable to the Trustee.
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<PAGE>
(c) If the Company shall establish pursuant to Section 3.01 that the
Registered Securities of a series are to be issued in whole or in part in the
form of one or more Global Notes, then the Company shall execute and the Trustee
shall, in accordance with Section 3.03 and the Company Order with respect to
such series, authenticate and deliver one or more Global Notes in temporary or
permanent form that (i) shall represent and shall be denominated in an amount
equal to the aggregate principal amount of the Outstanding Debt Securities of
such series to be represented by one or more Global Notes, (ii) shall be
registered in the name of the U.S. Depositary for such Global Note or Notes or
the nominee of such depositary, and (iii) shall bear a legend substantially to
the following effect: "This Debt Security may not be transferred except as a
whole by the Depositary to a nominee of the Depositary or by a nominee of the
Depositary to the Depositary or another nominee of the Depositary or by the
Depositary or any such nominee to a successor Depositary or a nominee of such
successor Depositary, unless and until this Debt Security is exchanged in whole
or in part for Debt Securities in definitive form."
Notwithstanding any other provision of this Section or Section 3.05,
unless and until it is exchanged in whole or in part for Registered Securities
in definitive form, a Global Note representing all or a portion of the
Registered Securities of a series may not be transferred except as a whole by
the U.S. Depositary for such series to a nominee of such depositary or by a
nominee of such depositary to such depositary or another nominee of such
depositary or by such depositary or any such nominee to a successor U.S.
Depositary for such series or a nominee of such successor depositary.
If at any time the U.S. Depositary for the Debt Securities of a series
notifies the Company that it is unwilling or unable to continue as U.S.
Depositary for the Debt Securities of such series or if at any time the U.S.
Depositary for Debt Securities of a series shall no longer be a clearing agency
registered and in good standing under the Securities Exchange Act of 1934, as
amended, or other applicable statute or regulation, the Company shall appoint a
successor U.S. Depositary with respect to the Debt Securities of such series.
If a successor U.S. Depositary for the Debt Securities of such series is not
appointed by the Company within 90 days after the Company receives such notice
or becomes aware of such condition, the Company will execute, and the Trustee,
upon receipt of a Company Order for the authentication and delivery of
definitive Debt Securities of such series, will authenticate and deliver,
Registered Securities of such series in definitive form in an aggregate
principal amount equal to the principal amount of the Global Note or Notes
representing such series in exchange for such Global Note or Notes.
The Company may at any time and in its sole discretion determine that
the Registered Securities of any series issued in the form of one or more Global
Notes shall no longer be represented by such Global Note or Notes. In such
event, the Company will execute, and the Trustee, upon receipt of a Company
Order for the authentication and delivery of definitive Debt Securities of such
series, will authenticate and deliver, Registered Securities of such series in
definitive form and in an aggregate principal amount equal to the principal
amount of the Global Note or Notes representing such series in exchange for such
Global Note or Notes.
If the Registered Securities of any series shall have been issued in
the form of one or more Global Notes and if an Event of Default with respect to
the Debt Securities of such series shall have occurred and be continuing, the
Company will promptly execute, and the Trustee, upon receipt of a Company Order
for the authentication and delivery of definitive Debt Securities of such
series, will authenticate and deliver, Registered Securities of such series in
definitive form and in an aggregate principal amount equal to the principal
amount of the Global Note or Notes representing such series in exchange for such
Global Note or Notes.
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<PAGE>
If specified by the Company pursuant to Section 3.01 with respect to
Registered Securities of a series, the U.S. Depositary for such series of
Registered Securities may surrender a Global Note for such series of Debt
Securities in exchange in whole or in part for Registered Securities of such
series in definitive form on such terms as are acceptable to the Company and
such depositary. Thereupon, the Company shall execute and the Trustee shall
authenticate and deliver, without charge:
(i) to each Person specified by the U.S. Depositary a new Registered
Security or Securities of the same series, of any authorized denomination
as requested by such Person in an aggregate principal amount equal to and
in exchange for such Person's beneficial interest in the Global Note; and
(ii) to the U.S. Depositary a new Global Note in a denomination equal
to the difference, if any, between the principal amount of the surrendered
Global Note and the aggregate principal amount of Registered Securities
delivered to Holders thereof.
Upon the exchange of a Global Note for Registered Securities in
definitive form, such Global Note shall be cancelled by the Trustee. Debt
Securities issued in exchange for a Global Note pursuant to this subsection (c)
shall be registered in such names and in such authorized denominations as the
U.S. Depositary for such Global Note, pursuant to instructions from its direct
or indirect participants or otherwise, shall instruct the Trustee. The Trustee
shall deliver such Debt Securities to the Persons in whose names such Debt
Securities are so registered.
Section 3.05. Registration, Transfer and Exchange.
-----------------------------------
(a) The Company shall cause to be kept at the Corporate Trust Office
of the Trustee a register (the registers maintained in such office and in any
other office or agency of the Company in a Place of Payment being herein
sometimes collectively referred to as the "Security Register") in which, subject
to such reasonable regulations as it may prescribe, the Company shall provide
for the registration of Registered Securities and of transfers and exchanges of
Registered Securities. The Trustee is hereby appointed "Security Registrar" for
the purpose of registering Registered Securities and registering transfers and
exchanges of Registered Securities as herein provided; provided, however, that
-------- -------
the Company may appoint co-Security Registrars or the terms of any series of
Debt Securities may provide otherwise.
Upon surrender for registration of transfer of any Registered Security
of any series at the office or agency of the Company maintained for such
purpose, the Company shall execute, and the Trustee shall authenticate and
deliver, in the name of the designated transferee, one or more new Registered
Securities of the same series of like aggregate principal amount of such
denominations as are authorized for Registered Securities of such series and of
a like Stated Maturity and with like terms and conditions.
Except as otherwise provided in Section 3.04 and this Section 3.05, at
the option of the Holder, Registered Securities of any series may be exchanged
for other Registered Securities of the same series of like aggregate principal
amount and of a like Stated Maturity and with like terms and conditions, upon
surrender of the Registered Securities to be exchanged at such office or agency.
Whenever any Registered Securities are surrendered for exchange, the Company
shall execute, and the Trustee shall authenticate and deliver, the Registered
Securities which the Holder making the exchange is entitled to receive.
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(b) If and to the extent specified pursuant to Section 3.01, the
provisions of this Section 3.05(b) shall be applicable to Debt Securities of any
series which are Bearer Securities. At the option of the Holder thereof, to the
extent permitted by law, any Bearer Security of any series which by its terms is
registrable as to principal and interest may be exchanged for a Registered
Security of such series of like aggregate principal amount and of a like Stated
Maturity and with like terms and conditions upon surrender of such Bearer
Security at the Corporate Trust Office or at any other office or agency of the
Company designated pursuant to Section 3.01 for the purpose of making any such
exchanges. Any Coupon Security surrendered for exchange shall be surrendered
with all unmatured Coupons and any matured Coupons in default attached thereto.
If the Holder of a Bearer Security is unable to produce any such unmatured
Coupon or Coupons or matured Coupon or Coupons in default, such exchange may be
effected if the Bearer Securities are accompanied by payment in funds acceptable
to the Company in an amount equal to the face amount of such missing Coupon or
Coupons, or the surrender of such missing Coupon or Coupons may be waived by the
Company and the Trustee if there is furnished to them such security or indemnity
as they may require to save each of them and any Paying Agent harmless. If
thereafter the Holder of such Bearer Security shall surrender to any Paying
Agent any such missing Coupon in respect of which such a payment shall have been
made, such Holder shall be entitled to receive the amount of such payment;
provided, however, that except as otherwise provided in Section 12.03, interest
-------- -------
represented by Coupons shall be payable only upon presentation and surrender of
those Coupons at an office or agency located outside the United States.
Notwithstanding the foregoing, in case a Bearer Security of any series is
surrendered at any such office or agency in exchange for a Registered Security
of the same series and of a like Stated Maturity and with like terms and
conditions after the close of business at such office or agency on (i) any
Regular Record Date and before the opening of business at such office or agency
on the relevant Interest Payment Date, or (ii) any Special Record Date and
before the opening of business at such office or agency on the related proposed
date for payment of Defaulted Interest, such Bearer Security shall be
surrendered without the Coupon relating to such Interest Payment Date or
proposed date for payment, as the case may be (or, if such Coupon is so
surrendered with such Bearer Security, such Coupon shall be returned to the
Person so surrendering the Bearer Security), and interest or Defaulted Interest,
as the case may be, will not be payable on such Interest Payment Date or
proposed date for payment, as the case may be, in respect of the Registered
Security issued in exchange for such Bearer Security, but will be payable only
to the Holder of such Coupon when due in accordance with the provisions of this
Indenture. The Company shall execute, and the Trustee shall authenticate and
deliver, the Registered Security or Securities which the Holder making the
exchange is entitled to receive.
Notwithstanding the foregoing, the exchange of Bearer Securities for
Registered Securities will be subject to the provisions of United States income
tax laws and regulations applicable to Debt Securities in effect at the time of
such exchange.
(c) Except as otherwise specified pursuant to Section 3.01, in no
event may Registered Securities, including Registered Securities received in
exchange for Bearer Securities, be exchanged for Bearer Securities.
(d) All Debt Securities issued upon any transfer or exchange of Debt
Securities shall be valid obligations of the Company, evidencing the same debt,
and entitled to the same benefits under this Indenture, as the Debt Securities
surrendered for such transfer or exchange.
Every Registered Security presented or surrendered for transfer or
exchange shall (if so required by the Company or the Trustee) be duly endorsed,
or be accompanied by a written instrument of transfer in form satisfactory to
the Company and the Security Registrar, duly executed, by the Holder thereof or
his attorney duly authorized in writing.
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No service charge will be made for any transfer or exchange of Debt
Securities except as provided in Section 3.04(b) or 3.06. The Company may
require payment of a sum sufficient to cover any tax or other governmental
charge that may be imposed in connection with any registration, transfer or
exchange of Debt Securities, other than those expressly provided in this
Indenture to be made at the Company's own expense or without expense or without
charge to the Holders.
The Company shall not be required (i) to register, transfer or
exchange Debt Securities of any series during a period beginning at the opening
of business 15 days before the day of the transmission of a notice of redemption
of Debt Securities of such series selected for redemption under Section 13.03
and ending at the close of business on the day of such transmission, or (ii) to
register, transfer or exchange any Debt Security so selected for redemption in
whole or in part, except the unredeemed portion of any Debt Security being
redeemed in part.
Section 3.06. Mutilated, Destroyed, Lost and Stolen Debt Securities.
-----------------------------------------------------
If (i) any mutilated Debt Security or any mutilated Coupon with the
Coupon Security to which it appertains (and all unmatured Coupons attached
thereto) is surrendered to the Trustee at its Corporate Trust Office (in the
case of Registered Securities) or at its principal London office (in the case of
Bearer Securities), or (ii) the Company and the Trustee receive evidence to
their satisfaction of the destruction, loss or theft of any Debt Security or any
Coupon, and there is delivered to the Company and the Trustee such security or
indemnity as may be required by them to save each of them and any Paying Agent
harmless, and neither the Company nor the Trustee receives notice that such Debt
Security or Coupon has been acquired by a bona fide purchaser, then the Company
shall execute and upon Company Request the Trustee shall authenticate and
deliver, in exchange for or in lieu of any such mutilated, destroyed, lost or
stolen Debt Security or in exchange for the Coupon Security to which such
mutilated, destroyed, lost or stolen Coupon appertained, a new Debt Security of
the same series of like Stated Maturity and with like terms and conditions and
like principal amount, bearing a number not contemporaneously Outstanding, and,
in the case of a Coupon Security, with such Coupons attached thereto that
neither gain nor loss in interest shall result from such exchange or
substitution.
In case any such mutilated, destroyed, lost or stolen Debt Security or
Coupon has become or is about to become due and payable, the Company in its
discretion may, instead of issuing a new Debt Security, pay the amount due on
such Debt Security or Coupon in accordance with its terms; provided, however,
-------- -------
that principal of (and premium, if any) and any interest on Bearer Securities
shall, except as otherwise provided in Section 12.03, be payable only at an
office or agency located outside the United States and, unless otherwise
specified as contemplated by Section 3.01 or except as otherwise provided in
this Section 3.06, any interest on Bearer Securities shall be payable only upon
presentation and surrender of the Coupons appertaining thereto.
Upon the issuance of any new Debt Security under this Section, the
Company may require the payment of a sum sufficient to cover any tax or other
governmental charge that may be imposed in respect thereto and any other
expenses (including the fees and expenses of the Trustee) connected therewith.
Every new Debt Security or Coupon of any series issued pursuant to
this Section shall constitute an original additional contractual obligation of
the Company, whether or not the destroyed, lost or stolen Debt Security or
Coupon shall be at any time enforceable by anyone, and shall be entitled to all
the benefits of this Indenture equally and proportionately with any and all
other Debt Securities or Coupons of that series duly issued hereunder.
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The provisions of this Section are exclusive and shall preclude (to
the extent lawful) all other rights and remedies with respect to the replacement
or payment of mutilated, destroyed, lost or stolen Debt Securities or Coupons.
Section 3.07. Payment of Interest; Interest Rights Preserved.
----------------------------------------------
(a) Interest on any Registered Security which is payable and is
punctually paid or duly provided for on any Interest Payment Date shall be paid
to the Person in whose name such Registered Security (or one or more Predecessor
Securities) is registered at the close of business on the Regular Record Date
for such interest notwithstanding the cancellation of such Registered Security
upon any transfer or exchange subsequent to the Regular Record Date. Unless
otherwise specified as contemplated by Section 3.01 with respect to the Debt
Securities of any series, payment of interest on Registered Securities shall be
made at the place or places specified pursuant to Section 3.01 or, at the option
of the Company, by check mailed to the address of the Person entitled thereto as
such address shall appear in the Security Register or, if provided pursuant to
Section 3.01, by wire transfer to an account designated by the Registered
Holder.
(b) Interest on any Coupon Security which is payable and is
punctually paid or duly provided for on any Interest Payment Date shall be paid
to the Holder of the Coupon which has matured on such Interest Payment Date upon
surrender of such Coupon on such Interest Payment Date at the principal London
office of the Trustee or at such other Place of Payment outside the United
States specified pursuant to Section 3.01.
Interest on any Bearer Security (other than a Coupon Security) which
is payable and is punctually paid or duly provided for on any Interest Payment
Date shall be paid to the Holder of the Bearer Security upon presentation of
such Bearer Security and notation thereon on such Interest Payment Date at the
principal London office of the Trustee or at such other Place of Payment outside
the United States specified pursuant to Section 3.01.
Unless otherwise specified pursuant to Section 3.01, at the direction
of the Holder of any Bearer Security or Coupon payable in Dollars, payment on
such Bearer Security or Coupon will be made by check drawn on a bank in The City
of New York or, if agreeable to the Trustee, by wire transfer to a Dollar
account maintained by such Holder outside the United States. If such payment at
the offices of all Paying Agents outside the United States becomes illegal or is
effectively precluded because of the imposition of exchange controls or similar
restrictions on the full payment or receipt of such amounts in Dollars, the
Company will appoint an office or agent in the United States at which such
payment may be made. Unless otherwise specified pursuant to Section 3.01, at
the direction of the Holder of any Bearer Security or Coupon payable in a
Foreign Currency, payment on such Bearer Security or Coupon will be made by a
check drawn on a bank outside the United States or by wire transfer to an
appropriate account maintained by such Holder outside the United States. Except
as provided in this paragraph, no payment on any Bearer Security or Coupon will
be made by mail to an address in the United States or by wire transfer to an
account in the United States.
(c) Any interest on any Debt Security which is payable but is not
punctually paid or duly provided for on any Interest Payment Date (herein called
"Defaulted Interest") shall, if such Debt Security is a Registered Security,
forthwith cease to be payable to the Registered Holder on the relevant Regular
Record Date by virtue of his having been such Registered Holder, and such
Defaulted Interest may be paid by the Company, at its election in each case, as
provided in clause (1) or (2) below:
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(1) The Company may elect to make payment of any Defaulted Interest
to the Persons in whose names such Registered Securities (or their
respective Predecessor Securities) are registered at the close of business
on a Special Record Date for the payment of such Defaulted Interest, which
shall be fixed in the following manner. The Company shall notify the
Trustee in writing of the amount of Defaulted Interest proposed to be paid
on each such Registered Security and the date of the proposed payment, and
at the same time the Company shall deposit with the Trustee an amount of
money in the Currency or Currency unit in which the Debt Securities of such
series are payable (except as otherwise specified pursuant to Sections 3.01
or 3.10) equal to the aggregate amount proposed to be paid in respect of
such Defaulted Interest or shall make arrangements satisfactory to the
Trustee for such deposit prior to the date of the proposed payment, such
money when deposited to be held in trust for the benefit of the Persons
entitled to such Defaulted Interest as in this clause provided. Thereupon
the Trustee shall fix a Special Record Date for the payment of such
Defaulted Interest which date shall be not more than 15 days and not less
than 10 days prior to the date of the proposed payment and not less than 10
days after the receipt by the Trustee of the notice of the proposed
payment. The Trustee shall promptly notify the Company of such Special
Record Date and, in the name and at the expense of the Company, shall cause
notice of the proposed payment of such Defaulted Interest and the Special
Record Date therefor to be mailed, first-class postage prepaid, to the
Holders of such Registered Securities at their addresses as they appear in
the Security Register, not less than 10 days prior to such Special Record
Date. Notice of the proposed payment of such Defaulted Interest and the
Special Record Date therefor having been mailed as aforesaid, such
Defaulted Interest shall be paid to the Persons in whose names such
Registered Securities (or their respective Predecessor Securities) are
registered at the close of business on such Special Record Date and shall
no longer be payable pursuant to the following clause (2).
(2) The Company may make payment of any Defaulted Interest on
Registered Securities in any other lawful manner not inconsistent with the
requirements of any securities exchange on which such Registered Securities
may be listed, and upon such notice as may be required by such exchange,
if, after notice given by the Company to the Trustee of the proposed
payment pursuant to this clause, such manner of payment shall be deemed
practicable by the Trustee.
(d) Any Defaulted Interest payable in respect of Bearer Securities of
any series shall be payable pursuant to such procedures as may be satisfactory
to the Trustee in such manner that there is no discrimination between the
Holders of Registered Securities (if any) and Bearer Securities of such series,
and notice of the payment date therefor shall be given by the Trustee, in the
name and at the expense of the Company, in the manner provided in Section 1.05
not more than 25 days and not less than 20 days prior to the date of the
proposed payment.
(e) Subject to the foregoing provisions of this Section, each Debt
Security delivered under this Indenture upon transfer of or in exchange for or
in lieu of any other Debt Security shall carry the rights to interest accrued
and unpaid, and to accrue, which were carried by such other Debt Security.
Section 3.08. Cancellation.
------------
Unless otherwise specified pursuant to Section 3.01 for Debt
Securities of any series, all Debt Securities surrendered for payment,
redemption, transfer, exchange or credit against any sinking fund and all
Coupons surrendered for payment or exchange shall, if surrendered to any Person
other than the Trustee, be delivered to the Trustee. All Registered Securities
and matured Coupons so delivered
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shall be promptly cancelled by the Trustee. All Bearer Securities and unmatured
Coupons so delivered shall be held by the Trustee and, upon instruction by the
Company Order, shall be cancelled or held for reissuance. Bearer Securities and
unmatured Coupons held for reissuance may be reissued only in exchange for
Bearer Securities of the same series and of like Stated Maturity and with like
terms and conditions pursuant to Section 3.05 or in replacement of mutilated,
lost, stolen or destroyed Bearer Securities of the same series and of like
Stated Maturity and with like terms and conditions or the related Coupons
pursuant to Section 3.06. All Bearer Securities and unmatured Coupons held by
the Trustee pending such cancellation or reissuance shall be deemed to be
delivered for cancellation for all purposes of this Indenture and the
Securities. The Company may at any time deliver to the Trustee for cancellation
any Debt Securities or Coupons previously authenticated and delivered hereunder
which the Company may have acquired in any manner whatsoever, and may deliver to
the Trustee (or to any other Person for delivery to the Trustee) for
cancellation any Debt Securities previously authenticated hereunder which the
Company has not issued, and all Debt Securities or Coupons so delivered shall be
promptly cancelled by the Trustee. No Debt Securities or Coupons shall be
authenticated in lieu of or in exchange for any Debt Securities or Coupons
cancelled as provided in this Section, except as expressly permitted by this
Indenture. All cancelled Debt Securities and Coupons held by the Trustee shall
be delivered to the Company upon Company Request. The acquisition of any Debt
Securities or Coupons by the Company shall not operate as a redemption or
satisfaction of the indebtedness represented thereby unless and until such Debt
Securities or Coupons are surrendered to the Trustee for cancellation. In the
case of any temporary Global Note which shall be destroyed if the entire
aggregate principal amount of the Debt Securities represented thereby has been
exchanged, the certificate of destruction shall state that all certificates
required pursuant to Section 3.04 hereof and substantially in the form of
Exhibit B hereto, to be given by the Euro-clear Operator or CEDEL, have been
duly presented to the Trustee by the Euro-clear Operator or CEDEL, as the case
may be. Permanent Global Notes shall not be destroyed until exchanged in full
for definitive Debt Securities or until payment thereon is made in full.
Section 3.09. Computation of Interest.
-----------------------
Except as otherwise specified pursuant to Section 3.01 for Debt
Securities of any series, interest on the Debt Securities of each series shall
be computed on the basis of a 360-day year of twelve 30-day months.
Section 3.10. Currency of Payments in Respect of Debt Securities.
--------------------------------------------------
(a) Except as otherwise specified pursuant to Section 3.01 for Bearer
Securities of any series, payment of the principal of (and premium, if any) and
interest on Bearer Securities of such series denominated in any Currency will be
made in such Currency.
(b) With respect to Registered Securities of any series not
permitting the election provided for in paragraph (c) below or the Holders of
which have not made the election provided for in paragraph (c) below, except as
provided in paragraph (e) below, payment of the principal of (and premium, if
any) and any interest on any Registered Security of such series will be made in
the Currency in which such Registered Security is payable.
(c) It may be provided pursuant to Section 3.01 with respect to the
Registered Securities of any series that Holders shall have the option, subject
to paragraphs (e) and (f) below, to receive payments of principal of (and
premium, if any) and any interest on such Registered Securities in any of the
Currencies which may be designated for such election by delivering to the
Trustee a written election, to be in form and substance satisfactory to the
Trustee, not later than the close of business
33
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on the Election Date immediately preceding the applicable payment date. If a
Holder so elects to receive such payments in any such Currency, such election
will remain in effect for such Holder or any transferee of such Holder until
changed by such Holder or such transferee by written notice to the Trustee (but
any such change must be made not later than the close of business on the
Election Date immediately preceding the next payment date to be effective for
the payment to be made on such payment date and no such change or election may
be made with respect to payments to be made on any Registered Security of such
series with respect to which an Event of Default has occurred or notice of
redemption has been given by the Company pursuant to Article Thirteen). Any
Holder of any such Registered Security who shall not have delivered any such
election to the Trustee by the close of business on the applicable Election Date
will be paid the amount due on the applicable payment date in the relevant
Currency as provided in paragraph (b) of this Section 3.10.
(d) If the election referred to in paragraph (c) above has been
provided for pursuant to Section 3.01, then not later than the fourth Business
Day after the Election Date for each payment date, the Trustee will deliver to
the Company a written notice specifying, in the Currency in which each series of
the Registered Securities is payable, the respective aggregate amounts of
principal of (and premium, if any) and any interest on the Registered Securities
to be paid on such payment date, specifying the amounts so payable in respect of
the Registered Securities as to which the Holders of Registered Securities
denominated in any Currency shall have elected to be paid in another Currency as
provided in paragraph (c) above. If the election referred to in paragraph (c)
above has been provided for pursuant to Section 3.01 and if at least one Holder
has made such election, then, on the second Business Day preceding each payment
date, the Company will deliver to the Trustee an Exchange Rate Officer's
Certificate in respect of the Currency payments to be made on such payment date.
The Currency amount receivable by Holders of Registered Securities who have
elected payment in a Currency as provided in paragraph (c) above shall be
determined by the Company on the basis of the applicable Market Exchange Rate in
effect on the third Business Day (the "Valuation Date") immediately preceding
each payment date.
(e) If a Conversion Event occurs with respect to a Foreign Currency,
the ECU or any other Currency unit in which any of the Debt Securities are
denominated or payable other than pursuant to an election provided for pursuant
to paragraph (c) above, then with respect to each date for the payment of
principal of (and premium, if any) and any interest on the applicable Debt
Securities denominated or payable in such Foreign Currency, the ECU or such
other Currency unit occurring after the last date on which such Foreign
Currency, the ECU or such other Currency unit was used (the "Conversion Date"),
the Dollar shall be the Currency of payment for use on each such payment date.
The Dollar amount to be paid by the Company to the Trustee and by the Trustee or
any Paying Agent to the Holders of such Debt Securities with respect to such
payment date shall be the Dollar Equivalent of the Foreign Currency or, in the
case of a Currency unit, the Dollar Equivalent of the Currency Unit, in each
case as determined by the Currency Determination Agent, if any, or, if there
shall not be a Currency Determination Agent, then by the Trustee, in the manner
provided in paragraph (g) or (h) below.
(f) If the Holder of a Registered Security denominated in any
Currency shall have elected to be paid in another Currency as provided in
paragraph (c) above, and a Conversion Event occurs with respect to such elected
Currency, such Holder shall receive payment in the Currency in which payment
would have been made in the absence of such election. If a Conversion Event
occurs with respect to the Currency in which payment would have been made in the
absence of such election, such Holder shall receive payment in Dollars as
provided in paragraph (e) of this Section 3.10.
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(g) The "Dollar Equivalent of the Foreign Currency" shall be
determined by the Currency Determination Agent, if any, or, if there shall not
be a Currency Determination Agent, then by the Trustee, and shall be obtained
for each subsequent payment date by converting the specified Foreign Currency
into Dollars at the Market Exchange Rate on the Conversion Date.
(h) The "Dollar Equivalent of the Currency Unit" shall be determined
by the Currency Determination Agent, if any, or, if there shall not be a
Currency Determination Agent, then by the Trustee, and subject to the provisions
of paragraph (i) below, shall be the sum of each amount obtained by converting
the Specified Amount of each Component Currency into Dollars at the Market
Exchange Rate for such Component Currency on the Valuation Date with respect to
each payment.
(i) For purposes of this Section 3.10 the following terms shall have
the following meanings:
A "Component Currency" shall mean any Currency which, on the
Conversion Date, was a component Currency of the relevant Currency unit,
including, but not limited to, the ECU.
A "Specified Amount" of a Component Currency shall mean the number of
units of such Component Currency or fractions thereof which were
represented in the relevant Currency unit, including, but not limited to,
the ECU, on the Conversion Date. If after the Conversion Date the official
unit of any Component Currency is altered by way of combination or
subdivision, the Specified Amount of such Component Currency shall be
divided or multiplied in the same proportion. If after the Conversion Date
two or more Component Currencies are consolidated into a single Currency,
the respective Specified Amounts of such Component Currencies shall be
replaced by an amount in such single Currency equal to the sum of the
respective Specified Amounts of such consolidated Component Currencies
expressed in such single Currency, and such amount shall thereafter be a
Specified Amount and such single Currency shall thereafter be a Component
Currency. If after the Conversion Date any Component Currency shall be
divided into two or more Currencies, the Specified Amount of such Component
Currency shall be replaced by amounts of such two or more Currencies with
appropriate Dollar equivalents at the Market Exchange Rate on the date of
such replacement equal to the Dollar equivalent of the Specified Amount of
such former Component Currency at the Market Exchange Rate on such date,
and such amounts shall thereafter be Specified Amounts and such Currencies
shall thereafter be Component Currencies. If after the Conversion Date of
the relevant Currency unit, including but not limited to, the ECU, a
Conversion Event (other than any event referred to above in this definition
of "Specified Amount") occurs with respect to any Component Currency of
such Currency unit, the Specified Amount of such Component Currency shall,
for purposes of calculating the Dollar Equivalent of the Currency Unit, be
converted into Dollars at the Market Exchange Rate in effect on the
Conversion Date of such Component Currency.
"Election Date" shall mean the record date with respect to any payment
date, and with respect to the Maturity shall mean the record date (if
within 16 or fewer days prior to the Maturity) immediately preceding the
Maturity, and with respect to any series of Debt Securities whose record
date immediately preceding the Maturity is more than 16 days prior to the
Maturity or any series of Debt Securities for which no record dates are
provided with respect to interest payments, shall mean the date which is 16
days prior to the Maturity.
(j) All decisions and determinations of the Trustee or the Currency
Determination Agent, if any, regarding the Dollar Equivalent of the Foreign
Currency, the Dollar Equivalent of the
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Currency Unit and the Market Exchange Rate shall be in its sole discretion and
shall, in the absence of manifest error, be conclusive for all purposes and
irrevocably binding upon the Company and all Holders of the Debt Securities
denominated or payable in the relevant Currency. In the event of a Conversion
Event with respect to a Foreign Currency, the Company, after learning thereof,
will immediately give written notice thereof to the Trustee (and the Trustee
will promptly thereafter give notice in the manner provided in Section 1.05 to
the Holders) specifying the Conversion Date. In the event of a Conversion Event
with respect to the ECU or any other Currency unit in which Debt Securities are
denominated or payable, the Company, after learning thereof, will immediately
give notice thereof to the Trustee (and the Trustee will promptly thereafter
give written notice in the manner provided in Section 1.05 to the Holders)
specifying the Conversion Date and the Specified Amount of each Component
Currency on the Conversion Date. In the event of any subsequent change in any
Component Currency as set forth in the definition of Specified Amount above, the
Company, after learning thereof, will similarly give written notice to the
Trustee. The Trustee shall be fully justified and protected in relying and
acting upon information received by it from the Company and the Currency
Determination Agent, if any, and shall not otherwise have any duty or obligation
to determine such information independently.
(k) For purposes of any provision of the Indenture where the Holders
of Outstanding Debt Securities may perform an Act which requires that a
specified percentage of the Outstanding Debt Securities of all series perform
such Act and for purposes of any decision or determination by the Trustee of
amounts due and unpaid for the principal (and premium, if any) and interest on
the Debt Securities of all series in respect of which moneys are to be disbursed
ratably, the principal of (and premium, if any) and interest on the Outstanding
Debt Securities denominated in a Foreign Currency will be the amount in Dollars
based upon the Market Exchange Rate for Debt Securities of such series, as of
the date for determining whether the Holders entitled to perform such Act have
performed it, or as of the date of such decision or determination by the
Trustee, as the case may be.
Section 3.11. Judgments.
---------
If for the purpose of obtaining a judgment in any court with respect
to any obligation of the Company hereunder or under any Debt Security, it shall
become necessary to convert into any other Currency any amount in the Currency
due hereunder or under such Debt Security, then such conversion shall be made at
the Market Exchange Rate as in effect on the date the Company shall make payment
to any Person in satisfaction of such judgment. If pursuant to any such
judgment, conversion shall be made on a date other than the date payment is made
and there shall occur a change between such Market Exchange Rate and the Market
Exchange Rate as in effect on the date of payment, the Company agrees to pay
such additional amounts (if any) as may be necessary to ensure that the amount
paid is equal to the amount in such other Currency which, when converted at the
Market Exchange Rate as in effect on the date of payment or distribution, is the
amount then due hereunder or under such Debt Security. Any amount due from the
Company under this Section 3.11 shall be due as a separate debt and is not to be
affected by or merged into any judgment being obtained for any other sums due
hereunder or in respect of any Debt Security. In no event, however, shall the
Company be required to pay more in the Currency or Currency unit due hereunder
or under such Debt Security at the Market Exchange Rate as in effect when
payment is made than the amount of Currency stated to be due hereunder or under
such Debt Security so that in any event the Company's obligations hereunder or
under such Debt Security will be effectively maintained as obligations in such
Currency, and the Company shall be entitled to withhold (or be reimbursed for,
as the case may be) any excess of the amount actually realized upon any such
conversion over the amount due and payable on the date of payment or
distribution.
Section 3.12. Exchange Upon Default.
---------------------
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If default is made in the payments referred to in Section 12.01, the
Company hereby undertakes that upon presentation and surrender of a permanent
Global Note to the Trustee (or to any other Person or at any other address as
the Company may designate in writing), on any Business Day on or after the
maturity date thereof the Company will issue and the Trustee will authenticate
and deliver to the bearer of such permanent Global Note duly executed and
authenticated definitive Debt Securities with the same issue date and maturity
date as set out in such permanent Global Note.
ARTICLE FOUR
SATISFACTION AND DISCHARGE
Section 4.01. Satisfaction and Discharge of Indenture.
---------------------------------------
This Indenture, with respect to the Debt Securities of any series (if
all series issued under this Indenture are not to be affected), shall, upon
Company Request, cease to be of further effect (except as to any surviving
rights of registration of transfer or exchange of such Debt Securities herein
expressly provided for and rights to receive payments of principal (and premium,
if any) and interest on such Debt Securities) and the Trustee, at the expense of
the Company, shall execute proper instruments acknowledging satisfaction and
discharge of this Indenture, when
(1) either
(A) all Debt Securities and the Coupons, if any, of such series
theretofore authenticated and delivered (other than (i) Debt Securities and
Coupons of such series which have been destroyed, lost or stolen and which
have been replaced or paid as provided in Section 3.06, (ii) Coupons
appertaining to Bearer Securities surrendered for exchange for Registered
Securities and maturing after such exchange, whose surrender is not
required or has been waived under Section 3.05, (iii) Coupons appertaining
to Bearer Securities called for redemption and maturing after the relevant
Redemption Date, whose surrender has been waived as provided in Section
13.06, and (iv) Debt Securities and Coupons of such series for whose
payment money has theretofore been deposited in trust or segregated and
held in trust by the Company and thereafter repaid to the Company or
discharged from such trust, as provided in Section 12.04) have been
delivered to the Trustee for cancellation; or
(B) all Debt Securities and the Coupons, if any, of such series not
theretofore delivered to the Trustee for cancellation,
(i) have become due and payable, or
(ii) will become due and payable at their Stated Maturity within one
year, or
(iii) are to be called for redemption within one year under
arrangements satisfactory to the Trustee for the giving of
notice by the Trustee in the name, and at the expense, of the
Company,
and the Company, either complies with any other condition or terms
specified pursuant to Section 3.01, or if not so specified in the case of
(i), (ii) or (iii) of this subclause (B), has irrevocably deposited or
caused to be deposited with the Trustee as trust funds in trust for such
purpose an
37
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amount in the Currency in which such Debt Securities are denominated
(except as otherwise provided pursuant to Section 3.01 or 3.10) sufficient
to pay and discharge the entire indebtedness on such Debt Securities for
principal (and premium, if any) and interest to the date of such deposit
(in the case of Debt Securities which have become due and payable) or to
the Stated Maturity or Redemption Date, as the case may be; provided,
--------
however, in the event a petition for relief under the Federal bankruptcy
-------
laws, as now or hereafter constituted, or any other applicable Federal or
state bankruptcy, insolvency or other similar law, is filed with respect to
the Company within 91 days after the deposit and the Trustee is required to
return the deposited money to the Company, the obligations of the Company
under this Indenture with respect to such Debt Securities shall not be
deemed terminated or discharged;
(2) the Company has paid or caused to be paid all other sums payable
hereunder by the Company;
(3) the Company has delivered to the Trustee an Officers' Certificate
and an Opinion of Counsel each stating that all conditions precedent herein
provided for relating to the satisfaction and discharge of this Indenture
with respect to such series have been complied with; and
(4) the Company has delivered to the Trustee an Opinion of Counsel or
a ruling by the Internal Revenue Service to the effect that Holders of the
Debt Securities of the series will not recognize income, gain or loss for
Federal income tax purposes as a result of such deposit and discharge.
Notwithstanding the satisfaction and discharge of this Indenture, the
obligations of the Company to the Trustee under Section 6.07, the obligations of
the Trustee to any Authenticating Agent under Section 6.14, the obligations of
the Company under Section 12.01, and, if money shall have been deposited with
the Trustee pursuant to subclause (B) of clause (1) of this Section, the
obligations of the Trustee under Section 4.02 and the last paragraph of Section
12.04, shall survive. If, after the deposit referred to in Section 4.01 has
been made, (x) the Holder of a Debt Security is entitled to, and does, elect
pursuant to Section 3.10(c), to receive payment in a Currency other than that in
which the deposit pursuant to Section 4.01 was made, or (y) if a Conversion
Event occurs with respect to the Currency in which the deposit was made or
elected to be received by the Holder pursuant to Section 3.10(c), then the
indebtedness represented by such Debt Security shall be fully discharged to the
extent that the deposit made with respect to such Debt Security shall be
converted into the Currency in which such payment is made.
Section 4.02. Application of Trust Money.
--------------------------
Subject to the provisions of the last paragraph of Section 12.04, all
money deposited with the Trustee pursuant to Section 4.01 shall be held in trust
and applied by it, in accordance with the provisions of the Debt Securities and
Coupons, if any, and this Indenture, to the payment, either directly or through
any Paying Agent (including the Company acting as its own Paying Agent) as the
Trustee may determine, to the Persons entitled thereto, of the principal (and
premium, if any) and interest for whose payment such money has been deposited
with the Trustee.
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ARTICLE FIVE
REMEDIES
Section 5.01. Events of Default.
-----------------
"Event of Default" wherever used herein with respect to Debt
Securities of any series means any one of the following events (whatever the
reason for such Event of Default and whether it shall be voluntary or
involuntary or be effected by operation of law, pursuant to any judgment, decree
or order of any court or any order, rule or regulation of any administrative or
governmental body):
(1) default in the payment of any interest upon any Debt Security or
any payment with respect to the Coupons, if any, of such series when it
becomes due and payable, and continuance of such default for a period of 30
days; or
(2) default in the payment of the principal of (and premium, if any,
on) any Debt Security of such series at its Maturity; or
(3) default in the deposit of any sinking fund payment, when and as
due by the terms of a Debt Security of such series; or
(4) default in the performance, or breach, of any covenant or
warranty of the Company in this Indenture (other than a covenant or
warranty a default in whose performance or whose breach is elsewhere in
this Section specifically dealt with or which expressly has been included
in this Indenture solely for the benefit of Debt Securities of a series
other than such series), and continuance of such default or breach for a
period of 30 days after there has been given, by registered or certified
mail, to the Company by the Trustee or to the Company and the Trustee by
the Holders of at least 30% in principal amount of the Outstanding Debt
Securities of such series, a written notice specifying such default or
breach and requiring it to be remedied and stating that such notice is a
"Notice of Default" hereunder; or
(5) the entry of a decree or order for relief in respect of the
Company by a court having jurisdiction in the premises in an involuntary
case under the Federal bankruptcy laws, as now or hereafter constituted, or
any other applicable Federal or State bankruptcy, insolvency or other
similar law, or a decree or order adjudging the Company a bankrupt or
insolvent, or approving as properly filed a petition seeking
reorganization, arrangement, adjustment or composition of or in respect of
the Company under any applicable Federal or State law, or appointing a
receiver, liquidator, assignee, custodian, trustee, sequestrator (or other
similar official) of the Company or of any substantial part of its
property, or ordering the winding up or liquidation of its affairs, and the
continuance of any such decree or order unstayed and in effect for a period
of 60 consecutive days; or
(6) the commencement by the Company of a voluntary case under the
Federal bankruptcy laws, as now or hereafter constituted, or any other
applicable Federal or State bankruptcy, insolvency or other similar law, or
the consent by it to the entry of an order for relief in an involuntary
case under any such law or to the appointment of a receiver, liquidator,
assignee, custodian, trustee, sequestrator (or other similar official) of
the Company or of any substantial part of its property, or the making by it
of an assignment for the benefit of its creditors, or the admission by it
in writing of its inability to pay its debts generally as they
39
<PAGE>
become due, or the taking of corporate action by the Company in furtherance
of any such action; or
(7) any other Event of Default provided with respect to Debt
Securities of that series pursuant to Section 3.01.
Section 5.02. Acceleration of Maturity; Rescission and Annulment.
--------------------------------------------------
If an Event of Default with respect to Debt Securities of any series
at the time Outstanding occurs and is continuing, then in every such case the
Trustee or the Holders of not less than 25% in principal amount of the
Outstanding Debt Securities of such series may declare the principal amount (or,
if any Debt Securities of such series are Discount Securities, such portion of
the principal amount of such Discount Securities as may be specified in the
terms of such Discount Securities) of all the Debt Securities of such series to
be due and payable immediately, by a notice in writing to the Company (and to
the Trustee if given by Holders), and upon any such declaration such principal
amount (or specified amount) plus accrued and unpaid interest (and premium, if
payable) shall become immediately due and payable. Upon payment of such amount
in the Currency in which such Debt Securities are denominated (except as
otherwise provided pursuant to Sections 3.01 or 3.10), all obligations of the
Company in respect of the payment of principal of the Debt Securities of such
series shall terminate.
At any time after such a declaration of acceleration with respect to
Debt Securities of any series has been made and before a judgment or decree for
payment of the money due has been obtained by the Trustee as hereinafter in this
Article provided, the Holders of a majority in principal amount of the
Outstanding Debt Securities of such series, by written notice to the Company and
the Trustee, may rescind and annul such declaration and its consequences if
(1) the Company has paid or deposited with the Trustee a sum in the
Currency in which such Debt Securities are denominated (except as otherwise
provided pursuant to Section 3.01 or 3.10) sufficient to pay
(A) all overdue installments of interest on all Debt Securities or
all overdue payments with respect to any Coupons of such series,
(B) the principal of (and premium, if any, on) any Debt Securities of
such series which have become due otherwise than by such
declaration of acceleration and interest thereon at the rate or
rates prescribed therefor in such Debt Securities,
(C) to the extent that payment of such interest is lawful, interest
upon overdue installments of interest on each Debt Security of
such series or upon overdue payments on any Coupons of such
series at the Overdue Rate, and
(D) all sums paid or advanced by the Trustee hereunder and the
reasonable compensation, expenses, disbursements and advances of
the Trustee, its agents and counsel; provided, however, that all
-------- -------
sums payable under this clause (D) shall be paid in Dollars;
and
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(2) All Events of Default with respect to Debt Securities of such
series, other than the nonpayment of the principal of Debt Securities of
such series which has become due solely by such declaration of
acceleration, have been cured or waived as provided in Section 5.13.
No such rescission and waiver shall affect any subsequent default or impair any
right consequent thereon.
Section 5.03. Collection of Indebtedness and Suits for Enforcement by
-------------------------------------------------------
Trustee.
-------
The Company covenants that if
(1) default is made in the payment of any installment of interest on
any Debt Security or any payment with respect to any Coupons when such
interest or payment becomes due and payable and such default continues for
a period of 30 days,
(2) default is made in the payment of principal of (or premium, if
any, on) any Debt Security at the Maturity thereof, or
(3) default is made in the making or satisfaction of any sinking fund
payment or analogous obligation when the same becomes due pursuant to the
terms of the Debt Securities of any series,
the Company will, upon demand of the Trustee, pay to it, for the benefit of the
Holders of such Debt Securities or of such Coupons, the amount then due and
payable on such Debt Securities or matured Coupons, for the principal (and
premium, if any) and interest, if any, and, to the extent that payment of such
interest shall be legally enforceable, interest upon the overdue principal (and
premium, if any) and upon overdue installments of interest, at the Overdue Rate;
and, in addition thereto, such further amount as shall be sufficient to cover
the costs and expenses of collection, including the reasonable compensation,
expenses, disbursements and advances of the Trustee, its agents and counsel.
If the Company fails to pay such amount forthwith upon such demand,
the Trustee, in its own name and as trustee of an express trust, may institute a
judicial proceeding for the collection of the sums so due and unpaid, and may
prosecute such proceeding to judgment or final decree, and may enforce the same
against the Company or any other obligor upon such Debt Securities and Coupons,
and collect the moneys adjudged or decreed to be payable in the manner provided
by law out of the property of the Company or any other obligor upon such Debt
Securities and Coupons wherever situated.
If an Event of Default with respect to Debt Securities of any series
occurs and is continuing, the Trustee may in its discretion proceed to protect
and enforce its rights and the rights of the Holders of Debt Securities and
Coupons of such series by such appropriate judicial proceedings as the Trustee
shall deem most effectual to protect and enforce any such rights, whether for
the specific enforcement of any covenant or agreement in this Indenture or in
aid of the exercise of any power granted herein, or to enforce any other proper
remedy.
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Section 5.04. Trustee May File Proofs of Claim.
--------------------------------
In case of the pendency of any receivership, insolvency, liquidation,
bankruptcy, reorganization, arrangement, adjustment, composition or other
judicial proceedings, or any voluntary or involuntary case under the Federal
bankruptcy laws, as now or hereafter constituted, relative to the Company or any
other obligor upon the Debt Securities and Coupons, if any, of a particular
series or the property of the Company or of such other obligor or their
creditors, the Trustee (irrespective of whether the principal of such Debt
Securities shall then be due and payable as therein expressed or by declaration
of acceleration or otherwise and irrespective of whether the Trustee shall have
made any demand on the Company for the payment of overdue principal or interest)
shall be entitled and empowered, by intervention in such proceeding or
otherwise,
(i) to file and prove a claim for the whole amount of principal (or,
if the Debt Securities of such series are Discount Securities, such portion
of the principal amount as may be due and payable with respect to such
series pursuant to a declaration in accordance with Section 5.02) (and
premium, if any) and interest owing and unpaid in respect of the Debt
Securities and Coupons of such series and to file such other papers or
documents as may be necessary or advisable in order to have the claims of
the Trustee (including any claim for the reasonable compensation, expenses,
disbursements and advances of the Trustee, its agents and counsel) and of
the Holders of such Debt Securities and Coupons allowed in such judicial
proceeding, and
(ii) to collect and receive any moneys or other property payable or
deliverable on any such claims and to distribute the same;
and any receiver, assignee, trustee, custodian, liquidator, sequestrator (or
other similar official) in any such proceeding is hereby authorized by each such
Holder to make such payments to the Trustee, and in the event that the Trustee
shall consent to the making of such payments directly to such Holders, to pay to
the Trustee any amount due it for the reasonable compensation, expenses,
disbursements and advances of the Trustee, its agents and counsel, and any other
amounts due the Trustee under Section 6.07.
Nothing herein contained shall be deemed to authorize the Trustee to
authorize or consent to or accept or adopt on behalf of any Holder any plan of
reorganization, arrangement, adjustment or composition affecting the Debt
Securities and any Coupons of such series or the rights of any Holder thereof,
or to authorize the Trustee to vote in respect of the claim of any Holder in any
such proceeding.
Section 5.05. Trustee May Enforce Claims Without Possession of Debt
-----------------------------------------------------
Securities.
----------
All rights of action and claims under this Indenture or the Debt
Securities and the Coupons, if any, of any series may be prosecuted and enforced
by the Trustee without the possession of any of such Debt Securities or Coupons
or the production thereof in any proceeding relating thereto, and any such
proceeding instituted by the Trustee shall be brought in its own name, as
trustee of an express trust, and any recovery of judgment shall, after provision
for the payment of the reasonable compensation, expenses, disbursements and
advances of the Trustee, its agents and counsel, be for the ratable benefit of
the Holders of the Debt Securities or Coupons in respect of which such judgment
has been recovered.
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Section 5.06. Application of Money Collected.
------------------------------
Any money collected by the Trustee pursuant to this Article shall be
applied in the following order, at the date or dates fixed by the Trustee and,
in case of the distribution of such money on account of principal (and premium,
if any) or interest, upon presentation of the Debt Securities or Coupons of any
series in respect of which money has been collected and the notation thereon of
the payment if only partially paid and upon surrender thereof if fully paid:
FIRST: To the payment of all amounts due the Trustee under Section
6.07.
SECOND: To the payment of the amounts then due and unpaid for
principal of (and premium, if any) and interest on the Debt Securities or
Coupons of such series, in respect of which or for the benefit of which
such money has been collected ratably, without preference or priority of
any kind, according to the amounts due and payable on such Debt Securities
or Coupons for principal (and premium, if any) and interest, respectively;
and
THIRD: The balance, if any, to the Person or Persons entitled thereto.
Section 5.07. Limitation on Suits.
-------------------
No Holder of any Debt Security or Coupon of any series shall have any
right to institute any proceeding, judicial or otherwise, with respect to this
Indenture, or for the appointment of a receiver or trustee, or for any other
remedy hereunder, unless
(1) such Holder has previously given written notice to the Trustee of
a continuing Event of Default with respect to such series;
(2) the Holders of not less than 25% in principal amount of the
Outstanding Debt Securities of such series shall have made written request
to the Trustee to institute proceedings in respect of such Event of Default
in its own name as Trustee hereunder;
(3) such Holder or Holders have offered to the Trustee reasonable
indemnity against the costs, expenses and liabilities to be incurred in
compliance with such request;
(4) the Trustee for 60 days after its receipt of such notice, request
and offer of indemnity has failed to institute any such proceeding; and
(5) no direction inconsistent with such written request has been
given to the Trustee during such 60-day period by the Holders of a majority
in principal amount of the Outstanding Debt Securities of such series;
it being understood and intended that no one or more of such Holders shall have
any right in any manner whatever by virtue of, or by availing of, any provision
of this Indenture to affect, disturb or prejudice the rights of any other such
Holders or of the Holders of Outstanding Debt Securities or Coupons of any other
series, or to obtain or to seek to obtain priority or preference over any other
of such Holders or to enforce any right under this Indenture, except in the
manner herein provided and for the equal and ratable benefit of all of such
Holders. For the protection and enforcement of the provisions of this Section
5.07, each and every Holder of Debt Securities or Coupons of any series and the
Trustee for such series shall be entitled to such relief as can be given at law
or in equity.
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Section 5.08. Unconditional Right of Holders to Receive Principal,
----------------------------------------------------
Premium and Interest.
--------------------
Notwithstanding any other provision in this Indenture, the Holder of
any Debt Security or of any Coupon shall have the right, which is absolute and
unconditional, to receive payment of the principal of (and premium, if any) and
(subject to Section 3.07) interest on such Debt Security or Coupon on the
respective Stated Maturity or Maturities expressed in such Debt Security or
Coupon (or, in the case of redemption, on the Redemption Date) and to institute
suit for the enforcement of any such payment and interest thereon, and such
right shall not be impaired without the consent of such Holder.
Section 5.09. Restoration of Rights and Remedies.
----------------------------------
If the Trustee or any Holder has instituted any proceeding to enforce
any right or remedy under this Indenture and such proceeding has been
discontinued or abandoned for any reason, or has been determined adversely to
the Trustee or to such Holder, then and in every such case the Company, the
Trustee and the Holders shall, subject to any determination in such proceeding,
be restored severally and respectively to their former positions hereunder, and
thereafter all rights and remedies of the Trustee and the Holders shall continue
as though no such proceeding had been instituted.
Section 5.10. Rights and Remedies Cumulative.
------------------------------
Except as otherwise expressly provided elsewhere in this Indenture, no
right or remedy herein conferred upon or reserved to the Trustee or to the
Holders is intended to be exclusive of any other right or remedy, and every
right and remedy shall, to the extent permitted by law, be cumulative and in
addition to every other right and remedy given hereunder or now or hereafter
existing at law or in equity or otherwise. The assertion or employment of any
right or remedy hereunder, or otherwise, shall not prevent the concurrent
assertion or employment of any other appropriate right or remedy.
Section 5.11. Delay or Omission Not Waiver.
----------------------------
No delay or omission of the Trustee or of any Holder to exercise any
right or remedy accruing upon any Event of Default shall impair any such right
or remedy or constitute a waiver of any such Event of Default or any
acquiescence therein. Every right and remedy given by this Indenture or by law
to the Trustee or to the Holders may be exercised from time to time, and as
often as may be deemed expedient, by the Trustee or by the Holders, as the case
may be.
Section 5.12. Control by Holders.
------------------
The Holders of a majority in principal amount of the Outstanding Debt
Securities of any series shall have the right to direct the time, method and
place of conducting any proceeding for any remedy available to the Trustee or
exercising any trust or power conferred on the Trustee with respect to the Debt
Securities of such series, provided, that
(1) such direction shall not be in conflict with any rule of law or
with this Indenture;
(2) subject to the provisions of Section 6.01, the Trustee shall have
the right to decline to follow any such direction if the Trustee in good
faith shall, by a Responsible Officer or Responsible Officers of the
Trustee, determine that the proceeding so directed would be
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unjustly prejudicial to the Holders of Debt Securities of such series not
joining in any such direction; and
(3) the Trustee may take any other action deemed proper by the
Trustee which is not inconsistent with such direction.
Section 5.13. Waiver of Past Defaults.
-----------------------
The Holders of not less than a majority in aggregate principal amount
of the Outstanding Debt Securities of any series may on behalf of the Holders of
all the Debt Securities of any such series waive any past default hereunder with
respect to such series and its consequences, except a default
(1) in the payment of the principal of (or premium, if any) or
interest on any Debt Security of such series, or in the payment of any
sinking fund installment or analogous obligation with respect to the Debt
Securities of such series, or
(2) in respect of a covenant or provision hereof which pursuant to
Article Eleven cannot be modified or amended without the consent of the
Holder of each Outstanding Debt Security of such series affected.
Upon any such waiver, such default shall cease to exist, and any Event
of Default arising therefrom shall be deemed to have been cured, for every
purpose of the Debt Securities of such series under this Indenture, but no such
waiver shall extend to any subsequent or other default or impair any right
consequent thereon.
Section 5.14. Undertaking for Costs.
---------------------
All parties to this Indenture agree, and each Holder of any Debt
Security or any Coupon by his acceptance thereof shall be deemed to have agreed,
that any court may in its discretion require, in any suit for the enforcement of
any right or remedy under this Indenture, or in any suit against the Trustee for
any action taken, suffered or omitted by it as Trustee, the filing by any party
litigant in such suit other than the Trustee of an undertaking to pay the costs
of such suit, and that such court may in its discretion assess reasonable costs,
including reasonable attorneys' fees, against any party litigant in such suit,
having due regard to the merits and good faith of the claims or defenses made by
such party litigant, but the provisions of this Section shall not apply to any
suit instituted by the Trustee, to any suit instituted by any Holder or group of
Holders holding in the aggregate more than 10% in principal amount of the
Outstanding Debt Securities of any series, or to any suit instituted by any
Holder of a Debt Security or Coupon for the enforcement of the payment of the
principal of (or premium, if any) or interest on such Debt Security or the
payment of any Coupon on or after the respective Stated Maturity or Maturities
expressed in such Debt Security or Coupon (or, in the case of redemption, on or
after the Redemption Date).
Section 5.15. Waiver of Stay or Extension Laws.
--------------------------------
The Company covenants (to the extent that it may lawfully do so) that
it will not at any time insist upon, or plead, or in any manner whatsoever claim
or take the benefit or advantage of, any stay or extension law wherever enacted,
now or at any time hereafter in force, which may affect the covenants or the
performance of this Indenture; and the Company (to the extent that it may
lawfully do so) hereby expressly waives all benefit or advantage of any such
law, and covenants that it will not
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hinder, delay or impede the execution of any power herein granted to the
Trustee, but will suffer and permit the execution of every such power as though
no such law had been enacted.
ARTICLE SIX
THE TRUSTEE
Section 6.01. Certain Duties and Responsibilities.
-----------------------------------
(a) Except during the continuance of an Event of Default with respect
to the Debt Securities of any series,
(1) the Trustee undertakes to perform such duties and only such
duties as are specifically set forth in this Indenture, and no implied
covenants or obligations shall be read into this Indenture against the
Trustee; and
(2) in the absence of bad faith on its part, the Trustee may
conclusively rely, as to the truth of the statements and the correctness of
the opinions expressed therein, upon certificates or opinions furnished to
the Trustee and conforming to the requirements of this Indenture; but in
the case of any such certificates or opinions which by any provisions
hereof are specifically required to be furnished to the Trustee, the
Trustee shall be under a duty to examine the same to determine whether or
not they conform to the requirements of this Indenture.
(b) In case an Event of Default with respect to Debt Securities of
any series has occurred and is continuing, the Trustee shall, with respect to
the Debt Securities of such series, exercise such of the rights and powers
vested in it by this Indenture, and use the same degree of care and skill in
their exercise, as a prudent man would exercise or use under the circumstances
in the conduct of his own affairs.
(c) No provision of this Indenture shall be construed to relieve the
Trustee from liability for its own negligent action, its own negligent failure
to act, or its own willful misconduct, except that
(1) this subsection shall not be construed to limit the effect of
subsection (a) of this Section;
(2) the Trustee shall not be liable for any error of judgment made in
good faith by a Responsible Officer, unless it shall be proved that the
Trustee was negligent in ascertaining the pertinent facts;
(3) the Trustee shall not be liable with respect to any action taken,
suffered or omitted to be taken by it with respect to Debt Securities of
any series in good faith in accordance with the direction of the Holders of
a majority in principal amount of the Outstanding Debt Securities of such
series relating to the time, method and place of conducting any proceeding
for any remedy available to the Trustee, or exercising any trust or power
conferred upon the Trustee, under this Indenture; and
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(4) the Trustee shall not be required to expend or risk its own funds
or otherwise incur any financial liability in the performance of any of its
duties hereunder, or in the exercise of any of its rights or powers, if it
shall have reasonable grounds for believing that repayment of such funds or
adequate indemnity against such risk or liability is not reasonably assured
to it.
(d) Whether or not therein expressly so provided, every provision of
this Indenture relating to the conduct or affecting the liability of or
affording protection to the Trustee shall be subject to the provisions of this
Section.
Section 6.02. Notice of Defaults.
------------------
Within 90 days after the occurrence of any default hereunder with
respect to Debt Securities or Coupons, if any, of any series, the Trustee shall
give notice to all Holders of Debt Securities and Coupons of such series of such
default hereunder known to the Trustee, unless such default shall have been
cured or waived; provided, however, that, except in the case of a default in the
-------- -------
payment of the principal of (or premium, if any) or interest on any Debt
Security or Coupon of such series or in the payment of any sinking fund
installment with respect to Debt Securities of such series, the Trustee shall be
protected in withholding such notice if and so long as the board of directors,
the executive committee or a trust committee of directors and/or Responsible
Officers of the Trustee in good faith determine that the withholding of such
notice is in the interest of the Holders of Debt Securities and of Coupons of
such series; and provided, further, that in the case of any default of the
-------- -------
character specified in Section 5.01(4) with respect to Debt Securities of such
series no such notice to Holders shall be given until at least 30 days after the
occurrence thereof. For the purpose of this Section, the term "default" means
any event which is, or after notice or lapse of time or both would become, an
Event of Default with respect to Debt Securities of such series.
Notice given pursuant to this Section 6.02 shall be transmitted by
mail:
(1) to all Registered Holders, as the names and addresses of the
Registered Holders appear in the Security Register;
(2) to such Holders of Bearer Securities of any series as have within
two years preceding such transmission, filed their names and addresses with
the Trustee for such series for that purpose; and
(3) to each Holder of a Debt Security of any series whose name and
address appear in the information preserved at the time by the Trustee in
accordance with Section 7.02(a) of this Indenture.
Section 6.03. Certain Rights of Trustee.
-------------------------
Except as otherwise provided in Section 6.01:
(a) the Trustee may rely and shall be protected in acting or
refraining from acting upon any resolution, certificate, statement, instrument,
opinion, report, notice, request, direction, consent, order, bond, debenture,
note, other evidence of indebtedness or other paper or document believed by it
to be genuine and to have been signed or presented by the proper party or
parties;
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(b) any request or direction of the Company mentioned herein shall be
sufficiently evidenced by a Company Request or Company Order and any resolution
of the Board of Directors shall be sufficiently evidenced by a Board Resolution;
(c) whenever in the administration of this Indenture the Trustee
shall deem it desirable that a matter be proved or established prior to taking,
suffering or omitting any action hereunder, the Trustee (unless other evidence
be herein specifically prescribed) may, in the absence of bad faith on its part,
rely upon an Officers' Certificate;
(d) the Trustee may consult with counsel and the advice of such
counsel or any Opinion of Counsel shall be full and complete authorization and
protection in respect of any action taken, suffered or omitted by it hereunder
in good faith and in reliance thereon;
(e) the Trustee shall be under no obligation to exercise any of the
rights or powers vested in it by this Indenture at the request or direction of
any of the Holders of Debt Securities of any series pursuant to this Indenture,
unless such Holders shall have offered to the Trustee reasonable security or
indemnity against the costs, expenses and liabilities which might be incurred by
it in compliance with such request or direction;
(f) the Trustee shall not be bound to make any investigation into the
facts or matters stated in any resolution, certificate, statement, instrument,
opinion, report, notice, request, direction, consent, order, bond, debenture,
note, other evidence of indebtedness or other paper or document, but the
Trustee, in its discretion, may make such further inquiry or investigation into
such facts or matters as it may see fit, and, if the Trustee shall determine to
make such further inquiry or investigation, it shall be entitled to examine the
books, records and premises of the Company, personally or by agent or attorney;
and
(g) the Trustee may execute any of the trusts or powers hereunder or
perform any duties hereunder either directly or by or through agents or
attorneys and the Trustee shall not be responsible for any misconduct or
negligence on the part of any agent (including any agent appointed pursuant to
Section 3.10(j)) or attorney appointed with due care by it hereunder.
Section 6.04. Not Responsible for Recitals or Issuance of Debt
------------------------------------------------
Securities.
----------
The recitals contained herein and in the Debt Securities, except the
Trustee's certificates of authentication, shall be taken as the statements of
the Company, and the Trustee assumes no responsibility for their correctness.
The Trustee makes no representations as to the validity or sufficiency of this
Indenture or of the Debt Securities or Coupons, if any, of any series. The
Trustee shall not be accountable for the use or application by the Company of
any Debt Securities or the proceeds thereof.
Section 6.05. May Hold Debt Securities.
------------------------
The Trustee, any Paying Agent, the Security Registrar or any other
agent of the Company, in its individual or any other capacity, may become the
owner or pledgee of Debt Securities or Coupons, and, subject to Sections 6.08
and 6.13, may otherwise deal with the Company with the same rights it would have
if it were not Trustee, Paying Agent, Security Registrar or such other agent.
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Section 6.06. Money Held in Trust.
-------------------
Money in any Currency held by the Trustee or any Paying Agent in trust
hereunder need not be segregated from other funds except to the extent required
by law. Neither the Trustee nor any Paying Agent shall be under any liability
for interest on any money received by it hereunder except as otherwise agreed
with the Company.
Section 6.07. Compensation and Reimbursement.
------------------------------
The Company agrees:
(1) to pay to the Trustee from time to time reasonable compensation
in Dollars for all services rendered by it hereunder (which compensation
shall not be limited by any provision of law in regard to the compensation
of a trustee of an express trust);
(2) except as otherwise expressly provided herein, to reimburse the
trustee in Dollars upon its request for all reasonable expenses,
disbursements and advances incurred or made by the Trustee in accordance
with any provision of this Indenture (including the reasonable compensation
and the expenses and disbursements of its agents and counsel), except any
such expense, disbursement or advance as may be attributable to its
negligence or bad faith; and
(3) to indemnify in Dollars the Trustee for, and to hold it harmless
against, any loss, liability or expense incurred without negligence or bad
faith on its part, arising out of or in connection with the acceptance or
administration of this trust or performance of its duties hereunder,
including the costs and expenses of defending itself against any claim or
liability in connection with the exercise or performance of any of its
powers or duties hereunder.
As security for the performance of the obligations of the Company
under this Section, the Trustee shall have a claim prior to the Debt Securities
and Coupons, if any, upon all property and funds held or collected by the
Trustee as such, except funds held in trust for the payment of amounts due on
the Debt Securities and Coupons.
The obligations of the Company under this Section 6.07 to compensate
and indemnify the Trustee for expenses, disbursements and advances shall
constitute additional indebtedness under this Indenture and shall survive the
satisfaction and discharge of this Indenture.
Section 6.08. Disqualification; Conflicting Interests.
---------------------------------------
(a) If the Trustee has or shall acquire any conflicting interest, as
defined in this Section with respect to the Debt Securities of any series, then,
within 90 days after ascertaining that it has such conflicting interest, and if
the default (as hereinafter defined) to which such conflicting interest relates
has not been cured or duly waived or otherwise eliminated before the end of such
90-day period, the Trustee shall either eliminate such conflicting interest or,
except as otherwise provided below, resign with respect to the Debt Securities
of such series, and the Company shall take prompt steps to have a successor
appointed, in the manner and with the effect hereinafter specified in this
Article.
(b) In the event that the Trustee shall fail to comply with the
provisions of subsection (a) of this Section with respect to the Debt Securities
of any series, the Trustee shall, within 10 days after
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the expiration of such 90-day period, transmit to all Holders of Debt Securities
of such series notice of such failure.
Notice given pursuant to this Section 6.08(b) shall be transmitted by
mail:
(1) to all Registered Holders, as the names and addresses of the
Registered Holders appear in the Security Register;
(2) to such Holders of Bearer Securities of any series as have,
within two years preceding such transmission, filed their names and
addresses with the Trustee for such series for that purpose; and
(3) to each Holder of a Debt Security of any series whose name and
address appear in the information preserved at the time by the Trustee in
accordance with Section 7.02(a) of this Indenture.
(c) For the purposes of this Section, the Trustee shall be deemed to
have a conflicting interest with respect to the Debt Securities of any series,
if there shall exist an Event of Default (as such term is defined herein, but
exclusive of any period of grace or requirement of notice) with respect to such
Debt Securities and
(1) the Trustee is trustee under this Indenture with respect to the
Outstanding Debt Securities of any series other than that series or is
trustee under another indenture under which any other securities, or
certificates of interest or participation in any other securities, of the
Company are outstanding, unless such other indenture is a collateral trust
indenture under which the only collateral consists of Debt Securities
issued under this Indenture, provided that there shall be excluded from the
operation of this paragraph of this Indenture with respect to the Debt
Securities of any series other than that series and any other indenture or
indentures under which other securities, or certificates of interest or
participation in other securities, of the Company are outstanding, if
(i) this Indenture and such other indenture or indentures (and
all series of securities issuable thereunder) are wholly unsecured and
rank equally and such other indenture or indentures are hereafter
qualified under the Trust Indenture Act, unless the Commission shall
have found and declared by order pursuant to Section 305(b) or Section
307(c) of the Trust Indenture Act that differences exist between the
provisions of this Indenture with respect to the Debt Securities of
such series and one or more other series or the provisions of such
other indenture or indentures which are so likely to involve a
material conflict of interest as to make it necessary, in the public
interest or for the protection of investors to disqualify the Trustee
from acting as such under this Indenture with respect to the Debt
Securities of such series and such other series or under such other
indenture or indentures, or
(ii) the Company shall have sustained the burden of proving, on
application to the Commission and after opportunity for hearing
thereon, that trusteeship under this Indenture with respect to the
Debt Securities of such series and such other series or such other
indenture or indentures is not so likely to involve a material
conflict of interest as to make it necessary in the public interest or
for the protection of investors to disqualify
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<PAGE>
the Trustee from acting as such under this Indenture with respect to
the Debt Securities of such series and such other series or under such
other indenture or indentures;
(2) the Trustee or any of its directors or executive officers is an
underwriter for the Company;
(3) the Trustee directly or indirectly controls or is directly or
indirectly controlled by or is under direct or indirect common control with
an underwriter for the Company;
(4) the Trustee or any of its directors or executive officers is a
director, officer, partner, employee, appointee or representative of the
Company, or of an underwriter (other than the Trustee itself) for the
Company who is currently engaged in the business of underwriting, except
that (i) one individual may be a director or an executive officer, or both,
of the Trustee and a director or an executive officer, or both, of the
Company but may not be at the same time an executive officer of both the
Trustee and the Company; (ii) if and so long as the number of directors of
the Trustee in office is more than nine, one additional individual may be a
director or an executive officer, or both, of the Trustee and a director of
the Company; and (iii) the Trustee may be designated by the Company or by
any underwriter for the Company to act in the capacity of transfer agent,
registrar, custodian, paying agent, fiscal agent, escrow agent, or
depositary or in any other similar capacity, or, subject to the provisions
of paragraph (c) of this subsection, to act as trustee, whether under an
indenture or otherwise;
(5) 10% or more of the voting securities of the Trustee is
beneficially owned either by the Company or by any director, partner or
executive officer thereof, or 20% or more of such voting securities is
beneficially owned, collectively, by any two or more of such persons; or
10% or more of the voting securities of the Trustee is beneficially owned
either by an underwriter for the Company or by any director, partner or
executive officer thereof or is beneficially owned, collectively, by any
two or more such persons;
(6) the Trustee is the beneficial owner of, or holds as collateral
security for an obligation which is in default (as hereinafter in this
subsection defined), (i) 5% or more of the voting securities, or 10% or
more of any other class of security, of the Company not including the Debt
Securities issued under this Indenture and securities issued under any
other indenture under which the Trustee is also trustee, or (ii) 10% or
more of any class of security of an underwriter for the Company;
(7) the Trustee is the beneficial owner of or holds as collateral
security for an obligation which is in default, 5% or more of the voting
securities of any person who, to the knowledge of the Trustee, owns 10% or
more of the voting securities of, or controls directly or indirectly or is
under direct or indirect common control with, the Company;
(8) the Trustee is the beneficial owner of or holds as collateral
security for an obligation which is in default, 10% or more of any class of
security of any person who, to the knowledge of the Trustee, owns 50% or
more of the voting securities of the Company;
(9) the Trustee owns, on the date of such Event of Default or any
anniversary of such Event of Default while such Event of Default remains
outstanding, in the capacity of executor, administrator, testamentary or
inter vivos trustee, guardian, committee or conservator, or in any other
similar capacity, an aggregate of 25% or more of the voting securities, or
of any class of
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security, of any person, the beneficial ownership of a specified percentage
of which would have constituted a conflicting interest under paragraph (6),
(7) or (8) of this subsection. As to any such securities of which the
Trustee acquired ownership through becoming executor, administrator or
testamentary trustee of an estate which included them, the provisions of
the preceding sentence shall not apply, for a period of not more than two
years from the date of such acquisition, to the extent that such securities
included in such estate do not exceed 25% of such voting securities or 25%
of any such class of security. Promptly after the dates of any such Event
of Default and annually in each succeeding year that such Event of Default
continues, the Trustee shall make a check of its holdings of such
securities in any of the above-mentioned capacities as of such dates. If
the Company fails to make payment in full of the principal of (or premium,
if any) or interest on any of the Debt Securities when and as the same
becomes due and payable, and such failure continues for 30 days thereafter,
the Trustee shall make a prompt check of its holdings of such securities in
any of the above-mentioned capacities as of the date of the expiration of
such 30-day period, and after such date, notwithstanding the foregoing
provisions of this paragraph, all such securities so held by the Trustee,
with sole or joint control over such securities vested in it, shall be
considered as though beneficially owned by the Trustee for the purposes of
paragraphs (6), (7) and (8) of this subsection; or
(10) except under the circumstances described in paragraphs (1), (3),
(4), (5) or (6) of Section 6.13(b) of this Indenture, the Trustee shall be
or shall become a creditor of the Company.
For the purposes of paragraph (1) of this subsection, the term "series
of securities" or "series" means a series, class or group of securities issuable
under an indenture pursuant to whose terms holders of one such series may vote
to direct the Trustee, or otherwise take action pursuant to a vote of such
holders, separately from holders of another series; provided, that "series of
--------
securities" or "series" shall not include any series of securities issuable
under an indenture if all such series rank equally and are wholly unsecured.
The specification of percentages in paragraphs (5) to (9), inclusive,
of this subsection shall not be construed as indicating that the ownership of
such percentages of the securities of a person is or is not necessary or
sufficient to constitute direct or indirect control for the purposes of
paragraph (3) or (7) of this subsection.
For the purposes of paragraphs (6), (7), (8) and (9) of this
subsection only, (i) the terms "security" and "securities" shall include only
such securities as are generally known as corporate securities, but shall not
include any note or other evidence of indebtedness issued to evidence an
obligation to repay moneys lent to a person by one or more banks, trust
companies or banking firms, or any certificate of interest or participation in
any such note or evidence of indebtedness; (ii) an obligation shall be deemed to
be "in default" when a default in payment of principal shall have continued for
30 days or more and shall not have been cured; and (iii) the Trustee shall not
be deemed to be the owner or holder of (A) any security which it holds as
collateral security, as trustee or otherwise, for an obligation which is not in
default as defined in clause (ii) above, or (B) any security which it holds as
collateral security under this Indenture, irrespective of any default hereunder,
or (C) any security which it holds as agent for collection, or as custodian,
escrow agent or depositary, or in any similar representative capacity.
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(d) For the purposes of this Section:
(1) The term "underwriter" when used with reference to the Company
means every person who, within one year prior to the time as of which the
determination is made, has purchased from the Company with a view to, or
has offered or sold for the Company in connection with, the distribution of
any security of the Company outstanding at such time, or has participated
or has had a direct or indirect participation in any such undertaking, or
has participated or has had a participation in the direct or indirect
underwriting of any such undertaking, but such term shall not include a
person whose interest was limited to a commission from an underwriter or
dealer not in excess of the usual and customary distributors' or sellers'
commission.
(2) The term "director" means any director of a corporation, or any
individual performing similar functions with respect to any organization
whether incorporated or unincorporated.
(3) The term "person" means an individual, a corporation, a
partnership, an association, a joint stock company, a trust, an estate, an
unincorporated organization, or a government or political subdivision
thereof. As used in this paragraph, the term "trust" shall include only a
trust where the interest or interests of the beneficiary or beneficiaries
are evidenced by a security.
(4) The term "voting security" means any security presently entitling
the owner or holder thereof to vote in the direction or management of the
affairs of a person, or any security issued under or pursuant to any trust,
agreement or arrangements whereby a trustee or trustees or agent or agents
for the owner or holder of such security are presently entitled to vote in
the direction or management of the affairs of a person.
(5) The term "Company" means any obligor upon the Debt Securities of
any series.
(6) The term "executive officer" means the president, every vice
president, every trust officer, the cashier, the secretary, and the
treasurer of a corporation, and any individual customarily performing
similar functions with respect to any organization, whether incorporated or
unincorporated, but shall not include the chairman of the board of
directors.
(e) The percentages of voting securities and other securities
specified in this Section shall be calculated in accordance with the following
provisions:
(1) A specified percentage of the voting securities of the Trustee,
the Company or any other person referred to in this Section (each of whom
is referred to as a "person" in this paragraph) means such amount of the
outstanding voting securities of such person as entitles the holder or
holders thereof to cast such specified percentage of the aggregate votes
which the holders of all the outstanding voting securities of such person
are entitled to cast in the direction or management of the affairs of such
person.
(2) A specified percentage of a class of securities of a person means
such percentage of the aggregate amount of securities of the class
outstanding.
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(3) The term "amount", when used with regard to securities means the
principal amount if relating to evidences of indebtedness, the number of
shares if relating to capital shares, and the number of units if relating
to any other kind of security.
(4) The term "outstanding" means issued and not held by or for the
account of the issuer. The following securities shall not be deemed
outstanding within the meaning of this definition:
(i) securities of an issuer held in a sinking fund relating to
securities of the issuer of the same class;
(ii) securities of an issuer held in a sinking fund relating to
another class of securities of the issuer, if the obligation evidenced
by such other class of securities is not in default as to principal or
interest or otherwise;
(iii) securities pledged by the issuer thereof as security
for an obligation of the issuer not in default as to principal or
interest or otherwise; and
(iv) securities held in escrow if placed in escrow by the issuer
thereof;
provided, however, that any voting securities of an issuer shall be deemed
-------- -------
outstanding if any person other than the issuer is entitled to exercise the
voting rights thereof.
(5) A security shall be deemed to be of the same class as another
security if both securities confer upon the holder or holders thereof
substantially the same rights and privileges; provided, however, that, in
-------- -------
the case of secured evidences of indebtedness, all of which are issued
under a single indenture, differences in the interest rates or maturity
dates of various series thereof shall not be deemed sufficient to
constitute such series different classes; and provided, further, that, in
-------- -------
the case of unsecured evidences of indebtedness, differences in the
interest rates or maturity dates thereof shall not be deemed sufficient to
constitute them securities of different classes, whether or not they are
issued under a single indenture.
(f) Except in the case of a default in the payment of the principal
of or interest on any Debt Security of any series, or in the payment of any
sinking or purchase fund installment, the Trustee shall not be required to
resign as provided by this Section if the Trustee shall have sustained the
burden of proving, on application to the Commission and after opportunity for
hearing thereon, that:
(1) the Event of Default may be cured or waived during a reasonable
period and under the procedures described in such application; and
(2) a stay of the Trustee's duty to resign will not be inconsistent
with the interests of Holders of the Debt Securities.
The filing of such an application shall automatically stay the performance of
the duty to resign until the Commission orders otherwise.
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Section 6.09. Corporate Trustee Required; Eligibility.
---------------------------------------
There shall at all times be a Trustee hereunder which shall be a
corporation organized and doing business under the laws of the United States of
America, any State thereof or the District of Columbia, authorized under such
laws to exercise corporate trust powers, having a combined capital and surplus
of at least $75,000,000, subject to supervision or examination by Federal, State
or District of Columbia authority. If such corporation publishes reports of
condition at least annually, pursuant to law or to the requirements of the
aforesaid supervising or examining authority, then for the purposes of this
Section, the combined capital and surplus of such corporation shall be deemed to
be its combined capital and surplus as set forth in its most recent report of
condition so published. Neither the Company nor any person directly or
indirectly controlling, controlled by, or under common control with the Company
shall serve as Trustee upon any Debt Securities.
Section 6.10. Resignation and Removal; Appointment of Successor.
-------------------------------------------------
(a) No resignation or removal of the Trustee and no appointment of a
successor Trustee pursuant to this Article shall become effective until the
acceptance of appointment by the successor Trustee under Section 6.11.
(b) The Trustee may resign at any time with respect to the Debt
Securities of one or more series by giving written notice thereof to the
Company. If an instrument of acceptance by a successor Trustee shall not have
been delivered to the Trustee within 30 days after the giving of such notice of
resignation, the resigning Trustee may petition any court of competent
jurisdiction for the appointment of a successor Trustee with respect to the Debt
Securities of such series.
(c) The Trustee may be removed at any time with respect to the Debt
Securities of any series and a successor Trustee appointed by Act of the Holders
of a majority in principal amount of the Outstanding Debt Securities of such
series, delivered to the Trustee and to the Company.
(d) If at any time:
(1) the Trustee shall fail to comply with Section 6.08(a) with
respect to the Debt Securities of any series after written request therefor
by the Company or by any Holder who has been a bona fide Holder of a Debt
Security of such series for at least six months, or
(2) the Trustee shall cease to be eligible under Section 6.09 with
respect to the Debt Securities of any series and shall fail to resign after
written request therefor by the Company or by any such Holder, or
(3) the Trustee shall become incapable of acting or shall be adjudged
a bankrupt or insolvent or a receiver of the Trustee or of its property
shall be appointed or any public officer shall take charge or control of
the Trustee or of its property or affairs for the purpose of
rehabilitation, conservation or liquidation,
then, in any such case, (i) the Company by a Board Resolution may remove the
Trustee with respect to all Debt Securities, or (ii) subject to Section 5.14,
any Holder who has been a bona fide Holder of a Debt Security of any series for
at least six months may, on behalf of himself and all others similarly situated,
petition any court of competent jurisdiction for the removal of the Trustee and
the appointment of a successor Trustee for the Debt Securities of such series.
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(e) If the Trustee shall resign, be removed or become incapable of
acting, or if a vacancy shall occur in the office of Trustee for any cause, with
respect to the Debt Securities of one or more series, the Company, by a Board
Resolution, shall promptly appoint a successor Trustee or Trustees with respect
to the Debt Securities of that or those series (it being understood that any
such successor Trustee may be appointed with respect to the Debt Securities of
one or more or all of such series and that at any time there shall be only one
Trustee with respect to the Debt Securities of any particular series) and shall
comply with the applicable requirements of Section 6.11. If, within one year
after such resignation, removal or incapability, or the occurrence of such
vacancy, a successor Trustee with respect to the Debt Securities of any series
shall be appointed by Act of the Holders of a majority in principal amount of
the Outstanding Debt Securities of such series delivered to the Company and the
retiring Trustee, the successor Trustee so appointed shall, forthwith upon its
acceptance of such appointment, become the successor Trustee with respect to the
Debt Securities of such series and to that extent supersede the successor
Trustee appointed by the Company. If no successor Trustee with respect to the
Debt Securities of any series shall have been so appointed by the Company or the
Holders of such series and accepted appointment in the manner hereinafter
provided, any Holder who has been a bona fide Holder of a Debt Security of such
series for at least six months may, subject to Section 5.14, on behalf of
himself and all others similarly situated, petition any court of competent
jurisdiction for the appointment of a successor Trustee with respect to the Debt
Securities of such series.
(f) The Company shall give notice of each resignation and each
removal of the Trustee with respect to the Debt Securities of any series and
each appointment of a successor Trustee with respect to the Debt Securities of
any series in the manner and to the extent provided in Section 1.05 to the
Holders of Debt Securities of such series. Each notice shall include the name
of the successor Trustee with respect to the Debt Securities of such series and
the address of its Corporate Trust Office.
Section 6.11. Acceptance of Appointment by Successor.
--------------------------------------
(a) In the case of an appointment hereunder of a successor Trustee
with respect to all Debt Securities, each such successor Trustee so appointed
shall execute, acknowledge and deliver to the Company and to the retiring
Trustee an instrument accepting such appointment, and thereupon the resignation
or removal of the retiring Trustee shall become effective and such successor
Trustee, without any further act, deed or conveyance, shall become vested with
all the rights, powers, trusts and duties of the retiring Trustee, but, on
request of the Company or the successor Trustee, such retiring Trustee shall,
upon payment of its charges, execute and deliver an instrument transferring to
such successor Trustee all the rights, powers and trusts of the retiring
Trustee, and shall duly assign, transfer and deliver to such successor Trustee
all property and money held by such retiring Trustee hereunder, subject
nevertheless to its claim, if any, provided for in Section 6.07.
(b) In case of the appointment hereunder of a successor Trustee with
respect to the Debt Securities of one or more (but not all) series, the Company,
the retiring Trustee and each successor Trustee with respect to the Debt
Securities of one or more series shall execute and deliver an indenture
supplemental hereto wherein each successor Trustee shall accept such appointment
and which (1) shall contain such provisions as shall be necessary or desirable
to transfer and confirm to, and to vest in, each successor Trustee all the
rights, powers, trusts and duties of the retiring Trustee with respect to the
Debt Securities of that or those series to which the appointment of such
successor Trustee relates, (2) if the retiring Trustee is not retiring with
respect to all Debt Securities, shall contain such provisions as shall be deemed
necessary or desirable to confirm that all the rights, powers, trusts and duties
of the retiring Trustee with respect to the Debt Securities of that or those
series as to which the retiring Trustee is not retiring shall continue to be
vested in the retiring Trustee, and (3) shall add to or change any of the
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provisions of this Indenture as shall be necessary to provide for or facilitate
the administration of the trusts hereunder by more than one Trustee, it being
understood that nothing herein or in any such supplemental indenture shall
constitute such Trustees co-trustees of the same trust and that each such
Trustee shall be trustee of a trust or trusts hereunder separate and apart from
any other trust or trusts hereunder administered by any other such Trustee; and
upon the execution and delivery of any such supplemental indenture the
resignation or removal of the retiring Trustee shall become effective to the
extent provided therein and each such successor Trustee, without any further
act, deed or conveyance, shall become vested with all the rights, powers, trusts
and duties of the retiring Trustee with respect to the Debt Securities of that
or those series to which the appointment of such successor Trustee relates, but,
on request of the Company or any successor Trustee, such retiring Trustee shall
duly assign, transfer and deliver to such successor Trustee all property and
money held by such retiring Trustee hereunder with respect to the Debt
Securities of that or those series to which the appointment of such successor
Trustee relates.
(c) Upon request of any such successor Trustee, the Company shall
execute any and all instruments for more fully and certainly vesting in and
confirming to such successor Trustee all such rights, powers and trusts referred
to in paragraph (a) or (b) of this Section, as the case may be.
(d) No successor Trustee shall accept its appointment unless at the
time of such acceptance such successor Trustee shall be qualified and eligible
under this Article.
Section 6.12. Merger, Conversion, Consolidation or Succession to
--------------------------------------------------
Business.
--------
Any corporation into which the Trustee may be merged or converted or
with which it may be consolidated, or any corporation resulting from any merger,
conversion or consolidation to which the Trustee shall be a party, or any
corporation succeeding to all or substantially all of the corporate trust
business of the Trustee, shall be the successor of the Trustee hereunder,
provided that such corporation shall be otherwise qualified and eligible under
this Article, without the execution or filing of any paper or any further act on
the part of any of the parties hereto. In case any Debt Securities shall have
been authenticated, but not delivered, by the Trustee then in office, any
successor by merger, conversion or consolidation to such authenticating Trustee
may adopt such authentication and deliver the Debt Securities so authenticated
with the same effect as if such successor Trustee had itself authenticated such
Debt Securities. In case any Debt Securities shall not have been authenticated
by such predecessor Trustee, any such successor Trustee may authenticate and
deliver such Debt Securities, in either its own name or that of its predecessor
Trustee, with the full force and effect which this Indenture provides for the
certificate of authentication of the Trustee.
Section 6.13. Preferential Collection of Claims Against Company.
-------------------------------------------------
(a) Subject to subsection (b) of this Section, if the Trustee shall
be or shall become a creditor, directly or indirectly, secured or unsecured, of
the Company within three months prior to a default, as defined in subsection (c)
of this Section, or subsequent to such default, then, unless and until such
default shall be cured, the Trustee shall set apart and hold in a special
account for the benefit of the Trustee individually, the Holders of the Debt
Securities and of the Coupons, if any, and the holders of other indenture
securities (as defined in subsection (c) of this Section):
(1) an amount equal to any and all reductions in the amount due and
owing upon any claim as such creditor in respect of principal or interest,
effected after the beginning of such three-month period and valid as
against the Company and its other creditors, except any such
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reduction resulting from the receipt or disposition of any property
described in paragraph (2) of this subsection, or from the exercise of any
right of set-off which the Trustee could have exercised if a voluntary or
involuntary case had been commenced in respect of the Company under the
Federal bankruptcy laws, as now or hereafter constituted, or any other
applicable Federal or State bankruptcy, insolvency or other similar law
upon the date of such default; and
(2) all property received by the Trustee in respect of any claim as
such creditor, either as security therefor, or in satisfaction or
composition thereof, or otherwise, after the beginning of such three-month
period, or an amount equal to the proceeds of any such property, if
disposed of, subject, however, to the rights, if any, of the Company and
------- -------
its other creditors in such property or such proceeds.
Nothing herein contained, however, shall affect the right of the Trustee:
(A) to retain for its own account (i) payments made on account of any
such claim by any Person (other than the Company) who is liable thereon,
and (ii) the proceeds of the bona fide sale of any such claim by the
Trustee to a third Person, and (iii) distributions made in cash, securities
or other property in respect of claims filed against the Company in
bankruptcy or receivership or in proceedings or reorganization pursuant to
the Federal bankruptcy laws, as now or hereafter constituted, or any other
applicable Federal or State bankruptcy, insolvency or other similar law;
(B) to realize, for its own account, upon any property held by it as
security for any such claim, if such property was so held prior to the
beginning of such three-month period;
(C) to realize, for its own account, but only to the extent of the
claim hereinafter mentioned, upon any property held by it as security for
any such claim, if such claim was created after the beginning of such
three-month period and such property was received as security therefor
simultaneously with the creation thereof, and if the Trustee shall sustain
the burden of proving that at the time such property was so received the
Trustee had no reasonable cause to believe that a default, as defined in
subsection (c) of this Section, would occur within three months, or
(D) to receive payment on any claim referred to in paragraph (B) or
(C) against the release of any property held as security for such claim as
provided in paragraph (B) or (C), as the case may be, to the extent of the
fair value of such property.
For the purposes of paragraphs (B), (C) and (D), property substituted
after the beginning of such three-month period for property held as security at
the time of such substitution shall, to the extent of the fair value of the
property released, have the same status as the property released, and, to the
extent that any claim referred to in any of such paragraphs is created in
renewal of or in substitution for or for the purpose of repaying or refunding
any pre-existing claim of the Trustee as such creditor, such claim shall have
the same status as such pre-existing claim.
If the Trustee shall be required to account, the funds and property
held in such special account and the proceeds thereof shall be apportioned among
the Trustee, the Holders and the holders of other indenture securities in such
manner that the Trustee, the Holders and the holders of other indenture
securities realize, as a result of payments from such special account and
payments of dividends on claims filed against the Company in bankruptcy or
receivership or in proceedings for reorganization pursuant to the Federal bank-
ruptcy laws, as now or hereafter constituted or any other applicable Federal
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or State bankruptcy, insolvency or other similar law, the same percentage of
their respective claims, figured before crediting to the claim of the Trustee
anything on account of the receipt by it from the Company of the funds and
property in such special account and before crediting to the respective claims
of the Trustee and the Holders and the holders of other indenture securities
dividends on claims filed against the Company in bankruptcy or receivership or
in proceedings for reorganization pursuant to the Federal bankruptcy laws, as
now or hereafter constituted, or any other applicable Federal or State
bankruptcy, insolvency or other similar law, but after crediting thereon
receipts on account of the indebtedness represented by their respective claims
from all sources other than from such dividends and from the funds and property
so held in such special account. As used in this paragraph, with respect to any
claim, the term "dividends" shall include any distribution with respect to such
claim, in bankruptcy or receivership or proceedings for reorganization pursuant
to the Federal bankruptcy laws, as now or hereafter constituted, or any other
applicable Federal or State bankruptcy, insolvency or other similar law, whether
such distribution is made in cash, securities, or other property, but shall not
include any such distribution with respect to the secured portion, if any, of
such claim. The court in which such bankruptcy, receivership or proceedings for
reorganization is pending shall have jurisdiction (i) to apportion among the
Trustee and the Holders and the holders of other indenture securities, in
accordance with the provisions of this paragraph, the funds and property held in
such special account and proceeds thereof, or (ii) in lieu of such
apportionment, in whole or in part, to give to the provisions of this paragraph
due consideration in determining the fairness of the distributions to be made to
the Trustee and the Holders and the holders of other indenture securities with
respect to their respective claims, in which event it shall not be necessary to
liquidate or to appraise the value of any securities or other property held in
such special account or as security for any such claim, or to make a specific
allocation of such distributions as between the secured and unsecured portions
of such claim, or otherwise to apply the provisions of this paragraph as a
mathematical formula.
Any Trustee which has resigned or been removed after the beginning of
such three-month period shall be subject to the provisions of this subsection as
though such resignation or removal had not occurred. If any Trustee has
resigned or been removed prior to the beginning of such three-month period, it
shall be subject to the provisions of this subsection if and only if the
following conditions exist:
(i) the receipt of property or reduction of claim, which would have
given rise to the obligation to account, if such Trustee had continued as
Trustee, occurred after the beginning of such three-month period; and
(ii) such receipt of property or reduction of claim occurred within
three months after such resignation or removal.
(b) There shall be excluded from the operation of subsection (a) of
this Section a creditor relationship arising from:
(1) the ownership or acquisition of securities issued under any
indenture, or any security or securities having a maturity of one year or
more at the time of acquisition by the Trustee;
(2) advances authorized by a receivership or bankruptcy court of
competent jurisdiction or by this Indenture, for the purpose of preserving
any property which shall at any time be subject to the Lien of this
Indenture or of discharging tax liens or other prior liens or encumbrances
thereon, if notice of such advances and of the circumstances surrounding
the making thereof is given to the Holders at the time and in the manner
provided in this Indenture;
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(3) disbursements made in the ordinary course of business in the
capacity of trustee under an indenture, transfer agent, registrar,
custodian, paying agent, fiscal agent or depositary, or other similar
capacity;
(4) an indebtedness created as a result of services rendered or
premises rented, or an indebtedness created as a result of goods or
securities sold in a cash transaction as defined in subsection (c) of this
Section;
(5) the ownership of stock or of other securities of a corporation
organized under the provisions of Section 25(a) of the Federal Reserve Act,
as amended, which is directly or indirectly a creditor of the Company; and
(6) The acquisition, ownership, acceptance or negotiation of any
drafts, bills of exchange, acceptances or obligations which fall within the
classification of self-liquidating paper as defined in subsection (c) of
this Section.
(c) for the purposes of this Section only:
(1) The term "default" means any failure to make payment in full of
the principal of or interest on any of the Debt Securities or upon the
other indenture securities when and as such principal or interest becomes
due and payable.
(2) The term "other indenture securities" means securities upon which
the Company is an obligor outstanding under any other indenture (i) under
which the Trustee is also trustee, (ii) which contains provisions
substantially similar to the provisions of this Section, and (iii) under
which a default exists at the time of the apportionment of the funds and
property held in such special account.
(3) The term "cash transaction" means any transaction in which full
payment for goods or securities sold is made within seven days after
delivery of the goods or securities in currency or in checks or other
orders drawn upon banks and payable upon demand.
(4) The term "self-liquidating paper" means any draft, bill of
exchange, acceptance or obligation which is made, drawn, negotiated or
incurred by the Company for the purpose of financing the purchase,
processing, manufacturing, shipment, storage or sale of goods, wares or
merchandise and which is secured by documents evidencing title to,
possession of, or a lien upon, the goods, wares or merchandise or the
receivables or proceeds arising from the sale of the goods, wares or
merchandise previously constituting the security, provided the security is
received by the Trustee simultaneously with the creation of the creditor
relationship with the Company arising from the making, drawing, negotiating
or incurring of the draft, bill of exchange, acceptance or obligation.
(5) The term "Company" means any obligor upon the Debt Securities.
Section 6.14. Appointment of Authenticating Agent.
-----------------------------------
As long as any Debt Securities of a series remain Outstanding, upon a
Company Request, there shall be an authenticating agent (the "Authenticating
Agent") appointed, for such period as the Company shall elect, by the Trustee
for such series of Debt Securities to act as its agent on its behalf and
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subject to its direction in connection with the authentication and delivery of
each series of Debt Securities for which it is serving as Trustee. Debt
Securities of each such series authenticated by such Authenticating Agent shall
be entitled to the benefits of this Indenture and shall be valid and obligatory
for all purposes as if authenticated by such Trustee. Wherever reference is
made in this Indenture to the authentication and delivery of Debt Securities of
any series by the Trustee for such series or to the Trustee's Certificate of
Authentication, such reference shall be deemed to include authentication and
delivery on behalf of the Trustee for such series by an Authenticating Agent for
such series and a Certificate of Authentication executed on behalf of such
Trustee by such Authenticating Agent. Such Authenticating Agent shall at all
times be a corporation organized and doing business under the laws of the United
States of America or of any State, authorized under such laws to exercise
corporate trust powers, having a combined capital and surplus of at least
$10,000,000 and subject to supervision or examination by Federal or State
authority. If such Authenticating Agent publishes reports of condition at least
annually, pursuant to law or to the requirements of said supervising or
examining authority, then for purposes of this Section, the combined capital and
surplus of such Authenticating Agent shall be deemed to be its combined capital
and surplus as set forth in its most recent report of condition so published.
If at any time an Authenticating Agent shall cease to be eligible in accordance
with the provisions of this Section, such Authenticating Agent shall resign
immediately in the manner and with the effect specified in this Section.
Any corporation into which any Authenticating Agent may be merged or
converted, or with which it may be consolidated, or any corporation resulting
from any merger, conversion or consolidation to which any Authenticating Agent
shall be a party, or any corporation succeeding to the corporate agency business
of any Authenticating Agent, shall continue to be the Authenticating Agent with
respect to all series of Debt Securities for which it served as Authenticating
Agent without the execution or filing of any paper or any further act on the
part of the Trustee for such series or such Authenticating Agent. Any
Authenticating Agent may at any time, and if it shall cease to be eligible
shall, resign by giving written notice of resignation to the applicable Trustee
and to the Company.
Upon receiving such a notice of resignation or upon such a
termination, or in case at any time any Authenticating Agent shall cease to be
eligible in accordance with the provisions of this Section 6.14 with respect to
one or more or all series of Debt Securities, the Trustee for such series shall
upon Company Request appoint a successor Authenticating Agent, and the Company
shall provide notice of such appointment to all Holders of Debt Securities of
such series in the manner and to the extent provided in Section 1.05. Any
successor Authenticating Agent upon acceptance of its appointment hereunder
shall become vested with all rights, powers, duties and responsibilities of its
predecessor hereunder, with like effect as if originally named as Authenticating
Agent herein. The Company agrees to pay to the Authenticating Agent for such
series from time to time reasonable compensation for its services. The
Authenticating Agent for the Debt Securities of any series shall have no
responsibility or liability for any action taken by it as such at the direction
of the Trustee for such series.
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If an appointment with respect to one or more series is made pursuant
to this Section, the Debt Securities of such series may have endorsed thereon,
in addition to the Trustee's certificate of authentication, an alternative
certificate of authentication in the following form:
This is one of the series of Debt Securities issued under the within
mentioned Indenture.
--------------------------------
--------------------------------
As Trustee
By:________________________
As Authenticating Agent
By:________________________
Authorized Signatory
ARTICLE SEVEN
HOLDERS' LISTS AND REPORTS BY TRUSTEE AND COMPANY
Section 7.01. Company to Furnish Trustee Names and Addresses of
-------------------------------------------------
Holders.
-------
The Company will furnish or cause to be furnished to the Trustee with
respect to Registered Securities of each series for which it acts as Trustee:
(a) semi-annually on a date not more than 15 days after each Regular
Record Date with respect to an Interest Payment Date, if any, for the Registered
Securities of such series (or on semi-annual dates in each year to be determined
pursuant to Section 3.01 if the Registered Securities of such series do not bear
interest), a list, in such form as the Trustee may reasonably require, of the
names and addresses of the Registered Holders as of the date 15 days next
preceding each such Regular Record Date (or such semi-annual dates, as the case
may be); and
(b) at such other times as the Trustee may request in writing, within
30 days after the receipt by the Company of any such request, a list of similar
form and content as of a date not more than 15 days prior to the time such list
is furnished;
provided, however, that if and so long as the Trustee shall be the Security
-------- -------
Registrar for such series, no such list need be furnished.
The Company shall also be required to furnish to the Trustee at all
such times set forth above all information in the possession or control of the
Company or any of its Paying Agents other than the Trustee as to the names and
addresses of the Holders of Bearer Securities of all series; provided, however,
-------- -------
that the Company shall have no obligation to investigate any matter relating to
any Holders of Bearer Securities of any series.
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Section 7.02. Preservation of Information; Communication to Holders.
-----------------------------------------------------
(a) The Trustee shall preserve, in as current a form as is reasonably
practicable, all information as to the names and addresses of Holders contained
in the most recent list furnished to the Trustee as provided in Section 7.01
received by it in the capacity of Paying Agent (if so acting) hereunder, and
filed with it within the two preceding years pursuant to Section 7.03(c)(2).
The Trustee may destroy any list furnished to it as provided in
Section 7.01 upon receipt of a new list so furnished, destroy any information
received by it as Paying Agent (if so acting) hereunder upon delivering to
itself as Trustee, not earlier than 45 days after an Interest Payment Date, a
list containing the names and addresses of the Holders obtained from such
information since the delivery of the next previous list, if any, destroy any
list delivered to itself as Trustee which was compiled from information received
by it as Paying Agent (if so acting) hereunder upon the receipt of a new list so
delivered, and destroy not earlier than two years after filing, any information
filed with it pursuant to Section 7.03(c)(2).
(b) If three or more Holders (hereinafter referred to as
"applicants") apply in writing to the Trustee, and furnish to the Trustee
reasonable proof that each such applicant has owned a Debt Security for a period
of at least six months preceding the date of such application, and such
application states that the applicants desire to communicate with other Holders
of Debt Securities of a particular series (in which case the applicants must
hold Debt Securities of such series) or with all Holders of Debt Securities with
respect to their rights under this Indenture or under the Debt Securities and is
accompanied by a copy of the form of proxy or other communication which such
applicants propose to transmit, then the Trustee shall, within five Business
Days after the receipt of such application, at its election, either
(i) afford such applicants access to the information preserved at the
time by the Trustee in accordance with Section 7.02(a), or
(ii) inform such applicants as to the approximate number of Holders of
Debt Securities of such series or of all Debt Securities, as the case may
be, whose names and addresses appear in the information preserved at the
time by the Trustee in accordance with Section 7.02(a), and as to the
approximate cost of mailing to such Holders the form of proxy or other
communication, specified in such application.
If the Trustee shall elect not to afford such applicants access to
such information, the Trustee shall, upon written request of such applicants,
mail to the Holders of Debt Securities of such series or all Holders, as the
case may be, whose names and addresses appear in the information preserved at
the time by the Trustee in accordance with Section 7.02(a), a copy of the form
of proxy or other communication which is specified in such request, with
reasonable promptness after a tender to the Trustee of the material to be mailed
and of payment, or provision for the payment, of the reasonable expenses of
mailing, unless within five days after such tender, the Trustee shall mail to
such applicants and file with the Commission, together with a copy of the
material to be mailed, a written statement to the effect that, in the opinion of
the Trustee, such mailing would be contrary to the best interests of the Holders
of Debt Securities of such series or all Holders, as the case may be, or would
be in violation of applicable law. Such written statement shall specify the
basis of such opinion. If the Commission, after opportunity for a hearing upon
the objections specified in the written statement so filed, shall enter an order
refusing to sustain any of such objections or if after the entry of an order
sustaining one or more of such objections, the Commission shall find, after
notice and opportunity for hearing, that all the
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objections so sustained have been met and shall enter an order so declaring, the
Trustee shall mail copies of such material to all such Holders with reasonable
promptness after the entry of such order and the renewal of such tender;
otherwise the Trustee shall be relieved of any obligation or duty to such
applicants respecting their application.
(c) Every Holder of Debt Securities, by receiving and holding the
same, agrees with the Company and the Trustee that neither the Company nor the
Trustee shall be held accountable by reason of the disclosure of any such
information as to the names and addresses of the Holders in accordance with
Section 7.02(b), regardless of the source from which such information was
derived, and that the Trustee shall not be held accountable by reason of mailing
of any material pursuant to a request made under Section 7.02(b).
Section 7.03. Reports by Trustee.
------------------
(a) Within 60 days after January 15 of each year, commencing January
15, 1996, the Trustee shall, to the extent required by the Trust Indenture Act,
transmit to all Holders of Debt Securities of any series with respect to which
it acts as Trustee, in the manner hereinafter provided in this Section 7.03, a
brief report dated such date with respect to any of the following events which
may have occurred within the previous 12 months (but if no such event has
occurred within such period no report need be transmitted):
(1) any change to its eligibility under Section 6.09 and its
qualifications under Section 6.08;
(2) the creation of or any material change to a relationship
specified in paragraph (1) through (10) of Section 6.08(c) of this
Indenture;
(3) the character and amount of any advances (and if the Trustee
elects so to state, the circumstances surrounding the making thereof) made
by the Trustee (as such) which remain unpaid on the date of such report,
and for the reimbursement of which it claims or may claim a lien or charge,
prior to that of the Debt Securities of such series, on any property or
funds held or collected by it as Trustee, except that the Trustee shall not
be required (but may elect) to report such advances if such advances so
remaining unpaid aggregate not more than 1/2 of 1% of the principal amount
of the Outstanding Debt Securities of such series on the date of such
report;
(4) any change to the amount, interest rate and maturity date of all
other indebtedness owing by the Company (or any other obligor on the Debt
Securities of such series) to the Trustee in its individual capacity, on
the date of such report, with a brief description of any property held as
collateral security therefor, except an indebtedness based upon a creditor
relationship arising in any manner described in Section 6.13(b)(2), (3),
(4) or (6);
(5) any change to the property and funds, if any, physically in the
possession of the Trustee as such on the date of such report;
(6) any additional issue of Debt Securities which the Trustee has not
previously reported; and
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(7) any action taken by the Trustee in the performance of its duties
hereunder which it has not previously reported and which in its opinion
materially affects the Debt Securities of such series, except action in
respect of a default, notice of which has been or is to be withheld by the
Trustee in accordance with Section 6.02.
(b) The Trustee shall transmit by mail to all Holders of Debt
Securities of any series (whose names and addresses appear in the information
preserved at the time by the Trustee in accordance with Section 7.02 (a)) for
which it acts as the Trustee, as hereinafter provided, a brief report with
respect to the character and amount of any advances (and if the Trustee elects
so to state, the circumstances surrounding the making thereof) made by the
Trustee (as such) since the date of the last report transmitted pursuant to
subsection (a) of this Section (or if no such report has yet been so
transmitted, since the date of execution of this instrument) for the
reimbursement of which it claims or may claim a lien or charge, prior to that of
the Debt Securities of such series, on property or funds held or collected by it
as Trustee, and which it has not previously reported pursuant to this
subsection, except that the Trustee for each series shall not be required (but
may elect) to report such advances if such advances remaining unpaid at any time
aggregate 10% or less of the principal amount of the Debt Securities of such
series Outstanding at such time, such report to be transmitted within 90 days
after such time.
(c) Reports pursuant to this Section 7.03 shall be transmitted by
mail:
(1) to all Holders of Registered Securities, as the names and
addresses of such Holders of Registered Securities appear in the Security
Register;
(2) to such Holders of Bearer Securities of any series as have,
within two years preceding such transmission, filed their names and
addresses with the Trustee for such series for that purpose; and
(3) except in the cases of reports pursuant to subsection (b) of this
Section 7.03, to each Holder of a Debt Security of any series whose name
and address appear in the information preserved at the time by the Trustee
in accordance with Section 7.02(a).
(d) A copy of each such report shall, at the time of such
transmission to Holders, be filed by the Trustee with each stock exchange upon
which any Debt Securities of such series are listed, with the Commission and
also with the Company. The Company will notify the Trustee when any series of
Debt Securities are listed on any stock exchange.
Section 7.04. Reports by Company.
------------------
Unless otherwise specified with respect to a particular series of Debt
Securities pursuant to Section 3.01, the Company will:
(1) file with the Trustee, within 15 days after the Company is
required to file the same with the Commission, copies of the annual reports
and of the information, documents and other reports (or copies of such
portions of any of the foregoing as the Commission may from time to time by
rules and regulations prescribe) which the Company may be required to file
with the Commission pursuant to Section 13 or Section 15(d) of the
Securities Exchange Act of 1934, as amended. Notwithstanding that the
Company may not be required to remain subject to the reporting requirements
of Section 13 or 15(d) of the Securities Exchange Act of 1934, as amended,
or otherwise report on an annual and quarterly basis on forms provided for
such annual
65
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and quarterly reporting pursuant to rules and regulations promulgated by
the Commission, the Company shall continue to file with the Commission and
provide the Trustee and the Holders of each series of Debt Securities with,
without cost to each Holder, (a) within 90 days after the end of each
fiscal year, annual reports on Form 10-K (or any successor or comparable
form) containing the information required to be contained therein (or
required in such successor or comparable form); (b) within 45 days after
the end of each of the first three fiscal quarters of each fiscal year,
reports on Form 10-Q (or any successor or comparable form); and (c)
promptly from time to time after the occurrence of an event required to be
therein reported, such other reports on Form 8-K (or any successor or
comparable form) containing the information required to be contained
therein (or required in any successor or comparable form); provided,
---------
however, that the Company shall not be obligated to file such reports with
-------
the Commission if the Commission does not permit such filings. The Company
will in all cases, without cost to each recipient, provide copies of such
information to the Holders of the Debt Securities of each series and, if
they are not permitted to file such reports with the Commission, shall make
available information to prospective purchasers and to securities analysts
and broker-dealers upon their request;
(2) file with the Trustee and the Commission, in accordance with
rules and regulations prescribed from time to time by the Commission, such
additional information, documents and reports with respect to compliance by
the Company with the conditions and covenants of this Indenture as may be
required from time to time by such rules and regulations; and
(3) transmit to all Holders of Debt Securities, in the manner and to
the extent provided in Section 7.03, within 30 days after the filing
thereof with the Trustee, such summaries of any information, documents and
reports required to be filed by the Company pursuant to paragraphs (1) and
(2) of this Section as may be required by rules and regulations prescribed
from time to time by the Commission.
ARTICLE EIGHT
CONCERNING THE HOLDERS
Section 8.01. Acts of Holders.
---------------
Any request, demand, authorization, direction, notice, consent, waiver
or other action provided by this Indenture to be given or taken by Holders may
be embodied in and evidenced by one or more instruments of substantially similar
tenor signed by such Holders in person or by an agent or proxy duly appointed in
writing; and, except as herein otherwise expressly provided, such action shall
become effective when such instrument or instruments are delivered to the
Trustee, and, where it is hereby expressly required, to the Company. Such
instrument or instruments (and the action embodied therein and evidenced
thereby) are herein sometimes referred to as the "Act" of the Holders signing
such instrument or instruments. Whenever in this Indenture it is provided that
the Holders of a specified percentage in aggregate principal amount of the
Outstanding Debt Securities of any series may take any Act, the fact that the
Holders of such specified percentage have joined therein may be evidenced (a) by
the instrument or instruments executed by Holders in person or by agent or proxy
appointed in writing, or (b) by the record of Holders voting in favor thereof at
any meeting of such Holders duly called and
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held in accordance with the provisions of Article Nine, or (c) by a combination
of such instrument or instruments and any such record of such a meeting of
Holders.
Section 8.02. Proof of Ownership; Proof of Execution of Instruments
-----------------------------------------------------
by Holder.
---------
The ownership of Registered Securities of any series shall be proved
by the Security Register for such series or by a certificate of the Security
Registrar for such series.
The ownership of Bearer Securities shall be proved by production of
such Bearer Securities or by a certificate executed by any bank or trust
company, which certificate shall be dated and shall state that on the date
thereof a Bearer Security bearing a specified identifying number or other mark
was deposited with or exhibited to the person executing such certificate by the
person named in such certificate, or by any other proof of possession reasonably
satisfactory to the Trustee. The holding by the person named in any such
certificate of any Bearer Security specified therein shall be presumed to
continue for a period of one year unless at the time of determination of such
holding (1) another certificate bearing a later date issued in respect of the
same Bearer Security shall be produced, (2) such Bearer Security shall be
produced by some other person, (3) such Bearer Security shall have been
registered on the Security Register, if, pursuant to Section 3.01, such Bearer
Security can be so registered, or (4) such Bearer Security shall have been
cancelled or paid.
Subject to the provisions of Sections 6.01, 6.03 and 9.05, proof of
the execution of a writing appointing an agent or proxy and of the execution of
any instrument by a Holder or his agent or proxy shall be sufficient and
conclusive in favor of the Trustee and the Company if made in the following
manner:
The fact and date of the execution by any such person of any
instrument may be proved by the certificate of any notary public or other
officer authorized to take acknowledgements of deeds, that the person executing
such instrument acknowledged to him the execution thereof, or by an affidavit of
a witness to such execution sworn to before any such notary or other such
officer. Where such execution is by an officer of a corporation or association
or a member of a partnership on behalf of such corporation, association or
partnership, as the case may be, or by any other person acting in a
representative capacity, such certificate or affidavit shall also constitute
sufficient proof of his authority.
The record of any Holders' meeting shall be proved in the manner
provided in Section 9.06.
The Trustee may in any instance require further proof with respect to
any of the matters referred to in this Section so long as the request is a
reasonable one.
Section 8.03. Persons Deemed Owners.
---------------------
The Company, the Trustee and any agent of the Company or the Trustee
may treat the Person in whose name any Registered Security is registered as the
owner of such Registered Security for the purpose of receiving payment of the
principal of (and premium, if any) and (subject to Section 3.07) interest, if
any, on such Registered Security and for all other purposes whatsoever, whether
or not such Registered Security be overdue, and neither the Company, the Trustee
nor any agent of the Company or the Trustee shall be affected by notice to the
contrary. The Company, the Trustee, and any agent of the Company or the Trustee
may treat the Holder of any Bearer Security or of any Coupon as the absolute
owner of such Bearer Security or Coupon for the purposes of receiving payment
thereof or on account
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thereof and for all other purposes whatsoever, whether or not such Bearer
Security or Coupon be overdue, and neither the Company, the Trustee nor any
agent of the Company or the Trustee shall be affected by notice to the contrary.
All payments made to any Holder, or upon his order, shall be valid, and, to the
extent of the sum or sums paid, effectual to satisfy and discharge the liability
for moneys payable upon such Debt Security or Coupon.
Section 8.04. Revocation of Consents; Future Holders Bound.
--------------------------------------------
At any time prior to (but not after) the evidencing to the Trustee, as
provided in Section 8.01, of the taking of any Act by the Holders of the
percentage in aggregate principal amount of the Outstanding Debt Securities
specified in this Indenture in connection with such Act, any Holder of a Debt
Security the number, letter or other distinguishing symbol of which is shown by
the evidence to be included in the Debt Securities the Holders of which have
consented to such Act may, by filing written notice with the Trustee at the
Corporate Trust Office and upon proof of ownership as provided in Section 8.02,
revoke such Act so far as it concerns such Debt Security. Except as aforesaid,
any such Act taken by the Holder of any Debt Security shall be conclusive and
binding upon such Holder and, subject to the provisions of Section 5.08, upon
all future Holders of such Debt Security and all past, present and future
Holders of Coupons, if any, appertaining thereto and of any Debt Securities and
Coupons issued on transfer or in lieu thereof or in exchange or substitution
therefor, irrespective of whether or not any notation in regard thereto is made
upon such Debt Security or Coupons or such other Debt Securities or Coupons.
ARTICLE NINE
HOLDERS' MEETINGS
Section 9.01. Purposes of Meetings.
--------------------
A meeting of Holders of any or all series may be called at any time
and from time to time pursuant to the provisions of this Article Nine for any of
the following purposes:
(1) to give any notice to the Company or to the Trustee for such
series, or to give any directions to the Trustee for such series, or to
consent to the waiving of any default hereunder and its consequences, or to
take any other action authorized to be taken by Holders pursuant to any of
the provisions of Article Five;
(2) to remove the Trustee for such series and appoint a successor
Trustee pursuant to the provisions of Article Six;
(3) to consent to the execution of an indenture or indentures
supplemental hereto pursuant to the provisions of Section 11.02; or
(4) to take any other action authorized to be taken by or on behalf
of the Holders of any specified aggregate principal amount of the
Outstanding Debt Securities of any one or more or all series, as the case
may be, under any other provision of this Indenture or under applicable
law.
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Section 9.02. Call of Meetings by Trustee.
---------------------------
The Trustee for any series may at any time call a meeting of Holders
of such series to take any action specified in Section 9.01, to be held at such
time or times and at such place or places as the Trustee for such series shall
determine. Notice of every meeting of the Holders of any series, setting forth
the time and the place of such meeting and in general terms the action proposed
to be taken at such meeting, shall be given to Holders of such series in the
manner and to the extent provided in Section 1.05. Such notice shall be given
not less than 10 days nor more than 90 days prior to the date fixed for the
meeting.
Section 9.03. Call of Meetings by Company or Holders.
--------------------------------------
In case at any time the Company, pursuant to a Board Resolution, or
the Holders of at least 10% in aggregate principal amount of the Outstanding
Debt Securities of a series or of all series, as the case may be, shall have
requested the Trustee for such series to call a meeting of Holders of any or all
such series by written request setting forth in reasonable detail the action
proposed to be taken at the meeting, and the Trustee shall not have given the
notice of such meeting within 10 days after the receipt of such request, then
the Company or such Holders may determine the time or times and the place or
places for such meetings and may call such meetings to take any action
authorized in Section 9.01, by giving notice thereof as provided in Section
9.02.
Section 9.04. Qualifications for Voting.
-------------------------
To be entitled to vote at any meeting of Holders a Person shall be (a)
a Holder of a Debt Security of the series with respect to which such meeting is
being held or (b) a Person appointed by an instrument in writing as agent or
proxy by such Holder. The only Persons who shall be entitled to be present or
to speak at any meeting of Holders shall be the Persons entitled to vote at such
meeting and their counsel and any representatives of the Trustee for the series
with respect to which such meeting is being held and its counsel and any
representatives of the Company and its counsel.
Section 9.05. Regulations.
-----------
Notwithstanding any other provisions of this Indenture, the Trustee
for any series may make such reasonable regulations as it may deem advisable for
any meeting of Holders of such series, in regard to proof of the holding of Debt
Securities of such series and of the appointment of proxies, and in regard to
the appointment and duties of inspectors of votes, the submission and
examination of proxies, certificates and other evidence of the right to vote,
and such other matters concerning the conduct of the meeting as it shall deem
appropriate.
The Trustee shall, by an instrument in writing, appoint a temporary
chairman of the meeting, unless the meeting shall have been called by the
Company or by Holders of such series as provided in Section 9.03, in which case
the Company or the Holders calling the meeting, as the case may be, shall in
like manner appoint a temporary chairman. A permanent chairman and a permanent
secretary of the meeting shall be elected by a majority vote of the meeting.
Subject to the provisos in the definition of "Outstanding," at any
meeting each Holder of a Debt Security of the series with respect to which such
meeting is being held or proxy therefor shall be entitled to one vote for each
$1,000 principal amount (or such other amount as shall be specified as
contemplated by Section 3.01) of Debt Securities of such series held or
represented by him; provided,
--------
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however, that no vote shall be cast or counted at any meeting in respect of any
-------
Debt Security challenged as not Outstanding and ruled by the chairman of the
meeting to be not Outstanding. The chairman of the meeting shall have no right
to vote other than by virtue of Outstanding Debt Securities of such series held
by him or instruments in writing duly designating him as the person to vote on
behalf of Holders of Debt Securities of such series. Any meeting of Holders
with respect to which a meeting was duly called pursuant to the provisions of
Section 9.02 or 9.03 may be adjourned from time to time by a majority of such
Holders present and the meeting may be held as so adjourned without further
notice.
Section 9.06. Voting.
------
The vote upon any resolution submitted to any meeting of Holders with
respect to which such meeting is being held shall be by written ballots on which
shall be subscribed the signatures of such Holders or of their representatives
by proxy and the serial number or numbers of the Debt Securities held or
represented by them. The permanent chairman of the meeting shall appoint two
inspectors of votes who shall count all votes cast at the meeting for or against
any resolution and who shall make and file with the secretary of the meeting
their verified written reports in duplicate of all votes cast at the meeting. A
record in duplicate of the proceedings of each meeting of Holders shall be taken
and there shall be attached to said record the original reports of the
inspectors of votes on any vote by ballot taken thereat and affidavits by one or
more persons having knowledge of the facts setting forth a copy of the notice of
the meeting and showing that said notice was transmitted as provided in Section
9.02. The record shall show the serial numbers of the Debt Securities voting in
favor of or against any resolution. The record shall be signed and verified by
the affidavits of the permanent chairman and secretary of the meeting and one of
the duplicates shall be delivered to the Company and the other to the Trustee to
be preserved by the Trustee.
Any record so signed and verified shall be conclusive evidence of the
matters therein stated.
The record date for determining the identity of the Holders entitled
to vote or consent to any resolution submitted to any meeting of Holders shall
be 30 days prior to the giving of notice pursuant to Section 1.05.
Section 9.07. No Delay of Rights by Meeting.
-----------------------------
Nothing contained in this Article Nine shall be deemed or construed to
authorize or permit, by reason of any call of a meeting of Holders or any rights
expressly or impliedly conferred hereunder to make such call, any hindrance or
delay in the exercise of any right or rights conferred upon or reserved to the
Trustee or to any Holder under any of the provisions of this Indenture or of the
Debt Securities of any series.
ARTICLE TEN
CONSOLIDATION, MERGER, CONVEYANCE, TRANSFER OR LEASE
Section 10.01. Company May Consolidate, etc., Only on Certain Terms.
----------------------------------------------------
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The Company shall not consolidate with or merge with or into or wind
up into (whether or not the Company is the surviving corporation) or sell,
assign, convey, transfer or lease its properties and assets substantially as an
entirety to any Person, unless:
(1) the corporation formed by such consolidation or into which the
Company is merged or the Person which acquires by conveyance or transfer,
or which leases, the properties and assets of the Company substantially as
an entirety (the "successor corporation") shall be a corporation organized
and existing under the laws of the United States or any State or territory
thereof or the District of Columbia and shall expressly assume, by an
indenture supplemental hereto, executed and delivered to the Trustee, in
form satisfactory to the Trustee, the due and punctual payment of the
principal of (and premium, if any) and interest on all the Debt Securities
and Coupons, if any, and the performance of every covenant of this
Indenture on the part of the Company to be performed or observed;
(2) immediately after giving effect to such transaction, no Event of
Default, and no event which, after notice or lapse of time, or both, would
become an Event of Default, shall have happened and be continuing;
(3) the Company has delivered to the Trustee an Officers' Certificate
and an Opinion of Counsel each stating that such consolidation, merger,
conveyance, transfer or lease and such supplemental indenture comply with
this Article and that all conditions precedent herein provided for relating
to such transaction have been complied with; and
(4) such other conditions as may be specified under Section 3.01 with
respect to any series of Debt Securities.
Section 10.02. Successor Corporation Substituted.
---------------------------------
Upon any consolidation with or merger into any other corporation, or
any conveyance, transfer or lease of the properties and assets of the Company
substantially as an entirety in accordance with Section 10.01, the successor
corporation formed by such consolidation or into which the Company is merged or
to which such conveyance, transfer or lease is made shall succeed to, and be
substituted for, and may exercise every right and power of, the Company under
this Indenture with the same effect as if such successor corporation had been
named as the Company herein.
ARTICLE ELEVEN
SUPPLEMENTAL INDENTURES
Section 11.01. Supplemental Indentures Without Consent of Holders.
--------------------------------------------------
Without the consent of any Holders, the Company, when authorized by a
Board Resolution, and the Trustee, at any time and from time to time, may enter
into one or more indentures supplemental hereto, in form satisfactory to the
Trustee, for any of the following purposes:
(1) to evidence the succession of another corporation to the rights
of the Company and the assumption by such successor of the covenants of the
Company contained herein and in the Debt Securities and Coupons, if any; or
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(2) to add to the covenants of the Company, for the benefit of the
Holders of all or any series of Debt Securities and the Coupons, if any,
appertaining thereto (and if such covenants are to be for the benefit of
less than all series, stating that such covenants are expressly being
included solely for the benefit of such series), or to surrender any right
or power herein conferred upon the Company; or
(3) to add any additional Events of Default (and if such Events of
Default are to be applicable to less than all series, stating that such
Events of Default are expressly being included solely to be applicable to
such series); or
(4) to add or change any of the provisions of this Indenture to such
extent as shall be necessary to permit or facilitate the issuance of Debt
Securities of any series in bearer form, registrable or not registrable,
and with or without Coupons, to permit Bearer Securities to be issued in
exchange for Registered Securities, to permit Bearer Securities to be
issued in exchange for Bearer Securities of other authorized denominations
or to permit the issuance of Debt Securities of any series in
uncertificated form, provided that any such action shall not adversely
--------
affect the interests of the Holders of Debt Securities of any series or any
related Coupons in any material respect; or
(5) to change or eliminate any of the provisions of this Indenture,
provided that any such change or elimination shall become effective only
--------
when there is no Outstanding Debt Security or Coupon of any series created
prior to the execution of such supplemental indenture which is entitled to
the benefit of such provision and as to which such supplemental indenture
would apply; or
(6) to secure the Debt Securities or to provide that any of the
Company's obligations under any series of the Debt Securities shall be
guaranteed and the terms and conditions for the release or substitution of
such security or guarantee; or
(7) to supplement any of the provisions of this Indenture to such
extent as shall be necessary to permit or facilitate the defeasance and
discharge of any series of Securities pursuant to Article Four or Fifteen,
provided that any such action shall not adversely affect the interests of
--------
the Holders of Debt Securities of such series or any other series of Debt
Securities or any related Coupons in any material respect; or
(8) to establish the form or terms of Debt Securities and Coupons, if
any, of any series as permitted by Sections 2.01 and 3.01; or
(9) to evidence and provide for the acceptance of appointment
hereunder by a successor Trustee with respect to one or more series of Debt
Securities and to add to or change any of the provisions of this Indenture
as shall be necessary to provide for or facilitate the administration of
the trusts hereunder by more than one Trustee, pursuant to the requirements
of Section 6.11; or
(10) to cure any ambiguity, to correct or supplement any provision
herein which may be defective or inconsistent with any other provision
herein, to eliminate any conflict between the terms hereof and the Trust
Indenture Act or to make any other provisions with respect to matters or
questions arising under this Indenture which shall not be inconsistent with
any provision of this Indenture; provided such other provisions shall not
--------
adversely affect the interests of the Holders
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of Outstanding Debt Securities or Coupons, if any, of any series created
prior to the execution of such supplemental indenture in any material
respect.
Section 11.02. Supplemental Indentures With Consent of Holders.
-----------------------------------------------
With the written consent of the Holders of not less than a majority in
principal amount of the Outstanding Debt Securities of each series affected by
such supplemental indenture voting separately, by Act of said Holders delivered
to the Company and the Trustee, the Company, when authorized by a Board
Resolution, and the Trustee may enter into an indenture or indentures
supplemental hereto for the purpose of adding any provisions to or changing in
any manner or eliminating any of the provisions of this Indenture or of
modifying in any manner the rights of the Holders under this Indenture of such
Debt Securities and Coupons, if any; provided, however, that no such
-------- -------
supplemental indenture shall, without the consent of the Holder of each
Outstanding Debt Security of each such series affected thereby,
(1) conflict with the required provisions of the Trust Indenture Act;
(2) except as specifically provided with respect to any series of
Debt Securities pursuant to Section 3.01, (a) change the Stated Maturity of
the principal of, or installment of interest, if any, on, any Debt
Security, or reduce the principal amount thereof or the interest thereon or
any premium payable upon redemption thereof (provided that a requirement to
offer to repurchase Debt Securities shall not be deemed a redemption for
this purpose), or change the Stated Maturity of or reduce the amount of any
payment to be made with respect to any Coupon, or change the Currency or
Currencies in which the principal of (and premium, if any) or interest on
such Debt Security is denominated or payable, or reduce the amount of the
principal of a Discount Security that would be due and payable upon a
declaration of acceleration of the Maturity thereof pursuant to Section
5.02, or reduce the amount of, or postpone the date fixed for, any payment
under any sinking fund or analogous provisions for any Debt Security, or
impair the right to institute suit for the enforcement of any payment on or
after the Stated Maturity thereof (or, in the case of redemption, on or
after the Redemption Date), or limit the obligation of the Company to
maintain a paying agency outside the United States for payment on Bearer
Securities as provided in Section 12.03, or adversely affect the right to
convert any Debt Security into shares of Common Stock of the Company as may
be provided pursuant to Section 3.01; or
(3) reduce the percentage in principal amount of the Outstanding Debt
Securities of any series, the consent of whose Holders is required for any
supplemental indenture, or the consent of whose Holders is required for any
waiver of compliance with certain provisions of this Indenture or certain
defaults hereunder and their consequences provided for in this Indenture;
or
(4) modify any of the provisions of this Section, Section 5.13 or
Section 12.07, except to increase any such percentage or to provide that
certain other provisions of this Indenture cannot be modified or waived
without the consent of the Holder of each Outstanding Debt Security of each
series affected thereby; provided, however, that this clause shall not be
-------- -------
deemed to require the consent of any Holder with respect to changes in the
references to "the Trustee" and concomitant changes in this Section and
Section 12.07, or the deletion of this proviso, in accordance with the
requirements of Sections 6.11 and 11.01(7); or
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(5) modify any of the provisions of this Indenture relating to the
subordination of the Debt Securities in a manner adverse to the Holders.
It shall not be necessary for any Act of Holders under this Section to
approve the particular form of any proposed supplemental indenture, but it shall
be sufficient if such Act shall approve the substance thereof.
A supplemental indenture which changes or eliminates any covenant or
other provision of this Indenture with respect to one or more particular series
of Debt Securities and Coupons, if any, or which modifies the rights of the
Holders of Debt Securities and Coupons of such series with respect to such
covenant or other provision, shall be deemed not to affect the rights under this
Indenture of the Holders of Debt securities and Coupons, if any, of any other
series.
Section 11.03. Execution of Supplemental Indentures.
------------------------------------
In executing, or accepting the additional trusts created by, any
supplemental indenture permitted by this Article or the modifications thereby of
the trusts created by this Indenture, the Trustee shall be entitled to receive,
and (subject to Section 6.01) shall be fully protected in relying upon, an
Opinion of Counsel stating that the execution of such supplemental indenture is
authorized or permitted by this Indenture. The Trustee may, but shall not be
obligated to, enter into any such supplemental indenture which adversely affects
the Trustee's own rights, duties or immunities under this Indenture or otherwise
in a material way.
Section 11.04. Effect of Supplemental Indentures.
---------------------------------
Upon the execution of any supplemental indenture under this Article,
this Indenture shall be modified in accordance therewith, and such supplemental
indenture shall form a part of this Indenture for all purposes; and every Holder
of Debt Securities and Coupons theretofore or thereafter authenticated and
delivered hereunder shall be bound thereby.
Section 11.05. Conformity with Trust Indenture Act.
-----------------------------------
Every supplemental indenture executed pursuant to this Article shall
conform to the requirements of the Trust Indenture Act as then in effect.
Section 11.06. Reference in Debt Securities to Supplemental
--------------------------------------------
Indentures.
----------
Debt Securities and Coupons, if any, of any series authenticated and
delivered after the execution of any supplemental indenture pursuant to this
Article may, and shall if required by the Trustee, bear a notation in form
approved by the Trustee as to any matter provided for in such supplemental
indenture. If the Company shall so determine, new Debt Securities and Coupons
of any series so modified as to conform, in the opinion of the Trustee and the
Board of Directors, to any such supplemental indenture may be prepared and
executed by the Company and authenticated and delivered by the Trustee in
exchange for Outstanding Debt Securities and Coupons of such series.
Section 11.07. Notice of Supplemental Indenture.
--------------------------------
Promptly after the execution by the Company and the appropriate
Trustee of any supplemental indenture pursuant to Section 11.02, the Company
shall transmit, in the manner and to the
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extent provided in Section 1.05, to all Holders of any series of the Debt
Securities affected thereby, a notice setting forth in general terms the
substance of such supplemental indenture.
Section 11.08. Effect on Senior Indebtedness.
-----------------------------
No supplemental indenture shall adversely affect the rights of any
holder of Senior Indebtedness under Article Sixteen without the consent of such
holder.
ARTICLE TWELVE
COVENANTS
Section 12.01. Payment of Principal, Premium and Interest.
------------------------------------------
The Company covenants and agrees for the benefit of each series of
Debt Securities and Coupons, if any, that it will duly and punctually pay the
principal of (and premium, if any) and interest on the Debt Securities in
accordance with the terms of the Debt Securities, the Coupons and this
Indenture. Unless otherwise specified as contemplated by Section 3.01 with
respect to any series of Debt Securities or except as otherwise provided in
Section 3.06, any interest due on Bearer Securities on or before Maturity shall
be payable only upon presentation and surrender of the several Coupons for such
interest installments as are evidenced thereby as they severally mature. If so
provided in the terms of any series of Debt Securities established as provided
in Section 3.01, the interest, if any, due in respect of any temporary Global
Note or permanent Global Note, together with any additional amounts payable in
respect thereof, as provided in the terms and conditions of such Debt Security,
shall be payable only upon presentation of such Debt Security to the Trustee for
notation thereon of the payment of such interest.
Section 12.02. Officer's Certificate as to Default.
-----------------------------------
Unless otherwise specifically provided for with respect to any series
of Debt Securities under Section 3.01, the Company will deliver to the Trustee,
on or before a date not more than four months after the end of each fiscal year
of the Company (which on the date hereof is the calendar year) ending after the
date hereof, a certificate of the principal executive officer, principal
financial officer or principal accounting officer of the Company stating whether
or not to the best knowledge of the signer thereof the Company is in compliance
with all covenants and conditions under this Indenture, and, if the Company
shall be in default, specifying all such defaults and the nature thereof of
which such signer may have knowledge. For purposes of this Section, such
compliance shall be determined without regard to any period of grace or
requirement of notice provided under this Indenture.
Section 12.03. Maintenance of Office or Agency.
-------------------------------
If Debt Securities of a series are issuable only as Registered
Securities, the Company will maintain in each Place of Payment for such series
an office or agency where Debt Securities of that series may be presented or
surrendered for payment, where Debt Securities of that series may be surrendered
for registration of transfer or exchange, where Debt Securities of that series
that are convertible may be surrendered for conversion, if applicable, and where
notices and demands to or upon the Company in respect of the Debt Securities of
that series and this Indenture may be served. If Debt Securities of a series
are issuable as Bearer Securities, the Company will maintain (A) in the Borough
of Manhattan, The
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City and State of New York, an office or agency where any Registered Securities
of that series may be presented or surrendered for payment, where any Registered
Securities of that series may be surrendered for registration of transfer, where
Debt Securities of that series may be surrendered for exchange or redemption,
where notices and demands to or upon the Company in respect of the Debt
Securities of that series and this Indenture may be served and where Bearer
Securities of that series and related Coupons may be presented or surrendered
for payment in the circumstances described in the following paragraph (and not
otherwise), (B) subject to any laws or regulations applicable thereto, in a
Place of Payment for that series which is located outside the United States, an
office or agency where Debt Securities of that series and related Coupons may be
presented and surrendered for payment (including payment of any additional
amounts payable on Debt Securities of that series, if so provided pursuant to
Section 3.01); provided, however, that if the Debt Securities of that series are
-------- -------
listed on The Stock Exchange of the United Kingdom and the Republic of Ireland,
the Luxembourg Stock Exchange or any other stock exchange located outside the
United States and such stock exchange shall so require, the Company will
maintain a Paying Agent for the Debt Securities of that series in London,
Luxembourg or any other required city located outside the United States, as the
case may be, so long as the Debt Securities of that series are listed on such
exchange, and (C) subject to any laws or regulations applicable thereto, in a
Place of Payment for that series located outside the United States an office or
agency where any Registered Securities of that series may be surrendered for
registration of transfer, where Debt Securities of that series may be
surrendered for exchange or redemption and where notices and demands to or upon
the Company in respect of the Debt Securities of that series and this Indenture
may be served. The Company will give prompt written notice to the Trustee of
the location, and any change in the location, of such office or agency. If at
any time the Company shall fail to maintain any such required office or agency
or shall fail to furnish the Trustee with the address thereof, such
presentations, surrenders, notices and demands may be made or served at the
Corporate Trust Office of the Trustee (in the case of Registered Securities) and
at the principal London office of the Trustee (in the case of Bearer
Securities), and the Company hereby appoints the Trustee as its agent to receive
all presentations, surrenders, notices and demands.
No payment of principal, premium or interest on Bearer Securities
shall be made at any office or agency of the Company in the United States or by
check mailed to any address in the United States or by transfer to an account
maintained with a bank located in the United States; provided, however, that, if
-------- -------
the Debt Securities of a series are denominated and payable in Dollars, payment
of principal of and any premium and interest on any Bearer Security (including
any additional amounts payable on Securities of such series, if so provided
pursuant to Section 3.01) shall be made at the office of the Company's Paying
Agent in the Borough of Manhattan, The City and State of New York, if (but only
if) payment in Dollars of the full amount of such principal, premium, interest
or additional amounts, as the case may be, at all offices or agencies outside
the United States maintained for the purpose by the Company in accordance with
this Indenture is illegal or effectively precluded by exchange controls or other
similar restrictions.
The Company may also from time to time designate different or
additional offices or agencies to be maintained for such purposes (in or outside
of such Place of Payment), and may from time to time rescind any such
designations; provided, however, that no such designation or rescission shall in
-------- -------
any manner relieve the Company of its obligations described in the preceding
paragraph. The Company will give prompt written notice to the Trustee of any
such additional designation or rescission of designation and any change in the
location of any such different or additional office or agency.
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Section 12.04. Money for Debt Securities; Payments To Be Held in
-------------------------------------------------
Trust.
-----
If the Company shall at any time act as its own Paying Agent with
respect to any series of Debt Securities and Coupons, if any, it will, on or
before each due date of the principal of (and premium, if any) or interest on
any of the Debt Securities of such series, segregate and hold in trust for the
benefit of the Persons entitled thereto a sum sufficient to pay the principal
(and premium, if any) or interest so becoming due until such sums shall be paid
to such Persons or otherwise disposed of as herein provided, and will promptly
notify the Trustee of its action or failure so to act.
Whenever the Company shall have one or more Paying Agents with respect
to any series of Debt Securities and Coupons, it will, by or on each due date of
the principal (and premium, if any) or interest on any Debt Securities of such
series, deposit with any such Paying Agent a sum sufficient to pay the principal
(and premium, if any) or interest so becoming due, such sum to be held in trust
for the benefit of the Persons entitled thereto, and (unless any such Paying
Agent is the Trustee) the Company will promptly notify the Trustee of its action
or failure so to act.
The Company will cause each Paying Agent with respect to any series of
Debt Securities other than the Trustee to execute and deliver to the Trustee an
instrument in which such Paying Agent shall agree with the Trustee, subject to
the provisions of this Section, that such Paying Agent will:
(1) hold all sums held by it for the payment of the principal of (and
premium, if any) or interest on Debt Securities of such series in trust for
the benefit of the Persons entitled thereto until such sums shall be paid
to such Persons or otherwise disposed of as herein provided;
(2) give the Trustee notice of any default by the Company (or any
other obligor upon the Debt Securities of such series) in the making of any
payment of principal (and premium, if any) or interest on the Debt
Securities of such series; and
(3) at any time during the continuance of any such default, upon the
written request of the Trustee, forthwith pay to the Trustee all sums so
held in trust by such Paying Agent.
The Company may at any time, for the purpose of obtaining the
satisfaction and discharge of this Indenture or for any other purpose, pay, or
by Company Order direct any Paying Agent to pay, to the Trustee all sums held in
trust by the Company or such Paying Agent, such sums to be held by the Trustee
upon the same trusts as those upon which such sums were held by the Company or
such Paying Agent; and, upon such payment by any Paying Agent to the Trustee,
such Paying Agent shall be released from all further liability with respect to
such money.
Any money deposited with the Trustee or any Paying Agent, or then held
by the Company, in trust for the payment of the principal of (and premium, if
any) or interest on any Debt Security of any series and remaining unclaimed for
two years after such principal (and premium, if any) or interest has become due
and payable shall be paid to the Company upon Company Request, or (if then held
by the Company) shall be discharged from such trust; and the Holder of such Debt
Security or Coupon shall thereafter, as an unsecured general creditor, look only
to the Company for payment thereof, and all liability of the Trustee or such
Paying Agent with respect to such trust money, and all liability of the Company
as trustee thereof, shall thereupon cease; provided, however, that the Trustee
-------- -------
or such Paying Agent, before being required to make any such repayment, may at
the expense of the Company cause to be transmitted in the manner and to the
extent provided by Section 1.05, notice that such money remains unclaimed and
that, after a date specified therein, which shall not be less than 30 days from
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the date of such notification, any unclaimed balance of such money then
remaining will be repaid to the Company.
Section 12.05. Corporate Existence.
-------------------
Subject to Article Ten, the Company will do or cause to be done all
things necessary to preserve and keep in full force and effect its corporate
existence, rights (charter and statutory) and franchises; provided, however,
-------- -------
that the Company shall not be required to preserve any such right or franchise
if the Company shall determine that the preservation thereof is no longer
desirable in the conduct of the business of the Company.
Section 12.06. Purchase of Debt Securities by Company.
--------------------------------------
If the Debt Securities of a series are listed on The Stock Exchange of
the United Kingdom and the Republic of Ireland and such stock exchange shall so
require, the Company will not purchase any Debt Securities of that series by
private treaty at a price (exclusive of expenses and accrued interest) which
exceeds 120% of the mean of the nominal quotations of the Debt Securities of
that series as shown in The Stock Exchange Daily Official List for the last
trading day preceding the date of purchase.
Section 12.07. Waiver of Certain Covenants.
---------------------------
The Company may omit in any particular instance to comply with any
term, provision or condition set forth in Sections 12.05 and 12.06 (and, if so
specified pursuant to Section 3.01, any other covenant not set forth herein and
specified pursuant to Section 3.01 to be applicable to the Securities of any
series, except as otherwise provided pursuant to Section 3.01) with respect to
the Debt Securities of any series if before the time for such compliance the
Holders of at least a majority in principal amount of the Outstanding Debt
Securities of such series shall, by Act of such Holders, either waive such
compliance in such instance or generally waive compliance with such term,
provision or condition, but no such waiver shall extend to or affect such term,
provision or condition except to the extent expressly so waived, and, until such
waiver shall become effective, the obligations of the Company and the duties of
the Trustee in respect of any such term, provision or condition shall remain in
full force and effect.
ARTICLE THIRTEEN
REDEMPTION OF DEBT SECURITIES
Section 13.01. Applicability of Article.
------------------------
Debt Securities of any series which are redeemable before their Maturity
shall be redeemable in accordance with their terms and (except as otherwise
specified pursuant to Section 3.01 for Debt Securities of any series) in
accordance with this Article.
Section 13.02. Election to Redeem; Notice to Trustee.
-------------------------------------
The election of the Company to redeem (or, in the case of Discount
Securities, to permit the Holders to elect to surrender for redemption) any Debt
Securities shall be evidenced by a Board Resolution. In case of any redemption
at the election of the Company of less than all of the Debt Securities of any
series pursuant to Section 13.03, the Company shall, at least 60 days before the
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Redemption Date fixed by the Company (unless a shorter notice shall be
satisfactory to the Trustee), notify the Trustee of such Redemption Date and of
the principal amount of Debt Securities of such series to be redeemed. In the
case of any redemption of Debt Securities prior to the expiration of any
restriction on such redemption provided in the terms of such Debt Securities or
elsewhere in this Indenture, the Company shall furnish the Trustee with an
Officers' Certificate evidencing compliance with such restrictions.
Section 13.03. Selection by Trustee of Debt Securities to Be
---------------------------------------------
Redeemed.
--------
Except in the case of a redemption in whole of the Bearer Securities
or the Registered Securities of such series, if less than all the Debt
Securities of any series are to be redeemed at the election of the Company, the
particular Debt Securities to be redeemed shall be selected not more than 60
days prior to the Redemption Date by the Trustee, from the Outstanding Debt
Securities of such series not previously called for redemption, by such method
as the Trustee shall deem fair and appropriate and which may provide for the
selection for redemption of portions (equal to the minimum authorized
denomination for Debt Securities of such series or any integral multiple
thereof) of the principal amount of Debt Securities of such series in a
denomination larger than the minimum authorized denomination for Debt Securities
of such series pursuant to Section 3.02 in the Currency in which the Debt
Securities of such series are denominated. The portions of the principal amount
of Debt Securities so selected for partial redemption shall be equal to the
minimum authorized denominations for Debt Securities of such series pursuant to
Section 3.02 in the Currency in which the Debt Securities of such series are
denominated or any integral multiple thereof, except as otherwise set forth in
the applicable form of Debt Securities. In any case when more than one
Registered Security of such series is registered in the same name, the Trustee
in its discretion may treat the aggregate principal amount so registered as if
it were represented by one Registered Security of such series.
The Trustee shall promptly notify the Company in writing of the Debt
Securities selected for redemption and, in the case of any Debt Securities
selected for partial redemption, the principal amount thereof to be redeemed.
For all purposes of this Indenture, unless the context otherwise
requires, all provisions relating to the redemption of Debt Securities shall
relate, in the case of any Debt Security redeemed or to be redeemed only in
part, to the portion of the principal amount of such Debt security which has
been or is to be redeemed.
Section 13.04. Notice of Redemption.
--------------------
Notice of redemption shall be given by the Company, or at the
Company's request, by the Trustee in the name and at the expense of the Company,
not less than 30 days and not more than 60 days prior to the Redemption Date to
the Holders of Debt Securities of any series to be redeemed in whole or in part
pursuant to this Article Thirteen, in the manner provided in Section 1.05. Any
notice so given shall be conclusively presumed to have been duly given, whether
or not the Holder receives such notice. Failure to give such notice, or any
defect in such notice to the Holder of any Debt Security of a series designated
for redemption, in whole or in part, shall not affect the sufficiency of any
notice of redemption with respect to the Holder of any other Debt Security of
such series.
All notices of redemption shall state:
(1) the Redemption Date,
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(2) the Redemption Price,
(3) that Debt Securities of such series are being redeemed by the
Company pursuant to provisions contained in this Indenture or the terms of
the Debt Securities of such series or a supplemental indenture establishing
such series, if such be the case, together with a brief statement of the
facts permitting such redemption,
(4) if less than all Outstanding Debt Securities of any series are to
be redeemed, the identification (and, in the case of partial redemption,
the principal amounts) of the particular Debt Securities to be redeemed,
(5) that on the Redemption Date the Redemption Price will become due
and payable upon each such Debt Security to be redeemed, and that interest
thereon, if any, shall cease to accrue on and after said date,
(6) that, unless otherwise specified in such notice, Coupon
Securities of any series, if any, surrendered for redemption must be
accompanied by all Coupons maturing subsequent to the date fixed for
redemption, failing which the amount of any such missing Coupon or Coupons
will be deducted from the Redemption Price,
(7) the Place or Places of Payment where such Debt Securities are to
be surrendered for payment of the Redemption Price,
(8) if Bearer Securities of any series are to be redeemed and any
Registered Securities of such series are not to be redeemed, and if such
Bearer Securities may be exchanged for Registered Securities not subject to
redemption on this Redemption Date pursuant to Section 3.05(b) or
otherwise, the last date on which such exchanges may be made, and
(9) that the redemption is for a sinking fund, if such is the case.
Section 13.05. Deposit of Redemption Price.
---------------------------
On or prior to the Redemption Date for any Debt Securities, the
Company shall deposit with the Trustee or with a Paying Agent (or, if the
Company is acting as its own Paying Agent, segregate and hold in trust as
provided in Section 12.04) an amount of money in the Currency or Currencies in
which such Debt Securities are denominated (except as provided pursuant to
Section 3.01) sufficient to pay the Redemption Price of such Debt Securities or
any portions thereof which are to be redeemed on that date.
Section 13.06. Debt Securities Payable on Redemption Date.
------------------------------------------
Notice of redemption having been given as aforesaid, any Debt
Securities so to be redeemed shall, on the Redemption Date, become due and
payable at the Redemption Price in the Currency in which the Debt Securities of
such series are payable (except as otherwise specified pursuant to Section 3.01
or 3.10), and from and after such date (unless the Company shall default in the
payment of the Redemption Price) such Debt Securities shall cease to bear
interest. Upon surrender of any such Debt Security for redemption in accordance
with said notice, such Debt Security shall be paid by the Company at the
Redemption Price; provided, however, that installments of interest on Bearer
-------- -------
Securities whose Stated Maturity is on or prior to the Redemption Date shall be
payable only at an office or agency
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located outside the United States (except as otherwise provided in Section
12.03) and, unless otherwise specified as contemplated by Section 3.01, only
upon presentation and surrender of Coupons for such interest; and provided,
--------
further, that, unless otherwise specified as contemplated by Section 3.01,
-------
installments of interest on Registered Securities which have a Stated Maturity
on or prior to the Redemption Date for such Debt Securities shall be payable
according to the terms of such Debt Securities and the provisions of Section
3.07.
If any Debt Security called for redemption shall not be so paid upon
surrender thereof for redemption, the principal (and premium, if any) shall,
until paid, bear interest from the Redemption Date at the rate prescribed
therefor in the Debt Security.
If any Coupon Security surrendered for redemption shall not be
accompanied by all Coupons appertaining thereto maturing on or after the
Redemption Date, the Redemption Price for such Coupon Security may be reduced by
an amount equal to the face amount of all such missing Coupons. If thereafter
the Holder of such Coupon shall surrender to any Paying Agent outside the United
States any such missing Coupon in respect of which a deduction shall have been
made from the Redemption Price, such Holder shall be entitled to receive the
amount so deducted. The surrender of such missing Coupon or Coupons may be
waived by the Company and the Trustee, if there be furnished to them such
security or indemnity as they may require to save each of them and any Paying
Agent harmless.
Section 13.07. Debt Securities Redeemed in Part.
--------------------------------
Any Debt Security which is to be redeemed only in part shall be
surrendered at the Corporate Trust Office or such other office or agency of the
Company as is specified pursuant to Section 3.01 (in the case of Registered
Securities) and at an office of the Trustee or such other office or agency of
the Company outside the United States as is specified pursuant to Section 3.01
(in the case of Bearer Securities) with, if the Company, the Security Registrar
or the Trustee so requires, due endorsement by, or a written instrument of
transfer in form satisfactory to the Company, the Security Registrar and the
Trustee duly executed by, the Holder thereof or his attorney duly authorized in
writing, and the Company shall execute, and the Trustee shall authenticate and
deliver to the Holder of such Debt Security without service charge, a new Debt
Security or Debt Securities of the same series, of like tenor and form, of any
authorized denomination as requested by such Holder in aggregate principal
amount equal to and in exchange for the unredeemed portion of the principal of
the Debt Security so surrendered, and, in the case of a Coupon Security, with
appropriate Coupons attached. In the case of a Debt Security providing
appropriate space for such notation, at the option of the Holder thereof, the
Trustee, in lieu of delivering a new Debt Security or Debt Securities as
aforesaid, may make a notation on such Debt Security of the payment of the
redeemed portion thereof.
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ARTICLE FOURTEEN
SINKING FUNDS
Section 14.01. Applicability of Article.
------------------------
The provisions of this Article shall be applicable to any sinking fund
for the retirement of Debt Securities of a series except as otherwise specified
pursuant to Section 3.01 for Debt Securities of such series.
The minimum amount of any sinking fund payment provided for by the
terms of Debt Securities of any series is herein referred to as a "mandatory
sinking fund payment," and any payment in excess of such minimum amount provided
for by the terms of Debt Securities of any series is herein referred to as an
"optional sinking fund payment." If provided for by the terms of Debt
Securities of any series, the amount of any cash sinking fund payment may be
subject to reduction as provided in Section 14.02. Each sinking fund payment
shall be applied to the redemption of Debt Securities of any series as provided
for by the terms of Debt Securities of such series.
Section 14.02. Satisfaction of Mandatory Sinking Fund Payments with
----------------------------------------------------
Debt Securities.
---------------
In lieu of making all or any part of a mandatory sinking fund payment
with respect to any Debt Securities of a series in cash, the Company may at its
option, at any time no more than sixteen months and no less than 45 days prior
to the date on which such sinking fund payment is due, deliver to the Trustee
Debt Securities of such series (together with the unmatured Coupons, if any,
appertaining thereto) theretofore purchased or otherwise acquired by the
Company, except Debt Securities of such series which have been redeemed through
the application of mandatory sinking fund payments pursuant to the terms of the
Debt Securities of such series, accompanied by a Company Order instructing the
Trustee to credit such obligations and stating that the Debt Securities of such
series were originally issued by the Company by way of bona fide sale or other
negotiation for value, provided that such Debt Securities shall not have been
--------
previously so credited. Such Debt Securities shall be received and credited for
such purpose by the Trustee at the Redemption Price specified in such Debt
Securities for redemption through operation of the sinking fund and the amount
of such mandatory sinking fund payment shall be reduced accordingly.
Section 14.03. Redemption of Debt Securities for Sinking Fund.
----------------------------------------------
Not less than 60 days prior to each sinking fund payment date for any
series of Debt Securities (unless a shorter period shall be satisfactory to the
Trustee), the Company will deliver to the Trustee an Officers' Certificate
specifying the amount of the next ensuing sinking fund payment for that series
pursuant to the terms of that series, the portion thereof, if any, which is to
be satisfied by payment of cash in the Currency or Currencies in which the Debt
Securities of such series are denominated (except as provided pursuant to
Section 3.01) and the portion thereof, if any, which is to be satisfied by
delivering and crediting Debt Securities of such series pursuant to Section
14.02 and whether the Company intends to exercise its rights to make a permitted
optional sinking fund payment with respect to such series. Such certificate
shall be irrevocable and upon its delivery the Company shall be obligated to
make the cash payment or payments therein referred to, if any, on or before the
next succeeding sinking fund payment date. In the case of the failure of the
Company to deliver such certificate, the sinking fund payment due on the next
succeeding sinking fund payment date for such series shall be paid
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entirely in cash and shall be sufficient to redeem the principal amount of the
Debt Securities of such series subject to a mandatory sinking fund payment
without the right to deliver or credit Debt Securities as provided in Section
14.02 and without the right to make any optional sinking fund payment with
respect to such series at such time.
Any sinking fund payment or payments (mandatory or optional) made in
cash plus any unused balance of any preceding sinking fund payments made with
respect to the Debt Securities of any particular series shall be applied by the
Trustee (or by the Company if the Company is acting as its own Paying Agent) on
the sinking fund payment date on which such payment is made (or, if such payment
is made before a sinking fund payment date, on the sinking fund payment date
immediately following the date of such payment) to the redemption of Debt
Securities of such series at the Redemption Price specified in such Debt
Securities with respect to the sinking fund. Any sinking fund moneys not so
applied or allocated by the Trustee (or by the Company if the Company is acting
as its own Paying Agent) to the redemption of Debt Securities shall be added to
the next sinking fund payment received by the Trustee (or if the Company is
acting as its own Paying Agent, segregated and held in trust as provided in
Section 12.04) for such series and, together with such payment (or such amount
so segregated) shall be applied in accordance with the provisions of this
Section. Any and all sinking fund moneys with respect to the Debt Securities of
any particular series held by the Trustee (or if the Company is acting as its
own Paying Agent, segregated and held in trust as provided in Section 12.04) on
the last sinking fund payment date with respect to Debt Securities of such
series and not held for the payment or redemption of particular Debt Securities
of such series shall be applied by the Trustee (or by the Company if the Company
is acting as its own Paying Agent), together with other moneys, if necessary, to
be deposited (or segregated) sufficient for the purpose, to the payment of the
principal of the Debt Securities of such series at Maturity.
The Trustee shall select or cause to be selected the Debt Securities
to be redeemed upon such sinking fund payment date in the manner specified in
Section 13.03 (unless otherwise specified pursuant to Section 3.01) and the
Company shall cause notice of the redemption thereof to be given in the manner
provided in Section 13.04. Such notice having been duly given, the redemption
of such Debt Securities shall be made upon the terms and in the manner stated in
Section 13.06.
On or before each sinking fund payment date, the Company shall pay to
the Trustee (or, if the Company is acting as its own Paying Agent, the Company
shall segregate and hold in trust as provided in Section 12.04) in cash a sum,
in the Currency or Currencies in which Debt Securities of such series are
denominated (except as provided pursuant to Sections 3.01 or 3.10), equal to the
principal and any interest accrued to the Redemption Date for Debt Securities or
portions thereof to be redeemed on such sinking fund payment date pursuant to
this Section.
Neither the Trustee nor the Company shall redeem any Debt Securities
of a series with sinking fund moneys or mail any notice of redemption of Debt
Securities of such series by operation of the sinking fund for such series
during the continuance of a default in payment of interest, if any, on any Debt
Securities of such series or of any Event of Default (other than an Event of
Default occurring as a consequence of this paragraph) with respect to the Debt
Securities of such series, except that if the notice of redemption shall have
been provided in accordance with the provisions hereof, the Trustee (or the
Company, if the Company is then acting as its own Paying Agent) shall redeem
such Debt Securities if cash sufficient for that purpose shall be deposited with
the Trustee (or segregated by the Company) for that purpose in accordance with
the terms of this Article. Except as aforesaid, any moneys in the sinking fund
for such series at the time when any such default or Event of Default
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shall occur and any moneys thereafter paid into such sinking fund shall, during
the continuance of such default or Event of Default, be held as security for the
payment of the Debt Securities and Coupons, if any, of such series; provided,
--------
however, that in case such default or Event of Default shall have been cured or
-------
waived as provided herein, such moneys shall thereafter be applied on or prior
to the next sinking fund payment date for the Debt Securities of such series on
which such moneys may be applied pursuant to the provisions of this Section.
ARTICLE FIFTEEN
DEFEASANCE
Section 15.01. Applicability of Article.
------------------------
If, pursuant to Section 3.01, provision is made for the defeasance of
Debt Securities of a series, and if the Debt Securities of such series are
Registered Securities and denominated and payable only in Dollars (except as
provided pursuant to Section 3.01) then the provisions of this Article shall be
applicable except as otherwise specified pursuant to Section 3.01 for Debt
Securities of such series. Defeasance provisions, if any, for Debt Securities
denominated in a Foreign Currency or Currencies or for Bearer Securities may be
specified pursuant to Section 3.01.
Section 15.02. Defeasance Upon Deposit of Moneys or U.S. Government
----------------------------------------------------
Obligations.
-----------
At the Company's option, either (a) the Company shall be deemed to
have been Discharged (as defined below) from its obligations with respect to
Debt Securities of any series ("legal defeasance option") or (b) the Company
shall cease to be under any obligation to comply with any term, provision or
condition set forth in Section 10.01 with respect to Debt Securities of any
series (and, if so specified pursuant to Section 3.01, any other obligation of
the Company or restrictive covenant added for the benefit of such series
pursuant to Section 3.01) ("covenant defeasance option") at any time after the
applicable conditions set forth below have been satisfied:
(1) the Company shall have deposited or caused to be deposited
irrevocably with the Trustee as trust funds in trust, specifically pledged
as security for, and dedicated solely to, the benefit of the Holders of the
Debt Securities of such series (i) money in an amount, or (ii) U.S.
Government Obligations (as defined below) which through the payment of
interest and principal in respect thereof in accordance with their terms
will provide, not later than one day before the due date of any payment,
money in an amount, or (iii) a combination of (i) and (ii), sufficient, in
the opinion (with respect to (i) and (ii)) of a nationally recognized firm
of independent public accountants expressed in a written certification
thereof delivered to the Trustee, to pay and discharge each installment of
principal (including any mandatory sinking fund payments) of and premium,
if any, and interest on, the Outstanding Debt Securities of such series on
the dates such installments of interest or principal and premium are due;
(2) such deposit shall not cause the Trustee with respect to the Debt
Securities of that series to have a conflicting interest as defined in
Section 6.08 and for purposes of the Trust Indenture Act with respect to
the Debt Securities of any series;
(3) such deposit will not result in a breach or violation of, or
constitute a default under, this Indenture or any other agreement or
instrument to which the Company is a party or by which it is bound;
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(4) if the Debt Securities of such series are then listed on any
national securities exchange, the Company shall have delivered to the
Trustee an Opinion of Counsel or a letter or other document from such
exchange to the effect that the Company's exercise of its option under this
Section would not cause such Debt Securities to be delisted;
(5) no Event of Default or event (including such deposit) which, with
notice or lapse of time or both, would become an Event of Default with
respect to the Debt Securities of such series shall have occurred and be
continuing on the date of such deposit and, with respect to the legal
defeasance option only, no Event of Default under Section 5.01(7) or
Section 5.01(8) or event which with the giving of notice or lapse of time,
or both, would become an Event of Default under Section 5.01(7) or Section
5.01(8) shall have occurred and be continuing on the 91st day after such
date; and
(6) the Company shall have delivered to the Trustee an Opinion of
Counsel or a ruling from the Internal Revenue Service to the effect that
the Holders of the Debt Securities of such series will not recognize
income, gain or loss for Federal income tax purposes as a result of such
deposit, defeasance or Discharge.
Notwithstanding the foregoing, if the Company exercises its covenant defeasance
option and an Event of Default under Section 5.01(5) or Section 5.01(6) or event
which with the giving of notice or lapse of time, or both, would become an Event
of Default under Section 5.01(5) or Section 5.01(6) shall have occurred and be
continuing on the 91st day after the date of such deposit, the obligations of
the Company referred to under the definition of covenant defeasance option with
respect to such Debt Securities shall be reinstated. Money and securities held
in trust pursuant to a legal defeasance shall not be subject to Article Sixteen.
"Discharged" means that the Company shall be deemed to have paid and
discharged the entire indebtedness represented by, and obligations under, the
Debt Securities of such series and to have satisfied all the obligations under
this Indenture relating to the Debt Securities of such series (and the Trustee,
at the expense of the Company, shall execute proper instruments acknowledging
the same), except (A) the rights of Holders of Debt Securities of such series to
receive, from the trust fund described in clause (1) above, payment of the
principal of (and premium, if any) and interest on such Debt Securities when
such payments are due, (B) the Company's obligations with respect to the Debt
Securities of such series under Sections 3.04, 3.05, 3.06, 12.03 and 15.03 and
(C) the rights, powers, trusts, duties and immunities of the Trustee hereunder.
"U.S. Government Obligations" means securities that are (a) direct
obligations of the United States of America for the timely payment of which its
full faith and credit is pledged or (b) obligations of a Person controlled or
supervised by and acting as an agency or instrumentality of the United States of
America the timely payment of which is unconditionally guaranteed as a full
faith and credit obligation by the United States of America, which, in either
case, are not callable or redeemable at the option of the issuer thereof, and
shall also include a depository receipt issued by a bank (as defined in Section
3(a)(2) of the Securities Act), as custodian with respect to any such U.S.
Government Obligation or a specific payment of principal of or interest on any
such U.S. Government Obligation held by such custodian for the account of the
holder of such depository receipt; provided, that (except as required by law)
such custodian is not authorized to make any deduction from the amount payable
to the holder of such depository receipt from any amount received by the
custodian in respect of the U.S. Government Obligation or the specific payment
of principal of or interest on the U.S. Government Obligation evidenced by such
depository receipt.
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Section 15.03. Deposited Moneys and U.S. Government Obligations to Be
------------------------------------------------------
Held in Trust.
-------------
All moneys and U.S. Government Obligations deposited with the Trustee
pursuant to Section 15.02 in respect of Debt Securities of a series shall be
held in trust and applied by it, in accordance with the provisions of such Debt
Securities and this Indenture, to the payment, either directly or through any
Paying Agent (including the Company acting as its own Paying Agent) as the
Trustee may determine, to the Holders of such Debt Securities, of all sums due
and to become due thereon for principal (and premium, if any) and interest, if
any, but such money need not be segregated from other funds except to the extent
required by law.
Section 15.04. Repayment to Company.
--------------------
The Trustee and any Paying Agent shall promptly pay or return to
the Company upon Company Request any moneys or U.S. Government Obligations held
by them at any time that are not required for the payment of the principal of
(and premium, if any) and interest on the Debt Securities of any series for
which money or U.S. Government Obligations have been deposited pursuant to
Section 15.02.
The provisions of the last paragraph of Section 12.04 shall apply to
any money held by the Trustee or any Paying Agent under this Article that
remains unclaimed for two years after the Maturity of any series of Debt
Securities for which money or U.S. Government Obligations have been deposited
pursuant to Section 15.02.
ARTICLE SIXTEEN
SUBORDINATION
Section 16.01. Agreement to Subordinate.
------------------------
The Company, for itself, its successors and assigns, covenants and
agrees, and each Holder of Debt Securities by his acceptance thereof, likewise
covenants and agrees, that the payment of the principal of (and premium, if any)
and interest on each and all of the Debt Securities is hereby expressly
subordinated, to the extent and in the manner hereinafter set forth, in right of
payment to the prior payment in full of all Senior Indebtedness.
Section 16.02. Distribution on Dissolution, Liquidation and
--------------------------------------------
Reorganization; Subrogation of Debt Securities.
----------------------------------------------
Upon any distribution of assets of the Company upon any dissolution,
winding up, liquidation or reorganization of the Company, whether in bankruptcy,
insolvency, reorganization of the Company or receivership proceedings upon an
assignment for the benefit of creditors or any other marshalling of the assets
and liabilities of the Company or otherwise (subject to the power of a court of
competent jurisdiction to make other equitable provision reflecting the rights
conferred in this Indenture upon the Senior Indebtedness and the holders thereof
with respect to the Debt Securities and the Holders thereof by a plan of
reorganization under applicable bankruptcy law):
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(a) the holders of all Senior Indebtedness shall be entitled to
receive payment in full of the principal thereof (and premium, if any) and
interest due thereon before the Holders of the Debt Securities are entitled
to receive any payment upon the principal (and premium, if any) or interest
on indebtedness evidenced by the Debt Securities; and
(b) any payment or distribution of the Company of any kind or
character, whether in cash, property or securities, to which the Holders of
the Debt Securities or the Trustee would be entitled except for the
provisions of this Article Sixteen shall be paid by the liquidating trustee
or agent or other person making such payment or distribution, whether a
trustee in bankruptcy, a receiver or liquidating trustee or otherwise,
directly to the holders of Senior Indebtedness or their representative or
representatives or to the trustee or trustees under any indenture under
which any instruments evidencing any of such Senior Indebtedness may have
been issued, ratably according to the aggregate amounts remaining unpaid on
account of the principal of (and premium, if any) and interest on the
Senior Indebtedness held or represented by each, to the extent necessary to
make payment in full of all Senior Indebtedness remaining unpaid, after
giving effect to any concurrent payment or distribution to the holders of
such Senior Indebtedness; and
(c) in the event that, notwithstanding the foregoing, any payment or
distribution of assets of the Company of any kind or character, whether in
cash, property or securities, shall be received by the Trustee or the
Holders of the Debt Securities before all Senior Indebtedness is paid in
full, such payment or distribution shall be paid over, upon written notice
to the Trustee, to the holder of such Senior Indebtedness or their
representative or representatives or to the trustee or trustees under any
indenture under which instrument evidencing any of such Senior Indebtedness
may have been issued, ratably as aforesaid, for application to payment of
all Senior Indebtedness remaining unpaid until all such Senior Indebtedness
shall have been paid in full, after giving effect to any concurrent payment
or distribution to the holders of such Senior Indebtedness.
Subject to the payment in full of all Senior Indebtedness, the Holders
of the Debt Securities shall be subrogated to the rights of the holders of
Senior Indebtedness to receive payments or distributions of cash, property or
securities of the Company applicable to Senior Indebtedness until the principal
of (and premium, if any) and interest on the Debt Securities shall be paid in
full and no such payments or distributions to the holders of such Senior
Indebtedness to which the Holders of Debt Securities or the Trustee would be
entitled except for the provisions of this Article or payments over, pursuant to
the provisions of this Article, to the holders of such Senior Indebtedness by
the Holders of the Debt Securities or on their behalf or by the Trustee shall,
as between the Company, its creditors other than the holders of Senior
Indebtedness and the Holders of the Debt Securities, be deemed to be a payment
by the Company to or on account of Senior Indebtedness. It is understood that
the provisions of this Article Sixteen are and are intended solely for the
purpose of defining the relative rights of the Holders of the Debt Securities,
on the one hand, and the holders of the Senior Indebtedness, on the other hand.
Nothing contained in this Article Sixteen or elsewhere in this Indenture or in
the Debt Securities is intended to or shall impair, as between the Company, its
creditors other than the holders of Senior Indebtedness, and the Holders of the
Debt Securities, the obligation of the Company, which is unconditional and
absolute, to pay to the Holders of the Debt Securities the principal of (and
premium, if any) and interest on the Debt Securities as and when the same shall
become due and payable in accordance with their terms, or to affect the relative
rights of the Holders of the Debt Securities and creditors of the Company other
than the holders of Senior Indebtedness, nor shall anything herein or in the
Debt Securities prevent the Trustee or the Holder of any Debt Security from
exercising all remedies
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otherwise permitted by applicable law upon default under this Indenture, subject
to the rights, if any, under this Article Sixteen of the holders of Senior
Indebtedness in respect of cash, property or securities of the Company received
upon the exercise of any such remedy. Upon any payment or distribution of
assets of the Company referred to in this Article Sixteen, the Trustee, subject
to the provisions of Section 6.02, shall be entitled to rely upon a certificate
of the liquidating trustee or agent or other person making any distribution to
the Trustee for the purpose of ascertaining the Persons entitled to participate
in such distribution, the holders of Senior Indebtedness and other indebtedness
of the Company, the amount thereof or payable thereon, the amount or amounts
paid or distributed thereon and all other facts pertinent to this Article
Sixteen.
The Trustee, however, shall not be deemed to owe any fiduciary duty to
the holders of Senior Indebtedness. The Trustee shall not be liable to any such
holder if it shall pay or distribute to or on behalf of Holders of Debt
Securities or the Company moneys or assets to which any holder of Senior
Indebtedness shall be entitled by virtue of this Article Sixteen.
If the Trustee or any Holder of Debt Securities does not file a proper
claim or proof of debt in the form required in any proceeding referred to above
prior to 30 days before the expiration of the time to file such claim in such
proceeding, then the holder of any Senior Indebtedness is hereby authorized, and
has the right, to file an appropriate claim or claims for or on behalf of such
Holder of Debt Securities.
Section 16.03. No Payment on Debt Securities in Event of Default on
----------------------------------------------------
Senior Indebtedness.
-------------------
No payment by the Company on account of principal (or premium, if
any), sinking funds or interest on the Debt Securities shall be made after any
applicable grace period unless full payment of amounts then due for principal,
premium, if any, sinking funds, and interest on Senior Indebtedness has been
made or duly provided for.
Section 16.04. Payments on Debt Securities Permitted.
-------------------------------------
Nothing contained in this Indenture or in any of the Debt Securities
shall (a) affect the obligation of the Company to make, or prevent the Company
from making, at any time except as provided in Sections 16.02 and 16.03,
payments of principal (and premium, if any) or interest of the Debt Securities
or (b) prevent the application by the Trustee of any moneys deposited with it
hereunder to the payment of or on account of the principal of (and premium, if
any) or interest on the Debt Securities, unless the Trustee shall have received
at its Corporate Trust Office written notice of any event prohibiting the making
of such payment more than two Business Days prior to the date fixed for such
payment.
Section 16.05. Authorization of Holders to Trustee to Effect
---------------------------------------------
Subordination.
-------------
Each Holder of Debt Securities by his acceptance thereof authorizes
and directs the Trustee on his behalf to take such action as may be necessary or
appropriate to effectuate the subordination as provided in this Article Sixteen
and appoints the Trustee his attorney-in-fact for any and all such purposes.
Section 16.06. Notices to Trustee.
------------------
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The Company shall give prompt written notice to the Trustee of any
fact known to the Company which would prohibit the making of any payment to or
by the Trustee in respect of the Debt Securities. Failure to give such notice
shall not affect the subordination of the Debt Securities to Senior
Indebtedness. Notwithstanding the provisions of this Article or any other
provisions of this Indenture, neither the Trustee nor any Paying Agent (other
than the Company) shall be charged with knowledge of the existence of any Senior
Indebtedness or of any event which would prohibit the making of any payment of
moneys to or by the Trustee or such Paying Agent, unless and until the Trustee
of such Paying Agent shall have received (in the case of the Trustee, at its
Corporate Trust Office) written notice thereof from the Company or from the
holder of any Senior Indebtedness or from the trustee for any such holder,
together with proof satisfactory to the Trustee of such holding of Senior
Indebtedness or of the authority of such trustee; provided, however, that if at
least two Business Days prior to the date upon which by the terms hereof any
such moneys may become payable for any purpose (including, without limitation,
the payment of either the principal (and premium, if any) or interest on any
Debt Security) the Trustee shall not have received with respect to such moneys
the notice provided for in this Section 16.06, then, anything herein contained
to the contrary notwithstanding, the Trustee shall have full power and authority
to receive such moneys and to apply the same to the purpose for which they were
received, and shall not be affected by any notice to the contrary, which may be
received by it within two Business Days prior to such date. The Trustee shall
be entitled to rely on the delivery to it of a written notice by a Person
representing himself to be a holder of Senior Indebtedness (or a trustee on
behalf of such holder) to establish that such a notice has been given by a
holder of Senior Indebtedness or a trustee on behalf of any such holder. In the
event that the Trustee determines in good faith that further evidence is
required with respect to the right of any Person as a holder of Senior
Indebtedness to participate in any payment or distribution pursuant to this
Article Sixteen, the Trustee may request such person to furnish evidence to the
reasonable satisfaction of the Trustee as to the amount of Senior Indebtedness
held by such Person, the extent to which such Person is entitled to participate
in such payment or distribution and any other facts pertinent to the rights of
such Person under this Article Sixteen and, if such evidence is not furnished,
the Trustee may defer any payment to such person pending judicial determination
as to the right of such person to receive such payment.
Section 16.07. Trustee as Holder of Senior Indebtedness.
----------------------------------------
The Trustee in its individual capacity shall be entitled to all the
rights set forth in this Article Sixteen in respect of any Senior Indebtedness
at any time held by it to the same extent as any other holder of Senior
Indebtedness and nothing in this Indenture shall be construed to deprive the
Trustee of any of its rights as such holder.
Nothing in this Article shall apply to claims, of, or payments to, the
Trustee under or pursuant to Section 6.07.
Section 16.08. Modification of Terms of Senior Indebtedness.
--------------------------------------------
Any renewal or extension of the time of payment of any Senior
Indebtedness or the exercise by the holders of Senior Indebtedness of any of
their rights under any instrument creating or evidencing Senior Indebtedness,
including, without limitation, the waiver of default thereunder, may be made or
done all without notice to or assent from the Holders of the Debt Securities or
the Trustee.
No compromise, alteration, amendment, modification, extension, renewal
or other change of, or waiver, consent or other action in respect of, any
liability or obligation under or in respect of, or of any of the terms,
covenants or conditions of any indenture or other instrument under which any
Senior
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Indebtedness is outstanding or of such Senior Indebtedness, whether or not such
release is in accordance with the provisions of any applicable document, shall
in any way alter or affect any of the provisions of this Article Sixteen or of
the Debt Securities relating to the subordination thereof.
Section 16.09. Reliance on Judicial Order or Certificate of
--------------------------------------------
Liquidation Agent.
-----------------
Upon any payment or distribution of assets of the Company referred to
in this Article Sixteen, the Trustee and the Holders of the Debt Securities
shall be entitled to rely upon any order or decree entered by any court of
competent jurisdiction in which each insolvency, bankruptcy, receivership,
liquidation, reorganization, dissolution, winding up or similar case or
proceeding is pending, or a certificate of the trustee in bankruptcy,
liquidating trustee, custodian, receiver, assignee for the benefit of creditors,
agent or other person making such payment or distribution, delivered to the
Trustee or to the Holders of Debt Securities, for the purpose of ascertaining
the persons entitled to participate in such payment or distribution, the holders
of Senior Indebtedness and other indebtedness of the Company, the amount
thereof, the amount or amounts paid or distributed thereon and all other facts
pertinent thereto or to this Article Sixteen.
The Company, for itself, its successors and assigns, covenants and
agrees, and each Holder of Debt Securities by his acceptance thereof, likewise
covenants and agrees, that the payment of the principal of (and premium, if any)
and interest on each and all of the Debt Securities is hereby expressly
subordinated, to the extent and in the manner hereinafter set forth, in right of
payment to the prior payment in full of all Senior Indebtedness.
ARTICLE SEVENTEEN
CONVERSION
Section 17.01. Applicability; Conversion Privilege.
-----------------------------------
Except as otherwise specified pursuant to Section 3.01 for Debt
Securities of any series, the provisions of this Article Seventeen shall be
applicable to any Debt Securities that are convertible into Common Stock. If so
provided pursuant to Section 3.01 with respect to the Debt Securities of any
series, the Holder of a Debt Security of such series shall have the right, at
such Holder's option, to convert, in accordance with the terms of such series of
Debt Securities and this Article Sixteen, all or any part (in a denomination of,
unless otherwise specified pursuant to Section 3.01 with respect to Securities
of such series, $1,000 in principal amount or any integral multiple thereof) of
such Debt Security into shares of Common Stock or, as to any Debt Securities
called for redemption, at any time prior to the time and date fixed for such
redemption (unless the Company shall default in the payment of the Redemption
Price, in which case such right shall not terminate at such time and date).
Section 17.02. Conversion Procedure; Conversion Price; Fractional
--------------------------------------------------
Shares.
------
(a) Each Debt Security to which this Article is applicable shall be
convertible at the office of the Conversion Agent, and at such other place or
places, if any, specified in pursuant to Section 3.01 with respect to the Debt
Securities of such series, into fully paid and nonassessable shares (calculated
to the nearest 1/100th of a share) of Common Stock. The Debt Securities will be
converted into shares of Common Stock at the Conversion Price therefor. No
payment or adjustment shall be made in respect of dividends on the Common Stock
or accrued interest on a converted Debt Security except
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as described in Section 16.09. The Company may, but shall not be required, in
connection with any conversion of Debt Securities, to issue a fraction of a
share of Common Stock and, if the Company shall determine not to issue any such
fraction, the Company shall, subject to Section 16.03(4), make a cash payment
(calculated to the nearest cent) equal to such fraction multiplied by the
Closing Price of the Common Stock on the last Trading Day prior to the date of
conversion.
(b) Before any Holder of a Debt Security shall be entitled to convert
the same into Common Stock, such Holder shall surrender such Debt Security duly
endorsed to the Company or in blank, or, in the case of Bearer Securities,
together with all unmatured Coupons and any matured Coupons in default attached
thereto, at the office of the Conversion Agent or at such other place or places,
if any, specified pursuant to Section 3.01 (in the case of Registered
Securities) and at an office of the Conversion Agent or at such other place or
places, if any, outside of the United States as is specified pursuant to
Section 3.01 (in the case of Bearer Securities), and shall give written notice
to the Company at said office or place that he elects to convert the same and
shall state in writing therein the principal amount of Debt Securities to be
converted and the name or names (with addresses) in which he wishes the
certificate or certificates for Common Stock to be issued; provided, however,
that no Debt Security or portion thereof shall be accepted for conversion unless
the principal amount of such Debt Security or such portion, when added to the
principal amount of all other Debt Securities or portions thereof then being
surrendered by the Holder thereof for conversion, exceeds the then effective
Conversion Price with respect thereto. If the Holder of a Bearer Security is
unable to produce any such unmatured Coupon or Coupons or matured Coupon or
Coupons in default, such conversion may be effected if the Bearer Securities to
be surrendered for conversion are accompanied by payment in funds acceptable to
the Company in an amount equal to the face amount of such missing Coupon or
Coupons, or the surrender of such missing Coupon or Coupons may be waived by the
Company and the Trustee if there is furnished to them such security or indemnity
as they may require to save each of them and any Paying Agent harmless. If
thereafter the Holder of such Bearer Security shall surrender to any Paying
Agent any such missing Coupon in respect of which such a payment shall have been
made, such Holder shall be entitled to receive the amount of such payment;
provided, however that except as otherwise provided in Section 12.03, interest
represented by Coupons shall be payable only upon presentation and surrender of
those Coupons at an office or agency located outside the United States. If more
than one Debt Security shall be surrendered for conversion at one time by the
same Holder, the number of full shares of Common Stock which shall be
deliverable upon conversion shall be computed on the basis of the aggregate
principal amount of the Debt Securities (or specified portions thereof to the
extent permitted thereby) so surrendered. Subject to the next succeeding
sentence, the Company will, as soon as practicable thereafter, issue and deliver
at said office or place to such Holder of a Debt Security, or to his nominee or
nominees, certificates for the number of full shares of Common Stock to which he
shall be entitled as aforesaid, together, subject to the last sentence of
paragraph (a) above, with cash in lieu of any fraction of a share to which he
would otherwise be entitled. The Company shall not be required to deliver
certificates for shares of Common Stock while the stock transfer books for such
stock or the Security Register are duly closed for any purpose, but certificates
for shares of Common Stock shall be issued and delivered as soon as practicable
after the opening of such books or Security Register. A Debt Security shall be
deemed to have been converted as of the close of business on the date of the
surrender of such Debt Security for conversion as provided above, and the Person
or Persons entitled to receive the Common Stock issuable upon such conversion
shall be treated for all purposes as the record Holder or Holders of such Common
Stock as of the close of business on such date. In case any Debt Security shall
be surrendered for partial conversion, the Company shall execute and the Trustee
shall authenticate and deliver to or upon the written order of the Holder of the
Debt Securities so surrendered, without charge to such Holder (subject to the
provisions of Section 16.08), a new Debt Security or Securities in
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<PAGE>
authorized denominations in an aggregate principal amount equal to the
unconverted portion of the surrendered Debt Security.
Section 17.03. Adjustment of Conversion Price for Common Stock.
-----------------------------------------------
The Conversion Price with respect to any Debt Security which is
convertible into Common Stock shall be adjusted from time to time as follows:
(1) In case the Company shall, at any time or from time to time while
any of such Debt Securities are outstanding, (i) pay a dividend in shares
of its Common Stock to holders of Common Stock, (ii) combine its
outstanding shares of Common Stock into a smaller number of shares of
Common Stock, (iii) subdivide its outstanding shares of Common Stock into a
greater number of shares of Common Stock or (iv) make a distribution in
shares of Common Stock to holders of Common Stock, then the Conversion
Price in effect immediately before such action shall be adjusted so that
the Holders of such Debt Securities, upon conversion thereof into Common
Stock immediately following such event, shall be entitled to receive the
kind and amount of shares of capital stock of the Company which they would
have owned or been entitled to receive upon or by reason of such event if
such Debt Securities had been converted immediately before the record dated
(or, if no record date, the effective date) for such event. An adjustment
made pursuant to this Section 16.03(1) shall become effective retroactively
immediately after the record date in the case of a dividend or distribution
and shall become effective retroactively immediately after the effective
date in the case of a subdivision or combination. For the purposes of this
Section 16.03(1), each Holder of Debt Securities shall be deemed to have
failed to exercise any right to elect the kind or amount of securities
receivable upon the payment of any such dividend, subdivision, combination
or distribution (provided that if the kind or amount of securities
receivable upon such dividend, subdivision, combination or distribution is
not the same for each nonelecting share, then the kind and amount of
securities or other property receivable upon such dividend, subdivision,
combination or distribution for each nonelecting share shall be deemed to
be the kind and amount so receivable per share by a plurality of the
nonelecting shares).
(2) In case the Company shall, at any time or from time to time while
any of such Debt Securities are outstanding, issue rights or warrants to
all holders of shares of its Common Stock entitling them (for a period
expiring within 45 days after the record date for such issuance) to
subscribe for or purchase shares of Common Stock (or securities convertible
into shares of Common Stock) at a price per share less than the Current
Market Price of the Common Stock at such record date (treating the price
per share of the securities convertible into Common Stock as equal to (x)
the sum of (i) the price for a unit of the security convertible into Common
Stock and (ii) any additional consideration initially payable upon the
conversion of such security into Common Stock divided by (y) the number of
shares of Common Stock initially underlying such convertible security), the
Conversion Price with respect to such Debt Securities shall be adjusted so
that it shall equal the price determined by dividing the Conversion Price
in effect immediately prior to the date of issuance of such rights or
warrants by a fraction, the numerator of which shall be the number of
shares of Common Stock outstanding on the date of issuance of such rights
or warrants plus the number of additional shares of Common Stock offered
for subscription or purchase (or into which the convertible securities so
offered are initially convertible), and the denominator of which shall be
the number of shares of Common Stock outstanding on the date of issuance of
securities which the aggregate offering price of the total number of shares
of securities so offered for subscription or purchase (or the aggregate
purchase price of the
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<PAGE>
convertible securities so offered plus the aggregate amount of any
additional consideration initially payable upon conversion of such
securities into Common Stock) would purchase at such Current Market Price
of the Common Stock. Such adjustment shall become effective retroactively
immediately after the record date for the determination of stockholders
entitled to receive such rights or warrants.
(3) In the case the Company shall, at any time or from time to time
while any of such Debt Securities are outstanding, distribute to all
holders of shares of its Common Stock (including any such distribution made
in connection with a consolidation or merger in which the Company is the
continuing corporation and the Common Stock is not changed or exchanged)
cash, evidences of its indebtedness, securities or assets (excluding (i)
regular periodic cash dividends in amounts, if any, determined from time to
time by the Board of Directors, (ii) dividends payable in shares of Common
Stock for which adjustment is made under Section 16.03(1) or (iii) rights
or warrants to subscribe for or purchase securities of the Company
(excluding those referred to in Section 16.03(2))), then in each such case
the Conversion Price with respect to such Debt Securities determined by
dividing the Conversion Price in effect immediately prior to the date of
such distribution by a fraction, the numerator of which shall be the
Current Market Price of the Common Stock on the record date referred to
below, and the denominator of which shall be such Current Market Price of
the Common Stock less the then fair market value (as determined by the
Board of Directors of the Company, whose determination shall be conclusive)
of the portion of the cash or assets or evidences of indebtedness or
securities so distributed or of such subscription rights or warrants
applicable to one share of Common Stock (provided that such denominator
shall never be less than 1.0); provided however, that no adjustment shall
be made with respect to any distribution of rights to purchase securities
of the Company if a Holder of Debt Securities would otherwise be entitled
to receive such rights upon conversion at any time of such Debt Securities
into Common Stock unless such rights are subsequently redeemed by the
Company, in which case such redemption shall be treated for purposes of
this section as a dividend on the Common Stock. Such adjustment shall
become effective retroactively immediately after the record date for the
determination of stockholders entitled to receive such distribution; and in
the event that such distribution is not so made, the Conversion Price shall
again be adjusted to the Conversion Price which would then be in effect if
such record date had not been fixed.
(4) The Company shall be entitled to make such additional adjustments
in the Conversion Price, in addition to those required by subsections
16.03(1), 16.03(2), and 16.03(03), as shall be necessary in order that any
dividend or distribution of Common Stock, any subdivision, reclassification
or combination of shares of Common Stock or any issuance of rights or
warrants referred to above shall not be taxable to the holders of Common
Stock for United States Federal income tax purposes.
(5) In any case in which this Section 16.03 shall require that any
adjustment be made effective as of or retroactively immediately following a
record date, the Company may elect to defer (but only for five (5) Trading
Days following the filing of the statement referred to in Section 16.05)
issuing to the Holder of any Debt Securities converted after such record
date the shares of Common Stock and other capital stock of the Company
issuable upon such conversion over and above the shares of Common Stock and
other capital stock of the Company issuable upon such conversion on the
basis of the Conversion Price prior to adjustment; provided, however, that
the Company shall deliver to such Holder a due bill or other appropriate
instrument
93
<PAGE>
evidencing such Holder's right to receive such additional shares upon the
occurrence of the event requiring such adjustment.
(6) All calculations under this Section 16.03 shall be made to the
nearest cent or one-hundredth of a share of security, with one-half cent
and 0.005 of a share, respectively, being rounded upward. Notwithstanding
any other provision of this Section 16.03, the Company shall not be
required to make any adjustment of the Conversion Price unless such
adjustment would require an increase or decrease of at least 1% of such
price. Any lessor adjustment shall be carried forward and shall be made at
the time of and together with the next subsequent adjustment which,
together with any adjustment or adjustments so carried forward, shall
amount to an increase or decrease of at least 1% in such price. Any
adjustments under this Section 16.03 shall be made successively whenever an
event requiring such an adjustment occurs.
(7) In the event that at any time, as a result of an adjustment made
pursuant to this Section 16.03, the Holder of any Debt Security thereafter
surrendered for conversion shall become entitled to receive any shares of
stock of the Company other than shares of Common Stock into which the Debt
Securities originally were convertible, the Conversion Price of such other
shares so receivable upon conversion of any such Debt Security 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 Common Stock
contained in subparagraphs (1) through (6) of this Section 16.03, and the
provisions of Sections 16.01, 16.02 and 16.04 through 16.09 with respect to
the Common Stock shall apply on like or similar terms to any such other
shares and the determination of the Board of Directors as to any such
adjustment shall be conclusive.
(8) No adjustment shall be made pursuant to this Section: (i) if the
effect thereof would be to reduce the Conversion Price below the par value
(if any) of the Common Stock or (ii) subject to 16.03(5) hereof, with
respect to any Debt Security that is converted prior to the time such
adjustment otherwise would be made.
Section 17.04 Consolidation or Merger of the Company.
--------------------------------------
In case of either (a) any consolidation or merger to which the Company
is a party, other than a merger or consolidation in which the Company is the
surviving or continuing corporation and which does not result in a
reclassification of, or change (other than a change in par value or from par
value to no par value or from no par value to par value, as a result of a
subdivision or combination) in, outstanding shares of Common Stock or (b) any
sale or conveyance of all or substantially all of the property and assets of the
Company to another Person, then each Debt Security then outstanding shall be
convertible from and after such merger, consolidation, sale or conveyance of
property and assets into the kind and amount of shares of stock or other
securities and property (including cash) receivable upon such consolidation,
merger, sale or conveyance by a holder of the number of shares of Common Stock
into which such Debt Securities would have been converted immediately prior to
such consolidation, merger, sale or conveyance, subject to adjustments which
shall be as nearly equivalent as may be practicable to the adjustments provided
for in this Article Sixteen (and assuming such holder of Common Stock failed to
exercise his rights of election, if any, as to the kind or amount of securities,
cash or other property (including cash) receivable upon such consolidation,
merger, sale or conveyance (provided that, if the kind or amount of securities,
cash or other property (including cash) receivable upon such consolidation,
merger, sale or conveyance is not the same for each nonelecting share, then the
kind and amount of securities, cash or other property (including cash)
receivable upon such consolidation, merger, sale or conveyance for each
nonelecting share shall be deemed to be the kind and amount so receivable
94
<PAGE>
per share by a plurality of the nonelecting shares or securities)). The Company
shall not enter into any of the transactions referred to in clause (a) or (b) of
the preceding sentence unless effective provision shall be made so as to give
effect to the provisions set forth in this Section 16.04. The provisions of
this Section 16.04 shall apply similarly to successive consolidations, mergers,
sales or conveyances.
Section 17.05. Notice of Adjustment.
--------------------
Whenever an adjustment in the Conversion Price with respect to a
series of Debt Securities is required:
(1) the Company shall forthwith place on file with the Trustee and
any Conversion Agent for such Securities a certificate of the Treasurer of
the Company, stating the adjusted Conversion Price determined as provided
herein and setting forth in reasonable detail such facts as shall be
necessary to show the reason for and the manner of computing such
adjustment, such certificate to be conclusive evidence that the adjustment
is correct; and
(2) a notice stating that the Conversion Price has been adjusted and
setting forth the adjusted Conversion Price shall forthwith be given by the
Company, or at the Company's request, by the Trustee in the name and at the
expense of the Company, in the manner provided in Section 1.05. Any notice
so given shall be conclusively presumed to have been duly given, whether or
not the Holder receives such notice.
Section 17.06. Notice in Certain Events.
------------------------
In case:
-------
(1) of a consolidation or merger to which the Company is a party and
for which approval of any stockholders of the Company is required, or of
the sale or conveyance to another Person or entity or group of Persons or
entities acting in concert as a partnership, limited partnership, syndicate
or other group (within the meaning of Rule 13d-3 under the Securities
Exchange Act of 1934, as amended) of all or substantially all of the
property and assets of the Company; or
(2) of the voluntary or involuntary dissolution, liquidation or
winding up of the Company; or
(3) of any action triggering an adjustment of the Conversion Price
pursuant to this Article Sixteen;
then, in each case, the Company shall cause to be filed with the Trustee and the
Conversion Agent for the applicable Debt Securities, and shall cause to be
given, to the Holders of record of applicable Debt Securities in the manner
provided in Section 1.05, at least fifteen (15) days prior to the applicable
date hereinafter specified, a notice stating (x) the date on which a record is
to be taken for the purpose of any distribution or grant of rights or warrants
triggering an adjustment to the Conversion Price pursuant to this Article
Sixteen, or, if a record is not to be taken, the date as of which the holders of
record or Common Stock entitled to such distribution, rights or warrants are to
be determined, or (y) the date on which any reclassification, consolidation,
merger, sale, conveyance, dissolution, liquidation or winding up triggering an
adjustment to the Conversion Price pursuant to this Article Sixteen is expected
to become effective, and the date as of which it is expected that holders of
Common Stock of record shall be entitled
95
<PAGE>
to exchange their Common Stock for securities or other property deliverable upon
such reclassification, consolidation, merger, sale, conveyance, dissolution,
liquidation or winding up.
Failure to give such notice or any defect therein shall not affect the
legality or validity of the proceedings described in clause (1), (2), or (3) of
this Section.
Section 17.07. Company to Reserve Stock; Registration; Listing.
-----------------------------------------------
(a) The Company shall at all times reserve and keep available, free
from preemptive rights, out of its authorized but unissued shares of Common
Stock, for the purpose of effecting the conversion of the Debt Securities, such
number of its duly authorized shares of Common Stock as shall from time to time
be sufficient to effect the conversion of all applicable outstanding Debt
Securities into such Common Stock at any time (assuming that, at the time of the
computation of such number of shares or securities, all such Debt Securities
would be held by a single holder); provided, however, that nothing contained
-----------------
herein shall preclude the Company from satisfying its obligations in respect of
the conversion of the Debt Securities by delivery of purchased shares of Common
Stock which are held in the treasury of the Company. The Company shall from
time to time, in accordance with the laws of its state of incorporation, use its
best efforts to cause the authorized amount of the Common Stock to be increased
if the aggregate of the authorized amount of the Common Stock remaining unissued
and the issued shares of such Common Stock in its treasury (other than any such
shares reserved for issuance in any other connection) shall not be sufficient to
permit the conversion of all Debt Securities.
(b) If any shares of Common Stock which would be issuable upon
conversion of Debt Securities hereunder require registration with or approval of
any governmental authority before such shares or securities may be issued upon
such conversion, the Company will in good faith and as expeditiously as possible
endeavor to cause such shares or securities to be duly registered or approved,
as the case may be. The Company will endeavor to list the shares of Common
Stock required to be delivered upon conversion of the Debt Securities prior to
such delivery upon the principal national securities exchange, if any, upon
which the outstanding Common Stock is listed at the time of such delivery.
Section 17.08. Taxes on Conversion.
-------------------
The Company shall pay any and all documentary, stamp or similar issue
or transfer taxes that may be payable in respect of the issue or delivery of
shares of Common Stock on conversion of Debt Securities pursuant hereto. The
Company shall not, however, be required to pay any such tax which may be payable
in respect of any transfer involved in the issue or delivery of shares of Common
Stock or the portion, if any, of the Debt Securities which are not so converted
in a name other than that in which the Debt Securities so converted were
registered (in case of Registered Securities), and no such issue or delivery
shall be made unless and until the Person requesting such issue has paid to the
Company the amount of such tax or has established to the satisfaction of the
Company that such tax has been paid.
Section 17.09 Conversion After Record Date.
----------------------------
If any Debt Securities are surrendered for conversion subsequent to
the record date preceding an Interest Payment Date but on or prior to such
Interest Payment Date (except Debt Securities called for redemption on a
Redemption Date between such record date and Interest Payment Date), the Holder
of such Debt Securities at the close of business on such record date shall be
entitled to receive the interest payable on such Debt Securities on such
Interest Payment Date notwithstanding the conversion
96
<PAGE>
thereof. Debt Securities surrendered for conversion during the period from the
close of business on any record date next preceding any Interest Payment Date to
the opening of business on such Interest Payment Date to the opening of business
on such Interest Payment Date shall (except in the case of Debt Securities which
have been called for redemption on a Redemption Date within such period) be
accompanied by payment in New York Clearing House funds or other funds and in
the Currency acceptable to the Company of an amount equal to the interest
payable on such Interest Payment Date on the Debt Securities being surrendered
for conversion. Except as provided in this Section 16.09, no adjustments in
respect of payments of interest on Debt Securities surrendered for conversion or
any dividends or distributions of interest on the Common Stock issued upon
conversion shall be made upon the conversion of any Debt Securities.
Section 17.10. Company Determination Final.
---------------------------
Any determination that the Company or the Board of Directors must make
pursuant to this Article is conclusive.
Section 17.11 Trustee's Disclaimer.
--------------------
The Trustee has no duty to determine when an adjustment under this
Article should be made, how it should be made or what it should be. The Trustee
makes no representation as to the validity or value of any securities or assets
issued upon conversion of Debt Securities. The Trustee shall not be responsible
for the Company's failure to comply with this Article. Each Conversion Agent
other than the Company shall have the same protection under this Section as the
Trustee.
97
<PAGE>
IN WITNESS WHEREOF, the parties hereto have caused this Indenture to
be duly executed, and their respective corporate seals to be hereunto affixed
and attested, all as of the day and year first above written.
BRUNO'S, INC.
By:________________________
Title:_____________________
Attest:
________________________
Title:
Seal
MARINE MIDLAND BANK,
as Trustee
By:________________________
Title:
Attest:
________________________
Title:
Seal
98
<PAGE>
STATE OF )
: ss.:
COUNTY OF )
On the day of , 19__, before me personally came ,
to me known, who, being by me duly sworn, did depose and say that he resides at
________________________________; that he is _____________________________ of
Bruno's, Inc., one of the corporations described in and which executed the
foregoing instrument; that he knows the seal of said corporation; that the seal
affixed to said instrument is such corporate seal; that it was so affixed by
authority of the Board of Directors of said corporation, and that he signed his
name thereto by like authority.
________________________
Notary Public
SEAL
99
<PAGE>
STATE OF )
: ss.:
COUNTY OF )
On the day of , 19__, before me personally came
-------------
, to me known, who, being by me duly sworn, did depose and say that he
-------
resides at
---------------------------------------------------------------------
; that he is of , one
--------------- -----------------------------------------
of the corporations described in and which executed the foregoing instrument;
that he knows the seal of said corporation; that the seal affixed to said
instrument is such corporate seal; that it was so affixed by authority of the
Board of Directors of said corporation, and that he signed his name thereto by
like authority.
________________________
Notary Public
SEAL
100
<PAGE>
EXHIBIT A
[FORMS OF CERTIFICATION]
[FORM OF CERTIFICATE TO BE GIVEN BY
PERSON ENTITLED TO RECEIVE BEARER SECURITY
OR INTEREST PRIOR TO AN EXCHANGE DATE]
CERTIFICATE
________________________
[Insert title or sufficient description
of Securities to be delivered]
This is to certify that as of the date hereof and except as set forth
below principal amount of the above captioned Debt Securities held by
you for our account (i) is owned by person(s) that are not United States
person(s) (as defined below), (ii) is owned by United States person(s) that are
(a) foreign branches of United States financial institutions (as defined in
Section 1.165-12(c)(1)(v) of the United States Treasury regulations) ("financial
institutions") purchasing for their own account or for resale, or (b) United
States person(s) who acquired the Debt Securities through foreign branches of
United States financial institutions and who hold the Debt Securities through
such United States financial institutions on the date hereof (and in either case
(a) or (b), each such United States financial institution hereby agrees, on its
own behalf or through its agent, that you may advise the Company or the
Company's agent that it will comply with the requirements of Section
165(j)(3)(A), (B) or (C) of the United States Internal Revenue Code of 1986, as
amended, and the Treasury regulations thereunder), or (iii) is owned by United
States or foreign financial institution(s) for the purpose of resale during the
restricted period (as defined in Section 1.163-5(c)(2)(i)(D)(7) of the United
States Treasury regulations), and in addition if the owner of the Debt
Securities is a United States or foreign financial institution described in
clause (iii) above (whether or not also described in clause (i) or (ii)) this is
to further certify that such financial institution has not acquired the Debt
Securities for the purpose of resale directly or indirectly to a United States
person or to a person within the United States or its possessions.
We undertake to advise you promptly by tested telex on or prior to the
date on which you intend to submit your certification relating to the beneficial
interest in the temporary global Security held by you for our account in
accordance with your operating procedures if any applicable statement herein is
not correct on such date, and in the absence of any such notification it may be
assumed that this certification applies as of such date.
This certificate excepts and does not relate to ________ principal
amount of Debt Securities held by you for our account as to which we are not
able to provide a certificate in this form. We understand that exchange of such
portion of the temporary global Note for definitive Bearer Securities or
interests in a permanent global Note cannot be made until we are able to provide
a certificate in this form.
We understand that this certificate is required in connection with
certain tax laws and regulations of the United States. If administrative or
legal proceedings are commenced or threatened in connection with which this
certificate is or would be relevant, we irrevocably authorize you to produce
this certificate or a copy thereof to any interested party in such proceedings.
<PAGE>
"United States person" means any citizen or resident of the United
States, any corporation, partnership or other entity created or organized in or
under the laws of the United States and any estate or trust the income of which
is subject to United States federal income taxation regardless of its source.
"United States" means the United States of America (including the States and the
District of Columbia) and its "possessions" which include Puerto Rico, the U.S.
Virgin Islands, Guam, American Samoa, Wake Island and the Northern Mariana
Islands.
Dated:________________________, 19__
[To be dated no earlier than the
10th day before the Exchange Date]
By:________________________
As, or as agent for, the
beneficial owner(s) of
the portion of the
temporary global Note
to which this
certificate relates.
2
<PAGE>
EXHIBIT B
[FORM OF CERTIFICATE TO BE GIVEN BY EURO-CLEAR AND
CEDEL, S.A. IN CONNECTION WITH THE EXCHANGE OF
A PORTION OF A TEMPORARY GLOBAL NOTE]
CERTIFICATE
________________________
[Insert title or sufficient description
of Securities to be delivered]
The undersigned certifies that, based solely on certifications we have
received in writing, by tested telex or by electronic transmission from member
organizations appearing in our records as persons being entitled to a portion of
the principal amount set forth below (our "Member Organizations") substantially
to the effect set forth in the Indenture as of the date hereof, _________
principal amount of the above-captioned Debt Securities (i) is owned by
person(s) that are not United States person(s) (as defined below), (ii) is owned
by United States person(s) that are (a) foreign branches of United States
financial institutions (as defined in Section 1.165-12(c)(1)(v) of the United
States Treasury regulations) ("financial institutions") purchasing for their own
account or for resale, or (b) United States person(s) who acquired the Debt
Securities through foreign branches of United States financial institutions and
who hold the Debt Securities through such United States financial institutions
on the date hereof (and in either case (a) or (b), each such United States
financial institution has agreed, on its own behalf or through its agent, that
we may advise the Company or the Company's agent that it will comply with the
requirements of Section 165(j)(3)(A), (B) or (C) of the Internal Revenue Code of
1986, as amended, and the Treasury regulations thereunder), or (iii) is owned by
United States or foreign financial institution(s) for the purpose of resale
during the restricted period (as defined in Section 1.163-5(c)(2)(i)(D)(7) of
the United States Treasury regulations), and in addition United States or
foreign financial institutions described in clause (iii) above (whether or not
also described in clause (i) or (ii)) have certified that they have not acquired
the Debt Securities for the purpose of resale directly or indirectly to a United
States person or to a person within the United States or its possessions.
We further certify (i) that we are not making available for exchange
or collection of any interest any portion of the temporary Global Note excepted
in such certifications and (ii) that as of the date hereof we have not received
any notification from any of our Member Organizations to the effect that the
statements made by such Member Organizations with respect to any portion of the
part submitted herewith for exchange or collection of any interest are no longer
true and cannot be relied upon as of the date hereof.
We understand that this certificate is required in connection with
certain tax laws and regulations of the United States. If administrative or
legal proceedings are commenced or threatened in connection with which this
certificate is or would be relevant, we irrevocably authorize you to produce
this certificate or a copy thereof to any interested party in such proceedings.
"United States person" means any citizen or resident of the United
States, any corporation, partnership or other entity created or organized in or
under the laws of the United States and any estate or trust the income of which
is subject to United States federal income taxation regardless of its source.
"United States" means the United States of America (including the States and the
District of Columbia) and its "possessions" which include Puerto Rico, the U.S.
Virgin Islands, Guam, American Samoa, Wake Island and the Northern Mariana
Islands.
<PAGE>
Dated:________________________, 19__
[To be dated no earlier than the
Exchange Date]
By:________________________
[MORGAN GUARANTY TRUST
COMPANY OF NEW YORK,
BRUSSELS OFFICE, as
Operator of the Euro-Clear
System] [CEDEL, S.A.]
2
Exhibit 4.7
--------------------------------------------------------------------------
BRUNO'S, INC.,
as Issuer,
$400,000,000
10 1/2% SENIOR SUBORDINATED NOTES DUE 2005
_________________
FIRST SUPPLEMENTAL INDENTURE
Dated as of August 18, 1995
_________________
MARINE MIDLAND BANK,
as Trustee
----------------------------------------------------------------------------
<PAGE>
TABLE OF CONTENTS
PAGE
ARTICLE 1
DEFINITIONS . . . . . . . . . . . . . . 1
Section 1.01. Definitions . . . . . . . . . . . . . . . . . . . . 1
Section 1.02. Other Definitions . . . . . . . . . . . . . . . . . 12
Section 1.03. Incorporation by Reference of Trust Indenture Act . 12
Section 1.04. Rules of Construction . . . . . . . . . . . . . . . 13
ARTICLE 2
REDEMPTION . . . . . . . . . . . . . . 14
Section 2.01. Selection of Securities to Be Redeemed . . . . . . 14
Section 2.02. Optional Redemption. . . . . . . . . . . . . . . . 14
Section 2.03. Offer to Purchase by Application of Excess
Proceeds . . . . . . . . . . . . . . . . . . . . . 15
ARTICLE 3
COVENANTS . . . . . . . . . . . . . . 17
Section 3.01. Reports . . . . . . . . . . . . . . . . . . . . . . 17
Section 3.02. Taxes . . . . . . . . . . . . . . . . . . . . . . . 17
Section 3.03. Stay, Extension and Usury Laws . . . . . . . . . . 17
Section 3.04. Restricted Payments . . . . . . . . . . . . . . . . 18
Section 3.05. Dividend and Other Payment Restrictions Affecting
Subsidiaries . . . . . . . . . . . . . . . . . . . 20
Section 3.06. Limitations on Incurrence of Indebtedness and
Issuance of Disqualified Stock . . . . . . . . . . 21
Section 3.07. Asset Sales . . . . . . . . . . . . . . . . . . . . 22
Section 3.08. Transactions with Affiliates . . . . . . . . . . . 23
Section 3.09. Liens . . . . . . . . . . . . . . . . . . . . . . . 24
Section 3.10. Offer to Purchase Upon Change of Control . . . . . 24
Section 3.11. Limitation on Other Senior Subordinated
Indebtedness . . . . . . . . . . . . . . . . . . . 25
Section 3.12. Limitation on Principal Amount, etc. . . . . . . . 26
ARTICLE 4
SUCCESSORS . . . . . . . . . . . . . . 26
Section 4.01. Merger, Consolidation, or Sale of All or
Substantially All Assets . . . . . . . . . . . . . 26
ARTICLE 5
DEFAULTS AND REMEDIES . . . . . . . . . . . 26
Section 5.01. Events of Default . . . . . . . . . . . . . . . . . 26
Section 5.02. Acceleration . . . . . . . . . . . . . . . . . . . 27
Section 5.03. Compliance Certificate; Notices of Default . . . . 28
ARTICLE 6
LEGAL DEFEASANCE AND COVENANT DEFEASANCE . . . . . . 28
Section 6.01. Option to Effect Legal Defeasance or Covenant
Defeasance . . . . . . . . . . . . . . . . . . . . 28
Section 6.02. Legal Defeasance and Discharge . . . . . . . . . . 28
Section 6.03. Covenant Defeasance . . . . . . . . . . . . . . . . 28
Section 6.04. Conditions to Legal or Covenant Defeasance . . . . 29
ARTICLE 7
SATISFACTION AND DISCHARGE . . . . . . . . . . 30
Section 7.01. Satisfaction and Discharge of Indenture . . . . . . 30
<PAGE>
ARTICLE 8
AMENDMENT, SUPPLEMENT AND WAIVER . . . . . . . . 31
Section 8.01. Without Consent of Holders of Securities . . . . . 31
Section 8.02. With Consent of Holders of Securities . . . . . . . 31
Section 8.03. Revocation and Effect of Consents . . . . . . . . . 33
Section 8.04. Notation on or Exchange of Securities . . . . . . . 33
Section 8.05. Payment for Consents . . . . . . . . . . . . . . . 33
ARTICLE 9
SUBORDINATION . . . . . . . . . . . . . 33
Section 9.01. Agreement to Subordinate. . . . . . . . . . . . . . 33
Section 9.02. Certain Definitions. . . . . . . . . . . . . . . . 34
Section 9.03. Liquidation; Dissolution; Bankruptcy . . . . . . . 34
Section 9.04. Default on Designated Senior Indebtedness . . . . . 35
Section 9.05. Acceleration of Securities . . . . . . . . . . . . 36
Section 9.06. When Distribution Must Be Paid Over . . . . . . . . 36
Section 9.07. Notice by Company . . . . . . . . . . . . . . . . . 36
Section 9.08. Subrogation . . . . . . . . . . . . . . . . . . . . 36
Section 9.09. Relative Rights . . . . . . . . . . . . . . . . . . 37
Section 9.10. Subordination May Not Be Impaired by Company . . . 37
Section 9.11. Distribution or Notice to Representative . . . . . 37
Section 9.12. Rights of Trustee and Paying Agent . . . . . . . . 37
Section 9.13. Authorization to Effect Subordination . . . . . . . 38
Section 9.14. Amendments . . . . . . . . . . . . . . . . . . . . 38
Section 9.15. Modification of Terms of Senior Indebtedness . . . 38
Section 9.16. Reliance on Judicial Order or Certificate of
Liquidation Agent . . . . . . . . . . . . . . . . . . . . . . 38
ARTICLE 10
SUBSIDIARY GUARANTEES . . . . . . . . . . . 39
Section 10.01. Subsidiary Guarantee. . . . . . . . . . . . . . . . 39
Section 10.02. Execution and Delivery of Subsidiary Guarantee. . . 40
Section 10.03. Subsidiary Guarantors May Consolidate, etc., on
Certain Terms. . . . . . . . . . . . . . . . . . . 40
Section 10.04. Releases From Subsidiary Guarantees. . . . . . . . 41
ARTICLE 11
MISCELLANEOUS . . . . . . . . . . . . . 41
Section 11.01. No Personal Liability of Partners, Directors,
Officers, Employees and Stockholders . . . . . . . 41
Section 11.02. Priority of Supplemental Indenture . . . . . . . . 41
Section 11.03. Governing Law . . . . . . . . . . . . . . . . . . . 42
Section 11.04. Appointment of Paying Agent, etc. . . . . . . . . . 42
Exhibits:
Exhibit A Form of Senior Subordinated Note
Exhibit B Form of Subsidiary Guarantee
<PAGE>
FIRST SUPPLEMENTAL INDENTURE (the "Supplemental Indenture"),
dated as of August 18, 1995, between Bruno's, Inc., an Alabama corporation
(the "Company"), and Marine Midland Bank, as trustee (the "Trustee"), to
the INDENTURE (the "Original Indenture" and, together with the Supplemental
Indenture, the "Indenture"), dated as of August 18, 1995, between the
Company and the Trustee. Pursuant to Section 3.01 of the Original
Indenture, the Company and the Trustee desire to set forth the terms of a
new series of securities. Therefore, the Company and the Trustee agree as
follows for the benefit of each other and for the equal and ratable benefit
of the Holders of $400,000,000 aggregate principal amount of 10 1/2% Senior
Subordinated Notes due 2005 (the "Securities"):
ARTICLE 1
DEFINITIONS
SECTION 1.01. DEFINITIONS.
Capitalized terms used herein and not otherwise defined shall have the
meanings set forth in the Original Indenture.
"Acquired Indebtedness" means, with respect to any specified Person,
(i) Indebtedness of any other Person existing at the time such other Person
merged with or into or became a Restricted Subsidiary of such specified
Person, including Indebtedness incurred in connection with, or in
contemplation of, such other Person merging with or into or becoming a
Restricted Subsidiary of such specified Person and (ii) Indebtedness
encumbering any asset acquired by such specified Person.
"Affiliate" of any specified Person means any other Person directly or
indirectly controlling or controlled by or under direct or indirect common
control with such specified Person. For purposes of this definition,
"control" (including, with correlative meanings, the terms "controlling,"
"controlled by" and "under common control with"), as used with respect to
any Person, shall mean the possession, directly or indirectly, of the power
to direct or cause the direction of the management or policies of such
Person, whether through the ownership of voting securities, by agreement or
otherwise, provided, however, that beneficial ownership of 10% or more of
the voting securities of a Person shall be deemed to be control.
"Asset Sale" means: (i) the sale, conveyance, transfer or other
disposition (whether in a single transaction or a series of related
transactions) of property or assets (including by way of a sale and
leaseback) of the Company or any Restricted Subsidiary (each referred to in
this definition as a "disposition") or (ii) the issuance or sale of Equity
Interests of any Restricted Subsidiary (whether in a single transaction or
a series of related transactions), in each case, other than: (a) a
disposition of Cash Equivalents or inventory or goods held for sale in the
ordinary course of business or obsolete equipment in the ordinary course of
business consistent with past practices of the Company; (b) the disposition
of all or substantially all of the assets of the Company in a manner
permitted pursuant to Section 4.01 hereof or any disposition that
constitutes a Change of Control pursuant to the Indenture; (c) any
disposition that is a Restricted Payment or that is a dividend or
distribution permitted pursuant to Section 3.04 hereof or any Investment
that is not prohibited thereunder or any disposition of cash or Cash
Equivalents; (d) any disposition, or related series of dispositions, of
assets with an aggregate fair market value of less than $1 million; (e) the
lease, assignment of a lease or sub-lease of any real or personal property
in the ordinary course of business; (f) dispositions, which together with
other dispositions, result in Net Proceeds not to exceed $20 million; or
(g) foreclosures on assets.
<PAGE>
"Bankruptcy Law" means Title 11, U.S. Code or any similar federal or
state law for the relief of debtors.
"Capitalized Lease Obligation" means, at the time any determination
thereof is to be made, the amount of the liability in respect of a capital
lease that would at such time be required to be capitalized and reflected
as a liability on a balance sheet in accordance with GAAP.
"Capital Stock" means with respect to any Person, any and all shares,
interests, participations, rights or other equivalents (however designated)
of corporate stock of such Person, including, without limitation, if such
Person is a partnership, partnership interests (whether general or limited)
and 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, such partnership.
"Cash Equivalents" means (i) United States dollars, (ii) securities
issued or directly and fully guaranteed or insured by the United States
government or any agency or instrumentality thereof, (iii) certificates of
deposit, time deposits and eurodollar time deposits with maturities of one
year or less from the date of acquisition, bankers' acceptances with
maturities not exceeding one year and overnight bank deposits, in each case
with any commercial bank having capital and surplus in excess of $500
million, (iv) repurchase obligations for underlying securities of the types
described in clauses (ii) and (iii) entered into with any financial
institution meeting the qualifications specified in clause (iii) above, (v)
commercial paper rated A-1 or the equivalent thereof by Moody's Investors
Service, Inc. or Standard & Poor's Ratings Group and in each case maturing
within one year after the date of acquisition, (vi) investment funds
investing 95% of their assets in securities of the types described in
clauses (i)-(v) above, (vii) readily marketable direct obligations issued
by any state of the United States of America or any political subdivision
thereof having one of the two highest rating categories obtainable from
either Moody's Investors Service, Inc. or Standard & Poor's Ratings Group
and (viii) Indebtedness or Preferred Stock issued by Persons with a rating
of "A" or higher from Standard & Poor's Ratings Group or "A2" or higher
from Moody's Investors Service, Inc.
"Change of Control" means the occurrence of any of the following:
(i) the sale, lease or transfer, in one or a series of
transactions, of all or substantially all of the assets of the Company
and its Subsidiaries, taken as a whole;
(ii) the Company becomes aware of (by way of a report or any
other filing pursuant to Section 13(d) of the Exchange Act, proxy,
vote, written notice or otherwise) the acquisition by any Person or
group (within the meaning of Section 13(d)(3) or Section 14(d)(2) of
the Exchange Act, or any successor provision), including any group
acting for the purpose of acquiring, holding or disposing of
securities (within the meaning of Rule 13d-5(b)(1) under the Exchange
Act), other than the Permitted Holder and its Related Parties, in a
single transaction or in a related series of transactions, by way of
merger, consolidation or other business combination or purchase of
beneficial ownership (within the meaning of Rule 13d-3 under the
Exchange Act, or any successor provision) of 35% or more of the total
voting power of the Voting Stock of the Company and beneficially owns
more than the Permitted Holder and its Related Parties;
(iii) the first day within any two-year period on which
a majority of the members of the Board of Directors of the Company are
not Continuing Directors; or
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(iv) the Company consolidates with, or merges with or into,
another Person or sells, assigns, conveys, transfers, leases or
otherwise disposes of all or substantially all of its assets to any
Person, or any Person consolidates with, or merges with or into, the
Company, in any such event pursuant to a transaction in which the
outstanding Voting Stock of the Company is converted into or exchanged
for cash, securities or other property, other than (A) any such
transaction where (1) the outstanding Voting Stock of the Company is
converted into or exchanged for (I) Voting Stock (other than
Disqualified Stock) of the surviving or transferee corporation and/or
(II) cash, securities and other property in an amount which could be
paid by the Company as a Restricted Payment under the Indenture and
(2) the "beneficial owners" of the Voting Stock of the Company
immediately prior to such transaction own, directly or indirectly, not
less than a majority of the Voting Stock of the surviving or
transferee corporation immediately after such transaction or (B) any
such transaction as a result of which the Permitted Holder or its
Affiliates own a majority of the total Voting Stock and Capital Stock
of the surviving or transferee corporation immediately after the
transaction.
"Commission" means the Securities and Exchange Commission.
"Consolidated Depreciation and Amortization Expense" means with
respect to any Person for any period, the total amount of depreciation and
amortization expense and other noncash charges (excluding any noncash item
that represents an accrual, reserve or amortization of a cash expenditure
for a future period) of such Person and its Restricted Subsidiaries for
such period on a consolidated basis and otherwise determined in accordance
with GAAP.
"Consolidated Interest Expense" means, with respect to any period, the
sum of: (a) consolidated interest expense of such Person and its
Restricted Subsidiaries for such period, whether paid or accrued (except to
the extent accrued in a prior period), to the extent such expense was
deducted in computing Consolidated Net Income (including amortization of
original issue discount, non-cash interest payments, the interest component
of Capitalized Lease Obligations, and net payments (if any) pursuant to
Hedging Obligations, excluding amortization of deferred financing fees) and
(b) consolidated capitalized interest of such Person and its Restricted
Subsidiaries for such period, whether paid or accrued, to the extent such
expense was deducted in computing Consolidated Net Income.
"Consolidated Net Income" means, with respect to any Person for any
period, the aggregate of the Net Income of such Person and its Restricted
Subsidiaries for such period, on a consolidated basis, and otherwise
determined in accordance with GAAP; provided, however, that (i) the Net
Income for such period of any Person that is not a Subsidiary, or is an
Unrestricted Subsidiary, or that is accounted for by the equity method of
accounting, shall be included only to the extent of the amount of dividends
or distributions or other payments paid in cash (or to the extent converted
into cash) to the referent Person or a Wholly Owned Subsidiary thereof in
respect of such period, (ii) the Net Income of any Person acquired in a
pooling of interests transaction shall not be included for any period prior
to the date of such acquisition and (iii) the Net Income for such period of
any Restricted Subsidiary that is not a Subsidiary Guarantor shall be
excluded to the extent that the declaration or payment of dividends or
similar distributions by that Restricted Subsidiary of its Net Income is
not at the date of determination permitted without any prior governmental
approval (which has not been obtained) or, directly or indirectly, by the
operation of the terms of its charter or any agreement, instrument,
judgment, decree, order, statute, rule or governmental regulation
applicable to that Restricted Subsidiary or its stockholders, unless such
restriction with respect to the payment of dividends or in similar
distributions has been legally waived.
3
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"Continuing Directors" means, as of any date of determination, any
member of the Board of Directors who (i) was a member of such Board of
Directors on the Issuance Date or (ii) was nominated for election or
elected to such Board of Directors with, or whose election to such Board of
Directors was approved by, the affirmative vote of a majority of the
Continuing Directors who were members of such Board of Directors at the
time of such nomination or election or (iii) is any designee of the
Permitted Holder or its Affiliates or was nominated by the Permitted Holder
or its Affiliates or any designees of the Permitted Holder or its
Affiliates on the Board of Directors.
"Credit Facility" means, that certain credit facility, dated as of
August 18, 1995, among the Company and the lenders thereto, including any
related guarantees, collateral documents, instruments and agreements
executed in connection therewith, and such Credit Facility shall include
any amendment, extension, renewal, restatement or refunding thereof or any
credit facility that replaces, refunds or refinances any part of the loans
or commitments thereunder.
"Crimson Associates" means Crimson Associates, L.P., a Delaware
limited partnership.
"Custodian" means any receiver, trustee, assignee, liquidator or
similar official under any Bankruptcy Law.
"Default" means any event that is or with the passage of time or the
giving of notice or both would be an Event of Default.
"Deferred Compensation Agreements" means those agreements between the
Company and certain employees providing for retirement benefits.
"Disqualified Stock" means, with respect to any Person, any Capital
Stock of such Person which, by its terms (or by the terms of any security
into which it is convertible or for which it is puttable or 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
Senior Subordinated Note Maturity Date; provided, however, that if such
Capital Stock is either (i) redeemable or repurchaseable solely at the
option of such Person or (ii) issued to employees of the Company or its
Subsidiaries or to any plan for the benefit of such employees, such Capital
Stock shall not constitute Disqualified Stock unless so designated.
"EBITDA" means, with respect to any Person for any period, the
Consolidated Net Income of such Person for such period plus (a) an amount
equal to any extraordinary loss plus any net loss realized in connection
with an Asset Sale (to the extent such losses were deducted in computing
Consolidated Net Income), plus (b) provision for taxes based on income or
profits of such Person for such period deducted in computing Consolidated
Net Income and any provision for taxes utilized in computing net loss under
clause (a), plus (c) Consolidated Interest Expense of such Person for such
period, plus (d) Consolidated Depreciation and Amortization Expense of such
Person for such period to the extent such depreciation and amortization
were deducted in computing Consolidated Net Income, in each case, on a
consolidated basis for such Person and its Restricted Subsidiaries and
otherwise determined in accordance with GAAP, plus (e) LIFO charges
(credit) of such Person and its consolidated Subsidiaries for such period,
plus (f) the amount of any restructuring charge or reserve recorded during
such period in accordance with GAAP, including any reserve or charge
related to the Merger, plus (g) without duplication, any other non-cash
charges reducing Consolidated Net Income for such period (excluding any
such charge which requires an accrual of a cash reserve for anticipated
cash charges for any future period), less, without duplication, (h) non-
cash items increasing Consolidated Net Income of such Person for such
period (excluding any
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<PAGE>
items which represent the reversal of any accrual of, or cash reserve for,
anticipated cash charges in any prior period) in each case determined in
accordance with GAAP, less (i) the amount of all cash payments made by such
Person or its Restricted Subsidiaries during such period to the extent that
such cash payment has been provided for in a restructuring charge or
reserve referred to in clause (f) above (and was not otherwise deducted in
the computation of Consolidated Net Income of such Person for such period).
"Employment Continuity Agreements" means agreements between the
Company and certain employees providing for lump sum cash payments if such
employee is terminated without cause by the Company or terminated with
cause within one year of a "change of control" (as defined therein) of the
Company.
"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).
"Exchange Act" means the Securities Exchange Act of 1934, as amended.
"Existing Indebtedness" means Indebtedness of the Company or its
Restricted Subsidiaries in existence on the Issuance Date, plus interest
accruing thereon, after application of the net proceeds of the sale of the
Securities as described in the Prospectus Supplement, dated August 10,
1995, relating to the Securities, until such amounts are repaid.
"Fixed Charge Coverage Ratio" means, with respect to any Person for
any period, the ratio of EBITDA of such Person for such period to the Fixed
Charges of such Person for such period. In the event that the Company or
any of its Restricted Subsidiaries incurs, assumes, guarantees or redeems
any Indebtedness (other than revolving credit borrowings with respect to
which the related commitment remains outstanding) or issues or redeems
Preferred Stock subsequent to the commencement of the period for which the
Fixed Charge Coverage Ratio is being calculated but prior to the event for
which the calculation of the Fixed Charge Coverage Ratio is made (the
"Calculation Date"), then the Fixed Charge Coverage Ratio shall be
calculated giving pro forma effect to such incurrence, assumption,
guarantee or redemption of Indebtedness, or such issuance or redemption of
Preferred Stock, as if the same had occurred at the beginning of the
applicable four-quarter period. For purposes of making the computation
referred to above, Investments, acquisitions, dispositions which constitute
all or substantially all of an operating unit of a business and
discontinued operations (as determined in accordance with GAAP) that have
been made by the Company or any of its Restricted Subsidiaries, including
all mergers, consolidations and dispositions, during the four-quarter
reference period or subsequent to such reference period and on or prior to
the Calculation Date shall be calculated on a pro forma basis assuming that
all such Investments, acquisitions, dispositions, discontinued operations,
mergers, consolidations (and the reduction of any associated fixed charge
obligations resulting therefrom) had occurred on the first day of the four-
quarter reference period. If since the beginning of such period any Person
(that subsequently became a Restricted Subsidiary or was merged with or
into the Company or any Restricted Subsidiary since the beginning of such
period) shall have made any Investment, acquisition, disposition which
constitutes all or substantially all of an operating unit of a business,
discontinued operation, merger or consolidation that would have required
adjustment pursuant to this definition, then the Fixed Charge Coverage
Ratio shall be calculated giving pro forma effect thereto for such period
as if such Investment, acquisition, disposition, discontinued operation,
merger or consolidation had occurred at the beginning of the applicable
four-quarter period. For purposes of this definition, whenever pro forma
effect is to be given to a transaction, the pro forma calculations shall be
made in good faith by a responsible financial or accounting officer of the
Company. If any Indebtedness bears a floating rate of interest and is
being
5
<PAGE>
given pro forma effect, the interest of such Indebtedness shall be
calculated as if the rate in effect on the Calculation Date had been the
applicable rate for the entire period (taking into account any Hedging
Obligations applicable to such Indebtedness). Interest on a Capitalized
Lease Obligation shall be deemed to accrue at an interest rate reasonably
determined by a responsible financial or accounting officer of the Company
to be the rate of interest implicit in such Capitalized Lease Obligation in
accordance with GAAP. Interest on Indebtedness that may optionally be
determined at an interest rate based upon a factor of a prime or similar
rate, a eurocurrency interbank offered rate, or other rate, shall be deemed
to have been based upon the rate actually chosen, or, if none, then based
upon such optional rate chosen as the Company may designate (provided that
the Company will deliver to the Trustee a copy of any documentation
necessary to evidence the designation of such optional rate).
"Fixed Charges" means, with respect to any Person for any period, the
sum of (a) Consolidated Interest Expense of such Person for such period and
(b) all cash dividend payments (excluding items eliminated in
consolidation) on any series of Preferred Stock of such Person.
"GAAP" means generally accepted accounting principles set forth in the
opinions and pronouncements of the Accounting Principles Board of the
American Institute of Certified Public Accountants and statements and
pronouncements of the Financial Accounting Standards Board or in such other
statements by such other entity as have been approved by a significant
segment of the accounting profession, which are in effect on the Issuance
Date. For the purposes hereof, the term "consolidated" with respect to any
Person shall mean such Person consolidated with its Restricted
Subsidiaries, and shall not include any Unrestricted Subsidiary.
"Government Securities" means securities that are (a) direct
obligations of the United States of America for the timely payment of which
its full faith and credit is pledged or (b) obligations of a Person
controlled or supervised by and acting as an agency or instrumentality of
the United States of America the timely payment of which is unconditionally
guaranteed as a full faith and credit obligation by the United States of
America, which, in either case, are not callable or redeemable at the
option of the issuer thereof, and shall also include a depository receipt
issued by a bank (as defined in Section 3(a)(2) of the Securities Act), as
custodian with respect to any such Government Security or a specific
payment of principal of or interest on any such Government Security held by
such custodian for the account of the holder of such depository receipt;
provided, that (except as required by law) such custodian is not authorized
to make any deduction from the amount payable to the holder of such
depository receipt from any amount received by the custodian in respect of
the Government Security or the specific payment of principal of or interest
on the Government Security evidenced by such depository receipt.
"Guarantee" means a guarantee (other than by endorsement of negotiable
instruments for collection in the ordinary course of business), direct or
indirect, in any manner (including, without limitation, letters of credit
and reimbursement agreements in respect thereof), of all or any part of any
Indebtedness or other obligations.
"Hedging Obligations" means, with respect to any Person, the
obligations of such Person under (i) currency exchange or interest rate
swap agreements, currency exchange or interest rate cap agreements and
currency exchange or interest rate collar agreements and (ii) other
agreements or arrangements designed to protect such Person against
fluctuations in currency exchange or interest rates.
"Holder" means a registered holder of the Securities.
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"Indebtedness" means, with respect to any Person, (a) any indebtedness
of such Person, whether or not contingent (i) in respect of borrowed money,
(ii) evidenced by bonds, notes, debentures or similar instruments or
letters of credit (or reimbursement agreements in respect thereof), (iii)
representing the balance deferred and unpaid of the purchase price of any
property (including Capitalized Lease Obligations), except any such balance
that constitutes an accrued expense or trade payable or any other monetary
obligation of a trade creditor (whether or not an Affiliate), or (iv)
representing any Hedging Obligations, if and to the extent of any of the
foregoing Indebtedness (other than letters of credit and Hedging
Obligations) that would appear as a liability upon a balance sheet of such
Person prepared in accordance with GAAP, (b) to the extent not otherwise
included, any obligation by such Person to be liable for, or to pay, as
obligor, guarantor or otherwise, on the Indebtedness of another Person
(other than by endorsement of negotiable instruments for collection in the
ordinary course of business) and (c) to the extent not otherwise included,
Indebtedness of another Person secured by a Lien on any asset owned by such
Person (whether or not such Indebtedness is assumed by such Person).
"Indenture" means the Indenture between the Company and Marine Midland
Bank, as trustee, dated as of August 18, 1995, as amended and supplemented
by this Supplemental Indenture and as it may from time to time be
supplemented or amended hereafter.
"Independent Financial Advisor" means an accounting, appraisal or
investment banking firm of nationally recognized standing that is, in the
judgment of the Company's Board of Directors, qualified to perform the task
for which it has been engaged.
"Investments" means, with respect to any Person, all investments by
such Person in other Persons (including Affiliates) in the form of loans
(including Guarantees), advances or capital contributions (excluding
advances to customers, commission, travel and similar advances to officers
and employees made in the ordinary course of business), purchases or other
acquisitions for consideration of Indebtedness, Equity Interests or other
securities issued by any other Person and investments that are required by
GAAP to be classified on the balance sheet of the Company in the same
manner as the other investments included in this definition to the extent
such transactions involve the transfer of cash or other property.
"Issuance Date" means the closing date for the sale and original
issuance of the Securities under the Indenture.
"KKR" means Kohlberg Kravis Roberts & Co., a private investment firm.
"Letter of Credit Obligations" means Indebtedness of the Company or
any of its Restricted Subsidiaries with respect to letters of credit issued
pursuant to the Credit Facility which shall be deemed to consist of (a)
the aggregate maximum amount then available to be drawn under all such
letters of credit (the determination of such maximum amount to assume
compliance with all conditions for drawing), and (b) the aggregate amount
that has then been paid by, and not reimbursed to, the issuers under such
letters of credit.
"Lien" means, with respect to any asset, any mortgage, lien, pledge,
charge, security interest or encumbrance of any kind in respect of such
asset, whether or not filed, recorded or otherwise perfected under
applicable law (including any conditional sale or other title retention
agreement, any lease in the nature thereof, any option or other agreement
to sell or give a security interest in and any filing of or agreement to
give any financing statement under the Uniform Commercial Code (or
equivalent statutes) of any jurisdiction); provided that in no event shall
an operating lease be deemed to constitute a Lien.
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"Merger" means the merger of Crimson Acquisition Corp., a wholly-owned
subsidiary of Crimson Associates, with and into the Company, with the
Company continuing as the surviving corporation.
"Mortgage Financing" means the incurrence by the Company or a
Subsidiary of the Company of any Indebtedness secured by a mortgage or
other Lien on real property acquired or improved by the Company or any
Subsidiary of the Company after the date of the Indenture.
"Mortgage Refinancing" means the incurrence by the Company or a
Subsidiary of the Company of any Indebtedness secured by a mortgage or
other Lien on real property subject to a mortgage or other Lien existing on
the date of the Indenture or created or incurred subsequent to the date of
the Indenture as permitted by the terms of the Indenture and owned by the
Company or any Subsidiary of the Company.
"Net Income" means, with respect to any Person, the net income (loss)
of such Person, determined in accordance with GAAP and before any reduction
in respect of Preferred Stock dividends, excluding, however, any gain or
loss, together with any related provision for taxes on such gain or loss,
realized in connection with (a) any Asset Sale (including, without
limitation, dispositions pursuant to sale and leaseback transactions) or
(b) the disposition of any capital stock or marketable securities.
"Net Proceeds" means the aggregate cash proceeds received by the
Company or any of its Restricted Subsidiaries in respect of any Asset Sale,
net of the direct costs relating to such Asset Sale (including, without
limitation, legal, accounting and investment banking fees, and brokerage
and sales commissions), and any relocation expenses incurred as a result
thereof, taxes paid or payable as a result thereof (after taking into
account any available tax credits or deductions and any tax sharing
arrangements), amounts required to be applied to the repayment of
principal, premium (if any) and interest on Indebtedness required (other
than required by clause (i) of the second paragraph of Section 3.07 hereof)
to be paid as a result of such transaction and any deduction of appropriate
amounts to be provided by the Company as a reserve in accordance with GAAP
against any liabilities associated with the asset disposed of in such
transaction and retained by the Company after such sale or other
disposition thereof, including, without limitation, pension and other post-
employment benefit liabilities and liabilities related to environmental
matters or against any indemnification obligations associated with such
transaction.
"Obligations" means any principal, interest, penalties, fees,
indemnifications, reimbursements, damages and other liabilities payable
under the documentation governing any Indebtedness.
"Offering" means the sale by the Company of its 10 1/2% Senior
Subordinated Notes due 2005.
"Officers' Certificate" means a certificate signed on behalf of the
Company or a Subsidiary Guarantor, as the case may be, by two officers of
the Company or a Subsidiary Guarantor, as the case may be, one of whom must
be the principal executive officer, the principal financial officer, the
treasurer or the principal accounting officer of the Company or a
Subsidiary Guarantor, as the case may be, that meets the requirements set
forth herein.
"Pari Passu Indebtedness" means Indebtedness which ranks pari passu in
right of payment to the Securities or Subsidiary Guarantees in respect
thereof.
"Permitted Holder" means Crimson Associates and any of its Affiliates.
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"Permitted Investments" means (a) any Investments in the Company or
any Restricted Subsidiary that is a Subsidiary Guarantor; (b) any
Investments in cash and Cash Equivalents; (c) Investments by the Company or
any Restricted Subsidiary of the Company in a Person, if as a result of
such Investment (i) such Person becomes a Restricted Subsidiary that is a
Subsidiary Guarantor or (ii) such Person, in one transaction or a series of
related transactions, is merged, consolidated or amalgamated with or into,
or transfers or conveys substantially all of its assets to, or is
liquidated into, the Company or a Restricted Subsidiary that is a
Subsidiary Guarantor; (d) any Related Business Investment; (e) Investments
in securities not constituting cash or Cash Equivalents and received in
connection with an Asset Sale made pursuant Section 3.07 hereof or any
other disposition of assets not constituting an Asset Sale; (f) Investments
existing on the Issuance Date; (g) any transaction to the extent it
constitutes an Investment that is permitted by and made in accordance with
the provisions of the second paragraph of Section 3.08 hereof (except
transactions described in clauses (ii) and (viii) of such paragraph); (h)
Investments by Restricted Subsidiaries that are Subsidiary Guarantors in
other Restricted Subsidiaries that are Subsidiary Guarantors and
Investments by Subsidiaries which are not Restricted Subsidiaries in other
Subsidiaries which are not Restricted Subsidiaries; (i) advances to
employees not in excess of $10 million outstanding at any one time; (j)
Obligations or Equity Interests received in connection with any good faith
settlement or bankruptcy proceeding; (k) Hedging Obligations; (l)
Investments by the Company or any Restricted Subsidiary consisting of the
transfer, assignment or other disposition of any property, lease or other
asset in existence on the Issuance Date and used primarily in the
operations of stores operating under the Piggly Wiggly name on the date of
the Indenture to a Restricted Subsidiary; (m) Investments by the Company or
any Restricted Subsidiary in Restricted Subsidiaries that are not
Subsidiary Guarantors in an aggregate amount not to exceed $15 million at
any one time outstanding; and (n) additional Investments in an aggregate
amount not exceeding $25 million.
"Person" means any individual, corporation, partnership, joint
venture, association, joint-stock company, trust, unincorporated
organization, government or any agency or political subdivision thereof or
any other entity.
"Preferred Stock" means any Equity Interest with preferential right of
payment of dividends or upon liquidation, dissolution, or winding up.
"Principal Business" means the supermarket and retail and wholesale
food sale and distribution business and any activity or business
incidental, directly related or similar thereto, or any business or
activity that is a reasonable extension, development or expansion thereof
or ancillary thereto.
"Prospectus Supplement" means the prospectus supplement relating to
the offering of the Securities, dated August 10, 1995.
"Related Business Investment" means (i) any Investment by a Person in
any other Person that is not a Subsidiary of the Company and a majority of
whose revenues are derived from the operation of one or more retail grocery
stores or supermarkets or any other line of business engaged in by the
Company or any of its Subsidiaries as of the Issuance Date or in the
business of owning and/or leasing real estate related to such activities;
(ii) any Investment by such Person in any cooperative or other supplier,
including, without limitation, any joint venture which is intended to
supply any product or service useful to the business of the Company and its
Subsidiaries as it is conducted as of the Issuance Date and as such
business may thereafter evolve or change, and any capital expenditure or
Investment, in each case reasonably related to the business of the Company
and its Subsidiaries as it is conducted as of the Issuance Date and as such
business may thereafter evolve or change; and (iii) any Investment in PM
Associates or any successor thereto by way of merger, consolidation,
combination or the sale of all or
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substantially all of its assets; provided that such Investment is for the
purpose of the activities described in clause (i).
"Related Parties" means any Person controlled by the Permitted Holder,
including any partnership of which the Permitted Holder or its Affiliates
is the general partner.
"Repurchase Offer" means an offer made by the Company to purchase all
or any portion of a Holder's Securities pursuant to Sections 2.03, 3.07 or
3.10 hereof.
"Restricted Investment" means (i) an Investment other than a Permitted
Investment, (ii) any sale, conveyance, lease, transfer or other disposition
of assets at less than fair market value to an Unrestricted Subsidiary,
provided that the amount of such Restricted Investment under this clause
(ii) shall be such difference in value or (iii) the designation of a
Restricted Subsidiary to be an Unrestricted Subsidiary, provided that the
amount of such Restricted Investment under this clause (iii) shall be the
portion (proportionate to the Company's direct or indirect equity interest
in such Subsidiary) of the book value of the shareholders' investment
(excluding retained earnings) set forth on the balance sheet of such
Subsidiary in accordance with GAAP as of the most recently ended fiscal
quarter for which internal financial statements are available.
"Restricted Subsidiary" means, at any time, any direct or indirect
Subsidiary of the Company that is not then an Unrestricted Subsidiary;
provided, however, that upon the occurrence of any Unrestricted Subsidiary
ceasing to be an Unrestricted Subsidiary, such Subsidiary shall be included
in the definition of "Restricted Subsidiary."
"Securities" means the 10 1/2% Senior Subordinated Notes due 2005 of the
Company, substantially in the form of Exhibit A hereto.
"Securities Act" means the Securities Act of 1933, as amended.
"Senior Subordinated Interest Payment Date" means February 1 and
August 1 of each year.
"Senior Subordinated Note Maturity Date" means August 1, 2005.
"Significant Subsidiary" means any Subsidiary which would be a
"significant subsidiary" as defined in Article 1, Rule 1-02 of Regulation
S-X, promulgated pursuant to the Securities Act, as such Regulation is in
effect on the Issuance Date.
"Subordinated Indebtedness" means any Indebtedness of the Company or
any of its Restricted Subsidiaries which is expressly by its terms
subordinated in right of payment to any other Indebtedness.
"Subsidiary" means, with respect to any Person, (i) any corporation,
association, or other business entity (other than a partnership) of which
more than 50% of the total voting power of shares of Capital Stock entitled
(without regard to the occurrence of any contingency) to vote in the
election of directors, managers or trustees thereof is at the time of
determination owned or controlled, directly or indirectly, by such Person
or one or more of the other Subsidiaries of that Person or a combination
thereof and (ii) any partnership of which more than 50% of the
partnership's capital accounts, distribution rights or general or limited
partnership interests are owned or controlled, directly or indirectly, by
such Person or one or more of the other Subsidiaries of that Person or a
combination thereof.
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"Subsidiary Guarantee" means the guarantee of the Securities by a
Subsidiary Guarantor pursuant to Article 10 hereof.
"Supplemental Indenture" means this First Supplemental Indenture
between the Company and Marine Midland Bank, as trustee, dated as of August
18, 1995.
"TIA" means the Trust Indenture Act of 1939, as amended.
"Unrestricted Subsidiary" means (i) any Subsidiary of the Company
which at the time of determination is an Unrestricted Subsidiary (as
designated by the Board of Directors of the Company, as provided below, and
provided that the Company concurrently delivers a copy of any such
designation or Board Resolution to the Trustee) and (ii) any Subsidiary of
an Unrestricted Subsidiary. The Board of Directors of the Company may
designate any Subsidiary of the Company (including any Subsidiary and any
newly acquired or newly formed Subsidiary) to be an Unrestricted Subsidiary
unless such subsidiary owns any Equity Interests of, or owns, or holds any
Lien on, any property of, any Subsidiary of the Company (other than any
Subsidiary of the Subsidiary to be so designated), provided that (a) any
Unrestricted Subsidiary must be an entity of which shares of the capital
stock or other equity interests(including partnership interests) entitled
to cast at least a majority of the votes that may be cast by all shares or
equity interests having ordinary voting power for the election of directors
or other governing body are owned, directly or indirectly, by the Company,
(b) the Company certifies that such designation complies with Section 3.04
hereof and (c) each of (I) the Subsidiary to be so designated and (II) its
Subsidiaries has not at the time of designation, and does not thereafter,
create, incur, issue, assume, guarantee or otherwise become directly or
indirectly liable with respect to any Indebtedness pursuant to which the
lender has recourse to any of the assets of the Company or any of its
Restricted Subsidiaries. The Board of Directors may designate any
Unrestricted Subsidiary to be a Restricted Subsidiary; provided that,
immediately after giving effect to such designation, the Company could
incur at least $1.00 of additional Indebtedness pursuant to the Fixed
Charge Coverage Ratio test described in Section 3.06 hereof on a pro forma
basis taking into account such designation.
"Voting Stock" means, with respect to any Person, any class or series
of capital stock of such Person that is ordinarily entitled to vote in the
election of directors thereof at a meeting of stockholders called for such
purpose, without the occurrence of any additional event or contingency.
"Weighted Average Life to Maturity" means, when applied to any
Indebtedness or Disqualified Stock, as the case may be, at any date, the
number of years obtained by dividing (a) the sum of the products obtained
by multiplying (x) the amount of each then remaining installment, sinking
fund, serial maturity or other required payments of principal, including
payment at final maturity, in respect thereof, by (y) the number of years
(calculated to the nearest one-twelfth) that will elapse between such date
and the making of such payment, by (b) the then outstanding principal
amount or liquidation preference, as applicable, of such Indebtedness or
Disqualified Stock, as the case may be.
"Wholly Owned Restricted Subsidiary" is any Wholly Owned Subsidiary
that is a Restricted Subsidiary.
"Wholly Owned Subsidiary" of any Person means a Subsidiary of such
Person 95% of the outstanding Capital Stock or other ownership interests of
which (other than directors' qualifying shares) shall at the time be owned
by such Person or by one or more Wholly Owned Subsidiaries of such Person
and one or more Wholly Owned Subsidiaries of such Person.
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SECTION 1.02. OTHER DEFINITIONS.
Defined in
Term Section
"Affiliate Transaction" . . . . . . . . . . . . . . 3.08
"Change of Control Offer" . . . . . . . . . . . . . 3.10
"Change of Control Payment" . . . . . . . . . . . . 3.10
"Change of Control Payment Date" . . . . . . . . . 3.10
"Covenant Defeasance" . . . . . . . . . . . . . . . 6.03
"Designated Senior Indebtedness" . . . . . . . . . 9.02
"Event of Default" . . . . . . . . . . . . . . . . 5.01
"Excess Proceeds" . . . . . . . . . . . . . . . . . 3.07
"Excess Proceeds Offer" . . . . . . . . . . . . . . 2.03
"incur" . . . . . . . . . . . . . . . . . . . . . . 3.06
"Legal Defeasance" . . . . . . . . . . . . . . . . 6.02
"Offer Amount" . . . . . . . . . . . . . . . . . . 2.03
"Offer Period" . . . . . . . . . . . . . . . . . . 2.03
"Permitted Refinancing" . . . . . . . . . . . . . . 3.06
"Purchase Date" . . . . . . . . . . . . . . . . . . 2.03
"Refinancing Indebtedness" . . . . . . . . . . . . 3.06
"Representative" . . . . . . . . . . . . . . . . . 9.02
"Retired Capital Stock" . . . . . . . . . . . . . . 3.04
"Restricted Payments" . . . . . . . . . . . . . . . 3.04
"Refunding Capital Stock" . . . . . . . . . . . . . 3.04
"SEC Reports" . . . . . . . . . . . . . . . . . . . 3.01
"Senior Indebtedness" . . . . . . . . . . . . . . 9.02
SECTION 1.03. INCORPORATION BY REFERENCE OF TRUST INDENTURE ACT.
Whenever this Supplemental Indenture refers to a provision of the
TIA, the provision is incorporated by reference in and made a part of the
Indenture. The defined terms in the Original Indenture are incorporated
herein by reference, but notwithstanding the foregoing, in the event of a
conflict between the defined terms set forth herein and the defined terms
set forth in the Original Indenture, the defined terms set forth herein
shall control.
The following TIA terms used in this Supplemental Indenture have the
following meanings:
"indenture securities" means the Securities;
"indenture security holder" means a Holder of a Security;
"indenture trustee" or "institutional trustee" means the Trustee;
"obligor" on the Securities means the Company and any successor
obligor upon the Securities.
All other terms used in the Indenture that are defined by the TIA,
defined by TIA reference to another statute or defined by Commission rule
under the TIA have the meanings so assigned to them.
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SECTION 1.04. RULES OF CONSTRUCTION.
Unless the context otherwise requires:
(1) a term has the meaning assigned to it;
(2) an accounting term not otherwise defined has the meaning
assigned to it in accordance with GAAP;
(3) "or" is not exclusive;
(4) words in the singular include the plural, and in the plural
include the singular; and
(5) provisions apply to successive events and transactions.
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ARTICLE 2
REDEMPTION
SECTION 2.01. SELECTION OF SECURITIES TO BE REDEEMED.
If less than all of the Securities are to be redeemed at any time,
selection of such Securities for redemption will be made by the Trustee in
compliance with the requirements of the principal national securities
exchange, if any, on which such Securities are listed, or, if such
Securities are not so listed, on a pro rata basis, by lot or by such other
method as the Trustee shall deem fair and appropriate (and in such manner
as complies with applicable legal requirements), provided that no
Securities of $1,000 or less shall be redeemed in part.
If less than all of the Securities are to be purchased in an Asset
Sale Offer at any time, selection of such Securities for purchase will be
made by the Trustee in compliance with the requirements of the principal
national securities exchange, if any, on which such Securities are listed,
or if such Securities are not so listed, on a pro rata basis, by lot or by
such other method as the Trustee shall deem fair and appropriate (and in
such manner as complies with applicable legal requirements), provided that
no Securities of $1,000 or less shall be purchased in part.
Notices of purchase or redemption shall be mailed by first class mail,
postage prepaid, at least 30 but not more than 60 days before the purchase
or redemption date to each Holder of Securities to be purchased or redeemed
at such Holder's registered address. If any Security is to be purchased or
redeemed in part only, any notice of purchase or redemption that relates to
such Security shall state the portion of the principal amount thereof that
has been or is to be purchased or redeemed.
A new Security in principal amount equal to the unpurchased or
unredeemed portion of any Security purchased or redeemed in part will be
issued in the name of the Holder thereof upon cancellation of the original
Security. On and after the purchase or redemption date, unless the Company
defaults in payment of the purchase or redemption price, interest shall
cease to accrue on Securities or portions thereof purchased or called for
redemption.
SECTION 2.02. OPTIONAL REDEMPTION.
Except as described below, the Securities are not redeemable at the
Company's option prior to August 1, 2000. From and after August 1, 2000,
the Securities will be subject to redemption at the option of the Company,
in whole or in part, upon not less than 30 nor more than 60 days' written
notice, at the redemption prices (expressed as percentages of principal
amount) set forth below, plus accrued and unpaid interest, if any, thereon
to the applicable redemption date, if redeemed during the twelve-month
period beginning on August 1 of each of the years indicated below:
Percentage of
Year Principal Amount
---- ----------------
2000 . . . . . . . . . . . . . . . . . . . . . 105.25%
2001 . . . . . . . . . . . . . . . . . . . . . 103.50%
2002 . . . . . . . . . . . . . . . . . . . . . 101.75%
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2003 and thereafter . . . . . . . . . . . . . . 100.00%
Prior to August 1, 1998, the Company may, at its option, on any one
or more occasions redeem up to 40% of the aggregate face amount of
Securities originally offered in the Offering at a redemption price equal
to 110.50% of the principal amount thereof, plus accrued and unpaid
interest thereon to the redemption date, with the net proceeds of an
underwritten public offering of Common Stock of the Company; provided that
at least 60% of the original aggregate principal amount of the Securities
remains outstanding immediately after the occurrence of such redemption;
and provided, further, that such redemption shall occur within 60 days of
the date of the closing of such underwritten public offering of Common
Stock of the Company.
SECTION 2.03. OFFER TO PURCHASE BY APPLICATION OF EXCESS PROCEEDS.
If at any time the aggregate amount of Excess Proceeds that have not
been applied in accordance with this Section 2.03 exceeds $20.0 million,
the Company shall, within 10 days thereafter, make an offer to all Holders
of Securities (an "Excess Proceeds Offer") to purchase the maximum
principal amount of Securities, that is an integral multiple of $1,000,
that may be purchased out of such Excess Proceeds, at an offer price in
cash in an amount equal to 100% of the principal amount thereof plus
accrued and unpaid interest, if any, to the date fixed for the closing of
such offer, in accordance with the procedures specified below.
The Excess Proceeds Offer shall remain open for a period of 20
Business Days following its commencement and no longer, except to the
extent that a longer period is required by applicable law (the "Offer
Period"). No later than five Business Days after the termination of the
Offer Period (the "Purchase Date"), the Company shall purchase the maximum
principal amount of Securities that may be purchased with such Excess
Proceeds (or such pro rata portion) (which maximum principal amount of
Securities shall be the "Offer Amount") or, if less than the Offer Amount
has been tendered, all Securities tendered in response to the Excess
Proceeds Offer, subject to the provisions of Section 3.07.
If the Purchase Date is on or after an interest record date and on or
before the related interest payment date, any accrued interest shall be
paid to the Person in whose name a Security is registered at the close of
business on such record date, and no additional interest shall be payable
to Holders who tender Securities pursuant to the Excess Proceeds Offer on
the portion of the tendered Securities purchased pursuant to the Excess
Proceeds Offer.
Upon the commencement of any Excess Proceeds Offer, the Company shall
send, by first class mail, a notice to the Trustee and each of the Holders
of the Securities, with a copy to the Trustee. The notice shall contain
all instructions and materials necessary to enable such Holders to tender
Securities pursuant to the Excess Proceeds Offer. The Excess Proceeds
Offer shall be made to all Holders. The notice, which shall govern the
terms of the Excess Proceeds Offer, shall state:
(a) that the Excess Proceeds Offer is being made pursuant to
Sections 2.03 and 3.07 and the length of time the Excess Proceeds Offer
shall remain open;
(b) the Offer Amount (including the amount of accrued interest,
if any), the purchase price and the Purchase Date;
(c) that any Security or portion thereof not tendered or
accepted for payment shall continue to accrue interest in accordance
with the terms thereof;
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(d) that any Security or portion thereof accepted for payment
pursuant to the Excess Proceeds Offer shall cease to accrue interest
after the Purchase Date;
(e) that Holders electing to have a Security or portion thereof
purchased pursuant to any Excess Proceeds Offer shall be required to
surrender the Security, with the form entitled "Option of Holder to
Elect Purchase" on the reverse of the Security completed, to the
Company, a depositary, if appointed by the Company, or a Paying Agent at
the address specified in the notice at least three Business Days before
the Purchase Date and must complete any form letter of transmittal
proposed by the Company and acceptable to the Trustee and the Paying
Agent;
(f) that Holders shall be entitled to withdraw their election if
the Company, depositary or Paying Agent, as the case may be, receives,
not later than the fourth Business Day before the Purchase Date, a
telegram, telex, facsimile transmission or letter setting forth the name
of the Holder, the principal amount of the Security or portion thereof
the Holder delivered for purchase, the Security certificate number and a
statement that such Holder is withdrawing his election to have the
Security or portion thereof purchased;
(g) that, if the aggregate principal amount of Securities
tendered by Holders exceeds the Offer Amount, the Trustee shall select
the Securities to be purchased on a pro rata basis (with such
adjustments as may be deemed appropriate by the Trustee so that only
Securities in denominations of $1,000, or integral multiples thereof,
shall be purchased);
(h) that Holders whose Securities were purchased only in part
shall be issued new Securities equal in principal amount to the
unpurchased portion of the Securities surrendered; and
(i) the instructions that Holders must follow to tender their
Securities.
On or before the Purchase Date, the Company shall, to the extent
lawful, accept for payment, on a pro rata basis to the extent necessary,
the Offer Amount of Securities or portions thereof tendered pursuant to the
Excess Proceeds Offer, or if less than the Offer Amount has been tendered,
all Securities or portion thereof tendered, and deliver to the Trustee an
Officers' Certificate stating that such Securities or portions thereof were
accepted for payment by the Company in accordance with the terms of this
Section 2.03. The Company, depository or Paying Agent, as the case may be,
shall promptly (but in any case not later than five days after the Purchase
Date) mail or deliver to each tendering Holder an amount equal to the
purchase price of the Security or portion thereof tendered by such Holder
and accepted by the Company for purchase, and the Company shall promptly
issue a new Security, and the Trustee shall authenticate and mail or
deliver such new Security to such Holder equal in principal amount to any
unpurchased portion of the Security surrendered. Any Security not so
accepted shall be promptly mailed or delivered by the Company to the Holder
thereof. The Company shall publicly announce the results of the Excess
Proceeds Offer on the second Business Day following the Purchase Date. In
the event that the aggregate amount of Excess Proceeds exceeds the
aggregate principal amount of Securities or portion thereof surrendered by
Holders thereof pursuant to an Excess Proceeds Offer, the Company may use
the remaining Excess Proceeds for general purposes. Upon completion of an
Excess Proceeds Offer, the amount of Excess Proceeds shall be deemed to be
reset at zero.
The Company shall comply, to the extent applicable, with the
requirements of Section 14(e) of the Exchange Act and any other securities
laws or regulations in connection with the repurchase of Securities
pursuant to an Excess Proceeds Offer. To the extent that the provision of
any securities laws or regulations conflict with the provisions of this
Section 2.03, the Company shall comply with the
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applicable securities laws and regulations and shall not be deemed to have
breached its obligations under this Section 2.03 or Article Thirteen of the
Original Indenture by virtue thereof.
The provisions set forth in Article Thirteen of the Original
Indenture shall not apply to Excess Proceeds Offers.
ARTICLE 3
COVENANTS
SECTION 3.01. REPORTS.
(a) The Company will file with the Trustee and provide Holders of
Securities, within 15 days after it files them with the Commission, copies
of its annual reports and of the information, documents and other reports
(or copies of such portions of any of the foregoing as the Commission may
by rule or regulation prescribe) which the Company is required to file with
the Commission pursuant to Section 13 or 15(d) of the Exchange Act ("SEC
Reports"). Notwithstanding that the Company may not be required to remain
subject to the reporting requirements of Section 13 or 15(d) of the
Exchange Act or otherwise report on an annual and quarterly basis on forms
provided for such annual and quarterly reporting pursuant to rules and
regulations promulgated by the Commission, the Company shall continue to
file with the Commission and provide the Trustee and Holders with, without
cost to each Holder, (a) within 90 days after the end of each fiscal year,
annual reports on Form 10-K (or any successor or comparable form)
containing the information required to be contained therein (or required in
such successor or comparable form); (b) within 45 days after the end of
each of the first three fiscal quarters of each fiscal year, reports on
Form 10-Q (or any successor or comparable form); and (c) promptly from time
to time after the occurrence of an event required to be therein reported,
such other reports on Form 8-K (or any successor or comparable form)
containing the information required to be contained therein (or required in
any successor or comparable form); provided, however, that the Company
shall not be so obligated to file such reports with the Commission if the
Commission does not permit such filings. The Company will in all cases,
without cost to each recipient, provide copies of such information to the
Holders of the Securities and, if they are not permitted to file such
reports with the Commission, shall make available such information to
prospective purchasers and to securities analysts and broker-dealers upon
their request. The Company shall also comply with the provisions of TIA Sec.
314(a).
(b) The Company shall provide the Trustee with a sufficient number
of copies of all SEC Reports that the Trustee may be required to deliver to
the Holders of the Securities under this Section 3.01.
SECTION 3.02. TAXES.
The Company shall pay, and shall cause each of its Subsidiaries to
pay, prior to delinquency, all material taxes, assessments, and
governmental levies, except as contested in good faith and by appropriate
proceedings or where the failure to effect such payment is not adverse in
any material respect to the Holders of the Securities.
SECTION 3.03. STAY, EXTENSION AND USURY LAWS.
The Company covenants (to the extent that it may lawfully do so) that
it shall not at any time insist upon, plead, or in any manner whatsoever
claim or take the benefit or advantage of, any stay,
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extension or usury law wherever enacted, now or at any time hereafter in
force, that may affect the covenants or the performance of the Indenture;
and the Company (to the extent that it may lawfully do so) hereby expressly
waives all benefit or advantage of any such law, and covenants that it
shall not, by resort to any such law, hinder, delay or impede the execution
of any power herein granted to the Trustee, but shall suffer and permit the
execution of every such power as though no such law has been enacted.
SECTION 3.04. RESTRICTED PAYMENTS.
(a) The Company will not, and will not permit any of its Restricted
Subsidiaries to, directly or indirectly: (i) declare or pay any dividend
or make any distribution on account of the Company's or any of its
Restricted Subsidiaries' Equity Interests (other than (1) dividends or
distributions by the Company payable in Equity Interests (other than
Disqualified Stock) of the Company; or (2) dividends or distributions by a
Restricted Subsidiary of the Company so long as, in the case of any
dividend or distribution payable on or in respect of any class or series of
securities issued by a Subsidiary other than a Wholly Owned Subsidiary, the
Company or a Restricted Subsidiary of the Company receives at least its pro
rata share of such dividend or distribution in accordance with its Equity
Interests in such class or series of securities); (ii) purchase, redeem,
defease or otherwise acquire or retire for value any Equity Interests of
the Company; or (iii) make any Restricted Investment (all such payments and
other actions set forth in clauses (i) through (iii) above being
collectively referred to as "Restricted Payments"), unless, at the time of
such Restricted Payment:
(A) no Default or Event of Default shall have occurred and be
continuing or would occur as a consequence thereof; and
(B) such Restricted Payment, together with the aggregate of all
other Restricted Payments made by the Company and its Restricted
Subsidiaries after the Issuance Date (including Restricted Payments
permitted by clause (i) of the next succeeding paragraph, but excluding
all other Restricted Payments permitted by the next succeeding
paragraph), is less than the sum of (V) 50% of the Consolidated Net
Income of the Company for the period (taken as one accounting period)
from the fiscal quarter that first begins after the Issuance Date to the
end of the Company's most recently ended fiscal quarter for which
internal financial statements are available at the time of such
Restricted Payment (or, in the case such Consolidated Net Income for
such period is a deficit, minus 100% of such deficit), plus (W) 100% of
the aggregate net cash proceeds and the fair market value, as determined
in good faith by the Board of Directors, of marketable securities
received by the Company since the Issuance Date from the issue or sale
of Equity Interests (including Retired Capital Stock (as defined below))
or debt securities of the Company that have been converted into such
Equity Interests of the Company (other than Refunding Capital Stock (as
defined below) or Equity Interests or convertible debt securities of the
Company sold to a Restricted Subsidiary of the Company and other than
Disqualified Stock or debt securities that have been converted into
Disqualified Stock), plus (X) 100% of the aggregate amounts contributed
to the capital of the Company, plus (Y) 100% of the aggregate amounts
received in cash and the fair market value of marketable securities
(other than Restricted Investments) received from (i) the sale or other
disposition of Restricted Investments made by the Company and its
Subsidiaries or (ii) the sale of the stock of an Unrestricted Subsidiary
or the sale of all or substantially all of the assets of an Unrestricted
Subsidiary to the extent that a liquidating dividend is paid to the
Company or any Subsidiary from the proceeds of such sale plus (Z) $40
million.
(b) The foregoing provisions in Section 3.04(a) shall not prohibit:
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(i) the payment of any dividend within 60 days after the date of
declaration thereof, if at the date of declaration such payment would have
complied with the provisions of the Indenture;
(ii) (A) the redemption, repurchase, retirement or other acquisition
of any Equity Interests of the Company or any Restricted Subsidiary (the
"Retired Capital Stock") in exchange for, or out of the proceeds of, the
substantially concurrent sale (other than to a Restricted Subsidiary of the
Company) of Equity Interests of the Company (other than any Disqualified
Stock) (the "Refunding Capital Stock"), and (B) if immediately prior to
such retirement of Retired Capital Stock the declaration and payment of
dividends thereon was permitted under clause (v) of this paragraph, the
declaration and payment of dividends on the Refunding Capital Stock in an
aggregate amount per year no greater than the aggregate amount of dividends
per annum that was declarable and payable on such Retired Capital Stock
immediately prior to such retirement; provided that at the time of the
declaration of any such dividends, no Default or Event of Default shall
have occurred and be continuing or would occur as a consequence thereof;
(iii) a Restricted Payment to pay for the repurchase, retirement or
other acquisition or retirement for value of any Equity Interests of the
Company held by any future, present or former employee or director of the
Company or any Subsidiary pursuant to any management equity plan or stock
option plan or any other agreement, provided that the aggregate Restricted
Payments made under this clause (iii) does not exceed the sum of (A) $10
million in any fiscal year (provided that any unused amounts may be carried
over to any subsequent fiscal year subject to a maximum amount of $20
million in any fiscal year) plus (B) cash proceeds from the sale of Equity
Interests to members of management of the Company and its Subsidiaries;
(iv) the payment of any amounts in connection with the Merger under
the Merger Agreement, the Employment Continuity Agreements, the Deferred
Compensation Agreements and the documents executed in connection therewith,
including without limitation, appraisal or similar rights;
(v) the declaration and payment of dividends to holders of any
class or series of Preferred Stock (other than Disqualified Stock) issued
after the Issuance Date (including, without limitation, the declaration and
payment of dividends on Refunding Capital Stock in excess of the dividends
declarable and payable thereon pursuant to clause (ii)); provided that at
the time of such issuance the Fixed Charge Coverage Ratio of the Company,
after giving effect to such issuance, would be greater than 1.50 to 1.00;
(vi) Investments in Unrestricted Subsidiaries in an aggregate amount
not to exceed $40 million at any one time outstanding;
(vii) the payment of dividends on the Company's Common Stock,
following the first public offering of the Company's Common Stock after the
Issuance Date, of up to 6% per annum of the net proceeds received by the
Company in such public offering, other than public offerings with respect
to the Company's Common Stock registered on Form S-8; and
(viii) a Restricted Payment to pay for the repurchase, retirement
or other acquisition or retirement for value of Equity Interests of the
Company in existence on the Issuance Date which are not held by the
Permitted Holder on the Issuance Date (including any Equity Interests
issued in respect of such Equity Interests as a result of a stock split,
recapitalization, merger, combination, consolidation or otherwise, but
excluding any management equity plan or stock option plan or similar
agreement), provided that the aggregate Restricted Payments made under this
clause (viii) shall not exceed $50 million, provided further that
notwithstanding the foregoing proviso, the Company shall be permitted to
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make additional Restricted Payments under this clause (viii) if the Fixed
Charge Coverage Ratio of the Company, after giving effect to such
Restricted Payment, would be greater than 1.50 to 1.00; provided, further,
that at the time of, and after giving effect to, any Restricted Payment
permitted under clauses (iii), (v), (vi), (vii) and (viii), no Default or
Event of Default shall have occurred and be continuing or would occur as a
consequence thereof; and provided further that for purposes of determining
the aggregate amount expended for Restricted Payments in accordance with
clause (a)(B) of the immediately preceding paragraph, only the amounts
expended under clause (i) shall be included.
(c) Not later than the date of making any Restricted Payment, the
Company shall deliver to the Trustee an Officers' Certificate stating that
such Restricted Payment is permitted and setting forth the basis upon which
the calculations required by Section 3.04 were computed, which calculations
may be based upon the Company's latest available financial statements.
(d) The Company shall not permit any Unrestricted Subsidiary to
become a Restricted Subsidiary except pursuant to the last sentence of the
definition of "Unrestricted Subsidiary." Unrestricted Subsidiaries will
not be subject to any of the restrictive covenants set forth in the
Indenture.
SECTION 3.05. DIVIDEND AND OTHER PAYMENT RESTRICTIONS AFFECTING
SUBSIDIARIES.
The Company will not, and will not permit any of its Restricted
Subsidiaries that are not Subsidiary Guarantors to, directly or indirectly,
create or otherwise cause to become effective any consensual encumbrance or
consensual restriction on the ability of any such Restricted Subsidiary to:
(a) (i) pay dividends or make any other distributions to the
Company or any of its Restricted Subsidiaries on its Capital Stock or
any other interest or participation in, or measured by, its profits or
(ii) pay any Indebtedness owed to the Company or any of its Restricted
Subsidiaries;
(b) make loans or advances to the Company or any of its Restricted
Subsidiaries that are Subsidiary Guarantors; or
(c) sell, lease, or transfer any of its properties or assets to the
Company or any of its Restricted Subsidiaries that are Subsidiary
Guarantors,
except (in each case) for such encumbrances or restrictions existing
under or by reason of: (i) contractual encumbrances or restrictions in
effect on the Issuance Date, including pursuant to the Credit Facility and
its related documentation; (ii) the Indenture and the Securities; (iii) any
instrument governing Indebtedness or Capital Stock of a Person acquired by
the Company or any Restricted Subsidiary as in effect at the time of such
acquisition; (iv) by reason of customary non-assignment or subletting
provisions in leases entered into in the ordinary course of business and
consistent with past practices; (v) purchase money obligations for property
acquired in the ordinary course of business that impose restrictions of the
nature discussed in clause (c) above on the property so acquired; (vi)
applicable law or any applicable rule or order; (vii) Existing
Indebtedness; (viii) other Indebtedness permitted to be incurred subsequent
to the Issuance Date pursuant to Section 3.06 hereof; provided that any
such restrictions are ordinary and customary with respect to the type of
Indebtedness being incurred (under the relevant circumstances); (ix) any
Mortgage Financing or Mortgage Refinancing that imposes restrictions on the
real property securing such Indebtedness; (x) any Permitted Investment;
(xi) contracts for the sale of assets, including, without limitation
customary restrictions with respect to a Subsidiary pursuant to an
agreement that has been entered into for the sale or disposition of all or
substantially all of the Capital Stock or assets of such Subsidiary; (xii)
secured Indebtedness otherwise permitted to be incurred pursuant to
Sections 3.06 and
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3.09 hereof that limit the right of the debtor to dispose of the assets
securing such Indebtedness; (xiii) customary net worth provisions contained
in leases and other agreements entered into in the ordinary course of
business; (xiv) customary provisions in joint venture agreements and other
similar agreements; and (xv) any encumbrances or restrictions imposed by
any amendments, modifications, restatements, renewals, increases,
supplements, refundings, replacements or refinancings of the contracts,
instruments or obligations referred to in clauses (i) through (xiv) above,
provided that such amendments, modifications, restatements, renewals,
increases, supplements, refundings, replacements or refinancings are, in
the good faith judgment of the Company's Board of Directors (as evidenced
by a Board Resolution, a copy of which is delivered to the Trustee), no
more restrictive with respect to such dividend and other payment
restrictions than those contained in the dividend or other payment
restrictions prior to such amendment, modification, restatement, renewal,
increase, supplement, refunding, replacement or refinancing.
SECTION 3.06. LIMITATIONS ON INCURRENCE OF INDEBTEDNESS AND ISSUANCE OF
DISQUALIFIED STOCK.
(a) The Company will not, and will not permit any of its Restricted
Subsidiaries to, directly or indirectly, create, incur, issue, assume,
Guarantee or otherwise become directly or indirectly liable with respect to
(collectively, "incur" and correlatively, an "incurrence" of) any
Indebtedness (including Acquired Indebtedness) or any shares of
Disqualified Stock; provided, however, that the Company or its Restricted
Subsidiaries may incur Indebtedness or issue shares of Disqualified Stock
if the Fixed Charge Coverage Ratio for the Company and its Restricted
Subsidiaries for the most recently ended four full fiscal quarters for
which internal financial statements are available immediately preceding the
date of such incurrence would have been (x) at least 1.75 to 1.0 if such
date is prior to April 4, 1998 and (y) 2.0 to 1.0 if such date is on or
after April 4, 1998 determined on a pro forma basis (including a pro forma
application of the net proceeds therefrom), as if the additional
Indebtedness had been incurred or the Disqualified Stock had been issued,
as the case may be, and application of proceeds had occurred at the
beginning of such four-quarter period.
(b) The foregoing limitation in Section 3.06(a) shall not apply to:
(i) the incurrence by the Company or any of its Restricted
Subsidiaries of Indebtedness under the Credit Facility and the issuance
of letters of credit thereunder (with letters of credit being deemed to
have a principal amount equal to the maximum face amount thereunder) up
to an aggregate principal amount of $750 million outstanding at any one
time, less principal repayments in accordance with the schedule of
required principal repayments under the Credit Facility in effect at the
Issuance Date; (ii) the incurrence by the Company or any of its
Restricted Subsidiaries of any Existing Indebtedness; (iii) the
incurrence by the Company or any of its Restricted Subsidiaries of
Indebtedness represented by the Securities or a Subsidiary Guarantee;
(iv) Indebtedness (including Capitalized Lease Obligations) incurred by
the Company or any of its Restricted Subsidiaries to finance the
purchase, lease or improvement of property (real or personal) or
equipment (whether through the direct purchase of assets or the Capital
Stock of any Person owning such assets); provided that, in the case of
Indebtedness exceeding $2 million for any such obligation or
transaction, such Indebtedness exists at the date of such purchase or
transaction or is created within 180 days thereafter; (v) Indebtedness
incurred by the Company or any of its Restricted Subsidiaries
constituting reimbursement obligations with respect to letters of credit
issued in the ordinary course of business, including without limitation
letters of credit in respect of workers' compensation claims or self-
insurance, or other Indebtedness with respect to reimbursement type
obligations regarding workers' compensation claims; (vi) Guarantees
incurred in the ordinary course of business, by the Company or a
Restricted Subsidiary, of Indebtedness of any other Person in the
aggregate not to
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exceed $15 million outstanding at any time; (vii) Guarantees by the
Company or a Restricted Subsidiary of Indebtedness incurred by a
Restricted Subsidiary so long as the incurrence of such Indebtedness
incurred by such Restricted Subsidiary is permitted under the terms of
the Indenture; (viii) Indebtedness arising from Guarantees of
Indebtedness of the Company or any Restricted Subsidiary or other
agreements of the Company or a Restricted Subsidiary providing for
indemnification, adjustment of purchase price or similar obligations, in
each case, incurred or assumed in connection with the disposition of any
business, assets or a Subsidiary, other than Guarantees of Indebtedness
incurred by any Person acquiring all or any portion of such business,
assets or a Subsidiary for the purpose of financing such acquisition;
provided that the maximum assumable liability in respect of all such
Indebtedness shall at no time exceed the gross proceeds actually
received by the Company and its Restricted Subsidiaries in connection
with such disposition; (ix) intercompany Indebtedness between or among
the Company and any Restricted Subsidiaries and Guarantees by a
Restricted Subsidiary of the Company of Indebtedness of any other
Restricted Subsidiary of the Company or the Company; (x) Hedging
Obligations that are incurred (1) for the purpose of fixing or hedging
interest rate risk with respect to any Indebtedness that is permitted by
the terms of the Indenture to be outstanding or (2) for the purpose of
fixing or hedging currency exchange rate risk with respect to any
currency exchanges; (xi) obligations in respect of performance and
surety bonds and completion guarantees provided by the Company or any
Restricted Subsidiary in the ordinary course of business; (xii)
Indebtedness not otherwise permitted hereunder in an amount under this
clause (xii) not to exceed $150 million at any one time; and (xiii) the
incurrence by the Company or any of its Restricted Subsidiaries of
Indebtedness which serves to refund, refinance or restructure its
Existing Indebtedness or any other Indebtedness incurred as permitted
under the first paragraph of this covenant and clauses (ii), (iii),
(iv), (v), (viii), (x) and (xi) above, or any Indebtedness issued to so
refund, refinance or restructure such Indebtedness including additional
Indebtedness incurred to pay premiums and fees in connection therewith
(the "Refinancing Indebtedness") prior to its respective maturity;
provided however that such Refinancing Indebtedness (A) has a Weighted
Average Life to Maturity at the time such Refinancing Indebtedness is
incurred which is not less than the remaining Weighted Average Life to
Maturity of Indebtedness being refunded or refinanced and (B) to the
extent such Refinancing Indebtedness refinances Indebtedness
subordinated or pari passu to the Securities, such Refinancing
Indebtedness is subordinated or pari passu to the Securities at least to
the same extent as the Indebtedness being refinanced or refunded; and
provided further that subclauses (A) and (B) of this clause (xiii) will
not apply to any refunding or refinancing of any Senior Indebtedness.
SECTION 3.07. ASSET SALES.
(a) The Company shall not, and shall not permit any of its
Restricted Subsidiaries to, cause, make or suffer to exist an Asset Sale,
unless (w) no Default or Event of Default exists or is continuing
immediately prior to or after giving effect to such Asset Sale and (x) the
Company, or its Restricted Subsidiaries, as the case may be, receives
consideration at the time of such Asset Sale at least equal to the fair
market value (as determined in good faith by the Company) of the assets
sold or otherwise disposed of; provided however that the Company shall have
the right to exclude from the provisions of this paragraph and the
succeeding paragraph Asset Sales subsequent to the Issuance Date the
proceeds of which are derived from the sale and substantially concurrent
lease-back of a supermarket and/or related assets or equipment which is
acquired or constructed by the Company or a Restricted Subsidiary
subsequent to the date that is six months prior to the Issuance Date;
provided that such sale and substantially concurrent lease-back occurs
within 365 days following such acquisition or the completion of such
construction, as the case may be.
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(b) Within 365 days after the Company's or any Restricted
Subsidiary's receipt of the Net Proceeds of any Asset Sale, the Company or
such Restricted Subsidiary may apply the Net Proceeds from such Asset Sale
to any of the following: (i) permanently reduce Obligations under the
Credit Facility (and to correspondingly reduce commitments with respect
thereto) or other Senior Indebtedness or Pari Passu Indebtedness, (ii) use
such Net Proceeds to secure Letter of Credit Obligations to the extent
related letters of credit have not been drawn upon or returned undrawn,
(iii) invest in any one or more business, capital expenditure or other
tangible asset of the Company or any Restricted Subsidiary, in each case,
engaged, used or useful in the Principal Business, with no concurrent
obligation to make an offer to purchase any Securities, (iv) invest in
properties or assets that replace the properties and assets that are the
subject of such Asset Sale and (v) in the case of a sale of a store or
stores, deem such Net Proceeds to have been applied to the extent of any
capital expenditures made to acquire or construct a replacement store in
the general vicinity of the store sold within 365 days preceding the date
of the Asset Sale. Pending the final application of any such Net Proceeds,
the Company or such Restricted Subsidiary may temporarily reduce
Indebtedness under a revolving credit facility, if any, or otherwise invest
such Net Proceeds in Cash Equivalents which shall be pledged to the Trustee
as security for the Securities. Any Net Proceeds from the Asset Sale that
are not invested as provided and within the time period set forth in the
first sentence of this paragraph will be deemed to constitute "Excess
Proceeds."
SECTION 3.08. TRANSACTIONS WITH AFFILIATES.
The Company will not, and will not permit any of its Restricted
Subsidiaries to, sell, lease, transfer or otherwise dispose of any of its
properties or assets to, or purchase any property or assets from, or enter
into any contract, agreement, understanding, loan, advance or guarantee
with, or for the benefit of, any Affiliate (each of the foregoing, an
"Affiliate Transaction") involving aggregate consideration in excess of $5
million, unless:
(a) such Affiliate Transaction is on terms that are no less
favorable to the Company or the relevant Restricted Subsidiary than
those that would have been obtained in a comparable transaction by the
Company or such Restricted Subsidiary with an unrelated Person; and
(b) the Company delivers to the Trustee with respect to any
Affiliate Transaction involving aggregate payments in excess of $15
million, a resolution adopted by a majority of the disinterested
directors of the Board of Directors approving such Affiliate Transaction
and set forth in an Officers' Certificate certifying that such Affiliate
Transaction complies with clause (a) above.
The foregoing provisions will not apply to the following: (i)
transactions between or among the Company and/or any of its Restricted
Subsidiaries that are Subsidiary Guarantors or between or among the
Restricted Subsidiaries that are Subsidiary Guarantors; (ii) Restricted
Payments permitted by Section 3.04 hereof; (iii) the payment of all fees,
expenses and other amounts as disclosed in the proxy/prospectus relating to
the Merger; (iv) the payment of customary annual management, consulting and
advisory fees and related expenses to KKR and its Affiliates; (v) the
payment of reasonable and customary regular fees paid to, and indemnity
provided on behalf of, officers, directors, employees or consultants of the
Company or any Restricted Subsidiary; (vi) the transfer or provision of
inventory, goods or services by the Company or any Restricted Subsidiary in
the ordinary course of business to any Restricted Subsidiary on terms that
are customary in the industry or consistent with past practices; (vii)
payments by the Company or any of its Restricted Subsidiaries to KKR and
its Affiliates made pursuant to any financial advisory, financing,
underwriting or placement agreement or in respect of other investment
banking activities, including, without limitation, in connection with
acquisitions or divestitures which are approved by the Board of Directors
in good faith; (viii) transactions in which the Company
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or any of its Restricted Subsidiaries, as the case may be, delivers to the
holders of the Securities a written opinion of an Independent Financial
Advisor stating that such transaction is fair to the Company or such
Restricted Subsidiary from a financial point of view; (ix) payments or
loans to employees or consultants which are approved by the Board of
Directors of the Company in good faith; (x) any agreement as in effect as
of the Issuance Date or any amendment thereto or any transaction
contemplated thereby (including pursuant to any amendment thereto so long
as any such amendment is not disadvantageous to the Holders of the
Securities in any material respect); (xi) the existence of, or the
performance by the Company or any of its Restricted Subsidiaries of its
obligations under the terms of, any stockholders agreement (including any
registration rights agreement or purchase agreement related thereto) to
which it is a party as of the Issuance Date and any similar agreements
which it may enter into thereafter, provided, however, that the existence
of, or the performance by the Company or any Restricted Subsidiaries of
obligations under any future amendment to any such existing agreement or
under any similar agreement entered into after the Issuance Date shall only
be permitted by this clause (xi) to the extent that the terms of any such
amendment or new agreement are not otherwise disadvantageous to the Holders
of the Securities in any material respect; (xii) transactions permitted by,
and complying with, the provisions of Section 4.01 hereof; and (xiii)
transactions with suppliers or other purchases or sales of goods or
services, in each case in the ordinary course of business (including,
without limitation, pursuant to joint venture agreements) and otherwise in
compliance with the terms of the Indenture which are fair to the Company or
its Restricted Subsidiaries, in the reasonable determination of the Board
of Directors of the Company or the senior management thereof, or are on
terms at least as favorable as might reasonably have been obtained at such
time from an unaffiliated party.
SECTION 3.09. LIENS.
The Company will not, and will not permit any of its Restricted
Subsidiaries to, directly or indirectly create, incur, assume or suffer to
exist any Lien that secures obligations under any Subordinated Indebtedness
on any asset or property of the Company or such Restricted Subsidiary, or
any income or profits therefrom, or assign or convey any right to receive
income therefrom, unless the Securities are equally and ratably secured
with the obligations so secured until such time as such obligations are no
longer secured by a Lien.
SECTION 3.10. OFFER TO PURCHASE UPON CHANGE OF CONTROL.
(a) Upon the occurrence of a Change of Control, the Company will
make an offer to purchase all or any part (equal to $1,000 or an integral
multiple thereof) of the Securities pursuant to the offer described below
(the "Change of Control Offer") at a price in cash (the "Change of Control
Payment") equal to 101% of the aggregate principal amount thereof plus
accrued and unpaid interest, if any, to the date of purchase. Within 30
days following any Change of Control, the Company will mail a notice to
each Holder of Securities issued under the Indenture, with a copy to the
Trustee, with the following information: (1) a Change of Control Offer is
being made pursuant to the covenant entitled "Change of Control," and that
all Securities properly tendered pursuant to such Change of Control Offer
will be accepted for payment; (2) the purchase price and the purchase date,
which will be no earlier than 30 days nor later than 60 days from the date
such notice is mailed, except as may be otherwise required by applicable
law (the "Change of Control Payment Date"); (3) any Security not properly
tendered will remain outstanding and continue to accrue interest; (4)
unless the Company defaults in the payment of the Change of Control
Payment, all Securities accepted for payment pursuant to the Change of
Control Offer will cease to accrue interest on the Change of Control
Payment Date; (5) Holders electing to have any Securities purchased
pursuant to a Change of Control Offer will be required to surrender the
Securities, with the form entitled "Option of Holder to Elect Purchase" on
the reverse of the Securities
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completed, to the paying agent specified in the notice at the address
specified in the notice prior to the close of business on the third
Business Day preceding the Change of Control Payment Date; (6) Holders will
be entitled to withdraw their tendered Securities and their election to
require the Company to purchase such Securities, provided, that the paying
agent receives, not later than the close of business on the last day of the
offer period, a telegram, telex, facsimile transmission or letter setting
forth the name of the Holder, the principal amount of Securities tendered
for purchase, the Security certificate number and a statement that such
Holder is withdrawing his tendered Securities and his election to have such
Securities purchased; and (7) that Holders whose Securities are being
purchased only in part will be issued new Securities equal in principal
amount to the unpurchased portion of the Securities surrendered, which
unpurchased portion must be equal to $1,000 in principal amount or an
integral multiple thereof. Prior to complying with the provisions of this
Section 3.10, but in any event within 30 days following a Change of
Control, the Company will either repay all outstanding amounts under the
Credit Facility or offer to repay in full all outstanding amounts under the
Credit Facility and repay the Obligations held by each lender who has
accepted such offer or obtain the requisite consents, if any, under the
Credit Facility to permit the repurchase of the Securities required by this
Section 3.10. The Company will comply with the requirements of Rule 14e-1
under the Exchange Act and any other securities laws and regulations
thereunder to the extent such laws or regulations are applicable in
connection with the repurchase of the Securities pursuant to a Repurchase
Offer. To the extent that the provisions of any securities laws or
regulations conflict with the provisions of the Indenture, the Company will
comply with the applicable securities laws and regulations and shall not be
deemed to have breached its obligations described herein by virtue thereof.
(b) On the Change of Control Payment Date, the Company will, to the
extent permitted by law, (1) accept for payment all Securities or portions
thereof properly tendered pursuant to the Change of Control Offer, (2)
deposit with the paying agent an amount equal to the aggregate Change of
Control Payment in respect of all Securities or portions thereof so
tendered and (3) deliver, or cause to be delivered, to the Trustee for
cancellation the Securities so accepted together with an Officers'
Certificate stating that such Securities or portions thereof have been
tendered to and purchased by the Company. The Indenture will provide that
the paying agent will promptly mail to each Holder of Securities the Change
of Control Payment for such Securities, and the Trustee will promptly
authenticate and mail to each Holder a new Security equal in principal
amount to any unpurchased portion of the Securities surrendered, if any,
provided, that each such new Security will be in a principal amount of
$1,000 or an integral multiple thereof. The Company will publicly announce
the results of the Change of Control Offer on or as soon as practicable
after the Change of Control Payment Date.
SECTION 3.11. LIMITATION ON OTHER SENIOR SUBORDINATED INDEBTEDNESS.
Neither the Company nor any Subsidiary Guarantor will, directly or
indirectly, incur any Indebtedness (including Acquired Indebtedness) that
is subordinate in right of payment to any Indebtedness of the Company or
such Subsidiary Guarantor unless such Indebtedness is either (a) pari passu
in right of payment with the Securities or the Subsidiary Guarantee, as the
case may be, or (b) subordinate in right of payment to the Securities, in
the same manner and at least to the same extent as the Securities are
subordinate to Senior Indebtedness.
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SECTION 3.12. LIMITATION ON PRINCIPAL AMOUNT, ETC.
The Securities will be limited in aggregate principal amount and will
have terms regarding maturity and interest, among other things, as set
forth in Exhibit A hereto. The Securities will be issued in the form of a
Global Note pursuant to the terms of the Original Indenture.
ARTICLE 4
SUCCESSORS
SECTION 4.01. MERGER, CONSOLIDATION, OR SALE OF ALL OR SUBSTANTIALLY ALL
ASSETS
The Company may not consolidate or merge with or into or wind up into
(whether or not the Company is the surviving corporation), or sell, assign,
transfer, lease, convey or otherwise dispose of all or substantially all of
its properties or assets in one or more related transactions to, any Person
unless (i) the Company is the surviving corporation or the Person formed by
or surviving any such consolidation or merger (if other than the Company)
or to which such sale, assignment, transfer, lease, conveyance or other
disposition will have been made is a corporation organized or existing
under the laws of the United States, any state thereof, the District of
Columbia, or any territory thereof; (ii) the Person formed by or surviving
any such consolidation or merger (if other than the Company) or the Person
to which such sale, assignment, transfer, lease, conveyance or other
disposition will have been made assumes all the obligations of the Company
under the Indenture pursuant to a supplemental indenture or other documents
or instruments in form reasonably satisfactory to the Trustee under the
Securities and the Indenture; (iii) immediately after such transaction no
Default or Event of Default exists; and (iv) the Company or any Person
formed by or surviving any such consolidation or merger, or to which such
sale, assignment, transfer, lease, conveyance or other disposition will
have been made will, at the time of such transaction and after giving pro
forma effect thereto as if such transaction had occurred at the beginning
of the applicable four-quarter period, be permitted to incur at least $1.00
of additional Indebtedness pursuant to the Fixed Charge Coverage Ratio test
set forth in Section 3.06 hereof. The foregoing provisions shall not apply
to the Merger. Notwithstanding the foregoing clauses (iii) and (iv), (a)
any Restricted Subsidiary may consolidate with, merge into or transfer all
or part of its properties and assets to the Company and (b) the Company may
merge with an Affiliate incorporated solely for the purpose of
reincorporating the Company in another jurisdiction. Section 10.01 of the
Original Indenture shall not apply to the Securities.
ARTICLE 5
DEFAULTS AND REMEDIES
SECTION 5.01. EVENTS OF DEFAULT.
Each of the following constitutes an "Event of Default", replacing
and superseding in full the Events of Default set forth in Section 5.01 of
the Original Indenture:
(a) default in payment when due and payable, upon redemption,
acceleration or otherwise, of principal or premium, if any, on the
Securities or under any Subsidiary Guarantee;
(b) default for 30 days or more in the payment when due of interest
on the Securities or under any Subsidiary Guarantee;
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(c) failure by the Company or any Subsidiary Guarantor for 30 days
after receipt of written notice given by the Trustee or the Holders of
at least 30% in principal amount of the Securities then outstanding to
comply with any of its other agreements in the Indenture or the
Securities;
(d) default under any mortgage, indenture or instrument under which
there is issued or by which there is secured or evidenced any
Indebtedness for money borrowed by the Company or any of its Restricted
Subsidiaries or the payment of which is guaranteed by the Company or any
of its Restricted Subsidiaries (other than Indebtedness owed to the
Company or a Restricted Subsidiary), whether such Indebtedness or
Guarantee now exists or is created after the Issuance Date, if both (A)
such default either (1) results from the failure to pay any such
Indebtedness at its stated final maturity (after giving effect to any
applicable grace periods) or (2) relates to an obligation other than the
obligation to pay such Indebtedness at its stated final maturity and
results in the holder or holders of such Indebtedness causing such
Indebtedness to become due prior to its stated maturity and (B) the
principal amount of such Indebtedness, together with the principal
amount of any other such Indebtedness in default for failure to pay
principal at stated final maturity (after giving effect to any
applicable grace periods), or the maturity of which has been so
accelerated, aggregate $30 million or more at any one time outstanding;
(e) failure by the Company or any of its Significant Subsidiaries
that is a Subsidiary Guarantor to pay final judgments aggregating in
excess of $30 million, which final judgments remain unpaid, undischarged
and unstayed for a period of more than 60 days after such judgment
becomes final;
(f) the Company or any of its Subsidiaries pursuant to or within the
meaning of Bankruptcy Law: (A) commences a voluntary case; (B) consents
to the entry of an order for relief against it in an involuntary case;
(C) consents to the appointment of a Custodian of it or for all or
substantially all of its property; (D) makes a general assignment for
the benefit of its creditors, or (E) admits in writing that it is
generally not paying its debts (other than debts which are the subject
of a bona fide dispute) as they become due; or
(g) a court of competent jurisdiction enters an order or decree
under any Bankruptcy Law that remains unstayed and in effect for 60 days
and: (A) is for relief against the Company or any of its Subsidiaries
in an involuntary case; (B) appoints a Custodian of the Company or any
of its Subsidiaries or for all or substantially all of the property of
the Company or any of its Subsidiaries; or (C) orders the liquidation of
the Company or any of its Subsidiaries; provided that clauses (A), (B)
and (C) shall not apply to an Unrestricted Subsidiary, unless such
action or proceeding has a material adverse effect on the interests of
the Company or any Restricted Subsidiary.
SECTION 5.02. ACCELERATION.
If any Event of Default (other than by reason of an Event of Default
specified in paragraphs (f) and (g) of Section 5.01 hereof) occurs and is
continuing under the Indenture, the Trustee or the Holders of at least 30%
in principal amount of the then outstanding Securities may declare the
principal, premium, if any, interest and any other monetary obligations on
all the then outstanding Securities to be due and payable immediately.
Notwithstanding the foregoing, in the case of an Event of Default arising
under Sections 5.01(f) or (g) hereof, with respect to the Company or any
Subsidiary Guarantor that is a Significant Subsidiary, all outstanding
Securities will become due and payable without further action or notice.
The provisions set forth in the first paragraph of Section 5.02 of the
Original Indenture shall not apply to the Securities.
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SECTION 5.03. COMPLIANCE CERTIFICATE; NOTICES OF DEFAULT.
The Company is required, within five Business Days, upon becoming
aware of any Default or Event of Default or any default under any document,
instrument or agreement representing Indebtedness of the Company, to
deliver to the Trustee a statement specifying such Default or Event of
Default.
ARTICLE 6
LEGAL DEFEASANCE AND COVENANT DEFEASANCE
SECTION 6.01. OPTION TO EFFECT LEGAL DEFEASANCE OR COVENANT DEFEASANCE.
The Company may, at the option of its Board of Directors evidenced by
a resolution set forth in an Officers' Certificate, at any time, with
respect to the Securities, elect to have either Section 6.02 or 6.03 be
applied to all outstanding Securities upon compliance with the conditions
set forth below in this Article 6. Sections 15.01 and 15.02 of the
Original Indenture shall not apply to the Securities.
SECTION 6.02. LEGAL DEFEASANCE AND DISCHARGE.
Upon the Company's exercise under Section 6.01 of the option
applicable to this Section 6.02, the Company and each Subsidiary Guarantor,
shall be deemed to have been discharged from its obligations with respect
to all outstanding Securities and any Subsidiary Guarantees, as applicable,
on the date the conditions set forth below are satisfied (hereinafter,
"Legal Defeasance"). For this purpose, such Legal Defeasance means that
the Company shall be deemed to have paid and discharged all the Obligations
relating to the outstanding Securities and any Subsidiary Guarantee, and
the Securities shall thereafter be deemed to be "outstanding" only for the
purposes of Section 15.03 of the Original Indenture and the other Sections
of the Indenture referred to in (a) and (b) below, and to have satisfied
all of its other obligations under such Securities and the Indenture and
cured all then existing Events of Default (and the Trustee, on demand of
and at the expense of the Company, shall execute proper instruments
acknowledging the same), except for the following which shall survive until
otherwise terminated or discharged hereunder: (a) the rights of holders of
outstanding Securities to receive payments in respect of the principal of,
premium, if any, and interest on such Securities when such payments are due
solely out of the trust created pursuant to the Indenture; (b) the
Company's and any Subsidiary Guarantor's obligations with respect to
Securities concerning issuing temporary Securities, registration of such
Securities, mutilated, destroyed, lost or stolen Securities and the
maintenance of an office or agency for payment and money for security
payments held in trust; (c) the rights, powers, trusts, duties and
immunities of the Trustee, and the Company's and any Subsidiary Guarantor's
obligations in connection therewith; and (d) the Legal Defeasance
provisions of the Indenture.
SECTION 6.03. COVENANT DEFEASANCE.
Upon the Company's exercise under Section 6.01 of the option
applicable to this Section 6.03, the Company shall be released from its
obligations under the covenants contained in Sections 3.01, 3.04, 3.05,
3.06, 3.07, 3.08, 3.09, 3.10, 3.11 and Article 4 hereof and Article Ten of
the Original Indenture with respect to the outstanding Securities on and
after the date the conditions set forth below are satisfied (hereinafter,
"Covenant Defeasance"), and the Securities shall thereafter be deemed not
"outstanding" for the purposes of any direction, waiver, consent or
declaration or act of Holders (and the consequences of any thereof) in
connection with such covenants, but shall continue to be deemed
"outstanding" for all other purposes hereunder (it being understood that
such Securities shall not be deemed outstanding for
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accounting purposes). For this purpose, such Covenant Defeasance means
that, with respect to the outstanding Securities, the Company may omit to
comply with and shall have no liability in respect of any term, condition
or limitation set forth in any such covenant, whether directly or
indirectly, by reason of any reference elsewhere herein to any such
covenant or by reason of any reference in any such covenant to any other
provision herein or in any other document and such omission to comply shall
not constitute a Default or an Event of Default under Sections 5.01 (c),
(d) or (e) but, except as specified above, the remainder of the Indenture
and such Securities shall be unaffected thereby. In addition, upon the
Company's exercise under Section 6.01 of the option applicable to this
Section 6.03, Sections 5.01(c) through 5.01(e) shall not constitute Events
of Default.
SECTION 6.04. CONDITIONS TO LEGAL OR COVENANT DEFEASANCE.
The following shall be the conditions to the application of either
Section 6.02 or Section 6.03 to the outstanding Securities:
(i) The Company shall irrevocably have deposited or caused to be
deposited with the Trustee (or another trustee satisfying the
requirements of the Indenture who shall agree to comply with the
provisions of this Article 6 applicable to it) as trust funds in trust
for the purpose of making the following payments, specifically pledged
as security for, and dedicated solely to, the benefit of the Holders of
such Securities, cash in U.S. dollars, non-callable Government
Securities, or a combination thereof, in such amounts as will be
sufficient, in the opinion of a nationally recognized firm of
independent public accountants selected by the Company, to pay the
principal of, premium, if any, and interest due on the outstanding
Securities, on the stated maturity date or on the applicable optional
redemption date, as the case may be, of such principal, premium, if any,
or interest on the outstanding Securities;
(ii) in the case of Legal Defeasance, the Company shall deliver to
the Trustee an opinion of counsel in the United States reasonably
acceptable to the Trustee confirming that, subject to customary
assumptions and exclusions, (A) the Company has received from, or there
has been published by, the Internal Revenue Service a ruling or (B)
since the date hereof, there has been a change in the applicable federal
income tax law, in either case to the effect that, and based thereon
such opinion of counsel shall confirm that, subject to customary
assumptions and exclusions, the Holders of the outstanding Securities
will not recognize income, gain or loss for federal income tax purposes
as a result of such Legal Defeasance and will be subject to federal
income tax on the same amounts, in the same manner and at the same times
as would have been the case if such Legal Defeasance had not occurred;
(iii) in the case of Covenant Defeasance, the Company shall deliver
to the Trustee an opinion of counsel in the United States reasonably
acceptable to the Trustee confirming that, subject to customary
assumptions and exclusions, the Holders of the outstanding Securities
will not recognize income, gain or loss for federal income tax purposes
as a result of such Covenant Defeasance and will be subject to federal
income tax on the same amounts, in the same manner and at the same times
as would have been the case if such covenant defeasance had not
occurred;
(iv) no Default or Event of Default shall have occurred and be
continuing on the date of such deposit or insofar as Events of Default
from bankruptcy or insolvency events are concerned, at any time in the
period ending on the 91st day after the date of deposit;
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(v) such Legal Defeasance or Covenant Defeasance shall not result
in a breach or violation of, or constitute a default under any material
agreement or instrument (other than the Indenture) to which the Company
or any Subsidiary Guarantor is a party or by which the Company or any
Subsidiary Guarantor is bound;
(vi) the Company shall have delivered to the Trustee an opinion of
counsel to the effect that, as of the date of such opinion and subject
to customary assumptions and exclusions following the deposit, the trust
funds will not be subject to the effect of any applicable bankruptcy,
insolvency, reorganization or similar laws affecting creditors' rights
generally under any applicable U.S. federal or state law, and that the
Trustee has a perfected security interest in such trust funds for the
ratable benefit of the Holders;
(vii) the Company shall have delivered to the Trustee an Officers'
Certificate stating that the deposit was not made by the Company with
the intent of defeating, hindering, delaying or defrauding creditors of
the Company or others; and
(viii) the Company shall have delivered to the Trustee an Officers'
Certificate and an opinion of counsel in the United States (which
opinion of counsel may be subject to customary assumptions and
exclusions), each stating that all conditions precedent provided for or
relating to the Legal Defeasance or the Covenant Defeasance, as the case
may be, have been complied with.
ARTICLE 7
SATISFACTION AND DISCHARGE
SECTION 7.01. SATISFACTION AND DISCHARGE OF INDENTURE.
The Indenture will be discharged and will cease to be of further
effect as to all Securities issued thereunder, when either (a) all such
Securities theretofore authenticated and delivered (except lost, stolen or
destroyed Securities which have been replaced or paid and Securities for
whose payment money has theretofore been deposited in trust and thereafter
repaid to the Company) have been delivered to the Trustee for cancellation;
or (b) (i) all such Securities not theretofore delivered to the Trustee for
cancellation have become due and payable by reason of the making of a
notice of redemption or otherwise or will become due and payable within one
year and the Company has irrevocably deposited or caused to be deposited
with the Trustee as trust funds in trust an amount of money sufficient to
pay and discharge the entire indebtedness on such Securities not
theretofore delivered to the Trustee for cancellation for principal,
premium, if any, and accrued interest to the date of maturity or
redemption; (ii) no Default or Event of Default with respect to the
Indenture or the Securities shall have occurred and be continuing on the
date of such deposit or shall occur as a result of such deposit and such
deposit will not result in a breach or violation of, or constitute a
default under, any other instrument to which the Company is a party or by
which it is bound; (iii) the Company has paid all sums payable by it under
the Indenture; and (iv) the Company has delivered irrevocable instructions
to the Trustee under the Indenture to apply the deposited money toward the
payment of such Securities at maturity or the redemption date, as the case
may be. In addition, the Company must deliver an Officers' Certificate and
an Opinion of Counsel to the Trustee stating that all conditions precedent
to satisfaction and discharge have been satisfied. The provisions of
Section 4.01 of the Original Indenture, except for the last paragraph
thereof, shall not apply to the Securities.
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ARTICLE 8
AMENDMENT, SUPPLEMENT AND WAIVER
SECTION 8.01. WITHOUT CONSENT OF HOLDERS OF SECURITIES.
Notwithstanding Section 8.02 hereof, the Company and the Trustee may
amend or supplement the Indenture, the Securities or the Subsidiary
Guarantees without the consent of any Holder of a Security:
(a) to cure any ambiguity, defect or inconsistency;
(b) to provide for uncertificated Securities in addition to or in
place of certificated Securities;
(c) to comply with the covenants relating to mergers,
consolidations and sale of assets;
(d) to provide for the assumption of the Company's obligations to
Holders of the Securities;
(e) to make any change that would provide any additional rights or
benefits to the Holders of the Securities (including providing
for additional Subsidiary Guarantees pursuant to the Indenture)
or that does not adversely affect the legal rights under the
Indenture of any such Holder;
(f) to add covenants for the benefit of the Holders or to surrender
any right or power conferred upon the Company; or
(g) to comply with requirements of the Commission in order to
effect or maintain the qualification of the Indenture under the
Trust Indenture Act.
Upon the request of the Company accompanied by a resolution of the
Board of Directors of the Company authorizing the execution of any such
amended or supplemental Indenture, and upon receipt by the Trustee of the
documents described in Section 11.03 of the Original Indenture, the Trustee
shall join with the Company in the execution of any amended or supplemental
Indenture authorized or permitted by the terms of the Indenture and to make
any further appropriate agreements and stipulations which may be therein
contained, but the Trustee shall not be obligated to enter into such
amended or supplemental Indenture which affects its own rights, duties or
immunities under the Indenture or otherwise. Section 11.01 of the Original
Indenture shall not apply to the Securities.
SECTION 8.02. WITH CONSENT OF HOLDERS OF SECURITIES.
The Company and the Trustee may amend or supplement the Indenture or
the Securities or any amended or supplemental Indenture with the written
consent of the Holders of Securities of at least a majority in aggregate
principal amount of the Securities then outstanding (including consents
obtained in connection with a tender offer or exchange offer for the
Securities), and any existing Default and its consequences or compliance
with any provision of the Indenture, the Securities or the Subsidiary
Guarantees, if any, may be waived with the consent of the Holders of at
least a majority in principal amount of the then outstanding Securities
(including consents obtained in connection with a tender offer or exchange
offer for the Securities).
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Upon the request of the Company accompanied by a resolution of the
Board of Directors of the Company authorizing the execution of any such
amended or supplemental Indenture, and upon the filing with the Trustee of
evidence satisfactory to the Trustee of the consent of the Holders of
Securities as aforesaid, and upon receipt by the Trustee of the documents
described in Section 11.03 of the Original Indenture, the Trustee shall
join with the Company in the execution of such amended or supplemental
Indenture unless such amended or supplemental Indenture affects the
Trustee's own rights, duties or immunities under the Indenture or
otherwise, in which case the Trustee may in its discretion, but shall not
be obligated to, enter into such amended or supplemental Indenture.
It shall not be necessary for the consent of the Holders of
Securities under this Section 8.02 to approve the particular form of any
proposed amendment or waiver, but it shall be sufficient if such consent
approves the substance thereof.
After an amendment, supplement or waiver under this Section becomes
effective, the Company shall mail to the Holders of Securities affected
thereby a notice briefly describing the amendment, supplement or waiver.
Any failure of the Company to mail such notice, or any defect therein,
shall not, however, in any way impair or affect the validity of any such
amended or supplemental Indenture or waiver. Subject to Sections 5.08 and
5.13 of the Original Indenture, the Holders of a majority in aggregate
principal amount of the Securities then outstanding may waive compliance in
a particular instance by the Company with any provision of the Indenture or
the Securities. However, without the consent of each Holder affected, an
amendment or waiver may not (with respect to any Securities held by a non-
consenting Holder of Securities):
(i) reduce the principal amount of Securities whose Holders must
consent to an amendment, supplement or waiver;
(ii) reduce the principal of or change the fixed maturity of any
Security or alter or waive the provisions with respect to the
redemption of the Securities (other than Sections 2.03, 3.07
and 3.10 hereof);
(iii) reduce the rate of or change the time for payment of interest
on any Security;
(iv) waive a Default or Event of Default in the payment of principal
of or premium, if any, or interest on the Securities (except a
rescission of acceleration of the Securities by the Holders of
at least a majority in aggregate principal amount of the
Securities and a waiver of the payment default that resulted
from such acceleration);
(v) make any Security payable in money other than that stated in
the Securities;
(vi) make any change in the provisions of the Indenture relating to
waivers of past Defaults or the rights of Holders of Securities
to receive payments of principal of, premium, if any, or
interest on the Securities; or
(vii) make any change in the foregoing amendment and waiver
provisions.
Section 11.02 of the Original Indenture shall not apply to the
Securities.
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SECTION 8.03. REVOCATION AND EFFECT OF CONSENTS.
Until an amendment, supplement or waiver becomes effective, a consent
to it by a Holder of a Security is a continuing consent by the Holder of a
Security and every subsequent Holder of a Security or portion of a Security
that evidences the same debt as the consenting Holder's Security, even if
notation of the consent is not made on any Security. However, any such
Holder of a Security or subsequent Holder of a Security may revoke the
consent as to its Security if the Trustee receives written notice of
revocation before the date the waiver, supplement or amendment becomes
effective. An amendment, supplement or waiver becomes effective in
accordance with its terms and thereafter binds every Holder of a Security.
The Company may fix a record date for determining which Holders of
the Securities must consent to such amendment, supplement or waiver. If
the Company fixes a record date, the record date shall be fixed at (i) the
later of 30 days prior to the first solicitation of such consent or (ii)
such other date as the Company shall designate.
SECTION 8.04. NOTATION ON OR EXCHANGE OF SECURITIES.
The Trustee may place an appropriate notation about an amendment,
supplement or waiver on any Security thereafter authenticated. The Company
in exchange for all Securities may issue and the Trustee shall authenticate
new Securities that reflect the amendment, supplement or waiver.
Failure to make the appropriate notation or issue a new Security
shall not affect the validity and effect of such amendment, supplement or
waiver.
SECTION 8.05. PAYMENT FOR CONSENTS.
The Company shall not, and shall not permit any of its Subsidiaries
to, directly or indirectly, pay or cause to be paid any consideration,
whether by way of interest, fee or otherwise, to any Holder of Securities
for or as an inducement to any consent, waiver or amendment of any of the
terms or provisions of the Indenture or the Securities, unless such
consideration is offered to be paid or agreed to be paid to all Holders of
the Securities that consent, waive or agree to amend in the time frame set
forth in the solicitation documents relating to such consent, waiver or
agreement.
ARTICLE 9
SUBORDINATION
This Article 9 supersedes and replaces in full the provisions set
forth in Article Sixteen of the Original Indenture with respect to the
Securities.
SECTION 9.01. AGREEMENT TO SUBORDINATE.
The Company agrees, and each Holder by accepting a Security agrees,
that the Indebtedness evidenced by the Security is subordinated in right of
payment, to the extent and in the manner provided in this Article, to the
prior payment in full in cash or Cash Equivalents of all Senior
Indebtedness (whether outstanding on the date hereof or hereafter created,
incurred, assumed or guaranteed), and that the subordination provided for
in this Article is for the benefit of, and may be enforced directly by, the
holders of Senior Indebtedness.
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SECTION 9.02. CERTAIN DEFINITIONS.
"Designated Senior Indebtedness" means (i) Indebtedness under the
Credit Facility so long as any Obligations under the Credit Facility are
outstanding and (ii) any other Senior Indebtedness permitted under the
Indenture the principal amount of which is $25 million or more and that has
been designated by the Company as Designated Senior Indebtedness.
"Representative" means the indenture trustee or other trustee, agent
or representative for any Senior Indebtedness.
"Senior Indebtedness" means (i) the Indebtedness under the Credit
Facility and (ii) any other Indebtedness permitted to be incurred by the
Company under the terms of the Indenture, unless the instrument under which
such Indebtedness is incurred expressly provides that it is on a parity
with or subordinated in right of payment to the Securities.
Notwithstanding anything to the contrary in the foregoing, Senior
Indebtedness will not include (1) any liability for federal, state, local
or other taxes owed or owing by the Company, (2) any obligation of the
Company to any of its Subsidiaries, (3) any accounts payable or trade
liabilities arising in the ordinary course of business (including
instruments evidencing such liabilities), (4) any Indebtedness that is
incurred in violation of the Indenture, (5) Indebtedness which, when
incurred and without respect to any election under Section 1111(b) of Title
11, United States Code, is without recourse to the Company, (6) any
Indebtedness, Guarantee or obligation of the Company which is subordinate
or junior to any other Indebtedness, Guarantee or obligation of the
Company, (7) Indebtedness evidenced by the Securities and (8) Capital
Stock.
A distribution may consist of cash, securities or other property, by
set-off or otherwise.
SECTION 9.03. LIQUIDATION; DISSOLUTION; BANKRUPTCY.
Upon any distribution to creditors of the Company in a liquidation or
dissolution of the Company or in a bankruptcy, reorganization, insolvency,
receivership or similar proceeding relating to the Company or its property,
in an assignment for the benefit of creditors or any marshalling of the
Company's assets and liabilities:
(1) holders of Senior Indebtedness shall be entitled to receive
payment in full in cash or Cash Equivalents of all Obligations due in
respect of such Senior Indebtedness (including interest accruing after
the commencement of any such proceeding at the rate specified in the
documents relating to the applicable Senior Indebtedness, regardless of
whether the claims of the holders of such Senior Indebtedness for such
interest are allowed in such proceeding) before Holders shall be
entitled to receive any payment with respect to the Securities (except
that Holders may receive (i) securities that are subordinated to at
least the same extent as the Securities to (a) Senior Indebtedness and
(b) any securities issued in exchange for Senior Indebtedness and
(ii) payments and other distributions made from any defeasance trust
created pursuant to Section 6.04 hereof); and
(2) until all Obligations with respect to Senior Indebtedness (as
provided in subsection (1) above) are paid in full in cash or Cash
Equivalents, any distribution to which Holders would be entitled but for
this Article shall be made to holders of Senior Indebtedness (except
that Holders may receive securities that are subordinated to at least
the same extent as the Securities to (a) Senior Indebtedness and (b) any
securities issued in exchange for Senior Indebtedness), as their
interests may appear.
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SECTION 9.04. DEFAULT ON DESIGNATED SENIOR INDEBTEDNESS.
The Company may not make any payment or distribution to the Trustee
or any Holder in respect of Obligations with respect to the Securities and
may not acquire from the Trustee or any Holder any Securities for cash or
property (other than (i) securities that are subordinated to at least the
same extent as the Securities to (a) Senior Indebtedness and (b) any
securities issued in exchange for Senior Indebtedness and (ii) payments and
other distributions made from any defeasance trust created pursuant to
Section 6.04 hereof) until all principal and other Obligations with respect
to the Senior Indebtedness have been paid in full in cash or Cash
Equivalents if:
(i) a default in the payment of any principal of, premium, if any,
or interest with respect to Designated Senior Indebtedness occurs and is
continuing beyond any applicable grace period in the agreement,
indenture or other document governing such Designated Senior
Indebtedness; or
(ii) a default, other than a payment default, on Designated Senior
Indebtedness occurs and is continuing that then permits holders of the
Designated Senior Indebtedness to accelerate its maturity and the
Trustee receives a notice of the default (a "Payment Blockage Notice")
from a Person who may give it pursuant to Section 9.12 hereof. No new
period of payment blockage may be commenced unless and until 365 days
have elapsed since the effectiveness of the immediately prior Payment
Blockage Notice. However, if any Payment Blockage Notice within such
365-day period is given by or on behalf of any holders of Designated
Senior Indebtedness (other than the Representative under the Credit
Facility), the Representative under the Credit Facility may give another
Payment Blockage Notice within such period. In no event, however, may
the total number of days during which any Payment Blockage Period or
Periods is in effect exceed 179 days in the aggregate during any 365
consecutive day period. No nonpayment default that existed or was
continuing on the date of delivery of any Payment Blockage Notice to the
Trustee shall be, or be made, the basis for a subsequent Payment
Blockage Notice unless such default shall have been cured or waived for
a period of not less than 180 days.
The Company may and shall resume payments on and distributions in
respect of the Securities and may acquire them upon the earlier of:
(1) in the case of a payment default, upon the date on which such
default is cured or waived or shall have ceased to exist or all
Obligations in respect of such Designated Senior Indebtedness shall have
been discharged or paid in full in cash or Cash Equivalents, or
(2) in case of a nonpayment default, the earlier of (x) the date on
which such nonpayment default is cured or waived, (y) 179 days after the
date on which the applicable Payment Blockage Notice is received or (z)
such Payment Blockage Period shall be terminated by written notice to
the Trustee from the holders of a majority of the outstanding principal
amount of such Designated Senior Indebtedness or their Representative
who delivered such notice (the "Payment Blockage Period"), after which
the Company shall resume making any and all required payments in respect
of the Securities, including any missed payments,
if this Article otherwise permits the payment, distribution or acquisition
at the time of such payment or acquisition.
35
<PAGE>
SECTION 9.05. ACCELERATION OF SECURITIES.
If payment of the Securities is accelerated because of an Event of
Default, the Company shall promptly notify holders of Senior Indebtedness
of the acceleration.
SECTION 9.06. WHEN DISTRIBUTION MUST BE PAID OVER.
In the event that the Trustee or any Holder receives any payment of
any Obligations with respect to the Securities at a time when such payment
is prohibited by Section 9.04 hereof, such payment shall be held by the
Trustee or such Holder, for the benefit of, and shall be paid forthwith
over and delivered, upon written request, to, the holders of Senior
Indebtedness as their interests may appear or to their Representative under
the indenture or other agreement (if any) pursuant to which such Senior
Indebtedness may have been issued, as their respective interests may
appear, for application to the payment of all Obligations with respect to
Senior Indebtedness remaining unpaid to the extent necessary to pay such
Obligations in full in cash or Cash Equivalents in accordance with their
terms, after giving effect to any concurrent payment or distribution to or
for the benefit of holders of Senior Indebtedness.
With respect to the holders of Senior Indebtedness, the Trustee
undertakes to perform only such obligations on the part of the Trustee as
are specifically set forth in this Article 9, and no implied covenants or
obligations with respect to the holders of Senior Indebtedness shall be
read into the Indenture against the Trustee. The Trustee shall not be
deemed to owe any fiduciary duty to the holders of Senior Indebtedness, and
shall not be liable to any such holders if the Trustee shall pay over or
distribute to or on behalf of Holders or the Company or any other Person
money or assets to which any holders of Senior Indebtedness shall be
entitled by virtue of this Article 9, except if such payment is made as a
result of the willful misconduct or gross negligence of the Trustee.
SECTION 9.07. NOTICE BY COMPANY.
The Company shall promptly notify the Trustee and the Paying Agent of
any facts known to the Company that would cause a payment of any
Obligations with respect to the Securities to violate this Article, but
failure to give such notice shall not affect the subordination of the
Securities to the Senior Indebtedness as provided in this Article 9.
SECTION 9.08. SUBROGATION.
After all Senior Indebtedness is paid in full in cash or Cash
Equivalents and until the Securities are paid in full, Holders shall be
subrogated (equally and ratably with all other Indebtedness pari passu with
the Securities) to the rights of holders of Senior Indebtedness to receive
distributions applicable to Senior Indebtedness to the extent that
distributions otherwise payable to the Holders have been applied to the
payment of Senior Indebtedness. No payments or distributions to the
holders of Senior Indebtedness to which the Holders of the Securities or
the Trustee would be entitled except for the provisions of this Article or
payments over, pursuant to the provisions of this Article, to the holders
of such Senior Indebtedness by the Holders of the Securities or on their
behalf or by the Trustee shall, as between the Company, its creditors other
than the holders of Senior Indebtedness and the Holders of the Securities,
be deemed to be a payment by the Company to or on account of Senior
Indebtedness; it being understood that the provisions of this Article are
intended solely for the purpose of determining the relative rights of the
Holders of the Securities, on the one hand, and the holders of the Senior
Indebtedness, on the other hand.
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<PAGE>
SECTION 9.09. RELATIVE RIGHTS.
This Article defines the relative rights of Holders and holders of
Senior Indebtedness. Nothing in the Indenture shall:
(1) impair, as between the Company and Holders, the obligation of
the Company, which is absolute and unconditional, to pay principal of
and interest on the Securities in accordance with their terms;
(2) affect the relative rights of Holders and creditors of the
Company other than their rights in relation to holders of Senior
Indebtedness; or
(3) prevent the Trustee or any Holder from exercising its available
remedies upon a Default or Event of Default, subject to the rights of
holders and owners of Senior Indebtedness to receive distributions and
payments otherwise payable to Holders.
If the Company fails because of this Article to pay principal of or
interest on a Security on the due date, the failure is still a Default or
Event of Default.
SECTION 9.10. SUBORDINATION MAY NOT BE IMPAIRED BY COMPANY.
No right of any holder of Senior Indebtedness to enforce the
subordination of the Indebtedness evidenced by the Securities shall be
impaired by any act or failure to act by the Company or any Holder or by
the failure of the Company or any Holder to comply with the Indenture.
SECTION 9.11. DISTRIBUTION OR NOTICE TO REPRESENTATIVE.
Whenever a distribution is to be made or a notice given to holders of
Senior Indebtedness, the distribution may be made and the notice given to
their Representative.
Upon any payment or distribution of assets of the Company referred to
in this Article 9, the Trustee and the Holders shall be entitled to rely
upon any order or decree made by any court of competent jurisdiction or
upon any certificate of such Representative or of the liquidating trustee
or agent or other Person making any distribution to the Trustee or to the
Holders for the purpose of ascertaining the Persons entitled to participate
in such distribution, the holders of the Senior Indebtedness and other
Indebtedness of the Company, the amount thereof or payable thereon, the
amount or amounts paid or distributed thereon and all other facts pertinent
thereto or to this Article 9.
SECTION 9.12. RIGHTS OF TRUSTEE AND PAYING AGENT.
Notwithstanding the provisions of this Article 9 or any other
provision of the Indenture, the Trustee shall not be charged with knowledge
of the existence of any facts that would prohibit the making of any payment
or distribution by the Trustee, and the Trustee and the Paying Agent may
continue to make payments on the Securities, unless the Trustee shall have
received at its Corporate Trust Office at least five Business Days prior to
the date of such payment written notice of facts that would cause the
payment of any Obligations with respect to the Securities to violate this
Article 9. Only the Company or a Representative may give the notice.
Nothing in this Article 9 shall impair the claims of, or payments to, the
Trustee under or pursuant to Section 6.07 of the Original Indenture.
37
<PAGE>
The Trustee in its individual or any other capacity may hold Senior
Indebtedness with the same rights it would have if it were not Trustee.
Any Paying Agent may do the same with like rights.
SECTION 9.13. AUTHORIZATION TO EFFECT SUBORDINATION.
Each Holder of a Security by the Holder's acceptance thereof
authorizes and directs the Trustee on the Holder's behalf to take such
action as may be necessary or appropriate to effectuate the subordination
as provided in this Article, and appoints the Trustee to act as the
Holder's attorney-in-fact for any and all such purposes. If the Trustee
does not file a proper proof of claim or proof of debt in the form required
in any proceeding referred to in Section 5.04 of the Original Indenture
hereof at least 30 days before the expiration of the time to file such
claim, the Representative under the Credit Facility (if the Credit Facility
is still outstanding) is hereby authorized to file an appropriate claim for
and on behalf of the Holders of the Securities.
SECTION 9.14. AMENDMENTS.
The provisions of this Article 9 shall not be amended or modified
without the written consent of the holders of all Senior Indebtedness.
SECTION 9.15. MODIFICATION OF TERMS OF SENIOR INDEBTEDNESS.
Any renewal or extension of the time of payment of any Senior
Indebtedness or the exercise by the holders of Senior Indebtedness of any
of their rights under any instrument creating or evidencing Senior
Indebtedness, including, without limitation, the waiver of default
thereunder, may be made or done all without notice to or assent from the
Holders of the Securities or the Trustee.
No compromise, alteration, amendment, modification, extension,
renewal or other change of, or waiver, consent or other action in respect
of, any liability or obligation under or in respect of, or of any of the
terms, covenants or conditions of any indenture or other instrument under
which any Senior Indebtedness is outstanding or of such Senior
Indebtedness, whether or not such release is in accordance with the
provisions of any applicable document, shall in any way alter or affect any
of the provisions of this Article 9 or of the Securities relating to the
subordination thereof.
SECTION 9.16. RELIANCE ON JUDICIAL ORDER OR CERTIFICATE OF LIQUIDATION
AGENT.
Upon any payment or distribution of assets of the Company referred to
in this Article 9, the Trustee and the Holders of the Securities shall be
entitled to rely upon any order or decree entered by any court of competent
jurisdiction in which each insolvency, bankruptcy, receivership,
liquidation, reorganization, dissolution, winding up or similar case or
proceeding is pending, or a certificate of the trustee in bankruptcy,
liquidating trustee, custodian, receiver, assignee for the benefit of
creditors, agent or other person making such payment or distribution,
delivered to the Trustee or to the Holders of Securities, for the purpose
of ascertaining the persons entitled to participate in such payment or
distribution, the holders of Senior Indebtedness and other indebtedness of
the Company, the amount thereof, the amount or amounts paid or distributed
thereon and all other facts pertinent thereto or to this Article 9.
38
<PAGE>
ARTICLE 10
SUBSIDIARY GUARANTEES
SECTION 10.01. SUBSIDIARY GUARANTEE.
At any time commencing one year after the date of the Indenture, at
the option of the Company, any or all of the Restricted Subsidiaries of the
Company (each, a "Subsidiary Guarantor") may, jointly and severally,
unconditionally guarantee on a senior subordinated basis, to each Holder of
a Security authenticated and delivered by the Trustee and to the Trustee
and its successors and assigns, irrespective of the validity and
enforceability of the Indenture, the Securities or the Obligations of the
Company hereunder, that: (a) the principal of and interest on the
Securities will be promptly paid in full when due, whether at maturity, by
acceleration, redemption or otherwise, and interest on the overdue
principal of and interest on the Securities, if any, if lawful, and all
other obligations of the Company to the Holders or the Trustee hereunder or
thereunder will be promptly paid in full or performed, all in accordance
with the terms hereof; and (b) in case of any extension of time of payment
or renewal of any Securities or any of such other obligations, that same
will be promptly paid in full when due or performed in accordance with the
terms of the extension or renewal, whether at stated maturity, by
acceleration or otherwise. Failing payment when due of any amount so
guaranteed or any performance so guaranteed for whatever reason, the
Subsidiary Guarantors will be jointly and severally obligated to pay the
same immediately. The Subsidiary Guarantors hereby agree that their
obligations hereunder shall be unconditional, irrespective of the validity,
regularity or enforceability of the Securities or the Indenture, the
absence of any action to enforce the same, any waiver or consent by any
Holder of the Securities with respect to any provisions hereof, the
recovery of any judgment against the Company, any action to enforce the
same or any other circumstance which might otherwise constitute a legal or
equitable discharge or defense of a guarantor. Each Subsidiary Guarantor
hereby waives diligence, presentment, demand of payment, filing of claims
with a court in the event of insolvency or bankruptcy of the Company, any
right to require a proceeding first against the Company, protest, notice
and all demands whatsoever and covenant that this guarantee will not be
discharged except by complete performance of the obligations contained in
the Securities and the Indenture. If any Holder or the Trustee is required
by any court or otherwise to return to the Company or any Subsidiary
Guarantor, or any Custodian, Trustee, liquidator or other similar official
acting in relation to either the Company or any Subsidiary Guarantor, any
amount paid by either to the Trustee or such Holder, this guarantee, to the
extent theretofore discharged, shall be reinstated in full force and
effect. Each Subsidiary Guarantor agrees that it shall not be entitled to
any right of subrogation in relation to the Holders in respect of any
obligations guaranteed hereby until the Securities have been paid in full.
Each Subsidiary Guarantor further agrees that, as between such Subsidiary
Guarantor, on the one hand, and the Holders and the Trustee, on the other
hand, (x) the maturity of the obligations guaranteed hereby may be
accelerated as provided in Article 5 hereof for the purposes of this
guarantee, notwithstanding any stay, injunction or other prohibition
preventing such acceleration in respect of the obligations guaranteed
hereby, and (y) in the event of any declaration of acceleration of such
obligations as provided in Article 5 hereof, such obligations (whether or
not due and payable) shall forthwith become due and payable by such
Subsidiary Guarantor for the purpose of this guarantee.
Notwithstanding the foregoing, in the event that any Subsidiary
Guarantee hereunder would constitute or result in a violation of any
applicable fraudulent conveyance or similar law of any relevant
jurisdiction, the liability of a Subsidiary Guarantor under such Subsidiary
Guarantee shall be reduced to the maximum amount permissible under such
fraudulent conveyance or similar law.
39
<PAGE>
SECTION 10.02. EXECUTION AND DELIVERY OF SUBSIDIARY GUARANTEE.
To evidence its Subsidiary Guarantee set forth in Section 10.01
hereof, each Subsidiary Guarantor hereby agrees that an acknowledgement of
such Subsidiary Guarantee substantially in the form of Exhibit B hereto
shall be executed on behalf of such Subsidiary Guarantor by its President
or one of its Vice Presidents and attested to by an Officer and delivered
to the Trustee.
Each Subsidiary Guarantor hereby agrees that its Subsidiary Guarantee
set forth in Section 10.01 hereof shall remain in full force and effect
notwithstanding any failure to endorse on each Security a notation of such
Subsidiary Guarantee.
If an officer or Officer whose signature is on the Indenture or on
the Subsidiary Guarantee no longer holds that office at the time the
Trustee authenticates the Security on which a Subsidiary Guarantee is
endorsed, the Subsidiary Guarantee shall be valid nevertheless.
The delivery of any Security by the Trustee, after the authentication
thereof hereunder, shall constitute due delivery of the Subsidiary
Guarantee set forth in the Indenture on behalf of the Subsidiary
Guarantors.
SECTION 10.03. SUBSIDIARY GUARANTORS MAY CONSOLIDATE, ETC., ON CERTAIN
TERMS.
Subject to Section 10.04 hereof, no Subsidiary Guarantor may
consolidate with or merge with or into (whether or not such Subsidiary
Guarantor is the surviving entity) another Person, whether or not
affiliated with such Subsidiary Guarantor, unless:
(a) the Person formed by or surviving any such consolidation or
merger (if other than such Subsidiary Guarantor) assumes all the
obligations of such Subsidiary Guarantor pursuant to a supplemental
indenture in form reasonably satisfactory to the Trustee, pursuant to
which such Person shall unconditionally guarantee, on a senior
subordinated basis, all of such Subsidiary Guarantor's obligations under
the Subsidiary Guarantee and the Indenture on the terms set forth
herein; and
(b) immediately after such transaction no Default or Event of
Default exists.
In case of any such consolidation or merger and upon the assumption
by the successor corporation, by supplemental indenture, executed and
delivered to the Trustee and satisfactory in form to the Trustee, of the
Subsidiary Guarantee endorsed upon the Securities and the due and punctual
performance of all of the covenants and conditions of the Indenture to be
performed by the Subsidiary Guarantor, such successor corporation shall
succeed to and be substituted for the Subsidiary Guarantor with the same
effect as if it had been named herein as a Subsidiary Guarantor. Such
successor corporation thereupon may cause to be signed any or all of the
Subsidiary Guarantees to be endorsed upon all of the Securities issuable
hereunder which theretofore shall not have been signed by the Company and
delivered to the Trustee. All the Subsidiary Guarantees so issued shall in
all respects have the same legal rank and benefit under the Indenture as
the Subsidiary Guarantees theretofore and thereafter issued in accordance
with the terms of the Indenture as though all of such Subsidiary Guarantees
had been issued at the date of the execution hereof.
Except as set forth in Articles 3 and 4 hereof, nothing contained in
the Indenture shall prevent any consolidation or merger of a Subsidiary
Guarantor with or into the Company.
40
<PAGE>
SECTION 10.04. RELEASES FROM SUBSIDIARY GUARANTEES.
In the event of (i) a sale or other disposition of all or
substantially all of the assets of any Subsidiary Guarantor or the sale of
a Subsidiary Guarantor by way of merger, consolidation or otherwise, (ii) a
Restricted Subsidiary becoming an Unrestricted Subsidiary pursuant to the
terms of the Indenture, (iii) a sale or other disposition of all of the
capital stock of any Subsidiary Guarantor or (iv) if at any time such
Subsidiary Guarantor does not guarantee any Obligations under the Credit
Facility, then such Subsidiary Guarantor shall be released and relieved of
any obligations under its Subsidiary Guarantee; provided that (x)
immediately after giving effect to such transaction, no Default or Event of
Default shall have occurred and be continuing or would occur as a
consequence thereof, (y) the Net Proceeds of such sale or other disposition
are applied in accordance with the applicable provisions of the Indenture
and (z) if such Subsidiary Guarantor is to become an Unrestricted
Subsidiary, all Investments by the Company or any other Restricted
Subsidiary in such Subsidiary Guarantor shall be deemed a Restricted
Investment (to the extent not previously included as a Restricted
Investment) made on the date of such designation in the amount of the book
value of such Investment. Upon delivery by the Company to the Trustee of
an Officers' Certificate and an Opinion of Counsel to the effect that such
sale or other disposition was made by the Company in accordance with the
provisions of the Indenture, including without limitation Section 3.07, the
Trustee shall execute any documents prepared by the Subsidiary Guarantor
reasonably required in order to evidence the release of any Subsidiary
Guarantor from its obligations under its Subsidiary Guarantee. Any
Subsidiary Guarantor whose guarantee of the Securities is released pursuant
to clause (iv) and which remains a Restricted Subsidiary shall be deemed a
Subsidiary Guarantor for all purposes of the Indenture so long as it
remains a Restricted Subsidiary and does not guarantee any Obligations
under the Credit Facility. Any Subsidiary Guarantor not released from its
obligations under its Subsidiary Guarantee shall remain liable for the full
amount of principal of and interest on the Securities and for the other
obligations of any Subsidiary Guarantor under the Indenture as provided in
this Article 10.
ARTICLE 11
MISCELLANEOUS
SECTION 11.01. NO PERSONAL LIABILITY OF PARTNERS, DIRECTORS, OFFICERS,
EMPLOYEES AND STOCKHOLDERS.
No director, officer, employee, incorporator or stockholder of the
Company or the Subsidiary Guarantors, as such, shall have any liability for
any obligations of the Company or the Subsidiary Guarantors under the
Securities, any Subsidiary Guarantee or the Indenture, as applicable, or
for any claim based on, in respect of, or by reason of such obligations or
their creation. Each Holder of the Securities by accepting a Security
waives and releases all such liability. The waiver and release are part
of the consideration for issuance of the Securities and the Subsidiary
Guarantees.
SECTION 11.02. PRIORITY OF SUPPLEMENTAL INDENTURE.
In the event any conflict arises between the terms of the Original
Indenture and the terms of this Supplemental Indenture, the terms of this
Supplemental Indenture shall be controlling and supersede such conflicting
terms of the Original Indenture; provided that, in all circumstances,
Section 1.06 of the Original Indenture shall control. Unless otherwise
specifically modified or amended hereby, the terms of the Original
Indenture shall remain in full force and effect with respect to the
Securities.
41
<PAGE>
SECTION 11.03. GOVERNING LAW.
This Indenture shall be deemed to be a contract made and to be
performed entirely in the State of New York, and for all purposes shall be
governed by and construed in accordance with the internal laws of said
State without regard to the conflicts of law rules of said State.
SECTION 11.04. APPOINTMENT OF PAYING AGENT, ETC..
The Company hereby appoints Bankers Trust Company to be Paying Agent,
an Authenticating Agent and a Security Registrar with respect to the
Securities, pursuant to Section 3.01(25) of the Original Indenture and
agrees to pay the reasonable fees and expenses of Bankers Trust Company in
connection with its duties as Paying Agent, Authenticating Agent and co-
Security Registrar.
42
<PAGE>
IN WITNESS WHEREOF, the parties hereto have caused this Supplemental
Indenture to be duly executed, and their respective corporate seals to be
hereunto affixed and attested, all as of the day and year first above
written.
BRUNO'S, INC.
By:_________________________________________
Name: Ronald G. Bruno
Title: Chairman of the Board of Directors
and Chief Executive Officer
Attest:
________________________
Name:
Title:
Seal
MARINE MIDLAND BANK,
as Trustee
By:________________________
Name:
Title:
Attest:
________________________
Name:
Title:
Seal
43
<PAGE>
Exhibit A
(Face of Senior Subordinated Note)
10 1/2% Senior Subordinated Note due 2005
CUSIP NO.: 116881AB9
No. $__________
Bruno's, Inc.
promises to pay to
or its registered assigns
the principal sum of
Dollars on August 1, 2005.
Interest Payment Dates: February 1 and August 1, commencing February 1, 1996.
Record Dates: January 15 and July 15 (whether or not a Business Day).
BRUNO'S, INC.
By:______________________________________________________
Ronald G. Bruno
Chairman of the Board of Directors and
Chief Executive Officer
By:______________________________________________________
R. Michael Conley
Secretary
(SEAL)
This is one of the Senior Subordinated Notes
issued under the within-mentioned Indenture:
Marine Midland Bank, as Trustee
By: Bankers Trust Company, as Authenticating Agent
By:_______________________________________________
Authorized Signatory
Dated: August 18, 1995
<PAGE>
(Back of Senior Subordinated Note)
10 1/2% Senior Subordinated Note due 2005
This Security is a Global Security within the meaning of the Indenture
hereinafter referred to and is registered to and is registered in the name
of The Depository Trust Company (the "Depositary") or a nominee of the
Depositary. This Global Security is exchangeable for Securities registered
in the name of a Person other than the Depositary or its nominee only in
the limited circumstances described in the Indenture, and no transfer of
this Security (other than a transfer of this Security as a whole by the
Depositary to a nominee of the Depositary or by a nominee of the Depositary
to the Depositary or another nominee of the Depositary) may be registered
except in such limited circumstances.
Unless this Security is presented by an authorized representative of the
Depositary (55 Water Street, New York, New York) to the Company or its
agent for registration of transfer, exchange or payment, and any Security
issued upon registration or transfer of, or in exchange for, or in lieu of,
this Security is registered in the name of Cede & Co. or such other name as
requested by an authorized representative of the Depositary and any payment
hereon is made to Cede & Co., ANY TRANSFER, PLEDGE OR OTHER USE HEREOF FOR
VALUE OR OTHERWISE BY OR TO ANY PERSON IS WRONGFUL since the registered
owner hereof, Cede & Co., has an interest herein.
Capitalized terms used herein have the meanings assigned to them in
the Indenture (as defined below) unless otherwise indicated.
1. Interest. Bruno's, Inc., an Alabama corporation (the "Company"),
promises to pay interest on the principal amount of this Senior
Subordinated Note at the rate and in the manner specified below. Interest
will accrue at 10 1/2% per annum and will be payable semi-annually in cash on
each February 1 and August 1, commencing February 1, 1996, or if any such
day is not a Business Day on the next succeeding Business Day (each an
"Interest Payment Date") to Holders of record of the Senior Subordinated
Notes at the close of business on the immediately preceding January 15 and
July 15, whether or not a Business Day. Interest will be computed on the
basis of a 360-day year consisting of twelve 30-day months. Interest shall
accrue from the most recent date to which interest has been paid or, if no
interest has been paid, from August 18, 1995. To the extent lawful, the
Company shall pay interest on overdue principal at the rate of the then
applicable interest rate on the Senior Subordinated Notes; it shall pay
interest on overdue installments of interest (without regard to any
applicable grace periods) at the same rate to the extent lawful.
2. Method of Payment. The Company will pay interest on the Senior
Subordinated Notes (except defaulted interest) to the Persons who are
registered Holders of Senior Subordinated Notes at the close of business on
the record date next preceding the Interest Payment Date, even if such
Senior Subordinated Notes are cancelled after such record date and on or
before such Interest Payment Date. The Holder hereof must surrender this
Senior Subordinated Note to a Paying Agent to collect principal payments.
The Company will pay principal and interest in money of the United States
that at the time of payment is legal tender for payment of public and
private debts. The Senior Subordinated Notes will be payable both as to
principal and interest at the office or agency of the Company maintained
for such purpose or, at the option of the Company, payment of interest may
be made by wire transfer to the Holders of Senior Subordinated Notes at
their respective addresses set forth in the register of Holders of Senior
Subordinated Notes. Unless otherwise designated by the Company, the
Company's office or agency will be the office of Bankers Trust Company
maintained for such purpose.
A-2
<PAGE>
3. Paying Agent and Security Registrar. Initially, Bankers Trust
Company (4 Albany Street, New York, New York 10006) will act as Paying
Agent and co-Security Registrar. The Company may change any Paying Agent,
Security Registrar or co-registrar without prior notice to any Holder of a
Senior Subordinated Note. The Company may act in any such capacity.
4. Indenture. The Company issued the Senior Subordinated Notes as
Registered Securities under an Indenture, dated as of August 18, 1995, as
amended and supplemented by the First Supplemental Indenture, dated as of
August 18, 1995 (collectively, the "Indenture"), between the Company and
the Trustee. The terms of the Senior Subordinated Notes include those
stated in the Indenture and those made part of the Indenture by reference
to the Trust Indenture Act of 1939, as amended (15 U.S.
Code Sec.Sec. 77aaa-77bbbb), as in effect on the date of the Indenture. The
Senior Subordinated Notes are subject to all such terms, and Holders of
Senior Subordinated Notes are referred to the Indenture and such act for a
statement of such terms. The terms of the Indenture shall govern any
inconsistencies between the Indenture and the Senior Subordinated Notes.
The Senior Subordinated Notes are unsecured obligations of the Company
limited to $400,000,000 in aggregate principal amount.
5. Optional Redemption. Except as provided in the next paragraph,
the Senior Subordinated Notes are not redeemable at the Company's option
prior to August 1, 2000. From and after August 1, 2000, the Senior
Subordinated Notes will be subject to redemption at the option of the
Company, in whole or in part, upon not less than 30 nor more than 60 days'
written notice, at the redemption prices (expressed as percentages of
principal amount) set forth below, plus accrued and unpaid interest, if
any, thereon to the applicable redemption date, if redeemed during the
twelve-month period beginning on August 1 of each of the years indicated
below:
Percentage of
Year Principal Amount
---- ----------------
2000 . . . . . . . . . . . . . . . . . . . . . 105.25%
2001 . . . . . . . . . . . . . . . . . . . . . 103.50%
2002 . . . . . . . . . . . . . . . . . . . . . 101.75%
2003 and thereafter . . . . . . . . . . . . . . 100.00%
Prior to August 1, 1998, the Company may, at its option, on any one
or more occasions redeem up to 40% of the aggregate face amount of Senior
Subordinated Notes originally issued at a redemption price equal to 110.50%
of the principal amount thereof, plus accrued and unpaid interest thereon
to the redemption date, with the net proceeds of an underwritten public
offering of Common Stock of the Company; provided that at least 60% of the
original aggregate principal amount of the Senior Subordinated Notes
remains outstanding immediately after the occurrence of such redemption;
and provided, further, that such redemption shall occur within 60 days of
the date of the closing of such underwritten public offering of Common
Stock of the Company.
6. Repurchase at Option of Holder. (a) Upon the occurrence of a
Change of Control, the Company will be required to make an offer to
purchase on the Change of Control Payment Date all outstanding Senior
Subordinated Notes at a purchase price in cash equal to 101% of the
aggregate principal amount thereof plus accrued and unpaid interest thereon
to the date of purchase. Holders of Senior Subordinated Notes that are
subject to an offer to purchase will receive a Change of Control Offer from
the Company prior to any related Change of Control Payment Date and may
elect to have such Senior Subordinated Notes purchased by completing the
form entitled "Option of Holder to Elect Purchase" appearing below.
A-3
<PAGE>
(b) When the aggregate amount of Excess Proceeds from Asset Sales
exceeds $20 million, the Company will be obligated to make an offer to
purchase the maximum principal amount of Senior Subordinated Notes that may
be purchased out of the Excess Proceeds at an offer price in cash in an
amount equal to 100% of the principal amount thereof plus accrued and
unpaid interest, if any, to the date fixed for the closing of such offer.
If the aggregate principal amount of Senior Subordinated Notes surrendered
by Holders thereof exceeds the amount of Excess Proceeds, the Trustee shall
select the Senior Subordinated Notes to be redeemed on a pro rata basis, by
lot or by such other method as the Trustee shall deem fair and appropriate
(and in such manner as complies with applicable legal requirements);
provided that no Securities of $1,000 or less shall be purchased in part.
Holders of Senior Subordinated Notes that are the subject of an offer to
purchase will receive an Excess Proceeds Offer from the Company prior to
any related purchase date and may elect to have such Senior Subordinated
Notes purchased by completing the form entitled "Option of Holder to Elect
Purchase" appearing below.
7. Notice of Redemption. Notice of redemption shall be given not
less than 30 days and not more than 60 days before the redemption date to
each Holder whose Senior Subordinated Notes are to be redeemed at its
registered address. Senior Subordinated Notes may be redeemed in part but
only in whole multiples of $1,000, unless all of the Senior Subordinated
Notes held by a Holder of Senior Subordinated Notes are to be redeemed. On
and after the redemption date, interest ceases to accrue on Senior
Subordinated Notes or portions of them called for redemption.
8. Denominations, Transfer, Exchange. The Senior Subordinated Notes
are in registered form without coupons in denominations of $1,000 and
integral multiples of $1,000. The transfer of Senior Subordinated Notes
may be registered and Senior Subordinated Notes may be exchanged as
provided in the Indenture. The Security Registrar, the co-Security
Registrar and the Trustee may require a Holder of a Senior Subordinated
Note, among other things, to furnish appropriate endorsements and transfer
documents and to pay any taxes and fees required by law or permitted by the
Indenture. The Security Registrar and co-Security Registrar need not
exchange or register the transfer of any Senior Subordinated Note or
portion of a Senior Subordinated Note selected for redemption. Also, it
need not exchange or register the transfer of any Senior Subordinated Notes
for a period of 15 business days before a selection of Senior Subordinated
Notes to be redeemed.
9. Persons Deemed Owners. Prior to due presentment to the co-
Security Registrar for registration of the transfer of this Senior
Subordinated Note, the Trustee, any Paying Agent, the Security Registrar,
the co-Security Registrar and the Company may deem and treat the Person in
whose name this Senior Subordinated Note is registered as its absolute
owner for the purpose of receiving payment of principal of, premium, if
any, and interest on this Senior Subordinated Note and for all other
purposes whatsoever, whether or not this Senior Subordinated Note is
overdue, and neither the Trustee, any Paying Agent, the Security Registrar,
the co-Security Registrar nor the Company shall be affected by notice to
the contrary. The registered Holder of a Senior Subordinated Note shall be
treated as its owner for all purposes.
10. Amendments, Supplement and Waivers. Subject to certain
exceptions, the Indenture, the Senior Subordinated Notes or the Subsidiary
Guarantees may be amended or supplemented with the consent of the Holders
of at least a majority in principal amount of the then outstanding Senior
Subordinated Notes, and any existing default or compliance with any
provision of the Indenture or the Senior Subordinated Notes may be waived
with the consent of the Holders of a majority in principal amount of the
then outstanding Senior Subordinated Notes. Without the consent of any
Holder of a Senior Subordinated Note, the Indenture, the Senior
Subordinated Notes or the Subsidiary Guarantees may be amended or
supplemented to cure any ambiguity, defect or inconsistency; to provide for
uncertificated Senior Subordinated Notes in addition to or in place of
certificated Senior Subordinated
A-4
<PAGE>
Notes; to comply with the covenants relating to mergers, consolidations and
sale of assets; to provide for the assumption of the Company's obligations
to the Holders of the Senior Subordinated Notes; to make any change that
would provide any additional rights or benefits to the Holders of the
Senior Subordinated Notes or that does not adversely affect the legal
rights under the Indenture of any such Holder; to add covenants for the
benefit of the Holders or to surrender any right or power conferred upon
the Company; or to comply with the requirements of the Commission in order
to effect or maintain the qualification of the Indenture under the Trust
Indenture Act. Notwithstanding the foregoing, without the consent of each
Holder affected, an amendment or waiver may not (with respect to any Senior
Subordinated Notes held by a non-consenting Holder of Senior Subordinated
Notes) reduce the principal amount of Senior Subordinated Notes whose
Holders must consent to an amendment, supplement or waiver; reduce the
principal of or change the fixed maturity of any Senior Subordinated Note
or alter or waive the provisions with respect to the redemption of the
Senior Subordinated Notes (other than Sections 2.03, 3.07 and 3.10 of the
Supplemental Indenture); reduce the rate of or change the time for payment
of interest on any Senior Subordinated Note; waive a Default or Event of
Default in the payment of principal of or premium, if any, or interest on
the Senior Subordinated Notes (except a rescission of acceleration of the
Senior Subordinated Notes by the Holders of at least a majority in
aggregate principal amount of the then outstanding Senior Subordinated
Notes and a waiver of the payment default that resulted from such
acceleration); make any Senior Subordinated Note payable in money other
than that stated in the Senior Subordinated Notes; make any change in the
provisions of the Indenture relating to waivers of past Defaults or the
rights of Holders of Senior Subordinated Notes to receive payments of
principal of, premium, if any, or interest on the Senior Subordinated
Notes; or make any change in the foregoing amendment and waiver provisions.
11. Defaults and Remedies. Each of the following constitutes an
Event of Default: default in payment when due and payable, upon redemption,
acceleration or otherwise, of principal or premium, if any, on the Senior
Subordinated Notes or under any Subsidiary Guarantee; default for 30 days
or more in the payment when due of interest on the Senior Subordinated
Notes or under any Subsidiary Guarantee; failure by the Company or any
Subsidiary Guarantor for 30 days after receipt of written notice given by
the Trustee or the Holders of at least 30% in principal amount of the
Senior Subordinated Notes then outstanding to comply with any of its other
agreements in the Indenture or the Senior Subordinated Notes; default under
any mortgage, indenture or instrument under which there is issued or by
which there is secured or evidenced any Indebtedness for money borrowed by
the Company or any of its Restricted Subsidiaries or the payment of which
is guaranteed by the Company or any of its Restricted Subsidiaries (other
than Indebtedness owed to the Company or a Restricted Subsidiary), whether
such Indebtedness or Guarantee now exists or is created after the Issuance
Date, if both (A) such default either (1) results from the failure to pay
any such Indebtedness at its stated final maturity (after giving effect to
any applicable grace periods) or (2) relates to an obligation other than
the obligation to pay such Indebtedness at its stated final maturity and
results in the holder or holders of such Indebtedness causing such
Indebtedness to become due prior to its stated maturity and (B) the
principal amount of such Indebtedness, together with the principal amount
of any other such Indebtedness in default for failure to pay principal at
stated final maturity (after giving effect to any applicable grace
periods), or the maturity of which has been so accelerated, aggregate $30
million or more at any one time outstanding; failure by the Company or any
of its Significant Subsidiaries that is a Subsidiary Guarantor to pay final
judgments aggregating in excess of $30 million, which final judgments
remain unpaid, undischarged and unstayed for a period of more than 60 days
after such judgment becomes final; and certain events of bankruptcy or
insolvency with respect to the Company. If any Event of Default (other
than by reason of bankruptcy or insolvency) occurs and is continuing under
the Indenture, the Trustee or the Holders of at least 30% in principal
amount of the then outstanding Senior Subordinated Notes may declare the
principal, premium (if any) and any other monetary obligations on all the
then outstanding Senior Subordinated Notes to be due and payable
immediately. Notwithstanding the foregoing, in the case of an Event of
Default arising from
A-5
<PAGE>
certain events of bankruptcy or insolvency with respect to the Company or
any Subsidiary Guarantor that is a Significant Subsidiary, all outstanding
Senior Subordinated Notes will become due and payable without further
action or notice. Holders of the Senior Subordinated Notes may not enforce
the Indenture or the Senior Subordinated Notes except as provided in the
Indenture. Subject to certain limitations, Holders of a majority in
principal amount of the then outstanding Senior Subordinated Notes may
direct the Trustee in its exercise of any trust or power. The Trustee may
withhold from Holders of the Senior Subordinated Notes notice of any
continuing Default or Event of Default (except a Default or Event of
Default relating to the payment of principal or interest) if it determines
that withholding notice is in their interest. The Holders of a majority in
aggregate principal amount of the Senior Subordinated Notes then
outstanding, by notice to the Trustee, may on behalf of the Holders of all
of the Senior Subordinated Notes waive any existing Default or Event of
Default and its consequences under the Indenture except a continuing
Default or Event of Default in the payment of interest or premium on, or
the principal of, the Senior Subordinated Notes held by a non-consenting
Holder. The Company is required to deliver to the Trustee annually a
statement regarding compliance with the Indenture, and the Company is
required, within five Business Days, upon becoming aware of any Default or
Event of Default or any default under any document, to deliver to the
Trustee a statement specifying such Default or Event of Default.
12. Trustee Dealings with Company. The Trustee under the Indenture,
in its individual or any other capacity, may make loans to, accept deposits
from, and perform services for the Company or its Affiliates, and may
otherwise deal with the Company or its Affiliates, as if it were not
Trustee; however, if the Trustee acquires any conflicting interest it must
eliminate such conflict within 90 days, apply to the Commission for
permission to continue as Trustee or resign.
13. No Personal Liabilities of Directors, Officers, Employees,
Incorporators and Stockholders. No director, officer, employee,
incorporator or stockholder of the Company or the Subsidiary Guarantors, as
such, shall have any liability for any obligations of the Company or the
Subsidiary Guarantors under the Securities, any Subsidiary Guarantee or the
Indenture, as applicable, or for any claim based on, in respect of, or by
reason of such obligations or their creation. Each Holder of the
Securities by accepting a Security waives and releases all such liability.
The waiver and release are part of the consideration for issuance of the
Securities and the Subsidiary Guarantees.
14. Subordination. Each Holder by accepting a Senior Subordinated
Note agrees that the payment of principal of, premium, if any, and interest
on each Senior Subordinated Note is subordinated in right of payment, to
the extent and in the manner provided in the Indenture, to the prior
payment in full of all Senior Indebtedness (whether outstanding on the date
of the Indenture or thereafter created, incurred, assumed or guaranteed),
and that the subordination is for the benefit of the holders of Senior
Indebtedness.
15. Subsidiary Guarantees. At any time commencing one year after
the date of the Indenture, at the option of the Company, any or all of the
Restricted Subsidiaries of the Company may unconditionally guarantee the
payment of principal and interest (including interest on overdue principal
and overdue interest, if lawful) on the Senior Subordinated Notes.
16. Authentication. This Senior Subordinated Note shall not be
valid until authenticated by the manual signature of the Trustee or an
Authenticating Agent.
17. Abbreviations. Customary abbreviations may be used in the name
of a Holder of a Senior Subordinated Note or an assignee, such as: TEN COM
(= tenants in common), TEN ENT (= tenants
A-6
<PAGE>
by the entireties), JT TEN (= joint tenants with right of survivorship and
not as tenants in common), CUST (= Custodian), and U/G/M/A (= Uniform Gifts
to Minors Act).
18. CUSIP Numbers. Pursuant to a recommendation promulgated by the
Committee on Uniform Security Identification Procedures, the Company has
caused CUSIP numbers to be printed on the Senior Subordinated Notes and
have directed the Trustee to use CUSIP numbers in notices of redemption as
a convenience to Holders of Senior Subordinated Notes. No representation
is made as to the accuracy of such numbers either as printed on the Senior
Subordinated Notes or as contained in any notice of redemption and reliance
may be placed only on the other identification numbers placed thereon.
The Company will furnish to any Holder of a Senior Subordinated Note
upon written request and without charge a copy of the Indenture. Request
may be made to:
Bruno's, Inc.
800 Lakeshore Parkway
Birmingham, Alabama 35211
Attention: Secretary
A-7
<PAGE>
ASSIGNMENT FORM
To assign this Note, fill in the form below: (I) or (we) assign and
transfer this Note to
___________________________________________________________________________
(Insert assignee's soc. sec. or tax I.D. no.)
___________________________________________________________________________
(Print or type assignee's name, address and zip code)
and irrevocably appoint ___________________________________________________
agent to transfer this Note on the books of the Company. The agent may
substitute another to act for him.
Date: ______________
Your Signature:______________________________
(Sign exactly as your name appears on the
face of this Note)
Signature Guarantee.
A-8
<PAGE>
OPTION OF HOLDER TO ELECT PURCHASE
If you want to elect to have all or any part of this Security
purchased by the Company pursuant to Section 2.03 or Section 3.10 of the
Supplemental Indenture check the appropriate box:
[ ] Section 2.03 [ ] Section 3.10
If you want to have only part of the Security purchased by the Company
pursuant to Section 2.03 or Section 3.10 of the Supplemental Indenture,
state the amount you elect to have purchased:
$ _______________
Date:____________
Your Signature:______________________________
(Sign exactly as your name appears on the
face of this Note)
Signature Guarantee.
A-9
<PAGE>
EXHIBIT B
Subsidiary Guarantee
The undersigned hereby irrevocably and unconditionally guarantees
(i) the due and punctual payment of the principal of, premium, if any, and
interest on the Securities (as defined in the First Supplemental Indenture,
dated as of August 18, 1995 (the "First Supplemental Indenture") to the
Indenture of even date therewith between Bruno's, Inc. (the "Company") and
Marine Midland Bank, as Trustee (as amended by the First Supplemental
Indenture, the "Indenture")), whether at maturity, by acceleration or
otherwise, the due and punctual payment of interest on the overdue
principal of and interest, if any, on the Securities, to the extent lawful,
and the due and punctual performance of all other obligations of the
Company to the Holders (as defined in the Indenture) or the Trustee all in
accordance with the terms set forth in Article 10 of the First Supplemental
Indenture, (ii) in case of any extension of time of payment or renewal of
any Securities or any of such other obligations, that the same will be
promptly paid in full when due or performed in accordance with the terms of
the extension or renewal, whether at stated maturity, by acceleration or
otherwise and (iii) has agreed to pay any and all costs and expenses
(including reasonable attorneys' fees) incurred by the Trustee or any
Holder in enforcing any rights under this Subsidiary Guarantee.
Capitalized terms used herein have the meanings assigned to them in the
First Supplemental Indenture unless otherwise indicated.
No stockholder, officer, director or incorporator, as such, past,
present or future, of any Subsidiary Guarantor shall have any personal
liability under this Subsidiary Guarantee by reason of his or its status as
such stockholder, officer, director or incorporator.
This Subsidiary Guarantee shall be binding upon each Subsidiary
Guarantor and its successors and assigns and shall inure to the benefit of
the successors and assigns of the Trustee and the Holders and, in the event
of any transfer or assignment of rights by any Holder or the Trustee, the
rights and privileges herein conferred upon that party shall automatically
extend to and be vested in such transferee or assignee, all subject to the
terms and conditions hereof. This Subsidiary Guarantee may be released in
accordance with the provisions set forth in Article 10 of the First
Supplemental Indenture to the Indenture.
This Subsidiary Guarantee shall not be valid or obligatory for
any purpose until the certificate of authentication on the Security with
respect to which this Subsidiary Guarantee relates shall have been executed
by the Trustee or an Authenticating Agent under the Indenture by the manual
signature of one of its authorized officers.
THE TERMS OF ARTICLE 10 OF THE FIRST SUPPLEMENTAL INDENTURE ARE
INCORPORATED HEREIN BY REFERENCE.
This Subsidiary Guarantee shall be governed by and construed in
accordance with the laws of the State of New York.
[Name of Subsidiary Guarantor]
By: ________________________________
Name:
Title:
A-10
EXHIBIT 5.3
[SIROTE & PERMUTT, P.C. LETTERHEAD]
August 18, 1995
Bruno's, Inc.
800 Lakeshore Parkway
Birmingham, Alabama 35211
Ladies and Gentlemen:
We have acted as counsel to Bruno's, Inc., an Alabama
corporation (the "Company"), in connection with the proposed
issuance and sale by the Company of $400,000,000 aggregate
principal amount of 10-1/2% Senior Subordinated Notes due 2005
(the "Securities"), pursuant to the Underwriting Agreement dated
August 10, 1995 (the "Underwriting Agreement") between the
Company and BT Securities Corporation, Chemical Securities Inc.
and Salomon Brothers Inc (collectively, the "Underwriters").
We have examined the the Registration Statement on Form
S-3 (File Number 33-60161), filed by the Company under the
Securities Act of 1933, as amended (the "1933 Act"), as amended
by Amendment No. 1 filed with the Securities and Exchange
Commission (the "Commission") on July 18, 1995 and Amendment No.
2 filed with the Commission on July 24, 1995 (collectively the
"Registration Statement"); the Company's Prospectus dated August
10, 1995, and the Prospectus Supplement dated August 10, 1995,
both as filed by the Company with the Commission in compliance
with Rule 424(b) of the rules and regulations under the 1933 Act
(collectively, the "Prospectus"); the Indenture dated August 18,
1995 between the Company and Marine Midland Bank, as Trustee,
relating to the Securities (the "Indenture"); and the First
Supplemental Indenture dated August 18, 1995 between the Company
and Marine Midland Bank, as Trustee, relating to the Securities
(the "Supplemental Indenture").
In such examination, we have assumed the genuineness of
all signatures, the legal capacity of natural persons, the
authenticity of all documents submitted to us as originals, the
<PAGE>
Bruno's, Inc.
August 18, 1995
Page 2--
conformity to the original documents of all documents submitted
to us as certified or photostatic copies, and the authenticity of
the originals of such latter documents.
In accordance with the general policies of this law
firm in rendering legal opinion, we have assumed for the purposes
of the opinions expressed herein that no fraud exists with
respect to any of the matters relevant to the opinions expressed
herein, although we have no reason to believe that there exists
any fraud which would render invalid the opinions expressed
below.
Based on our review of the foregoing and subject to the
assumptions set forth herein, it is our opinion that, as of the
date of this letter:
(1) The Securities have been duly authorized, executed
and delivered by the Company and (assuming the due
authorization, execution and delivery of the Indenture and
Supplemental Indenture by the Trustee and the execution,
delivery and authentication of the Securities by the Trustee
in accordance with the Indenture and Supplemental Indenture)
when issued and paid for by the Underwriters in accordance
with the terms of the Underwriting Agreement, will
constitute the legally valid and binding obligations of the
Company enforceable against the Company in accordance with
their terms, subject to the applicable bankruptcy,
insolvency, fraudulent conveyance, reorganization,
moratorium and similar laws affecting creditors' rights and
remedies generally and subject to general principles of
equity (regardless of whether a proceeding is sought in
equity or at law).
(2) The Company has all requisite corporate power and
authority to execute, deliver and perform its obligations
under the Indenture, Supplemental Indenture and the
Securities; the Indenture has been qualified under and
complies in all material respects with the requirements of
the Trust Indenture Act, as amended (the "Trust Indenture
Act"); the Indenture and Supplemental Indenture have been
duly authorized, executed and delivered by the Company and
(assuming the due authorization, execution and delivery
thereof by the Trustee), will constitute the legally valid
and binding obligations of the Company, enforceable against
the Company in accordance with their terms, subject to
applicable bankruptcy, insolvency, reorganization,
moratorium and similar laws affecting creditors' rights and
<PAGE>
Bruno's, Inc.
August 18, 1995
Page 3--
remedies generally and subject to general principles of
equity (regardless of whether a proceeding is sought in
equity or at law).
Our opinions set forth above are subject to the effects
of bankruptcy, insolvency, fraudulent conveyance, reorganization,
moratorium and other similar laws relating to or affecting
creditors' rights generally, general equitable principles
(whether considered in a proceeding in equity or at law) and an
implied covenant of good faith, fair dealing, and
conscionability; and we are not rendering any opinion with
respect to any provisions of the Securities dealing with (a)
choice of law, (b) severability, (c) exculpation, (d)
indemnification and contribution, (e) arbitration, (f)
restriction of available remedies or attempts to establish a
remedy, and (g) release of unmatured claims.
We are members of the Bar of the State of Alabama, and
we do not express any opinion concerning any law other than the
law of the State of Alabama and the Federal law of the United
States. We have relied on the opinion of Simpson Thacher &
Bartlett insofar as the opinions expressed herein relate to or
are dependant upon any matters governed by the laws of the State
of New York or the Trust Indenture Act.
We hereby consent to the filing of this opinion as an
exhibit to the Registration Statement and further consent to the
reference to us under the caption "Legal Matters" in the
Prospectus and the Registration Statement.
Very truly yours,
SIROTE & PERMUTT, P.C.
EXHIBIT 5.4
[SIMPSON THACHER & BARTLETT LETTERHEAD]
August 18, 1995
Bruno's, Inc.
800 Lakeshore Parkway
Birmingham, Alabama 35211
Ladies and Gentlemen:
We have acted as special New York counsel to Bruno's,
Inc., an Alabama corporation (the "Company"), in connection with
the issuance and sale by the Company of $400,000,000 aggregate
principal amount of 10-1/2% Senior Subordinated Notes due 2005
(the "Notes"), pursuant to the Underwriting Agreement dated
August 10, 1995 (the "Underwriting Agreement") among the Company,
BT Securities Corporation, Chemical Securities Inc. and Salomon
Brothers Inc.
We have examined the Indenture dated as of August 18,
1995, as supplemented by the First Supplemental Indenture (as
defined below) (the "Indenture"), between the Company and Marine
Midland Bank, as Trustee (the "Trustee") relating to the Notes;
and the First Supplemental Indenture dated as of August 18, 1995
(the "First Supplemental Indenture"), between the Company and the
Trustee. In addition, we have examined, and have relied as to
matters of fact upon, the documents delivered to you at the
closing (except the Notes, of which we have examined specimens),
and upon originals or copies, certified or otherwise identified
to our satisfaction, of such corporate records, agreements,
documents and other instruments and such certificates or
comparable documents of public officials and of officers and
representatives of the Company, and have made such other and
further investigations, as we have deemed relevant and necessary
as a basis for the opinions hereinafter set forth.
In such examination, we have assumed the genuineness of
all signatures, the legal capacity of natural persons, the
authenticity of all documents submitted to us as originals, the
conformity to original documents of all documents submitted to us
<PAGE>
as certified or photostatic copies, and the authenticity of the
originals of such latter documents.
Based upon the foregoing, and subject to the
qualifications and limitations stated herein, we are of the
opinion that:
1. The Indenture has been duly authorized, executed
and delivered by the Company and duly qualified under the
Trust Indenture Act of 1939, as amended (the "Trust
Indenture Act"), and, assuming due authorization, execution
and delivery thereof by the Trustee, constitutes a valid and
legally binding instrument of the Company enforceable
against the Company in accordance with its terms.
2. The First Supplemental Indenture has been duly
authorized, executed and delivered by the Company, and
assuming due authorization, execution and delivery thereof
by the Trustee, constitutes a valid and legally binding
instrument of the Company enforceable against the Company in
accordance with its terms.
3. The Notes have been duly authorized, executed and
issued by the Company and, assuming due authentication
thereof by the Trustee and upon payment and delivery in
accordance with the Underwriting Agreement, will constitute
valid and legally binding obligations of the Company
enforceable against the Company in accordance with their
terms and entitled to the benefits of the Indenture.
Our opinions set forth in paragraphs 1, 2 and 3 above
are subject to the effects of bankruptcy, insolvency, fraudulent
conveyance, reorganization, moratorium and other similar laws
relating to or affecting creditors' rights generally, general
equitable principles (whether considered in a proceeding in
equity or at law) and an implied covenant of good faith and fair
dealing.
Insofar as the opinions expressed herein relate to or
are dependent upon matters governed by the laws of the State of
Alabama, we have relied upon the opinion of Sirote & Permutt,
P.C.
We are members of the Bar of the State of New York and
we do not express any opinion herein concerning any law other
than the law of the State of New York and the federal law of the
United States and, to the extent set forth herein, the laws of
the State of Alabama.
This opinion is rendered to you in connection with the
<PAGE>
above described transactions. This opinion may not be relied upon
by you for any other purpose, or relied upon by, or furnished to,
any other person, firm or corporation without our prior written
consent, except that Sirote & Permutt, P.C. may rely on this
opinion with respect to matters of New York law and the Trust
Indenture Act.
We hereby consent to the filing of this opinion of
counsel as Exhibit 5.4 to the Registration Statement and to the
use of our name under the caption "Legal Matters" in the
Registration Statement.
Very truly yours,
SIMPSON THACHER & BARTLETT
Exhibit 10.1
EXECUTION COPY
=================================================================
CREDIT AGREEMENT
among
BRUNO'S, INC.
The Several Lenders
from Time to Time Parties Hereto
and
CHEMICAL BANK,
as Administrative Agent
Dated as of August 18, 1995
=================================================================
<PAGE>
TABLE OF CONTENTS
Page
SECTION 1. Definitions . . . . . . . . . . . . . . . . . 1
SECTION 2. Amount and Terms of Credit . . . . . . . . . . 23
2.1 Commitments . . . . . . . . . . . . . . . . . . . . 23
2.2 Minimum Amount of Each Borrowing; Maximum Number
of
Borrowings . . . . . . . . . . . . . . . . . . . . 25
2.3 Notice of Borrowing . . . . . . . . . . . . . . . . 25
2.4 Disbursement of Funds . . . . . . . . . . . . . . . 26
2.5 Repayment of Loans; Evidence of Debt . . . . . . . 26
2.6 Conversions and Continuations . . . . . . . . . . . 29
2.7 Pro Rata Borrowings . . . . . . . . . . . . . . . . 30
2.8 Interest . . . . . . . . . . . . . . . . . . . . . 30
2.9 Interest Periods . . . . . . . . . . . . . . . . . 30
2.10 Increased Costs, Illegality, etc. . . . . . . . . . 31
2.11 Compensation . . . . . . . . . . . . . . . . . . . 33
2.12 Change of Lending Office . . . . . . . . . . . . . 33
2.13 Notice of Certain Costs . . . . . . . . . . . . . . 33
SECTION 3. Letters of Credit . . . . . . . . . . . . . . 33
3.1 Letters of Credit . . . . . . . . . . . . . . . . . 33
3.2 Letter of Credit Requests . . . . . . . . . . . . . 34
3.3 Letter of Credit Participations . . . . . . . . . . 34
3.4 Agreement to Repay Letter of Credit Drawings . . . 36
3.5 Increased Costs . . . . . . . . . . . . . . . . . . 37
3.6 Successor Letter of Credit Issuer . . . . . . . . . 37
SECTION 4. Fees; Commitments . . . . . . . . . . . . . . 38
4.1 Fees . . . . . . . . . . . . . . . . . . . . . . . 38
4.2 Voluntary Reduction of Revolving Credit
Commitments . . . . . . . . . . . . . . . . . . . 38
4.3 Mandatory Termination of Commitments . . . . . . . 39
SECTION 5. Payments . . . . . . . . . . . . . . . . . . . 39
5.1 Voluntary Prepayments . . . . . . . . . . . . . . . 39
5.2 Mandatory Prepayments . . . . . . . . . . . . . . . 40
5.3 Method and Place of Payment . . . . . . . . . . . . 42
5.4 Net Payments . . . . . . . . . . . . . . . . . . . 42
5.5 Computations of Interest and Fees . . . . . . . . . 44
SECTION 6. Conditions Precedent to Initial Borrowing . . 44
6.1 Credit Documents . . . . . . . . . . . . . . . . . 44
6.2 Closing Certificate . . . . . . . . . . . . . . . . 44
6.3 Corporate Proceedings of Each Credit Party . . . . 45
6.4 Corporate Documents . . . . . . . . . . . . . . . . 45
6.5 No Material Adverse Change . . . . . . . . . . . . 45
6.6 Fees . . . . . . . . . . . . . . . . . . . . . . . 45
6.7 Equity Contributions . . . . . . . . . . . . . . . 45
6.8 Merger . . . . . . . . . . . . . . . . . . . . . . 45
6.9 Other Indebtedness . . . . . . . . . . . . . . . . 45
6.10 Closing Date Balance Sheet . . . . . . . . . . . . 45
6.11 Solvency Letter . . . . . . . . . . . . . . . . . . 45
<PAGE>
6.12 Required Approvals . . . . . . . . . . . . . . . . 46
6.13 Existing Indebtedness of the Borrower . . . . . . . 46
6.14 Legal Opinions . . . . . . . . . . . . . . . . . . 46
6.15 Audited Financial Statements . . . . . . . . . . . 46
6.16 Environmental and Safety Conditions . . . . . . . . 46
6.17 Subordinated Notes . . . . . . . . . . . . . . . . 46
SECTION 7. Conditions Precedent to All Credit Events . . 46
7.1 No Default; Representations and Warranties . . . . 46
7.2 Notice of Borrowing; Letter of Credit Request . . . 46
SECTION 8. Representations, Warranties and Agreements . . 47
8.1 Corporate Status . . . . . . . . . . . . . . . . . 47
8.2 Corporate Power and Authority . . . . . . . . . . . 47
8.3 No Violation . . . . . . . . . . . . . . . . . . . 47
8.4 Litigation . . . . . . . . . . . . . . . . . . . . 47
8.5 Margin Regulations . . . . . . . . . . . . . . . . 47
8.6 Governmental Approvals . . . . . . . . . . . . . . 48
8.7 Investment Company Act . . . . . . . . . . . . . . 48
8.8 True and Complete Disclosure . . . . . . . . . . . 48
8.9 Financial Condition; Financial Statements . . . . . 48
8.10 Tax Returns and Payments . . . . . . . . . . . . . 48
8.11 Compliance with ERISA . . . . . . . . . . . . . . . 48
8.12 Subsidiaries . . . . . . . . . . . . . . . . . . . 49
8.13 Patents, etc. . . . . . . . . . . . . . . . . . . . 49
8.14 Environmental Laws . . . . . . . . . . . . . . . . 49
8.15 Properties . . . . . . . . . . . . . . . . . . . . 49
SECTION 9. Affirmative Covenants . . . . . . . . . . . . 49
9.1 Information Covenants . . . . . . . . . . . . . . . 49
9.2 Books, Records and Inspections . . . . . . . . . . 51
9.3 Maintenance of Insurance . . . . . . . . . . . . . 51
9.4 Payment of Taxes . . . . . . . . . . . . . . . . . 51
9.5 Consolidated Corporate Franchises . . . . . . . . . 52
9.6 Compliance with Statutes, Obligations, etc. . . . . 52
9.7 ERISA . . . . . . . . . . . . . . . . . . . . . . . 52
9.8 Good Repair . . . . . . . . . . . . . . . . . . . . 52
9.9 Transactions with Affiliates . . . . . . . . . . . 52
9.10 End of Fiscal Years; Fiscal Quarters . . . . . . . 53
9.11 Additional Guarantors . . . . . . . . . . . . . . . 53
9.12 Pledges of Additional Stock and Evidence of
Indebtedness . . . . . . . . . . . . . . . . . . . 53
9.13 Use of Proceeds . . . . . . . . . . . . . . . . . . 53
SECTION 10. Negative Covenants . . . . . . . . . . . . . 53
10.1 Changes in Business . . . . . . . . . . . . . . . . 53
10.2 Limitation on Indebtedness . . . . . . . . . . . . 53
10.3 Limitation on Liens . . . . . . . . . . . . . . . . 54
10.4 Limitation on Fundamental Changes . . . . . . . . . 55
10.5 Limitation on Sale of Assets . . . . . . . . . . . 55
10.6 Limitation on Investments . . . . . . . . . . . . . 56
10.7 Limitation on Dividends . . . . . . . . . . . . . . 56
10.8 Limitation on Debt Payments . . . . . . . . . . . . 57
10.9 Consolidated Total Debt to Consolidated EBITDA
Ratio . . . . . . . . . . . . . . . . . . . . . . 57
10.10Consolidated EBITDA to Consolidated Interest
Expense Ratio . . . . . . . . . . . . . . . . . . 57
10.11Consolidated Fixed Charge Coverage Ratio . . . . . 58
-ii-
<PAGE>
Page
10.12Capital Expenditures . . . . . . . . . . . . . . . 58
SECTION 11. Events of Default . . . . . . . . . . . . . . 59
11.1 Payments . . . . . . . . . . . . . . . . . . . . . 59
11.2 Representations, etc. . . . . . . . . . . . . . . . 59
11.3 Covenants . . . . . . . . . . . . . . . . . . . . . 59
11.4 Default Under Other Agreements . . . . . . . . . . 59
11.5 Bankruptcy, etc. . . . . . . . . . . . . . . . . . 60
11.6 ERISA . . . . . . . . . . . . . . . . . . . . . . . 60
11.7 Guarantee . . . . . . . . . . . . . . . . . . . . . 60
11.8 Pledge Agreement . . . . . . . . . . . . . . . . . 60
11.9 Judgments . . . . . . . . . . . . . . . . . . . . . 60
11.10Change of Control . . . . . . . . . . . . . . . . . 61
SECTION 12. The Administrative Agent . . . . . . . . . . 61
12.1 Appointment . . . . . . . . . . . . . . . . . . . . 61
12.2 Delegation of Duties . . . . . . . . . . . . . . . 61
12.3 Exculpatory Provisions . . . . . . . . . . . . . . 61
12.4 Reliance by Administrative Agent . . . . . . . . . 62
12.5 Notice of Default . . . . . . . . . . . . . . . . . 62
12.6 Non-Reliance on Administrative Agent and Other
Lenders . . . . . . . . . . . . . . . . . . . . . . . . . . . 62
12.7 Indemnification . . . . . . . . . . . . . . . . . . 63
12.8 Administrative Agent in Its Individual Capacity . . 63
12.9 Successor Agent . . . . . . . . . . . . . . . . . . 63
SECTION 13. Miscellaneous . . . . . . . . . . . . . . . . 63
13.1 Amendments and Waivers . . . . . . . . . . . . . . 63
13.2 Notices . . . . . . . . . . . . . . . . . . . . . . 64
13.3 No Waiver; Cumulative Remedies . . . . . . . . . . 65
13.4 Survival of Representations and Warranties . . . . 65
13.5 Payment of Expenses and Taxes . . . . . . . . . . . 65
13.6 Successors and Assigns; Participations and
Assignments . . . . . . . . . . . . . . . . . . . . . . . . . 66
13.7 Replacements of Lenders under Certain
Circumstances . . . . . . . . . . . . . . . . . . 67
13.8 Adjustments; Set-off . . . . . . . . . . . . . . . 68
13.9 Counterparts . . . . . . . . . . . . . . . . . . . 68
13.10Severability . . . . . . . . . . . . . . . . . . . 68
13.11Integration . . . . . . . . . . . . . . . . . . . . 68
13.12GOVERNING LAW . . . . . . . . . . . . . . . . . . . 68
13.13Submission To Jurisdiction; Waivers . . . . . . . . 69
13.14Acknowledgements . . . . . . . . . . . . . . . . . 69
13.15WAIVERS OF JURY TRIAL . . . . . . . . . . . . . . . 69
13.16Confidentiality . . . . . . . . . . . . . . . . . . 69
13.17Pre-Funding Escrow Arrangements . . . . . . . . . . 70
-iii-
<PAGE>
SCHEDULES
Schedule 1.1 Commitments and Addresses of Lenders
Schedule 8.12 Subsidiaries
Schedule 10.2 Other Indebtedness
Schedule 10.3 Existing Liens
EXHIBITS
Exhibit A Form of Guarantee
Exhibit B Form of Pledge Agreement
Exhibit C-1 Form of Promissory Note (Term Loans)
Exhibit C-2 Form of Promissory Note (Revolving Credit and Swingline
Loans)
Exhibit D Form of Letter of Credit Request
Exhibit E-1 Form of Legal Opinion of Simpson Thacher & Bartlett
Exhibit E-2 Form of Legal Opinion of Sirote & Permutt
Exhibit F Form of Assignment and Acceptance
Exhibit G Form of Closing Certificate
Exhibit H-1 Form of Tranche B Prepayment Option Notice
Exhibit H-2 Form of Tranche C Prepayment Option Notice
Exhibit H-3 Form of Tranche D Prepayment Option Notice
Exhibit I Form of Confidentiality Agreement
<PAGE>
CREDIT AGREEMENT dated as of August 18, 1995, among BRUNO'S,
INC., an Alabama corporation (the "Borrower"), the lending institutions
--------
from time to time parties hereto (each a "Lender" and, collectively, the
------
"Lenders"), and CHEMICAL BANK, as Administrative Agent (such term and each
-------
other capitalized term used but not defined in this introductory statement
having the meaning provided in Section 1).
The Borrower has entered into an Agreement and Plan of Merger
dated as of April 20, 1995, and amended as of May 18, 1995 (such Agreement
and Plan of Merger, as so amended and as the same may be amended,
supplemented or otherwise modified from time to time after the date hereof,
being referred to herein as the "Merger Agreement"), with Crimson
----------------
Acquisition Corp., an Alabama corporation ("Crimson") and a wholly owned
-------
subsidiary of the Partnership, pursuant to which Crimson will merge with
and into the Borrower in a transaction (the "Merger") in which (a) the pre-
------
Merger shareholders of the Borrower will receive cash in an aggregate
amount of approximately $880,000,000 and approximately 17% of the post-
Merger common stock of the Borrower, (b) the Partnership will receive
approximately 83% of the post-Merger common stock of the Borrower and
(c) the Borrower will be the surviving corporation in the Merger.
The proceeds of (a) Tranche A Term Loans in an aggregate
principal amount of $275,000,000, (b) Tranche B Term Loans in an aggregate
principal amount of $75,000,000, (c) Tranche C Term Loans in an aggregate
principal amount of $75,000,000 and (d) Tranche D Term Loans in an
aggregate principal amount of $50,000,000 made under this Agreement will be
used by the Borrower, together with Revolving Credit Loans made under this
Agreement on the Closing Date and the entire amount of the Equity
Contributions made to Crimson, (i) to finance the amounts payable by the
Borrower in the Merger and (ii) to refinance certain existing debt of the
Borrower. The proceeds of Revolving Credit Loans made under this Agreement
(other than the Revolving Credit Loans used for the purpose specified in
the immediately preceding sentence) and the proceeds of the Swingline Loans
made under this Agreement will be used by the Borrower (a) to refinance
certain existing debt of the Borrower, (b) to pay fees and expenses in
connection with the Merger and the other transactions contemplated hereby
and (c) for general corporate purposes. Letters of Credit issued under
this Agreement will be used by the Borrower for general corporate purposes.
The parties hereto hereby agree as follows:
SECTION 1. Definitions. As used herein, the following terms
-----------
shall have the meanings specified in this Section 1 unless the context
otherwise requires (it being understood that defined terms in this
Agreement shall include in the singular number the plural and in the plural
the singular):
"ABR" shall mean, for any day, a rate per annum (rounded upwards,
---
if necessary, to the next 1/16 of 1%) equal to the greatest of (a) the
Prime Rate in effect on such day, (b) the Base CD Rate in effect on
such day plus 1% and (c) the Federal Funds Effective Rate in effect on
such day plus 1/2 of 1%. Any change in the ABR due to a change in the
Prime Rate, the Three-Month Secondary CD Rate or the Federal Funds
Effective Rate shall be effective as of the opening of business on the
effective day of such change in the Prime Rate, the Three-Month
Secondary CD Rate or the Federal Funds Effective Rate, respectively.
"ABR Loan" shall mean each Loan bearing interest at the rate
--------
provided in Section 2.8(a) and, in any event, shall include all
Swingline Loans.
"ABR Revolving Credit Loan" shall mean any Revolving Credit Loan
-------------------------
bearing interest at a rate determined by reference to the ABR.
"Adjusted Total Revolving Credit Commitment" shall mean at any
------------------------------------------
time the Total Revolving Credit Commitment less the aggregate
Revolving Credit Commitments of all Defaulting Lenders.
"Adjusted Total Tranche A Commitment" shall mean at any time the
-----------------------------------
Total Tranche A Commitment less the Tranche A Commitments of all
Defaulting Lenders.
<PAGE>
2
"Administrative Agent" shall mean Chemical, together with its
--------------------
affiliates, as the arranger of the Commitments and as the agent for
the Lenders under this Agreement and the other Credit Documents.
"Administrative Agent's Office" shall mean the office of the
-----------------------------
Administrative Agent located at 270 Park Avenue, New York, New York
10017, or such other office in New York City as the Administrative
Agent may hereafter designate in writing as such to the other parties
hereto.
"Affiliate" shall mean, with respect to any Person, any other
---------
Person directly or indirectly controlling, controlled by, or under
direct or indirect common control with such Person. A Person shall be
deemed to control a corporation if such Person possesses, directly or
indirectly, the power (a) to vote 10% or more of the securities having
ordinary voting power for the election of directors of such
corporation or (b) to direct or cause the direction of the management
and policies of such corporation, whether through the ownership of
voting securities, by contract or otherwise.
"Aggregate Revolving Credit Outstandings" shall have the meaning
---------------------------------------
provided in Section 5.2(b).
"Agreement" shall mean this Credit Agreement, as the same may be
---------
from time to time modified, amended and/or supplemented.
"Applicable ABR Margin" shall mean, with respect to each ABR Loan
---------------------
at any date, the applicable percentage per annum set forth below based
upon (a) whether such loan is a Revolving Credit Loan, a Swingline
Loan, a Tranche A Term Loan, a Tranche B Term Loan, a Tranche C Term
Loan or a Tranche D Term Loan and (b) in the case of Revolving Credit
Loans, Swingline Loans and Tranche A Term Loans, the Status in effect
on such date:
Applicable ABR
Loan Status Margin
---- ------ -------------
Revolving Credit Loans, Level I Status 0.000%
Swingline Loans and Level II Status 0.250%
Tranche A Term Loans Level III Status 0.500%
Level IV Status 0.750%
Level V Status 1.000%
Level VI Status 1.250%
Level VII Status 1.500%
Tranche B Term Loans 2.000%
Tranche C Term Loans 2.500%
Tranche D Term Loans 3.000%
"Applicable Eurodollar Margin" shall mean, with respect to each
----------------------------
Eurodollar Term Loan and Eurodollar Revolving Credit Loan at any date,
the applicable percentage per annum set forth below based upon
(a) whether such loan is a Revolving Credit Loan, a Tranche A Term
Loan, a Tranche B Term Loan, a Tranche C Term Loan or a Tranche D Term
Loan and (b) in the case of Revolving Credit Loans and Tranche A Term
Loans, the Status in effect on such date:
Applicable
Eurodollar
Loan Status Margin
---- ------ -------------
Revolving Credit Loans Level I Status 1.000%
and Tranche A Term Loans Level II Status 1.250%
<PAGE>
3
Applicable
Eurodollar
Loan Status Margin
---- ------ -------------
Level III Status 1.500%
Level IV Status
1.750%
Level V Status 2.000%
Level VI Status 2.250%
Level VII Status 2.500%
Tranche B Term Loans 3.000%
Tranche C Term Loans 3.500%
Tranche D Term Loans 4.000%
"Asset Sale Prepayment Event" shall mean any sale, transfer or
---------------------------
other disposition of any business units, assets or other properties of
the Borrower or any of its Subsidiaries not in the ordinary course of
business. Notwithstanding the foregoing, the term "Asset Sale
Prepayment Event" shall not include any transaction permitted by
Section 10.5 (other than Section 10.5(b)).
"Authorized Officer" shall mean the Chairman of the Board, the
------------------
President, the Chief Financial Officer, the Treasurer or any other
senior officer of the Borrower designated as such in writing to the
Administrative Agent by the Borrower.
"Available Commitment" shall mean (a) at any time to but
--------------------
excluding the Closing Date, an amount equal to the amount of the Total
Commitment and (b) at any time from and including the Closing Date, an
amount equal to the excess, if any, of (i) the sum of (A) the amount
of the Total Revolving Credit Commitment and (B) the amount of the
Total Tranche A Commitment over (ii) the sum of (x) the aggregate
principal amount of all Revolving Credit Loans (but not Swingline
Loans) then outstanding and (y) the aggregate Letter of Credit
Outstandings at such time.
"Available Investment Amount" shall mean, on any date (the
---------------------------
"Reference Date"), an amount equal to the sum of (a) $100,000,000, (b)
--------------
the Net Cash Proceeds of any Prepayment Events to the extent that such
Net Cash Proceeds have not on or prior to the Reference Date been (i)
applied to the repayment of Loans in accordance with Section 5.2(a)(i)
or (ii) reinvested in the business of the Borrower or any of its
Subsidiaries, (c) an amount equal to (i) the cumulative amount of
Excess Cash Flow for all fiscal years completed prior to the Reference
Date minus (ii) the portion of such Excess Cash Flow that has been on
-----
or prior to the Reference Date (or will be) applied to the prepayment
of Loans in accordance with Section 5.2(a)(ii), (d) the amount of any
capital contributions made to the Borrower from and including the
Business Day immediately following the Closing Date through and
including the Reference Date and (e) an amount equal to (i) 50% of the
Net Cash Proceeds received by the Borrower on or prior to the
Reference Date from any issuance of equity securities by the Borrower
minus (ii) the portion of such Net Cash Proceeds that has been applied
-----
to the purchase of Subordinated Notes or other subordinated
Indebtedness of the Borrower or any of its Subsidiaries in accordance
with Section 10.8.
"Bankruptcy Code" shall have the meaning provided in Section 11.5.
---------------
"Base CD Rate" shall mean the sum of (a) the product of (i) the
------------
Three-Month Secondary CD Rate and (ii) a fraction, the numerator of
which is one and the denominator of which is one minus the C/D Reserve
Percentage and (b) the C/D Assessment Rate.
<PAGE>
4
"Board" shall mean the Board of Governors of the Federal Reserve
-----
System of the United States (or any successor).
"Borrower" shall have the meaning provided in the first paragraph
--------
of this Agreement.
"Borrower Common Stock" shall mean any class of outstanding
---------------------
common stock of the Borrower after the Merger.
"Borrowing" shall mean and include (a) the incurrence of
---------
Swingline Loans from Chemical on a given date, (b) the incurrence of
one Type of Term Loan on the Closing Date (or resulting from
conversions on a given date after the Closing Date) having, in the
case of Eurodollar Term Loans, the same Interest Period (provided that
--------
ABR Loans incurred pursuant to Section 2.10(b) shall be considered
part of any related Borrowing of Eurodollar Term Loans) and (c) the
incurrence of one Type of Revolving Credit Loan on a given date (or
resulting from conversions on a given date) having, in the case of
Eurodollar Revolving Credit Loans, the same Interest Period (provided
--------
that ABR Loans incurred pursuant to Section 2.10(b) shall be
considered part of any related Borrowing of Eurodollar Revolving
Credit Loans).
"Business Day" shall mean (a) for all purposes other than as
------------
covered by clause (b) below, any day excluding Saturday, Sunday and
any day that shall be in the City of New York a legal holiday or a day
on which banking institutions are authorized by law or other
governmental actions to close and (b) with respect to all notices and
determinations in connection with, and payments of principal and
interest on, Eurodollar Loans, any day that is a Business Day
described in clause (a) and which is also a day for trading by and
between banks in Dollar deposits in the relevant interbank Eurodollar
market.
"Capital Expenditures" shall mean, for any period, the aggregate
--------------------
of all expenditures (whether paid in cash or accrued as liabilities
and including in all events all amounts expended or capitalized under
Capital Leases, but excluding any amount representing capitalized
interest) by the Borrower and its Subsidiaries during such period
that, in conformity with GAAP, are or are required to be included as
additions during such period to property, plant or equipment reflected
in the consolidated balance sheet of the Borrower and its
Subsidiaries, provided that the term "Capital Expenditures" shall not
--------
include (a) expenditures made in connection with the replacement,
substitution or restoration of assets (i) to the extent financed from
insurance proceeds paid on account of the loss of or damage to the
assets being replaced or restored or (ii) with awards of compensation
arising from the taking by eminent domain or condemnation of the
assets being replaced, (b) the purchase price of equipment that is
purchased simultaneously with the trade-in of existing equipment to
the extent that the gross amount of such purchase price is reduced by
the credit granted by the seller of such equipment for the equipment
being traded in at such time and (c) the purchase of plant, property
or equipment made within one year of the sale of any asset to the
extent purchased with the proceeds of such sale.
"Capital Lease", as applied to any Person, shall mean any lease
-------------
of any property (whether real, personal or mixed) by that Person as
lessee that, in conformity with GAAP, is, or is required to be,
accounted for as a capital lease on the balance sheet of that Person.
"Capitalized Lease Obligations" shall mean all obligations under
-----------------------------
Capital Leases of the Borrower or any of its Subsidiaries, in each
case taken at the amount thereof accounted for as liabilities in
accordance with GAAP.
<PAGE>
5
"C/D Assessment Rate" shall mean for any day as applied to any
-------------------
ABR Loan, the annual assessment rate in effect on such day that is
payable by a member of the Bank Insurance Fund maintained by the
Federal Deposit Insurance Corporation or any successor thereto (the
"FDIC") classified as well-capitalized and within supervisory subgroup
----
"B" (or a comparable successor assessment risk classification) within
the meaning of 12 C.F.R. Sec. 327.3(d) (or any successor provision) to
the FDIC for the FDIC's insuring time deposits at offices of such
institution in the United States.
"C/D Reserve Percentage" shall mean for any day as applied to any
----------------------
ABR Loan, the percentage (expressed as a decimal) that is in effect on
such day, as prescribed by the Board, for determining the reserve
requirement for a Depositary Institution (as defined in Regulation D
of the Board) in respect of new non-personal time deposits in Dollars
having a maturity that is 30 days or more.
"Change of Control" shall mean and be deemed to have occurred if
-----------------
(a) at any time Continuing Directors shall not constitute a majority
of the Board of Directors of the Borrower; (b) KKR and its Affiliates
shall at any time not own directly or indirectly, beneficially and of
record, a majority of the outstanding Voting Stock of the Borrower
(other than as the result of one or more public offerings of Borrower
Common Stock, whether by the Borrower or by KKR or any of its
Affiliates); and/or (c) any person, entity or "group" (within the
meaning of Section 13(d) or 14(d) of the Securities Exchange Act of
1934, as amended) shall at any time have acquired direct or indirect
beneficial ownership of a percentage of the outstanding Voting Stock
of the Borrower that exceeds the percentage of such Voting Stock then
beneficially owned by KKR and its Affiliates.
"Chemical" shall mean Chemical Bank, a New York banking
--------
corporation, and any successor thereto by merger, consolidation or
otherwise.
"Closing Date" shall mean the date of the initial Borrowing
------------
hereunder.
"Code" shall mean the Internal Revenue Code of 1986, as amended
----
from time to time, and the regulations promulgated and rulings issued
thereunder. Section references to the Code are to the Code, as in
effect at the date of this Agreement and any subsequent provisions of
the Code, amendatory thereof, supplemental thereto or substituted
therefor.
"Commitments" shall mean, with respect to each Lender, such
-----------
Lender's Term Loan Commitments and Revolving Credit Commitment.
<PAGE>
6
"Commitment Fee Rate" shall mean, for any Lender for any day, the
-------------------
rate per annum equal to (a) in the case of such Lender's Tranche B
Commitment, Tranche C Commitment and Tranche D Commitment, .5000% and
(b) in the case of such Lender's Revolving Credit Commitment and
Tranche A Commitment, the rate per annum set forth below opposite the
Status in effect on such day:
Commitment
Status Fee Rate
------ --------------
Level I Status .3750%
Level II Status .3750%
Level III Status .3750%
Level IV Status .3750%
Level V Status .5000%
Level VI Status .5000%
Level VII Status .5000%
"Confidential Information" shall have the meaning provided in
------------------------
Section 13.16.
"Confidential Information Memorandum" shall mean the Confidential
-----------------------------------
Information Memorandum of the Borrower dated June 1995, delivered to
the Lenders in connection with this Agreement.
"Consolidated Earnings" shall mean, for any period, "income from
---------------------
continuing operations before income taxes and extraordinary items" of
the Borrower and its Subsidiaries for such period, determined in a
manner consistent with the manner in which such amount was determined
in accordance with the audited financial statements referred to in
Section 9.1(a).
"Consolidated EBITDA" shall mean, for any period, the sum,
-------------------
without duplication, of the amounts for such period of (a)
Consolidated Earnings, (b) Consolidated Interest Expense, (c)
depreciation expense, (d) amortization expense, including amortization
of deferred financing fees, (e) non-recurring charges, (f) non-cash
charges, (g) losses on asset sales, (h) in the case of any period
ending during the fiscal year ended June 29, 1996, expenses related to
the Merger and the transactions in connection therewith and (i) in the
case of any Test Period ending on or prior to December 31, 1995,
income in an aggregate amount not in excess of $5,000,000 in respect
of a contract between the Borrower and a supplier less the sum of the
----
amounts for such period of (j) non-recurring gains, (k) non-cash gains
and (l) gains on asset sales, all as determined on a consolidated
basis for the Borrower and its Subsidiaries in accordance with GAAP.
"Consolidated Interest Expense" shall mean, for any period, cash
-----------------------------
interest expense (including that attributable to Capital Leases in
accordance with GAAP), net of interest income, of the Borrower and its
Subsidiaries on a consolidated basis with respect to all outstanding
Indebtedness of the Borrower and its Subsidiaries, including, without
limitation, all commissions, discounts and other fees and charges owed
with respect to letters of credit and bankers' acceptance financing
and net costs under Hedge Agreements (other than currency swap
agreements, currency future or option contracts and other similar
agreements), but excluding, however, amortization of deferred
financing costs and any other amounts of non-cash interest, all as
calculated on a consolidated basis in accordance with GAAP; provided,
--------
however, that Consolidated Interest Expense for the Test Periods
-------
ending on December 31, 1995, March 31, 1996, and June 30, 1996, shall
be determined by (a) in the case of the Test
<PAGE>
7
Period ending on December 31, 1995, multiplying Consolidated Interest
Expense for the period commencing on September 30, 1995, and ending on
December 31, 1995, by 4, (b) in the case of the Test Period ending on
March 31, 1996, multiplying Consolidated Interest Expense for the
period commencing on September 30, 1995, and ending on March 31, 1996,
by 2 and (c) in the case of the Test Period ending on June 30, 1996,
multiplying Consolidated Interest Expense for the period commencing on
September 30, 1995, and ending on June 30, 1996, by 4/3.
"Consolidated Net Income" shall mean, for any period, the
-----------------------
consolidated net income (or loss) of the Borrower and its
Subsidiaries, determined on a consolidated basis in accordance with
GAAP.
"Consolidated Rental Expense" shall mean, for any period, the
---------------------------
aggregate rental expense of the Borrower and its Subsidiaries for such
period, excluding real estate taxes and common area maintenance
charges, calculated on a consolidated basis in accordance with GAAP,
in respect of all rent obligations under operating leases for real or
personal property.
"Consolidated Senior Debt" shall mean, as of any date of
------------------------
determination, Consolidated Total Debt as of such date minus
-----
Consolidated Subordinated Debt as of such date.
"Consolidated Senior Debt to Consolidated EBITDA Ratio" shall
-----------------------------------------------------
mean, as of any date of determination, the ratio of (a) Consolidated
Senior Debt as of the last day of the Test Period ending with the
fiscal period covered by the Section 9.1 Financials last delivered or
required to be delivered pursuant to Section 9.1 to (b) Consolidated
EBITDA for such Test Period.
"Consolidated Subordinated Debt" shall mean, as of any date of
------------------------------
determination, all Indebtedness of the Borrower and its Subsidiaries
for borrowed money that is (a) outstanding on such date and
(b) subordinated in right of payment to the Obligations, all
calculated on a consolidated basis in accordance with GAAP.
"Consolidated Total Debt" shall mean, as of any date of
-----------------------
determination, the sum of (a) all Indebtedness of the Borrower and its
Subsidiaries for borrowed money outstanding on such date and (b) all
Capitalized Lease Obligations of the Borrower and its Subsidiaries
outstanding on such date, all calculated on a consolidated basis in
accordance with GAAP.
"Consolidated Total Debt to Consolidated EBITDA Ratio" shall
----------------------------------------------------
mean, as of any date of determination, the ratio of (a) Consolidated
Total Debt as of the last day of the Test Period ending with the
fiscal period covered by the Section 9.1 Financials last delivered or
required to be delivered pursuant to Section 9.1 to (b) Consolidated
EBITDA for such Test Period.
"Consolidated Working Capital" shall mean, at any date, the
----------------------------
excess of (a) the sum of all amounts (other than cash and cash
equivalents) that would, in conformity with GAAP, be set forth
opposite the caption "total current assets" (or any like caption) on a
consolidated balance sheet of the Borrower and its Subsidiaries at
such date over (b) the sum of all amounts that would, in conformity
with GAAP, be set forth opposite the caption "total current
liabilities" (or any like caption) on a consolidated balance sheet of
the Borrower and its Subsidiaries on such date, but excluding (i) the
current portion of any Funded Debt and (ii) without duplication of
clause (i) above, all Indebtedness consisting of Loans and Letter of
Credit Exposure to the extent otherwise included therein.
"Contingent Obligations" shall mean, as to any Person, any
----------------------
obligation of such Person guaranteeing or intended to guarantee any
Indebtedness, leases, dividends or other monetary obligations
("primary obligations") of any other Person (the "primary obligor") in
------------------- ---------------
any manner,
<PAGE>
8
whether directly or indirectly, including, without limitation, any
obligation of such Person, whether or not contingent, (a) to purchase
any such primary obligation or any property constituting direct or
indirect security therefor, (b) to advance or supply funds (i) for the
purchase or payment of any such primary obligation or (ii) to maintain
working capital or equity capital of the primary obligor or otherwise
to maintain the net worth or solvency of the primary obligor, (c) to
purchase property, securities or services primarily for the purpose of
assuring the owner of any such primary obligation of the ability of
the primary obligor to make payment of such primary obligation or (d)
otherwise to assure or hold harmless the owner of such primary
obligation against loss in respect thereof; provided, however, that
-------- -------
the term "Contingent Obligations" shall not include (x) endorsements
of instruments for deposit or collection in the ordinary course of
business, (y) guarantees made by a Person of the obligations of a
Subsidiary or Affiliate of such Person that do not constitute
Indebtedness of such Subsidiary or Affiliate and are incurred in the
ordinary course of business of such Subsidiary or Affiliate or
(z) obligations arising from agreements providing for indemnification
or adjustment of purchase price (or from guarantees securing any
obligations pursuant to any such agreements), incurred or assumed in
connection with the acquisition or disposition of any business or
assets or Subsidiary (other than Guarantee Obligations). The amount
of any Contingent Obligation shall be deemed to be an amount equal to
the stated or determinable amount of the primary obligation in respect
of which such Contingent Obligation is made or, if not stated or
determinable, the maximum reasonably anticipated liability in respect
thereof (assuming such Person is required to perform thereunder) as
determined by such Person in good faith.
"Continuing Director" shall mean, at any date, an individual (a)
-------------------
who is a member of the Board of Directors of the Borrower on the date
hereof, (b) who, as at such date, has been a member of such Board of
Directors for at least the 12 preceding months, (c) who has been
nominated to be a member of such Board of Directors, directly or
indirectly, by KKR or Persons nominated by KKR or (d) who has been
nominated to be a member of such Board of Directors by a majority of
the other Continuing Directors then in office.
"Credit Documents" shall mean this Agreement, the Guarantee, the
----------------
Pledge Agreement and any promissory notes issued by the Borrower
hereunder .
"Credit Event" shall mean and include the making (but not the
------------
conversion or continuation) of a Loan and the issuance of a Letter of
Credit.
"Credit Party" shall mean each of the Borrower and the
------------
Guarantors.
"Crimson" shall have the meaning provided in the first paragraph
-------
of this Agreement.
"Debt Incurrence Prepayment Event" shall mean any issuance or
--------------------------------
incurrence by the Borrower or any of its Subsidiaries of any
Indebtedness (including any Indebtedness incurred in connection with
any Permitted Mortgage Financing but excluding any other Indebtedness
permitted to be issued or incurred under Section 10.2).
"Default" shall mean any event, act or condition that with notice
-------
or lapse of time, or both, would constitute an Event of Default.
"Defaulting Lender" shall mean any Lender with respect to which a
-----------------
Lender Default is in effect.
"Dividends" shall have the meaning provided in Section 10.7.
---------
<PAGE>
9
"Dollars" and "$" shall mean dollars in lawful currency of the
------- -
United States of America.
"Drawing" shall have the meaning provided in Section 3.4(b).
-------
"Environmental Claims" shall mean any and all administrative,
--------------------
regulatory or judicial actions, suits, demands, demand letters,
claims, liens, notices of noncompliance or violation, investigations
(other than internal reports prepared by the Borrower or any of its
Subsidiaries (a) in the ordinary course of such Person's business or
(b) as required in connection with a financing transaction or an
acquisition or disposition of real estate) or proceedings relating in
any way to any Environmental Law or any permit issued, or any approval
given, under any such Environmental Law (hereafter, "Claims"),
------
including, without limitation, (i) any and all Claims by governmental
or regulatory authorities for enforcement, cleanup, removal, response,
remedial or other actions or damages pursuant to any applicable
Environmental Law and (ii) any and all Claims by any third party
seeking damages, contribution, indemnification, cost recovery,
compensation or injunctive relief resulting from Hazardous Materials
or arising from alleged injury or threat of injury to health, safety
or the environment.
"Environmental Law" shall mean any applicable Federal, state,
-----------------
foreign or local statute, law, rule, regulation, ordinance, code and
rule of common law now or hereafter in effect and in each case as
amended, and any binding judicial or administrative interpretation
thereof, including any binding judicial or administrative order,
consent decree or judgment, relating to the environment, human health
or safety or Hazardous Materials.
"Equity Contribution" shall mean the equity contribution to the
-------------------
Borrower by the Partnership of an aggregate cash amount of not less
than $250,000,000.
"ERISA" shall mean the Employee Retirement Income Security Act of
-----
1974, as amended from time to time. Section references to ERISA are
to ERISA as in effect at the date of this Agreement and any subsequent
provisions of ERISA amendatory thereof, supplemental thereto or
substituted therefor.
"ERISA Affiliate" shall mean each person (as defined in Section
---------------
3(9) of ERISA) that together with the Borrower or a Subsidiary would
be deemed to be a "single employer" within the meaning of Section
414(b) or (c) of the Code or, solely for purposes of Section 302 of
ERISA and Section 412 of the Code, is treated as a single employer
under Section 414 of the Code.
"Eurodollar Rate" shall mean, in the case of any Eurodollar Term
---------------
Loan or Eurodollar Revolving Credit Loan, with respect to each day
during each Interest Period pertaining to such Eurodollar Loan, the
rate of interest determined on the basis of the rate for deposits in
Dollars for a period equal to such Interest Period commencing on the
first day of such Interest Period appearing on Page 3750 of the
Telerate screen as of 11:00 A.M., London time, two Business Days prior
to the beginning of such Interest Period. In the event that such rate
does not appear on Page 3750 of the Telerate Service (or otherwise on
such service), the "Eurodollar Rate" for the purposes of this
paragraph shall be determined by reference to such other publicly
available service for displaying eurodollar rates as may be agreed
upon by the Administrative Agent and the Borrower or, in the absence
of such agreement, the "Eurodollar Rate" for the purposes of this
paragraph shall instead be the rate per annum equal to the average of
the respective rates notified to the Administrative Agent by each of
the Reference Lenders as the rate at which such Reference Lender is
offered Dollar deposits at or about 10:00 A.M., New York time, two
Business Days prior to the beginning of such Interest Period, in the
interbank eurodollar market where the eurodollar and foreign currency
and exchange operations in respect of its Eurodollar Loans are then
being conducted for delivery
<PAGE>
10
on the first day of such Interest Period for the number of days
comprised therein and in an amount comparable to the amount of its
Eurodollar Term Loan or Eurodollar Revolving Credit Loan, as the case
may be, to be outstanding during such Interest Period.
"Eurodollar Loan" shall mean any Eurodollar Term Loan or
---------------
Eurodollar Revolving Credit Loan.
"Eurodollar Revolving Credit Loan" shall mean any Revolving
--------------------------------
Credit Loan bearing interest at a rate determined by reference to the
Eurodollar Rate.
"Eurodollar Term Loan" shall mean any Term Loan bearing interest
--------------------
at a rate determined by reference to the Eurodollar Rate.
"Event of Default" shall have the meaning provided in Section 11.
----------------
"Excess Cash Flow" shall mean, for any period, an amount equal to
----------------
the excess of (a) the sum, without duplication, of (i) Consolidated
Net Income for such period, (ii) an amount equal to the amount of all
non-cash charges to the extent deducted in arriving at such
Consolidated Net Income, (iii) decreases in Consolidated Working
Capital for such period and (iv) an amount equal to the aggregate net
non-cash loss on the sale, lease, transfer or other disposition of
assets by the Borrower and its Subsidiaries during such period (other
than sales in the ordinary course of business) to the extent deducted
in arriving at such Consolidated Net Income over (b) the sum, without
----
duplication, of (i) an amount equal to the amount of all non-cash
credits included in arriving at such Consolidated Net Income, (ii) the
aggregate amount actually paid by the Borrower and its Subsidiaries in
cash during such period on account of Capital Expenditures (excluding
the principal amount of Indebtedness incurred in connection with such
Capital Expenditures, whether incurred in such period or in a
subsequent period), (iii) the aggregate amount of all prepayments of
Revolving Credit Loans and Swingline Loans made during such period to
the extent accompanying reductions of the Total Revolving Credit
Commitments, (iv) the aggregate amount of all principal payments of
Indebtedness of the Borrower or its Subsidiaries (including, without
limitation, any Term Loans and the principal component of payments in
respect of Capitalized Lease Obligations but excluding Revolving
Credit Loans and Swingline Loans) made during such period (other than
in respect of any revolving credit facility to the extent there is not
an equivalent permanent reduction in commitments thereunder), (v) an
amount equal to the aggregate net non-cash gain on the sale, lease,
transfer or other disposition of assets by the Borrower and its
Subsidiaries during such period (other than sales in the ordinary
course of business) to the extent included in arriving at such
Consolidated Net Income, (vi) increases in Consolidated Working
Capital for such period, (vii) payments by the Borrower and its
Subsidiaries during such period in respect of long-term liabilities of
the Borrower and its Subsidiaries other than Indebtedness, (viii) the
amount of Investments made during such period pursuant to Section 10.6
to the extent that such Investments were financed with internally
generated cash flow of the Borrower and its Subsidiaries and (ix) the
aggregate amount of expenditures actually made by the Borrower and its
Subsidiaries in cash during such period (including, without
limitation, expenditures for the payment of financing fees) to the
extent that such expenditures are not expensed during such period.
"Federal Funds Effective Rate" shall mean, for any day, the
----------------------------
weighted average of the per annum rates on overnight federal funds
transactions with members of the Federal Reserve System arranged by
federal funds brokers, as published on the next succeeding Business
Day by the Federal Reserve Bank of New York, or, if such rate is not
so published for any day that is a Business Day, the average of the
quotations for the day of such transactions received by the
Administrative Agent from three federal funds brokers of recognized
standing selected by it.
<PAGE>
11
"Fees" shall mean all amounts payable pursuant to, or referred to
----
in, Section 4.1.
"Final Date" shall mean the date on which the Commitments shall
----------
have terminated, no Loans shall be outstanding and the Letter of
Credit Outstandings shall have been reduced to zero.
"Fronting Fee" shall have the meaning provided in Section 4.1(c).
------------
"Funded Debt" shall mean all Indebtedness of the Borrower and its
-----------
Subsidiaries that matures more than one year from the date of its
creation or matures within one year from such date that is renewable
or extendable, at the option of the Borrower or one of its
Subsidiaries, to a date more than one year from such date or arises
under a revolving credit or similar agreement that obligates the
lender or lenders to extend credit during a period of more than one
year from such date, including, without limitation, all amounts of
Funded Debt required to be paid or prepaid within one year from the
date of its creation and, in the case of the Borrower, Indebtedness in
respect of the Loans.
"GAAP" shall mean generally accepted accounting principles in the
----
United States of America as in effect from time to time; provided,
--------
however, that if there occurs after the date hereof any change in GAAP
-------
that affects in any respect the calculation of any covenant contained
in Section 10, the Lenders and the Borrower shall negotiate in good
faith amendments to the provisions of this Agreement that relate to
the calculation of such covenant with the intent of having the
respective positions of the Lenders and the Borrower after such change
in GAAP conform as nearly as possible to their respective positions as
of the date of this Agreement and, until any such amendments have been
agreed upon, the covenants in Section 10 shall be calculated as if no
such change in GAAP has occurred.
"Governmental Authority" shall mean any nation or government, any
----------------------
state or other political subdivision thereof, and any entity
exercising executive, legislative, judicial, regulatory or
administrative functions of or pertaining to government.
"Guarantee Obligation" shall mean, as to any Person, any
--------------------
Contingent Obligation of such Person in respect of any Indebtedness of
any other Person (other than Indebtedness of the kind described in
clause (g) of the definition thereof that is not itself a Contingent
Obligation in respect of Indebtedness).
"Guarantor" shall mean each Subsidiary of the Borrower that
---------
becomes a party to the Guarantee.
"Guarantee" shall mean and include the Guarantee, made by each
---------
Guarantor in favor of the Administrative Agent for the benefit of the
Lenders, substantially in the form of Exhibit A, as the same may be
amended, supplemented or otherwise modified from time to time.
"Hazardous Materials" shall mean (a) any petroleum or petroleum
-------------------
products, radioactive materials, friable asbestos, urea formaldehyde
foam insulation, transformers or other equipment that contain
dielectric fluid containing regulated levels of polychlorinated
biphenyls, and radon gas; (b) any chemicals, materials or substances
defined as or included in the definition of "hazardous substances",
"hazardous waste", "hazardous materials", "extremely hazardous waste",
"restricted hazardous waste", "toxic substances", "toxic pollutants",
"contaminants", or "pollutants", or words of similar import, under any
applicable Environmental Law; and (c) any other chemical, material or
substance, exposure to which is prohibited, limited or regulated by
any Governmental Authority.
<PAGE>
12
"Hedge Agreements" shall mean interest rate swap, cap or collar
----------------
agreements, interest rate future or option contracts, currency swap
agreements, currency future or option contracts and other similar
agreements entered into by the Borrower in order to protect the
Borrower or the Subsidiaries against fluctuations in interest rates or
currency rates.
"Indebtedness" of any Person shall mean (a) all indebtedness of
------------
such Person for borrowed money, (b) the deferred purchase price of
assets or services that in accordance with GAAP would be shown on the
liability side of the balance sheet of such Person, (c) the face
amount of all letters of credit issued for the account of such Person
and, without duplication, all drafts drawn thereunder, (d) all
Indebtedness of a second Person secured by any Lien on any property
owned by such first Person, whether or not such Indebtedness has been
assumed, (e) all Capitalized Lease Obligations of such Person, (f) all
obligations of such Person under interest rate swap, cap or collar
agreements, interest rate future or option contracts, currency swap
agreements, currency future or option contracts and other similar
agreements and (g) without duplication, all Contingent Obligations of
such Person, provided that Indebtedness shall not include trade
--------
payables and accrued expenses, in each case arising in the ordinary
course of business.
"Interest Period" shall mean, with respect to any Term Loan or
---------------
Revolving Credit Loan, the interest period applicable thereto, as
determined pursuant to Section 2.9.
"KKR" shall mean each of Kohlberg Kravis Roberts & Co. and KKR
---
Associates, L.P.
"L/C Maturity Date" shall mean the date that is five Business
-----------------
Days prior to the Revolving Credit Maturity Date.
"L/C Participant" shall have the meaning provided in Section
---------------
3.3(a).
"L/C Participation" shall have the meaning provided in Section
-----------------
3.3(a).
"Lender" shall have the meaning provided in the preamble to this
------
Agreement.
"Lender Default" shall mean (a) the refusal (which has not been
--------------
retracted) of a Lender to make available its portion of any Borrowing
or to fund its portion of any unreimbursed payment under Section 3.3
or (b) a Lender having notified the Administrative Agent and/or the
Borrower that it does not intend to comply with the obligations under
Section 2.1(b) or 2.1(d) or under Section 3.3, in the case of either
clause (a) or clause (b) above, as a result of the appointment of a
receiver or conservator with respect to such Lender at the direction
or request of any regulatory agency or authority.
"Letter of Credit" shall mean each standby letter of credit
----------------
issued pursuant to Section 3.1.
"Letter of Credit Commitment" shall mean $50,000,000, as the same
---------------------------
may be reduced from time to time pursuant to Section 3.1.
"Letter of Credit Exposure" shall mean, with respect to any
-------------------------
Lender, such Lender's Revolving Credit Commitment Percentage of the
Letter of Credit Outstandings.
"Letter of Credit Fee" shall have the meaning provided in Section
--------------------
4.1(b).
"Letter of Credit Issuer" shall mean Chemical or any successor to
-----------------------
Chemical pursuant to Section 3.6.
<PAGE>
13
"Letter of Credit Outstandings" shall mean, at any time, the sum
-----------------------------
of, without duplication, (a) the aggregate Stated Amount of all
outstanding Letters of Credit and (b) the aggregate amount of all
Unpaid Drawings in respect of all Letters of Credit.
"Letter of Credit Request" shall have the meaning provided in
------------------------
Section 3.2.
"Level I Status" shall mean, on any date, the Consolidated Senior
--------------
Debt to Consolidated EBITDA Ratio is less than or equal to 1.10:1.00
as of such date.
"Level II Status" shall mean, on any date, the Consolidated
---------------
Senior Debt to Consolidated EBITDA Ratio is less than or equal to
1.50:1.00 as of such date.
"Level III Status" shall mean, on any date, the Consolidated
----------------
Senior Debt to Consolidated EBITDA Ratio is less than or equal to
1.75:1.00 as of such date.
"Level IV Status" shall mean, on any date, the Consolidated
---------------
Senior Debt to Consolidated EBITDA Ratio is less than or equal to
2.15:1.00 as of such date.
"Level V Status" shall mean, on any date, the Consolidated Senior
--------------
Debt to Consolidated EBITDA Ratio is less than or equal to 2.50:1.00
as of such date.
"Level VI Status" shall mean, on any date, the Consolidated
---------------
Senior Debt to Consolidated EBITDA Ratio is less than or equal to
2.85:1.00 as of such date.
"Level VII Status" shall mean, on any date, the circumstance
----------------
that none of Level I Status, Level II Status, Level III, Level IV,
Level V or Level VI Status exists as of such date.
"Lien" shall mean any mortgage, pledge, security interest,
----
hypothecation, assignment, lien (statutory or other), or similar
encumbrance (including any agreement to give any of the foregoing, any
conditional sale or other title retention agreement or any lease in
the nature thereof).
"Loan" shall mean any Revolving Credit Loan, Swingline Loan or
----
Term Loan made by any Lender hereunder.
"Mandatory Borrowing" shall have the meaning provided in Section
-------------------
2.1(d).
"Margin Stock" shall have the meaning provided in Regulation U.
------------
"Material Adverse Change" shall mean any change in the business,
-----------------------
assets, operations, properties or financial condition of the Borrower
and its Subsidiaries taken as a whole that would materially adversely
affect the ability of the Borrower and the other Credit Parties taken
as a whole to perform their obligations under this Agreement and the
other Credit Documents taken as a whole.
"Material Adverse Effect" shall mean a circumstance or condition
-----------------------
affecting the business, assets, operations, properties or financial
condition of the Borrower and its Subsidiaries taken as a whole that
would materially adversely affect (a) the ability of the Borrower and
the other Credit Parties taken as a whole to perform their obligations
under this Agreement and the other Credit Documents taken as a whole
or (b) the rights and remedies of the Administrative Agent and the
Lenders under this Agreement and the other Credit Documents taken as a
whole.
<PAGE>
14
"Material Subsidiary" shall mean, at any date of determination,
-------------------
any Subsidiary of the Borrower (a) whose total assets at the last day
of the Test Period ending on the last day of the most recent fiscal
period for which Section 9.1 Financials have been delivered were equal
to or greater than 20% of the consolidated total assets of the
Borrower and its Subsidiaries at such date and (b) whose gross
revenues for such Test Period were equal to or greater than 20% of the
consolidated gross revenues of the Borrower and its Subsidiaries for
such period, in each case determined in accordance with GAAP.
"Maturity Date" shall mean the Tranche A Maturity Date, the
-------------
Tranche B Maturity Date, the Tranche C Maturity Date, the Tranche D
Maturity Date or the Revolving Credit Maturity Date.
"Merger Agreement" shall have the meaning provided in the first
----------------
paragraph of this Agreement.
"Minimum Borrowing Amount" shall mean (a) with respect to a
------------------------
Borrowing of Term Loans or Revolving Credit Loans, $5,000,000 and (b)
with respect to a Borrowing of Swingline Loans, $500,000.
"Moody's" shall mean Moody's Investors Service, Inc. or any
-------
successor by merger or consolidation to its business.
"Net Cash Proceeds" shall mean, with respect to any Prepayment
-----------------
Event or any issuance by the Borrower of equity securities, (a) the
gross cash proceeds (including payments from time to time in respect
of installment obligations, if applicable) received by or on behalf of
the Borrower or any of its Subsidiaries in respect of such Prepayment
Event or issuance, as the case may be, less (b) the sum of:
(i) in the case of any Asset Sale Prepayment Event, the
amount, if any, of all taxes paid or estimated to be payable by
the Borrower or any of its Subsidiaries in connection with such
Asset Sale Prepayment Event,
(ii) in the case of any Asset Sale Prepayment Event, the
amount of any reasonable reserve established in accordance with
GAAP against any liabilities (other than any taxes deducted
pursuant to clause (i) above) associated with the assets sold or
disposed of and retained by the Borrower or any of its
Subsidiaries, provided that the amount of any subsequent
--------
reduction of such reserve (other than in connection with a
payment in respect of any such liability) shall be deemed to be
Net Cash Proceeds of an Asset Sale Prepayment Event occurring on
the date of such reduction,
(iii) in the case of any Asset Sale Prepayment Event, the
amount of any Indebtedness secured by a Lien on such asset to the
extent that the instrument creating or evidencing such
Indebtedness requires that such Indebtedness be repaid upon
consummation of such Asset Sale Prepayment Event,
(iv) in the case of any Asset Sale Prepayment Event, the
amount of any proceeds of such Asset Sale Prepayment Event that
the Borrower has reinvested (or intends to reinvest within one
year of the date of such Asset Sale Prepayment Event) in the
business of the Borrower or any of its Subsidiaries, provided
--------
that any portion of such proceeds that has not been so reinvested
within such one-year period shall (x) be deemed to be Net Cash
Proceeds of an Asset Sale Prepayment Event occurring on the last
day of such one-year period and (y) be applied to the repayment
of Term Loans in accordance with Section 5.2(a)(i) and
<PAGE>
15
(v) in the case of any Prepayment Event or any issuance by
the Borrower of equity securities, reasonable and customary fees,
commissions, expenses, issuance costs, discounts and other costs
paid by the Borrower or any of its Subsidiaries in connection
with such Prepayment Event or issuance, as the case may be (other
than those payable to the Borrower or any Subsidiary of the
Borrower), in each case only to the extent not already deducted
in arriving at the amount referred to in clause (a) above.
"Non-Defaulting Lender" shall mean and include each Lender other
---------------------
than a Defaulting Lender.
"Non-Excluded Taxes" shall have the meaning provided in Section
------------------
5.4(a).
"Notice of Borrowing" shall have the meaning provided in Section
-------------------
2.3.
"Notice of Conversion or Continuation" shall have the meaning
------------------------------------
provided in Section 2.6.
"Obligations" shall mean all monetary amounts of every type or
-----------
description at any time owing to the Administrative Agent or any
Lender pursuant to the terms of this Agreement or any other Credit
Document.
"Participant" shall have the meaning provided in Section
-----------
13.6(a)(ii).
"Partnership" shall mean Crimson Associates, L.P., a Delaware
-----------
limited partnership.
"PBGC" shall mean the Pension Benefit Guaranty Corporation
----
established pursuant to Section 4002 of ERISA, or any successor
thereto.
"Permitted Acquisition" shall mean the acquisition by the
---------------------
Borrower or any of the Subsidiaries of assets or capital stock or
other equity interests, so long as (a) such acquisition and all
transactions related thereto shall be consummated in accordance with
applicable law; (b) such acquisition shall, in the case of a Permitted
Acquisition of capital stock or other equity interest of a domestic
corporation or other domestic entity by the Borrower or any of its
direct domestic Subsidiaries, result in such domestic corporation or
other domestic entity becoming a Subsidiary and a direct Subsidiary in
the case of such an Acquisition by the Borrower; (c) no capital stock
or other equity interest or assets acquired in connection with such
acquisition shall be subject to any Lien (other than Liens permitted
by Section 10.3); (d) neither the Borrower nor any of its Subsidiaries
shall assume or incur, directly or indirectly, any Indebtedness or
other liability in connection with such acquisition (other than
Indebtedness permitted by Section 10.2); and (e) after giving effect
to such acquisition, no Default or Event of Default shall have
occurred and be continuing.
"Permitted Business" shall mean the owning, leasing and operating
------------------
of supermarkets and the food retailing business, any activities
heretofore conducted by the Borrower and other related businesses
approved from time to time by the Board of Directors of the Borrower.
"Permitted Investments" shall mean (a) securities issued or
---------------------
unconditionally guaranteed by the United States government or any
agency or instrumentality thereof, in each case having maturities of
not more than 24 months from the date of acquisition thereof, (b)
securities issued by any state of the United States of America or any
political subdivision of any such state or any public instrumentality
thereof or any political subdivision of any such state or any public
instrumentality thereof having maturities of not more than 24 months
from the date of acquisition thereof and, at the time of acquisition,
having an investment grade rating generally
<PAGE>
16
obtainable from either S&P or Moody's (or, if at any time neither S&P
nor Moody's shall be rating such obligations, then from another
nationally recognized rating service); (c) commercial paper issued by
any Lender or any bank holding company owning any Lender;
(d) commercial paper maturing no more than 12 months after the date of
creation thereof and, at the time of acquisition, having a rating of
at least A-2 or P-2 from either S&P or Moody's (or, if at any time
neither S&P nor Moody's shall be rating such obligations, an
equivalent rating from another nationally recognized rating service);
(e) domestic and eurodollar certificates of deposit or bankers'
acceptances maturing no more than two years after the date of
acquisition thereof issued by any Lender or any other bank having
combined capital and surplus of not less than $250,000,000 in the case
of domestic banks and $100,000,000 (or the dollar equivalent thereof)
in the case of foreign banks; (f) repurchase agreements with a term of
not more than 30 days for underlying securities of the type described
in clauses (a), (b) and (e) above entered into with any bank meeting
the qualifications specified in clause (e) above or securities dealers
of recognized national standing; and (g) shares of investment
companies that are registered under the Investment Company Act of 1940
and invest solely in one or more of the types of securities described
in clauses (a) through (f) above.
"Permitted Liens" shall mean (a) Liens for taxes, assessments or
---------------
governmental charges or claims not yet due or which are being
contested in good faith and by appropriate proceedings for which
appropriate reserves have been established in accordance with GAAP;
(b) Liens in respect of property or assets of the Borrower or any of
its Subsidiaries imposed by law, such as carriers', warehousemen's and
mechanics' Liens and other similar Liens arising in the ordinary
course of business, in each case so long as such Liens arise in the
ordinary course of business and do not individually or in the
aggregate have a Material Adverse Effect; (c) Liens arising from
judgments or decrees in circumstances not constituting an Event of
Default under Section 11.9; (d) Liens incurred or deposits made in
connection with workers' compensation, unemployment insurance and
other types of social security, or to secure the performance of
tenders, statutory obligations, surety and appeal bonds, bids, leases,
government contracts, performance and return-of-money bonds and other
similar obligations incurred in the ordinary course of business; (e)
ground leases in respect of real property on which facilities owned or
leased by the Borrower or any of its Subsidiaries are located; (f)
easements, rights-of-way, restrictions, minor defects or
irregularities in title and other similar charges or encumbrances not
interfering in any material respect with the business of the Borrower
and its Subsidiaries taken as a whole; (g) any interest or title of a
lessor or secured by a lessor's interest under any lease permitted by
this Agreement; (h) Liens in favor of customs and revenue authorities
arising as a matter of law to secure payment of customs duties in
connection with the importation of goods; (i) Liens on goods the
purchase price of which is financed by a documentary letter of credit
issued for the account of the Borrower or any of its Subsidiaries,
provided that such Lien secures only the obligations of the Borrower
--------
or such Subsidiaries in respect of such letter of credit to the extent
permitted under Section 10.2; and (j) leases or subleases granted to
others not interfering in any material respect with the business of
the Borrower and its Subsidiaries, taken as a whole.
"Permitted Mortgage Financing" shall mean Indebtedness of the
----------------------------
Borrower that is incurred after the Closing Date and is secured by a
mortgage on any Real Estate owned by the Borrower or its Subsidiaries,
provided that (a) the recourse of the lenders with respect to such
--------
Indebtedness is limited solely to the mortgaged Real Estate, (b) no
agreement in connection with such Indebtedness shall restrict the
ability of the Borrower or any of its Subsidiaries to create, incur,
assume or suffer to exist any Lien upon any of its property, assets or
revenues, whether now owned or hereafter acquired, other than the
mortgaged Real Estate, (c) the aggregate of the initial principal
amount of the Indebtedness incurred in connection with such Permitted
Mortgage Financing is equal to at least 70% of the aggregate of the
fair market value of the Real Estate securing such Indebtedness
determined at the time of the issuance thereof in good faith by the
Borrower, (d) the final maturity of such Indebtedness is later than
<PAGE>
17
the final scheduled maturity of all the Loans and (e) the proceeds of
such Indebtedness are applied as provided in Section 5.2(a).
"Person" shall mean any individual, partnership, joint venture,
------
firm, corporation, limited liability company, association, trust or
other enterprise or any government or political subdivision or any
agency, department or instrumentality thereof.
"Plan" shall mean any multiemployer or single-employer plan, as
----
defined in Section 4001 of ERISA and subject to Title IV of ERISA,
that is or was within any of the preceding five plan years maintained
or contributed to by (or to which there is or was an obligation to
contribute or to make payments of) the Borrower, a Subsidiary or an
ERISA Affiliate.
"Pledge Agreement" shall mean and include the Pledge Agreement
----------------
entered into by the Borrower, the other pledgors party thereto and the
Administrative Agent for the benefit of the Lenders, substantially in
the form of Exhibit B, as the same may be amended, supplemented or
otherwise modified from time to time.
"Prepayment Event" shall mean any Asset Sale Prepayment Event and
----------------
any Debt Incurrence Prepayment Event.
"Prime Rate" shall mean the rate of interest per annum publicly
----------
announced from time to time by the Administrative Agent as its
reference rate in effect at its principal office in New York City (the
Prime Rate not being intended to be the lowest rate of interest
charged by Chemical in connection with extensions of credit to
debtors).
"Real Estate" shall mean land, buildings and improvements owned
-----------
or leased by the Borrower or any of its Subsidiaries, but excluding
all operating fixtures and equipment, whether or not incorporated into
improvements.
"Reference Lenders" shall mean Chemical and The Bank of New York.
-----------------
"Register" shall have the meaning provided in Section 13.6(c).
--------
"Regulation D" shall mean Regulation D of the Board as from time
------------
to time in effect and any successor to all or a portion thereof
establishing reserve requirements.
"Regulation G" shall mean Regulation G of the Board as from time
------------
to time in effect and any successor to all or a portion thereof
establishing margin requirements.
"Regulation T" shall mean Regulation T of the Board as from time
------------
to time in effect and any successor to all or a portion thereof
establishing margin requirements.
"Regulation U" shall mean Regulation U of the Board as from time
------------
to time in effect and any successor to all or a portion thereof
establishing margin requirements.
"Regulation X" shall mean Regulation X of the Board as from time
------------
to time in effect and any successor to all or a portion thereof
establishing margin requirements.
"Repayment Amount" shall mean Tranche A Repayment Amount,
----------------
Tranche B Repayment Amount, Tranche C Repayment Amount or Tranche D
Repayment Amount.
"Repayment Date" shall mean Tranche A Repayment Date, Tranche B
--------------
Repayment Date, Tranche C Repayment Date or Tranche D Repayment Date.
<PAGE>
18
"Reportable Event" shall mean an event described in Section 4043
----------------
of ERISA and the regulations thereunder.
"Required Lenders" shall mean, at any date, (a) Non-Defaulting
----------------
Lenders having or holding a majority of the sum of (i) the Adjusted
Total Revolving Credit Commitment at such date, (ii) the Adjusted
Total Tranche A Commitment at such date and (iii) the outstanding
principal amount of the Term Loans (excluding the Term Loans held by
Defaulting Lenders) at such date or (b) if the Total Revolving Credit
Commitment and the Total Tranche A Commitment have been terminated or
for the purposes of acceleration pursuant to Section 11, the holders
(excluding Defaulting Lenders) of a majority of the outstanding
principal amount of the Loans and Letter of Credit Exposures
(excluding the Loans and Letter of Credit Exposures of Defaulting
Lenders) at such date.
"Required Tranche A Lenders" shall mean, at any date, (a) Non-
--------------------------
Defaulting Lenders having or holding a majority of the sum of (i) the
Adjusted Total Revolving Credit Commitment at such date, (ii) the
Adjusted Total Tranche A Commitment at such date and (iii) the
outstanding principal amount of the Tranche A Term Loans (excluding
the Tranche A Term Loans held by Defaulting Lenders) at such date or
(b) if the Total Revolving Credit Commitment and the Total Tranche A
Commitment have been terminated or for the purposes of acceleration
pursuant to Section 11, the holders (excluding Defaulting Lenders) of
a majority of the outstanding principal amount of the Revolving Credit
Loans, Tranche A Term Loans and Letter of Credit Exposures (excluding
the Loans and Letter of Credit Exposures of Defaulting Lenders) at
such date.
"Required Tranche B, C and D Lenders" shall mean, at any date,
-----------------------------------
Non-Defaulting Lenders having or holding a majority of the outstanding
principal amount of the Tranche B Term Loans, Tranche C Term Loans and
Tranche D Term Loans (excluding the Tranche B Term Loans, Tranche C
Term Loans and Tranche D Term Loans held by Defaulting Lenders) in the
aggregate at such date.
"Requirement of Law" shall mean, as to any Person, the
------------------
Certificate of Incorporation and By-Laws or other organizational or
governing documents of such Person, and any law, treaty, rule or
regulation or determination of an arbitrator or a Court or other
Governmental Authority, in each case applicable to or binding upon
such Person or any of its property or assets or to which such Person
or any of its property or assets is subject.
"Revolving Credit Commitment" shall mean, (a) with respect to
---------------------------
each Lender that is a Lender on the date hereof, the amount set forth
opposite such Lender's name on Schedule 1.1 as such Lender's
"Revolving Credit Commitment" and (b) in the case of any Lender that
becomes a Lender after the date hereof, the amount specified as such
Lender's "Revolving Credit Commitment" in the Assignment and
Acceptance pursuant to which such Lender assumed a portion of the
Total Revolving Credit Commitment, in each case as the same may be
changed from time to time pursuant to the terms hereof.
"Revolving Credit Commitment Percentage" shall mean at any time,
--------------------------------------
for each Lender, the percentage obtained by dividing such Lender's
Revolving Credit Commitment by the Total Revolving Credit Commitment,
provided that at any time when the Total Revolving Credit Commitment
--------
shall have been terminated, each Lender's Revolving Credit Commitment
Percentage shall be its Revolving Credit Commitment Percentage as in
effect immediately prior to such termination.
"Revolving Credit Loan" shall have the meaning provided in
---------------------
Section 2.1.
<PAGE>
19
"Revolving Credit Maturity Date" shall mean the date that is six
------------------------------
years and six months after the Closing Date, or, if such date is not a
Business Day, the next preceding Business Day.
"SEC" shall have the meaning provided in Section 8.4.
---
"Section 9.1 Financials" shall mean the financial statements
----------------------
delivered, or required to be delivered, pursuant to Section 9.1(a) or
(b) together with the accompanying officer's certificate delivered, or
required to be delivered, pursuant to Section 9.1(e).
"Senior Notes" shall mean (a) the $100,000,000 aggregate
------------
principal amount of 6.62% Series A Senior Notes of the Borrower due
September 15, 2003 and (b) the $100,000,000 aggregate principal amount
of 7.09% Series B Senior Notes due September 15, 2008.
"Specified Subsidiary" shall mean, at any date of determination,
--------------------
a Subsidiary (a) whose total assets at the last day of the Test Period
ending on the last day of the most recent fiscal period for which
Section 9.1 Financials have been delivered were equal to or greater
than 5% of the consolidated total assets of the Borrower and its
Subsidiaries at such date or (b) whose gross revenues for such Test
Period were equal to or greater than 5% of the consolidated gross
revenues of the Borrower and its Subsidiaries for such period, in each
case determined in accordance with GAAP.
"S&P" shall mean Standard & Poor's Ratings Group or any successor
---
by merger or consolidation to its business.
"SEC" shall mean the Securities and Exchange Commission or any
---
successor thereto.
"Stated Amount" of any Letter of Credit shall mean the maximum
-------------
amount from time to time available to be drawn thereunder, determined
without regard to whether any conditions to drawing could then be met.
"Status" shall mean, as to the Borrower as of any date, the
------
existence of Level I Status, Level II Status, Level III Status,
Level IV Status, Level V Status, Level VI Status or Level VII Status
as the case may be, on such date. Changes in Status resulting from
changes in the Consolidated Senior Debt to Consolidated EBITDA Ratio
shall become effective on each date (the "Adjustment Date") on which
---------------
(a) Section 9.1 Financials are delivered to the Lenders under Section
9.1 and (b) an officer's certificate is delivered by the Borrower to
the Lenders setting forth, with respect to the most recently delivered
Section 9.1 Financials, the then-applicable Status, and shall remain
in effect until the next change to be effected pursuant to this
definition, provided that (i) until the effectiveness of the initial
--------
change in Status based upon the Section 9.1 Financials, the Status of
the Borrower for the purposes of this Agreement shall be deemed to be
Level VII and (ii) each determination of the Consolidated Senior Debt
to Consolidated EBITDA Ratio pursuant to this definition shall be
made with respect to the Test Period ending at the end of the period
covered by the relevant financial statements.
"Subordinated Notes" shall mean the $400,000,000 aggregate
------------------
principal amount of Senior Subordinated Notes of the Borrower due 2005
issued on or about the Closing Date pursuant to the Indenture dated as
of August 18, 1995, between the Borrower and Marine Midland Bank, as
trustee, as supplemented by the First Supplemental Indenture dated as
of August 18, 1995, between the Borrower and such trustee.
"Subsidiary" of any Person shall mean and include (a) any
----------
corporation more than 50% of whose stock of any class or classes
having by the terms thereof ordinary voting power to elect a majority
of the directors of such corporation (irrespective of whether or not
at the
<PAGE>
20
time stock of any class or classes of such corporation shall have or
might have voting power by reason of the happening of any contingency)
is at the time owned by such Person directly or indirectly through
Subsidiaries and (b) any partnership, association, joint venture or
other entity in which such Person directly or indirectly through
Subsidiaries has more than a 50% equity interest at the time. Unless
otherwise expressly provided, all references herein to a "Subsidiary"
shall mean a Subsidiary of the Borrower.
"Supermajority Tranche A Lenders" shall mean, at any date,
-------------------------------
(a) Non-Defaulting Lenders having or holding at least 66-2/3% of the
sum of (i) the Adjusted Total Revolving Credit Commitment at such
date, (ii) the Adjusted Total Tranche A Commitment at such date and
(iii) the outstanding principal amount of the Tranche A Term Loans
(excluding the Tranche A Term Loans held by Defaulting Lenders) at
such date or (b) if the Total Revolving Credit Commitment and the
Total Tranche A Commitment have been terminated or for the purposes of
acceleration pursuant to Section 11, the holders (excluding Defaulting
Lenders) of at least 66-2/3% of the outstanding principal amount of
the Revolving Credit Loans, Tranche A Term Loans and Letter of Credit
Exposures (excluding the Loans and Letter of Credit Exposures of
Defaulting Lenders) at such date.
"Supermajority Tranche B, C and D Lenders" shall mean, at any
----------------------------------------
date, Non-Defaulting Lenders having or holding at least 66-2/3% of the
outstanding principal amount of the Tranche B Term Loans, Tranche C
Term Loans and Tranche D Term Loans (excluding the Tranche B Term
Loans, Tranche C Term Loans and Tranche D Term Loans held by
Defaulting Lenders) in the aggregate at such date.
"Swingline Commitment" shall mean $25,000,000.
--------------------
"Swingline Loans" shall have the meaning provided in Section 2.1.
---------------
"Swingline Maturity Date" shall mean, with respect to any
-----------------------
Swingline Loan, the date that is five Business Days prior to the
Revolving Credit Maturity Date.
"Term Loan" shall mean any Tranche A Term Loan, Tranche B Term
---------
Loan, Tranche C Term Loan or Tranche D Term Loan.
"Term Loan Commitment" shall mean, with respect to each Lender,
--------------------
the sum of such Lender's Tranche A Commitment, Tranche B Commitment,
Tranche C Commitment and Tranche D Commitment.
"Test Period" shall mean, for any determination under this
-----------
Agreement, the four consecutive fiscal quarters of the Borrower then
last ended.
"Three-Month Secondary CD Rate" shall mean, for any day, the
-----------------------------
secondary market rate, expressed as a per annum rate, for three-month
certificates of deposit reported as being in effect on such day (or,
if such day shall not be a Business Day, the next preceding Business
Day) by the Board through the public information telephone line of the
Federal Reserve Bank of New York (which rate will, under the current
practices of the Board, be published in Federal Reserve Statistical
Release H.15(519) during the week following such day), or, if such
rate shall not be so reported on such day or such next preceding
Business Day, the average of the secondary market quotations for
three-month certificates of deposit of major money center banks in New
York City received at approximately 10:00 A.M., New York time, on such
day (or, if such day shall not be a Business Day, on the next
preceding Business Day) by the Administrative Agent from three New
York City negotiable certificate of deposit dealers of recognized
standing selected by it.
<PAGE>
21
"Total Commitment" shall mean the sum of the Total Term Loan
----------------
Commitment and the Total Revolving Credit Commitment.
"Total Credit Exposure" shall mean, at any date, the sum of (a)
---------------------
the Total Revolving Credit Commitment at such date, (b) the Total Tranche A
Commitment at such date and (c) the outstanding principal amount of all
Term Loans at such date.
"Total Revolving Credit Commitment" shall mean the sum of the
---------------------------------
Revolving Credit Commitments of all the Lenders.
"Total Term Loan Commitment" shall mean the sum of the Term Loan
--------------------------
Commitments of all the Lenders.
"Total Tranche A Commitment" shall mean the Tranche A Commitments
--------------------------
of all the Lenders.
"Tranche A Availability Period" shall mean the period from and
-----------------------------
including the Closing Date to but excluding the day that is 180 days
following the Closing Date.
"Tranche A Commitment" shall mean, (a) in the case of each Lender
--------------------
that is a Lender on the date hereof, the amount set forth opposite
such Lender's name on Schedule 1.1 as such Lender's "Tranche A
Commitment" and (b) in the case of any Lender that becomes a Lender
after the date hereof, the amount specified as such Lender's "Tranche
A Commitment" in the Assignment and Acceptance pursuant to which such
Lender assumed a portion of the Total Term Loan Commitment, in each
case as the same may be changed from time to time pursuant to the
terms hereof.
"Tranche A Maturity Date" shall mean the date that is six years
-----------------------
and six months after the Closing Date, or, if such Date is not a
Business Day, the next preceding Business Day.
"Tranche A Repayment Amount" shall have the meaning provided in
--------------------------
Section 2.5(b).
"Tranche A Repayment Date" shall have the meaning provided in
------------------------
Section 2.5(b).
"Tranche A Term Loan" shall have the meaning provided in
-------------------
Section 2.1.
"Tranche B Commitment" shall mean, (a) in the case of each Lender
--------------------
that is a Lender on the date hereof, the amount set forth opposite
such Lender's name on Schedule 1.1 as such Lender's "Tranche B
Commitment" and (b) in the case of any Lender that becomes a Lender
after the date hereof, the amount specified as such Lender's "Tranche
B Commitment" in the Assignment and Acceptance pursuant to which such
Lender assumed a portion of the Total Term Loan Commitment, in each
case as the same may be changed from time to time pursuant to the
terms hereof.
"Tranche B Maturity Date" shall mean the date that is seven years
-----------------------
and six months after the Closing Date, or, if such date is not a
Business Day, the next preceding Business Day.
"Tranche B Repayment Amount" shall have the meaning provided in
--------------------------
Section 2.5(c).
"Tranche B Repayment Date" shall have the meaning provided in
------------------------
Section 2.5(c).
"Tranche B Term Loan" shall have the meaning provided in
-------------------
Section 2.1.
<PAGE>
22
"Tranche C Commitment" shall mean, (a) in the case of each Lender
--------------------
that is a Lender on the date hereof, the amount set forth opposite
such Lender's name on Schedule 1.1 as such Lender's "Tranche C
Commitment" and (b) in the case of any Lender that becomes a Lender
after the date hereof, the amount specified as such Lender's "Tranche
C Commitment" in the Assignment and Acceptance pursuant to which such
Lender assumed a portion of the Total Term Loan Commitment, in each
case as the same may be changed from time to time pursuant to the
terms hereof.
"Tranche C Maturity Date" shall mean the date that is eight years
-----------------------
and six months after the Closing Date, or, if such date is not a
Business Day, the next preceding Business Day.
"Tranche C Repayment Amount" shall have the meaning provided in
--------------------------
Section 2.5(d).
"Tranche C Repayment Date" shall have the meaning provided in
------------------------
Section 2.5(d).
"Tranche C Term Loan" shall have the meaning provided in
-------------------
Section 2.1.
"Tranche D Commitment" shall mean, (a) in the case of each Lender
--------------------
that is a Lender on the date hereof, the amount set forth opposite
such Lender's name on Schedule 1.1 as such Lender's "Tranche D
Commitment" and (b) in the case of any Lender that becomes a Lender
after the date hereof, the amount specified as such Lender's "Tranche
D Commitment" in the Assignment and Acceptance pursuant to which such
Lender assumed a portion of the Total Term Loan Commitment, in each
case as the same may be changed from time to time pursuant to the
terms hereof.
"Tranche D Maturity Date" shall mean the date that is nine years
-----------------------
and six months after the Closing Date, or, if such date is not a
Business Day, the next preceding Business Day.
"Tranche D Repayment Amount" shall have the meaning provided in
--------------------------
Section 2.5(e).
"Tranche D Repayment Date" shall have the meaning provided in
------------------------
Section 2.5(e).
"Tranche D Term Loan" shall have the meaning provided in
-------------------
Section 2.1.
"Transferee" shall have the meaning provided in Section 13.6(e).
----------
"Type" shall mean (a) as to any Term Loan, its nature as an
----
ABR Loan or a Eurodollar Term Loan and (b) as to any Revolving Credit
Loan, its nature as an ABR Loan or a Eurodollar Revolving Credit Loan.
"Unfunded Current Liability" of any Plan shall mean the amount,
--------------------------
if any, by which the present value of the accrued benefits under the
Plan as of the close of its most recent plan year, determined in
accordance with Statement of Financial Accounting Standards No. 87 as
in effect on the date hereof, based upon the actuarial assumptions
that would be used by the Plan's actuary in a termination of the Plan,
exceeds the fair market value of the assets allocable thereto.
"Unpaid Drawing" shall have the meaning provided in Section 3.4(a).
--------------
"Voting Stock" shall mean, with respect to any Person, shares of
------------
such Person's capital stock having the right to vote for the election
of directors of such Person under ordinary circumstances.
<PAGE>
23
SECTION 2. Amount and Terms of Credit.
--------------------------
2.1 Commitments. (a) Subject to and upon the terms and
-----------
conditions herein set forth:
(i) each Lender having a Tranche A Commitment severally agrees to
make a loan or loans (each a "Tranche A Term Loan" and, collectively,
-------------------
the "Tranche A Term Loans") to the Borrower, which Tranche A Term
--------------------
Loans (x) shall not exceed for any such Lender the Tranche A
Commitment of such Lender and (y) shall be repaid in full on the
Tranche A Maturity Date;
(ii) each Lender having a Tranche B Commitment severally agrees
to make a loan or loans (each a "Tranche B Term Loan" and,
-------------------
collectively, the "Tranche B Term Loans") to the Borrower, which
--------------------
Tranche B Term Loans (x) shall not exceed for any such Lender the
Tranche B Commitment of such Lender and (y) shall be repaid in full on
the Tranche B Maturity Date;
(iii) each Lender having a Tranche C Commitment severally agrees
to make a loan or loans (each a "Tranche C Term Loan" and,
-------------------
collectively, the "Tranche C Term Loans") to the Borrower, which
--------------------
Tranche C Term Loans (x) shall not exceed for any such Lender the
Tranche C Commitment of such Lender and (y) shall be repaid in full on
the Tranche C Maturity Date; and
(iv) each Lender having a Tranche D Commitment severally agrees
to make a loan or loans (each a "Tranche D Term Loan" and,
-------------------
collectively, the "Tranche D Term Loans") to the Borrower, which
--------------------
Tranche D Term Loans (x) shall not exceed for any such Lender the
Tranche D Commitment of such Lender and (y) shall be repaid in full on
the Tranche D Maturity Date.
Such Term Loans (x) shall be made (A) in the case of any Term Loan other
than a Tranche A Term Loan, on the Closing Date and (B) in the case of any
Tranche A Term Loan, from time to time during the Tranche A Availability
Period, (y) may, at the option of the Borrower, be incurred and maintained
as, and/or converted into, ABR Loans or Eurodollar Term Loans, provided
--------
that all Term Loans made by each of the Lenders pursuant to the same
Borrowing shall, unless otherwise specifically provided herein, consist
entirely of Term Loans of the same Type, and (z) may be repaid in
accordance with the provisions hereof. Once repaid, Term Loans may not be
reborrowed.
(b) Subject to and upon the terms and conditions herein set
forth, each Lender having a Revolving Credit Commitment severally agrees to
make a loan or loans (each a "Revolving Credit Loan" and, collectively, the
---------------------
"Revolving Credit Loans") to the Borrower, which Revolving Credit Loans
----------------------
(i) shall be made at any time and from time to time on and after the
Closing Date and prior to the Revolving Credit Maturity Date, (ii) may, at
the option of the Borrower, be incurred and maintained as, and/or converted
into, ABR Loans or Eurodollar Revolving Credit Loans, provided that all
--------
Revolving Credit Loans made by each of the Lenders pursuant to the same
Borrowing shall, unless otherwise specifically provided herein, consist
entirely of Revolving Credit Loans of the same Type, (iii) may be repaid
and reborrowed in accordance with the provisions hereof, (iv) shall not
exceed for any Lender at any time outstanding that aggregate principal
amount which, when added to the product of (x) such Lender's Revolving
Credit Commitment Percentage and (y) the sum of (I) the aggregate Letter of
Credit Outstandings at such time and (II) the aggregate principal amount of
---
all Swingline Loans then outstanding, equals the Revolving Credit
Commitment of such Lender at such time and (v) shall not, after giving
effect thereto and to the application of the proceeds thereof, exceed for
all Lenders at any time outstanding the aggregate principal amount that,
when added to the sum of (x) the Letter of Credit Outstandings at such time
and (y) the aggregate principal amount of all Swingline Loans then
outstanding, equals the Total Revolving Credit Commitment then in effect.
On the Revolving Credit Maturity Date, all Revolving Credit Loans shall be
repaid in full.
<PAGE>
24
(c) Subject to and upon the terms and conditions herein set
forth, Chemical in its individual capacity agrees, at any time and from
time to time on and after the Closing Date and prior to the date that is
five Business Days prior to the Revolving Credit Maturity Date, to make a
loan or loans (each a "Swingline Loan" and, collectively, the "Swingline
-------------- ---------
Loans") to the Borrower, which Swingline Loans (i) shall be ABR Loans,
-----
(ii) shall have the benefit of the provisions of Section 2.1(d), (iii)
shall not exceed at any time outstanding the Swingline Commitment, (iv)
shall not, after giving effect thereto and to the application of the
proceeds thereof, exceed in the aggregate at any time outstanding the
principal amount that, when added to the aggregate principal amount of all
Revolving Credit Loans then outstanding and all Letter of Credit
Outstandings at such time, equals the Total Revolving Credit Commitment
then in effect and (v) may be repaid and reborrowed in accordance with the
provisions hereof. On the Swingline Maturity Date, each outstanding
Swingline Loan shall be repaid in full. Chemical shall not make any
Swingline Loan after receiving a written notice from the Borrower or any
Lender stating that a Default or Event of Default exists and is continuing
until such time as Chemical shall have received written notice of
(i) rescission of all such notices from the party or parties originally
delivering such notice or (ii) the waiver of such Default or Event of
Default in accordance with the provisions of Section 13.1.
(d) On any Business Day, Chemical may, in its sole discretion,
give notice to the Lenders that all then-outstanding Swingline Loans shall
be funded with a Borrowing of Revolving Credit Loans, in which case a
Borrowing of Revolving Credit Loans constituting ABR Loans (each such
Borrowing, a "Mandatory Borrowing") shall be made on the immediately
-------------------
succeeding Business Day by all Lenders pro rata based on each Lender's
--- ----
Revolving Credit Commitment Percentage, and the proceeds thereof shall be
applied directly to Chemical to repay Chemical for such outstanding
Swingline Loans. Each Lender hereby irrevocably agrees to make such
Revolving Credit Loans upon one Business Day's notice pursuant to each
Mandatory Borrowing in the amount and in the manner specified in the
preceding sentence and on the date specified to it in writing by Chemical
notwithstanding (i) that the amount of the Mandatory Borrowing may not
comply with the minimum amount for each Borrowing specified in Section 2.2,
(ii) whether any conditions specified in Section 7 are then satisfied,
(iii) whether a Default or an Event of Default has occurred and is
continuing, (iv) the date of such Mandatory Borrowing and (v) any reduction
in the Total Commitment after any such Swingline Loans were made. In the
event that, in the sole judgment of Chemical, any Mandatory Borrowing
cannot for any reason be made on the date otherwise required above
(including, without limitation, as a result of the commencement of a
proceeding under the Bankruptcy Code in respect of the Borrower), each
Lender hereby agrees that it shall forthwith purchase from Chemical
(without recourse or warranty) such participation of the outstanding
Swingline Loans as shall be necessary to cause the Lenders to share in such
Swingline Loans ratably based upon their respective Revolving Credit
Commitment Percentages, provided that all principal and interest payable on
--------
such Swingline Loans shall be for the account of Chemical until the date
the respective participation is purchased and, to the extent attributable
to the purchased participation, shall be payable to the Lender purchasing
same from and after such date of purchase.
2.2 Minimum Amount of Each Borrowing; Maximum Number of
---------------------------------------------------
Borrowings. The aggregate principal amount of each Borrowing of Term
----------
Loans, Revolving Credit Loans or Swingline Loans shall be in a multiple of
$100,000 and shall not be less than the Minimum Borrowing Amount with
respect thereto (except that Mandatory Borrowings shall be made in the
amounts required by Section 2.1(d)). More than one Borrowing may be
incurred on any date, provided that at no time shall there be outstanding
--------
more than 20 Borrowings of Eurodollar Loans under this Agreement.
2.3 Notice of Borrowing. (a) The Borrower shall give the
-------------------
Administrative Agent at the Administrative Agent's Office (i) prior to
12:00 Noon (New York time) at least three Business Days' prior written
notice (or telephonic notice promptly confirmed in writing) of the
Borrowing of the Term Loans if all or any of the Term Loans are to be
initially Eurodollar Loans and (ii) prior written notice (or telephonic
notice promptly confirmed in writing) prior to 10:00 A.M. (New York time)
on the date of the Borrowing of the Term Loans if all the Term Loans are to
be ABR Loans. Each such
<PAGE>
25
notice (each, together with each notice of a Borrowing of Revolving Credit
Loans pursuant to Section 2.3(b) and each notice of a Borrowing of
Swingline Loans pursuant to Section 2.3(c), a "Notice of Borrowing") shall
-------------------
be irrevocable and shall specify (i) the aggregate principal amount of the
Term Loans to be made on the Closing Date or, in the case of any Tranche A
Term Loan, on any date during the Tranche A Availability Period, (ii) in
the case of the initial Borrowing, the Closing Date (which shall be a
Business Day) and (iii) whether the Term Loans shall consist of ABR Loans
and/or Eurodollar Term Loans and, if the Term Loans are to include
Eurodollar Term Loans, the Interest Period to be initially applicable
thereto. The Administrative Agent shall promptly give each Lender written
notice (or telephonic notice promptly confirmed in writing) of any
Borrowing of the Term Loans, of such Lender's proportionate share thereof
and of other matters covered by the Notice of Borrowing.
(b) Whenever the Borrower desires to incur Revolving Credit
Loans hereunder (other than Mandatory Borrowings or borrowings to repay
Unpaid Drawings), it shall give the Administrative Agent at the
Administrative Agent's Office (i) prior to 12:00 Noon (New York time) at
least three Business Days' prior written notice (or telephonic notice
promptly confirmed in writing) of each Borrowing of Eurodollar Revolving
Credit Loans and (ii) prior to 12:00 Noon (New York time) at least one
Business Day's prior written notice (or telephonic notice promptly
confirmed in writing) of each Borrowing of ABR Loans. Each such Notice of
Borrowing, except as otherwise expressly provided in Section 2.10, shall be
irrevocable and shall specify (i) the aggregate principal amount of the
Revolving Credit Loans to be made pursuant to such Borrowing, (ii) the date
of Borrowing (which shall be a Business Day) and (iii) whether the
respective Borrowing shall consist of ABR Loans or Eurodollar Revolving
Credit Loans and, if Eurodollar Revolving Credit Loans, the Interest Period
to be initially applicable thereto. The Administrative Agent shall
promptly give each Lender written notice (or telephonic notice promptly
confirmed in writing) of each proposed Borrowing of Revolving Credit Loans,
of such Lender's proportionate share thereof and of the other matters
covered by the Notice of Borrowing.
(c) Whenever the Borrower desires to incur Swingline Loans
hereunder, it shall give the Administrative Agent written notice (or
telephonic notice promptly confirmed in writing) of each Borrowing of
Swingline Loans prior to 1:00 P.M. (New York time) on the date of such
Borrowing. Each such notice shall be irrevocable and shall specify (i) the
aggregate principal amount of the Swingline Loans to be made pursuant to
such Borrowing and (ii) the date of Borrowing (which shall be a Business
Day). The Administrative Agent shall promptly give Chemical written notice
(or telephonic notice promptly confirmed in writing) of each proposed
Borrowing of Swingline Loans and of the other matters covered by the Notice
of Borrowing.
(d) Mandatory Borrowings shall be made upon the notice specified
in Section 2.1(d), with the Borrower irrevocably agreeing, by its
incurrence of any Swingline Loan, to the making of Mandatory Borrowings as
set forth in such Section.
(e) Borrowings to reimburse Unpaid Drawings shall be made upon
the notice specified in Section 3.4(c).
(f) Without in any way limiting the obligation of the Borrower
to confirm in writing any notice it may give hereunder by telephone, the
Administrative Agent may act prior to receipt of written confirmation
without liability upon the basis of such telephonic notice believed by the
Administrative Agent in good faith to be from an Authorized Officer of the
Borrower. In each such case the Borrower hereby waives the right to
dispute the Administrative Agent's record of the terms of any such
telephonic notice.
2.4 Disbursement of Funds. (a) No later than 12:00 Noon (New
---------------------
York time) on the date specified in each Notice of Borrowing (including
Mandatory Borrowings), each Lender will make available its pro rata
--- ----
portion, if any, of each Borrowing requested to be made on such date in the
<PAGE>
26
manner provided below, provided that all Swingline Loans shall be made
--------
available in the full amount thereof by Chemical no later than 2:00 P.M.
(New York time) on the date requested.
(b) Each Lender shall make available all amounts it is to fund
under any Borrowing in Dollars and immediately available funds to the
Administrative Agent at the Administrative Agent's Office and the
Administrative Agent will (except in the case of Mandatory Borrowings and
Borrowings to repay Unpaid Drawings) make available to the Borrower by
depositing to the Borrower's account at the Administrative Agent's Office
the aggregate of the amounts so made available in Dollars and the type of
funds received. Unless the Administrative Agent shall have been notified
by any Lender prior to the date of any such Borrowing that such Lender does
not intend to make available to the Administrative Agent its portion of the
Borrowing or Borrowings to be made on such date, the Administrative Agent
may assume that such Lender has made such amount available to the
Administrative Agent on such date of Borrowing, and the Administrative
Agent, in reliance upon such assumption, may (in its sole discretion and
without any obligation to do so) make available to the Borrower a
corresponding amount. If such corresponding amount is not in fact made
available to the Administrative Agent by such Lender and the Administrative
Agent has made available same to the Borrower, the Administrative Agent
shall be entitled to recover such corresponding amount from such Lender.
If such Lender does not pay such corresponding amount forthwith upon the
Administrative Agent's demand therefor, the Administrative Agent shall
promptly notify the Borrower, and the Borrower shall immediately pay such
corresponding amount to the Administrative Agent. The Administrative Agent
shall also be entitled to recover from such Lender or the Borrower, as the
case may be, interest on such corresponding amount in respect of each day
from the date such corresponding amount was made available by the
Administrative Agent to the Borrower to the date such corresponding amount
is recovered by the Administrative Agent, at a rate per annum equal to (i)
if paid by such Lender, the Federal Funds Effective Rate or (ii) if paid by
the Borrower, the then-applicable rate of interest, calculated in
accordance with Section 2.8, for the respective Loans.
(c) Nothing in this Section 2.4 shall be deemed to relieve any
Lender from its obligation to fulfill its commitments hereunder or to
prejudice any rights that the Borrower may have against any Lender as a
result of any default by such Lender hereunder (it being understood,
however, that no Lender shall be responsible for the failure of any other
Lender to fulfill its commitments hereunder).
2.5 Repayment of Loans; Evidence of Debt. (a) The Borrower
------------------------------------
shall repay to the Administrative Agent, for the benefit of the Lenders,
(i) on the Tranche A Maturity Date, the then-unpaid Tranche A Term Loans
and Revolving Credit Loans; (ii) on the Tranche B Maturity Date, the then-
unpaid Tranche B Term Loans; (iii) on the Tranche C Maturity Date, the
then-unpaid Tranche C Term Loans; and (iv) on the Tranche D Maturity Date,
the then-unpaid Tranche D Term Loans. The Borrower shall repay to the
Administrative Agent, for the account of Chemical, on the Swingline
Maturity Date, the then-unpaid Swingline Loans.
(b) The Borrower shall repay to the Administrative Agent, for
the benefit of the Lenders of Tranche A Term Loans, on each date set forth
below (each a "Tranche A Repayment Date"), the principal amount of the
------------------------
Tranche A Term Loans set forth below opposite such Tranche A Repayment Date
(each a "Tranche A Repayment Amount"):
--------------------------
Tranche A Tranche A
--------- ---------
Repayment Date Repayment Amount
-------------- -----------------
August 18, 1996 $17,500,000
August 18, 1997 17,500,000
February 18, 1998 15,000,000
August 18, 1998 15,000,000
February 18, 1999 20,000,000
<PAGE>
27
Tranche A Tranche A
--------- ---------
Repayment Date Repayment Amount
-------------- -----------------
August 18, 1999 20,000,000
February 18, 2000 30,000,000
August 18, 2000 30,000,000
February 18, 2001 37,500,000
August 18, 2001 37,500,000
Tranche A Maturity Date 35,000,000
To the extent that the aggregate principal amount of Tranche A
Term Loans outstanding on the last day of the Tranche A Availability Period
is less than $275,000,000, the Tranche A Repayment Amounts shall
automatically be decreased, in the inverse order of maturity, by the amount
of such difference.
(c) The Borrower shall repay to the Administrative Agent, for
the benefit of the Lenders of Tranche B Loans, on each date set forth below
(each a "Tranche B Repayment Date"), the principal amount of the Tranche B
------------------------
Term Loans set forth below opposite such Tranche B Repayment Date (each a
"Tranche B Repayment Amount"):
--------------------------
Tranche B Tranche B
Repayment Date Repayment Amount
-------------- ----------------
February 18, 1996 $500,000
August 18, 1996 500,000
February 18, 1997 500,000
August 18, 1997 500,000
February 18, 1998 500,000
August 18, 1998 500,000
February 18, 1999 500,000
August 18, 1999 500,000
February 18, 2000 500,000
August 18, 2000 500,000
February 18, 2001 500,000
August 18, 2001 500,000
February 18, 2002 23,000,000
August 18, 2002 23,000,000
Tranche B Maturity Date 23,000,000
(d) The Borrower shall repay to the Administrative Agent, for
the benefit of the Lenders of Tranche C Loans, on each date set forth below
(each a "Tranche C Repayment Date"), the principal amount of the Tranche C
------------------------
Term Loans set forth below opposite such Tranche C Repayment Date (each a
"Tranche C Repayment Amount"):
--------------------------
Tranche C Tranche C
Repayment Date Repayment Amount
-------------- ----------------
February 18, 1996 $500,000
August 18, 1996 500,000
February 18, 1997 500,000
August 18, 1997 500,000
February 18, 1998 500,000
August 18, 1998 500,000
February 18, 1999 500,000
<PAGE>
28
Tranche A Tranche A
--------- ---------
Repayment Date Repayment Amount
-------------- -----------------
August 18, 1999 500,000
February 18, 2000 500,000
August 18, 2000 500,000
February 18, 2001 500,000
August 18, 2001 500,000
February 18, 2002 500,000
August 18, 2002 500,000
February 18, 2003 22,666,666
August 18, 2003 22,666,667
Tranche C Maturity Date 22,666,667
(e) The Borrower shall repay to the Administrative Agent, for
the benefit of the Lenders of Tranche D Loans, on each date set forth below
(each a "Tranche D Repayment Date"), the principal amount of the Tranche D
------------------------
Term Loans set forth below opposite such Tranche D Repayment Date (each a
"Tranche D Repayment Amount"):
--------------------------
Tranche D Tranche D
Repayment Date Repayment Amount
-------------- ----------------
February 18, 1996 $500,000
August 18, 1996 500,000
February 18, 1997 500,000
August 18, 1997 500,000
February 18, 1998 500,000
August 18, 1998 500,000
February 18, 1999 500,000
August 18, 1999 500,000
February 18, 2000 500,000
August 18, 2000 500,000
February 18, 2001 500,000
August 18, 2001 500,000
February 18, 2002 500,000
August 18, 2002 500,000
February 18, 2003 500,000
August 18, 2003 500,000
February 18, 2004 14,000,000
August 18, 2004 14,000,000
Tranche D Maturity Date 14,000,000
(f) Each Lender shall maintain in accordance with its usual
practice an account or accounts evidencing the indebtedness of the Borrower
to the appropriate lending office of such Lender resulting from each Loan
made by such lending office of such Lender from time to time, including the
amounts of principal and interest payable and paid to such lending office
of such Lender from time to time under this Agreement.
(g) The Administrative Agent shall maintain the Register
pursuant to Section 13.6, and a subaccount for each Lender, in which
Register and subaccounts (taken together) shall be recorded (i) the amount
of each Loan made hereunder, whether such Loan is a Term Loan, a Revolving
Credit Loan or a Swingline Loan, the Type of each Loan made and the
Interest Period 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 or Chemical hereunder
<PAGE>
29
and (iii) the amount of any sum received by the Agent hereunder from the
Borrower and each Lender's share thereof.
(h) The entries made in the Register and accounts and
subaccounts maintained pursuant to paragraphs (f) and (g) of this
Section 2.5 shall, to the extent permitted by applicable law, be prima
facie evidence of the existence and amounts of the obligations of the
Borrower therein recorded; provided, however, that the failure of any
-------- -------
Lender or the Administrative Agent to maintain such account, such Register
or such subaccount, as applicable, or any error therein, shall not in any
manner affect the obligation of the Borrower to repay (with applicable
interest) the Loans made to the Borrower by such Lender in accordance with
the terms of this Agreement.
2.6 Conversions and Continuations. (a) The Borrower shall have
-----------------------------
the option on any Business Day to convert all or a portion equal to at
least the Minimum Borrowing Amount of the outstanding principal amount of
Term Loans or Revolving Credit Loans of one Type into a Borrowing or
Borrowings of another Type or to continue the outstanding principal amount
of any Eurodollar Term Loans or Eurodollar Revolving Credit Loans as
Eurodollar Term Loans or Eurodollar Revolving Credit Loans, as the case may
be, for an additional Interest Period, provided that (i) no partial
--------
conversion of Eurodollar Term Loans or Eurodollar Revolving Credit Loans
shall reduce the outstanding principal amount of Eurodollar Term Loans or
Eurodollar Revolving Credit Loans made pursuant to a single Borrowing to
less than the Minimum Borrowing Amount, (ii) ABR Loans may not be converted
into Eurodollar Term Loans or Eurodollar Revolving Credit Loans if a
Default or Event of Default is in existence on the date of the conversion
and the Administrative Agent has or the Required Lenders have determined in
its or their sole discretion not to permit such conversion,
(iii) Eurodollar Loans may not be continued as Eurodollar Term Loans or
Eurodollar Revolving Credit Loans for an additional Interest Period if a
Default or Event of Default is in existence on the date of the proposed
continuation and the Administrative Agent has or the Required Lenders have
determined in its or their sole discretion not to permit such continuation
and (iv) Borrowings resulting from conversions pursuant to this Section 2.6
shall be limited in number as provided in Section 2.2. Each such
conversion or continuation shall be effected by the Borrower by giving the
Administrative Agent at the Administrative Agent's Office prior to 12:00
Noon (New York time) at least three Business Days' (or one Business Day's
notice in the case of a conversion into ABR Loans) prior written notice (or
telephonic notice promptly confirmed in writing) (each a "Notice of
---------
Conversion or Continuation") specifying the Term Loans or Revolving Credit
--------------------------
Loans to be so converted or continued, the Type of Term Loans or Revolving
Credit Loans to be converted or continued into and, if such Term Loans or
Revolving Credit Loans are to be converted into or continued as Eurodollar
Term Loans or Eurodollar Revolving Credit Loans, the Interest Period to be
initially applicable thereto. The Administrative Agent shall give each
Lender notice as promptly as practicable of any such proposed conversion or
continuation affecting any of its Term Loans or Revolving Credit Loans.
(b) If any Default or Event of Default is in existence at the
time of any proposed continuation of any Eurodollar Term Loans or
Eurodollar Revolving Credit Loans and the Administrative Agent has or the
Required Lenders have determined in its or their sole discretion not to
permit such continuation, such Eurodollar Term Loans or Eurodollar
Revolving Credit Loans shall be automatically converted on the last day of
the current Interest Period into ABR Loans. If upon the expiration of any
Interest Period in respect of Eurodollar Term Loans or Eurodollar Revolving
Credit Loans, the Borrower has failed to elect a new Interest Period to be
applicable thereto as provided in clause (a) above, the Borrower shall be
deemed to have elected to convert such Borrowing of Eurodollar Term Loans
or Eurodollar Revolving Credit Loans, as the case may be, into a Borrowing
of ABR Loans effective as of the expiration date of such current Interest
Period.
2.7 Pro Rata Borrowings. Each Borrowing of Term Loans or
-------------------
Revolving Credit Loans under this Agreement shall be loaned by the Lenders
pro rata on the basis of their then-applicable Commitments. It is
--- ----
understood that no Lender shall be responsible for any default by any other
Lender in its obligation to make Loans hereunder and that each Lender shall
be obligated to make the Loans provided to be made by it hereunder,
regardless of the failure of any other Lender to fulfill its commitments
hereunder.
<PAGE>
30
2.8 Interest. (a) The unpaid principal amount of each ABR Loan
--------
shall bear interest from the date of the Borrowing thereof until maturity
(whether by acceleration or otherwise) at a rate per annum that shall at
all times be the Applicable ABR Margin plus the ABR in effect from time to
time.
(b) The unpaid principal amount of each Eurodollar Term Loan or
Eurodollar Revolving Credit Loan shall bear interest from the date of the
Borrowing thereof until maturity thereof (whether by acceleration or
otherwise) at a rate per annum that shall at all times be the Applicable
Eurodollar Margin in effect from time to time plus the relevant Eurodollar
Rate.
(c) If all or a portion of (i) the principal amount of any Loan
or (ii) any interest payable thereon shall not be paid when due (whether at
the stated maturity, by acceleration or otherwise), such overdue amount
shall bear interest at a rate per annum that is (x) in the case of overdue
principal, the rate that would otherwise be applicable thereto plus 2% or
----
(y) in the case of any overdue interest, to the extent permitted by
applicable law, the rate described in Section 2.8(a) plus 2% from and
----
including the date of such non-payment to but excluding the date on which
such amount is paid in full (after as well as before judgment).
(d) Interest on each Loan shall accrue from and including the
date of any Borrowing to but excluding the date of any repayment thereof
and shall be payable (i) in respect of each ABR Loan, quarterly in arrears
on the last day of each March, June, September and December, (ii) in
respect of each Eurodollar Term Loan or Eurodollar Revolving Credit Loan,
on the last day of each Interest Period applicable thereto and, in the case
of an Interest Period in excess of three months, on each date occurring at
three-month intervals after the first day of such Interest Period, (iii) in
respect of each Loan (except, in the case of prepayments, any ABR Loan), on
any prepayment (on the amount prepaid), at maturity (whether by
acceleration or otherwise) and, after such maturity, on demand.
(e) All computations of interest hereunder shall be made in
accordance with Section 5.5.
(f) The Administrative Agent, upon determining the interest rate
for any Borrowing of Eurodollar Loans, shall promptly notify the Borrower
and the relevant Lenders thereof. Each such determination shall, absent
clearly demonstrable error, be final and conclusive and binding on all
parties hereto.
2.9 Interest Periods. At the time the Borrower gives a Notice
----------------
of Borrowing or Notice of Conversion or Continuation in respect of the
making of, or conversion into or continuation as, a Borrowing of Eurodollar
Term Loans or Eurodollar Revolving Credit Loans (in the case of the initial
Interest Period applicable thereto) or prior to 10:00 A.M. (New York time)
on the third Business Day prior to the expiration of an Interest Period
applicable to a Borrowing of Eurodollar Term Loans or Eurodollar Revolving
Credit Loans, the Borrower shall have the right to elect by giving the
Administrative Agent written notice (or telephonic notice promptly
confirmed in writing) the Interest Period applicable to such Borrowing,
which Interest Period shall, at the option of the Borrower, be a one, two,
three, six or (in the case of Tranche A Term Loans and Revolving Credit
Loans, if available to all the Lenders making such loans as determined by
such Lenders in good faith based on prevailing market conditions) a nine or
twelve month period. Notwithstanding anything to the contrary contained
above:
(a) the initial Interest Period for any Borrowing of Eurodollar
Term Loans or Eurodollar Revolving Credit Loans shall commence on the
date of such Borrowing (including the date of any conversion from a
Borrowing of ABR Loans) and each Interest Period occurring thereafter
in respect of such Borrowing shall commence on the day on which the
next preceding Interest Period expires;
(b) if any Interest Period relating to a Borrowing of Eurodollar
Term Loans or Eurodollar Revolving Credit Loans begins on the last
Business Day of a calendar month or begins on a day for which there is
no numerically corresponding day in the calendar month at the end of
such Interest Period, such Interest Period shall end on the last
Business Day of the calendar month at the end of such Interest Period;
<PAGE>
31
(c) if any Interest Period would otherwise expire on a day that
is not a Business Day, such Interest Period shall expire on the next
succeeding Business Day, provided that if any Interest Period in
--------
respect of a Eurodollar Term Loan or Eurodollar Revolving Credit Loan
would otherwise expire on a day that is not a Business Day but is a
day of the month after which no further Business Day occurs in such
month, such Interest Period shall expire on the next preceding
Business Day; and
(d) the Borrower shall not be entitled to elect any Interest
Period in respect of any Eurodollar Term Loan or Eurodollar Revolving
Credit Loan if such Interest Period would extend beyond the applicable
Maturity Date of such Loan.
2.10 Increased Costs, Illegality, etc. (a) In the event that
---------------------------------
(x) in the case of clause (i) below, the Administrative Agent or (y) in the
case of clauses (ii) and (iii) below, any Lender shall have reasonably
determined (which determination shall, absent clearly demonstrable error,
be final and conclusive and binding upon all parties hereto):
(i) on any date for determining the Eurodollar Rate for any
Interest Period that, by reason of any changes arising on or after the
Closing Date affecting the interbank Eurodollar market, adequate and
fair means do not exist for ascertaining the applicable interest rate
on the basis provided for in the definition of Eurodollar Rate; or
(ii) at any time, that such Lender shall incur increased costs or
reductions in the amounts received or receivable hereunder with
respect to any Eurodollar Loans (other than any such increase or
reduction attributable to taxes) because of (x) any change since the
date hereof in any applicable law, governmental rule, regulation,
guideline or order (or in the interpretation or administration thereof
and including the introduction of any new law or governmental rule,
regulation, guideline or order), such as, for example, but not limited
to, a change in official reserve requirements, and/or (y) other
circumstances affecting the interbank Eurodollar market or the
position of such Lender in such market; or
(iii) at any time, that the making or continuance of any
Eurodollar Loan has become unlawful by compliance by such Lender in
good faith with any law, governmental rule, regulation, guideline or
order (or would conflict with any such governmental rule, regulation,
guideline or order not having the force of law even though the failure
to comply therewith would not be unlawful), or has become
impracticable as a result of a contingency occurring after the date
hereof that materially and adversely affects the interbank Eurodollar
market;
then, and in any such event, such Lender (or the Administrative Agent, in
the case of clause (i) above) shall within a reasonable time thereafter
give notice (if by telephone confirmed in writing) to the Borrower and to
the Administrative Agent of such determination (which notice the
Administrative Agent shall promptly transmit to each of the other Lenders).
Thereafter (x) in the case of clause (i) above, Eurodollar Term Loans and
Eurodollar Revolving Credit Loans shall no longer be available until such
time as the Administrative Agent notifies the Borrower and the Lenders that
the circumstances giving rise to such notice by the Administrative Agent no
longer exist (which notice the Administrative Agent agrees to give at such
time when such circumstances no longer exist), and any Notice of Borrowing
or Notice of Conversion given by the Borrower with respect to Eurodollar
Term Loans or Eurodollar Revolving Credit Loans that have not yet been
incurred shall be deemed rescinded by the Borrower, (y) in the case of
clause (ii) above, the Borrower shall pay to such Lender, promptly after
receipt of written demand therefor, such additional amounts (in the form of
an increased rate of, or a different method of calculating, interest or
otherwise as such Lender in its reasonable discretion shall determine) as
shall be required to compensate such Lender for such increased costs or
reductions in amounts receivable hereunder (it being agreed that a written
notice as to the additional amounts owed to such Lender, showing in
reasonable detail the basis for the calculation thereof, submitted to the
Borrower by such Lender shall, absent clearly demonstrable error, be final
and conclusive and binding upon all parties hereto) and (z) in the case of
clause (iii) above, the Borrower shall take one of the actions specified in
Section 2.10(b) as promptly as possible and, in any event, within the time
period required by law.
<PAGE>
32
(b) At any time that any Eurodollar Loan is affected by the
circumstances described in Section 2.10(a)(ii) or (iii), the Borrower may (and
in the case of a Eurodollar Loan affected pursuant to Section 2.10(a)(iii)
shall) either (i) if the affected Eurodollar Loan is then being made pursuant to
a Borrowing, cancel said Borrowing by giving the Administrative Agent telephonic
notice (confirmed promptly in writing) thereof on the same date that the
Borrower was notified by a Lender pursuant to Section 2.10(a)(ii) or (iii) or
(ii) if the affected Eurodollar Loan is then outstanding, upon at least three
Business Days notice to the Administrative Agent, require the affected Lender to
convert each such Eurodollar Revolving Credit Loan and Eurodollar Term Loan into
an ABR Loan, provided that if more than one Lender is affected at any time, then
--------
all affected Lenders must be treated in the same manner pursuant to this
Section 2.10(b).
(c) If, after the date hereof, the adoption of 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, the National Association of Insurance Commissioners, central bank or
comparable agency charged with the interpretation or administration thereof, or
compliance by a Lender or its parent with any request or directive made or
adopted after the date hereof regarding capital adequacy (whether or not having
the force of law) of any such authority, association, central bank or comparable
agency, has or would have the effect of reducing the rate of return on such
Lender's or its parent's capital or assets as a consequence of such Lender's
commitments or obligations hereunder to a level below that which such Lender or
its parent could have achieved but for such adoption, effectiveness, change or
compliance (taking into consideration such Lender's or its parent's policies
with respect to capital adequacy), then from time to time, promptly after demand
by such Lender (with a copy to the Administrative Agent), the Borrower shall pay
to such Lender such additional amount or amounts as will compensate such Lender
or its parent for such reduction, it being understood and agreed, however, that
a Lender shall not be entitled to such compensation as a result of such Lender's
compliance with, or pursuant to any request or directive to comply with, any
such law, rule or regulation as in effect on the date hereof. Each Lender, upon
determining in good faith that any additional amounts will be payable pursuant
to this Section 2.10(c), will give prompt written notice thereof to the
Borrower, which notice shall set forth in reasonable detail the basis of the
calculation of such additional amounts, although the failure to give any such
notice shall not, subject to Section 2.13, release or diminish any of the
Borrower's obligations to pay additional amounts pursuant to this Section
2.10(c) upon receipt of such notice.
2.11 Compensation. If (a) any payment of principal of any Eurodollar
------------
Term Loan or Eurodollar Revolving Credit Loan is made by the Borrower to or for
the account of a Lender other than on the last day of the Interest Period for
such Eurodollar Loan as a result of a payment or conversion pursuant to Section
2.5, 2.6, 2.10, 5.1 or 5.2, as a result of acceleration of the maturity of the
Loans pursuant to Section 11 or for any other reason, (b) if any Borrowing of
Eurodollar Term Loans or Eurodollar Revolving Credit Loans is not made as a
result of a withdrawn Notice of Borrowing, (c) if any ABR Loan is not converted
into a Eurodollar Term Loan or Eurodollar Revolving Credit Loan as a result of a
withdrawn Notice of Conversion or Continuation or (d) if any Eurodollar Loan is
not continued as a Eurodollar Term Loan or Eurodollar Revolving Credit Loan as a
result of a withdrawn Notice of Conversion or Continuation, the Borrower shall,
after receipt of a written request by such Lender (which request shall set forth
in reasonable detail the basis for requesting such amount), pay to the
Administrative Agent for the account of such Lender any amounts required to
compensate such Lender for any additional losses, costs or expenses that such
Lender may reasonably incur as a result of such payment, failure to convert or
failure to continue, including, without limitation, any loss, cost or expense
(excluding loss of anticipated profits) actually incurred by reason of the
liquidation or reemployment of deposits or other funds acquired by any Lender to
fund or maintain such Eurodollar Loan.
2.12 Change of Lending Office. Each Lender agrees that, upon the
------------------------
occurrence of any event giving rise to the operation of Section 2.10(a)(ii),
2.10(a)(iii), 2.10(b), 3.5 or 5.4 with respect to such Lender, it will, if
requested by the Borrower, use reasonable efforts (subject to overall policy
considerations of such Lender) to designate another lending office for any Loans
affected by such event, provided that such designation is made on such terms
--------
that such Lender and its lending office suffer no economic, legal or regulatory
disadvantage, with the object of avoiding the consequence of the event giving
rise to the operation of any such Section. Nothing in this Section 2.12 shall
affect or postpone any of the obligations of the Borrower or the right of any
Lender provided in Section 2.10, 3.5 or 5.4.
<PAGE>
33
2.13 Notice of Certain Costs. Notwithstanding anything in this
-----------------------
Agreement to the contrary, to the extent any notice required by Section 2.10,
2.11, 3.5 or 5.4 is given by any Lender more than 180 days after such Lender has
knowledge (or should have had knowledge) of the occurrence of the event giving
rise to the additional cost, reduction in amounts, loss, tax or other additional
amounts described in such Sections, such Lender shall not be entitled to
compensation under Section 2.10, 2.11, 3.5 or 5.4, as the case may be, for any
such amounts incurred or accruing prior to the giving of such notice to the
Borrower.
SECTION 3. Letters of Credit.
-----------------
3.1 Letters of Credit. (a) Subject to and upon the terms and
-----------------
conditions herein set forth, the Borrower, at any time and from time to time on
or after the Closing Date and prior to the L/C Maturity Date, may request that
the Letter of Credit Issuer issue, for the account of the Borrower, a standby
letter of credit or letters of credit in such form as may be approved by the
Letter of Credit Issuer in its reasonable discretion.
(b) Notwithstanding the foregoing, (i) no Letter of Credit shall be
issued the Stated Amount of which, when added to the Letter of Credit
Outstandings at such time, would exceed the Letter of Credit Commitment then in
effect; (ii) no Letter of Credit shall be issued the Stated Amount of which,
when added to the sum of (x) the Letter of Credit Outstandings at such time and
(y) the aggregate principal of all Revolving Credit Loans and Swingline Loans
then outstanding, would exceed the Total Revolving Credit Commitment then in
effect; (iii) each Letter of Credit shall, unless otherwise agreed upon by the
Administrative Agent and the Letter of Credit Issuer, have an expiry date
occurring no later than one year after the date of issuance thereof, and in no
event occurring later than the L/C Maturity Date; (iv) each Letter of Credit
shall be denominated in Dollars; and (v) no Letter of Credit shall be issued by
the Letter of Credit Issuer after it has received a written notice from the
Borrower or any Lender stating that a Default or Event of Default has occurred
and is continuing until such time as the Letter of Credit Issuer shall have
received a written notice of (x) rescission of such notice from the party or
parties originally delivering such notice or (y) the waiver of such Default or
Event of Default in accordance with the provisions of Section 13.1.
(c) Upon at least one Business Day's prior written notice (or
telephonic notice promptly confirmed in writing) to the Administrative Agent and
the Letter of Credit Issuer (which notice the Administrative Agent shall
promptly transmit to each of the Lenders), the Borrower shall have the right, on
any day, permanently to terminate or reduce the Letter of Credit Commitment in
whole or in part, provided that, after giving effect to such termination or
--------
reduction, the Letter of Credit Outstandings shall not exceed the Letter of
Credit Commitment.
3.2 Letter of Credit Requests. (a) Whenever the Borrower desires
-------------------------
that a Letter of Credit be issued for its account, it shall give the
Administrative Agent and the Letter of Credit Issuer at least five (or such
lesser number as may be agreed upon by the Administrative Agent and the Letter
of Credit Issuer) Business Days' written notice thereof. Each notice shall be
executed by the Borrower and shall be in the form of Exhibit D (each a "Letter
------
of Credit Request"). The Administrative Agent shall promptly transmit copies of
-----------------
each Letter of Credit Request to each Lender.
(b) The making of each Letter of Credit Request shall be deemed to be
a representation and warranty by the Borrower that the Letter of Credit may be
issued in accordance with, and will not violate the requirements of, Section
3.1(b).
3.3 Letter of Credit Participations. (a) Immediately upon the
-------------------------------
issuance by the Letter of Credit Issuer of any Letter of Credit, the Letter of
Credit Issuer shall be deemed to have sold and transferred to each other Lender
(each such other Lender, in its capacity under this Section 3.3, an "L/C
---
Participant"), and each such L/C Participant shall be deemed irrevocably and
-----------
unconditionally to have purchased and received from the Letter of Credit Issuer,
without recourse or warranty, an undivided interest and participation (each an
"L/C Participation"), to the extent of such L/C Participant's Revolving Credit
-----------------
Commitment Percentage, in such Letter of Credit, each substitute letter of
credit, each drawing made thereunder and the obligations of the Borrower
<PAGE>
34
under this Agreement with respect thereto, and any security therefor or guaranty
pertaining thereto (although Letter of Credit Fees will be paid directly to the
Administrative Agent for the ratable account of the L/C Participants as provided
in Section 4.1(b) and the L/C Participants shall have no right to receive any
portion of any Fronting Fees).
(b) In determining whether to pay under any Letter of Credit, the
Letter of Credit Issuer shall have no obligation relative to the L/C
Participants other than to confirm that any documents required to be delivered
under such Letter of Credit have been delivered and that they appear to comply
on their face with the requirements of such Letter of Credit. Any action taken
or omitted to be taken by the Letter of Credit Issuer under or in connection
with any Letter of Credit issued by it, if taken or omitted in the absence of
gross negligence or willful misconduct, shall not create for the Letter of
Credit Issuer any resulting liability.
(c) In the event that the Letter of Credit Issuer makes any payment
under any Letter of Credit issued by it and the Borrower shall not have repaid
such amount in full to the Letter of Credit Issuer pursuant to Section 3.4(a),
the Letter of Credit Issuer shall promptly notify the Administrative Agent and
each L/C Participant of such failure, and each L/C Participant shall promptly
and unconditionally pay to the Administrative Agent, for the account of the
Letter of Credit Issuer, the amount of such L/C Participant's Revolving Credit
Commitment Percentage of such unreimbursed payment in Dollars and in same day
funds; provided, however, that no L/C Participant shall be obligated to pay to
-------- -------
the Administrative Agent for the account of the Letter of Credit Issuer its
Revolving Credit Commitment Percentage of such unreimbursed amount arising from
any wrongful payment made by the Letter of Credit Issuer under a Letter of
Credit as a result of acts or omissions constituting willful misconduct or gross
negligence on the part of the Letter of Credit Issuer. If the Letter of Credit
Issuer so notifies, prior to 11:00 A.M. (New York time) on any Business Day, any
L/C Participant required to fund a payment under a Letter of Credit, such L/C
Participant shall make available to the Administrative Agent for the account of
the Letter of Credit Issuer such L/C Participant's Revolving Credit Commitment
Percentage of the amount of such payment on such Business Day in same day funds.
If and to the extent such L/C Participant shall not have so made its Revolving
Credit Commitment Percentage of the amount of such payment available to the
Administrative Agent for the account of the Letter of Credit Issuer, such L/C
Participant agrees to pay to the Administrative Agent for the account of the
Letter of Credit Issuer, forthwith on demand, such amount, together with
interest thereon for each day from such date until the date such amount is paid
to the Administrative Agent for the account of the Letter of Credit Issuer at
the Federal Funds Effective Rate. The failure of any L/C Participant to make
available to the Administrative Agent for the account of the Letter of Credit
Issuer its Revolving Credit Commitment Percentage of any payment under any
Letter of Credit shall not relieve any other L/C Participant of its obligation
hereunder to make available to the Administrative Agent for the account of the
Letter of Credit Issuer its Revolving Credit Commitment Percentage of any
payment under such Letter of Credit on the date required, as specified above,
but no L/C Participant shall be responsible for the failure of any other L/C
Participant to make available to the Administrative Agent such other L/C
Participant's Revolving Credit Commitment Percentage of any such payment.
(d) Whenever the Letter of Credit Issuer receives a payment in
respect of an unpaid reimbursement obligation as to which the Administrative
Agent has received for the account of the Letter of Credit Issuer any payments
from the L/C Participants pursuant to the preceding clause (c) above, the Letter
of Credit Issuer shall pay to the Administrative Agent and the Administrative
Agent shall promptly pay to each L/C Participant that has paid its Revolving
Credit Commitment Percentage of such reimbursement obligation, in Dollars and in
same day funds, an amount equal to such L/C Participant's share (based upon the
proportionate aggregate amount originally funded by such L/C Participant to the
aggregate amount funded by all L/C Participants) of the principal amount of such
reimbursement obligation and interest thereon accruing after the purchase of the
respective L/C Participations.
(e) The obligations of the L/C Participants to make payments to the
Administrative Agent for the account of the Letter of Credit Issuer with respect
to Letters of Credit shall be irrevocable and not subject to counterclaim,
set-off or other defense or any other qualification or exception whatsoever and
shall be made in accordance with the terms and conditions of this Agreement
under all circumstances, including, without limitation, any of the following
circumstances:
<PAGE>
35
(i) any lack of validity or enforceability of this Agreement or any
of the other Credit Documents;
(ii) the existence of any claim, set-off, defense or other right
that the Borrower may have at any time against a beneficiary named in a
Letter of Credit, any transferee of any Letter of Credit (or any Person for
whom any such transferee may be acting), the Administrative Agent, the
Letter of Credit Issuer, any Lender or other Person, whether in connection
with this Agreement, any Letter of Credit, the transactions contemplated
herein or any unrelated transactions (including any underlying transaction
between the Borrower and the beneficiary named in any such Letter of
Credit);
(iii) any draft, certificate or any other document presented under
any Letter of Credit proving to be forged, fraudulent, invalid or
insufficient in any respect or any statement therein being untrue or in-
accurate in any respect;
(iv) the surrender or impairment of any security for the performance
or observance of any of the terms of any of the Credit Documents; or
(v) the occurrence of any Default or Event of Default;
provided, however, that no L/C Participant shall be obligated to pay to the
-------- -------
Administrative Agent for the account of the Letter of Credit Issuer its
Revolving Credit Commitment Percentage of any unreimbursed amount arising from
any wrongful payment made by the Letter of Credit Issuer under a Letter of
Credit as a result of acts or omissions constituting willful misconduct or gross
negligence on the part of the Letter of Credit Issuer.
3.4 Agreement to Repay Letter of Credit Drawings. (a) The Borrower
--------------------------------------------
hereby agrees to reimburse the Letter of Credit Issuer, by making payment to the
Administrative Agent in Dollars in immediately available funds at the
Administrative Agent's Office, for any payment or disbursement made by the
Letter of Credit Issuer under any Letter of Credit (each such amount so paid
until reimbursed, an "Unpaid Drawing") immediately after, and in any event on
--------------
the date of, such payment, with interest on the amount so paid or disbursed by
the Letter of Credit Issuer, to the extent not reimbursed prior to 5:00 P.M.
(New York time) on the date of such payment or disbursement, from and including
the date paid or disbursed to but excluding the date the Letter of Credit Issuer
is reimbursed therefor, at a rate per annum that shall at all times be the
Applicable ABR Margin plus the ABR as in effect from time to time, provided
--------
that, notwithstanding anything contained in this Agreement to the contrary,
(i) unless the Borrower shall have notified the Administrative Agent and the
Letter of Credit Issuer prior to 10:00 A.M. on the date of such drawing that the
Borrower intends to reimburse the Letter of Credit Issuer for the amount of such
drawing with funds other than the proceeds of Loans, the Borrower shall be
deemed to have given a Notice of Borrowing to the Administrative Agent
requesting that the Lenders make Revolving Credit Loans (which shall initially
be ABR Loans) on the date on which such drawing is honored in an amount equal to
the amount of such drawing and (ii) each Lender shall, on such date, make
Revolving Credit Loans in an amount equal to such Lender's pro rata portion of
such Borrowing in accordance with the provisions of Section 2.4.
(b) The Borrower's obligations under this Section 3.4 to reimburse
the Letter of Credit Issuer with respect to Unpaid Drawings (including, in each
case, interest thereon) shall be absolute and unconditional under any and all
circumstances and irrespective of any setoff, counterclaim or defense to payment
that the Borrower or any other Person may have or have had against the Letter of
Credit Issuer, the Administrative Agent or any Lender (including in its capacity
as an L/C Participant), including, without limitation, any defense based upon
the failure of any drawing under a Letter of Credit (each a "Drawing") to
-------
conform to the terms of the Letter of Credit or any non-application or
misapplication by the beneficiary of the proceeds of such Drawing, provided that
--------
the Borrower shall not be obligated to reimburse the Letter of Credit Issuer for
any wrongful payment made by the Letter of Credit Issuer under the Letter of
Credit issued by it as a result of acts or omissions constituting willful
misconduct or gross negligence on the part of the Letter of Credit Issuer.
<PAGE>
36
(c) Each payment by the Letter of Credit Issuer under any Letter of
Credit shall constitute a request by the Borrower for an ABR Revolving Credit
Loan in the amount of the Unpaid Drawing in respect of such Letter of Credit.
The Letter of Credit Issuer shall notify the Borrower and the Administrative
Agent, by 10:00 A.M. (New York time) on any Business Day on which the Letter of
Credit Issuer intends to honor a drawing under a Letter of Credit, of (i) the
Letter of Credit Issuer's intention to honor such drawing and (ii) the amount
of such drawing. Unless otherwise instructed by the Borrower by 10:30 A.M. (New
York time) on such Business Day, the Administrative Agent shall notify each
Lender of such drawing and the amount of its Revolving Credit Loan to be made in
respect thereof, and each Lender shall be irrevocably obligated to make an ABR
Revolving Credit Loan to the Borrower in the amount of its Revolving Credit
Commitment Percentage of the applicable Unpaid Drawing by 12:00 noon (New York
time) on such Business Day by making the amount of such Revolving Credit Loan
available to the Administrative Agent at the Administrative Agent's Office.
Such Revolving Credit Loans shall be made without regard to the Minimum
Borrowing Amount. The Administrative Agent shall use the proceeds of such
Revolving Credit Loans solely for purpose of reimbursing the Letter of Credit
Issuer for the related Unpaid Drawing.
3.5 Increased Costs. If after the date hereof, the adoption of any
---------------
applicable law, rule or regulation, 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 actual compliance by the Letter of Credit Issuer or any L/C
Participant with any request or directive made or adopted after the date hereof
(whether or not having the force of law), by any such authority, central bank or
comparable agency shall either (a) impose, modify or make applicable any
reserve, deposit, capital adequacy or similar requirement against letters of
credit issued by the Letter of Credit Issuer, or any L/C Participant's L/C
Participation therein, or (b) impose on the Letter of Credit Issuer or any L/C
Participant any other conditions affecting its obligations under this Agreement
in respect of Letters of Credit or L/C Participations therein or any Letter of
Credit or such L/C Participant's L/C Participation therein; and the result of
any of the foregoing is to increase the cost to the Letter of Credit Issuer or
such L/C Participant of issuing, maintaining or participating in any Letter of
Credit, or to reduce the amount of any sum received or receivable by the Letter
of Credit Issuer or such L/C Participant hereunder (other than any such increase
or reduction attributable to taxes) in respect of Letters of Credit or L/C
Participations therein, then, promptly after receipt of written demand to the
Borrower by the Letter of Credit Issuer or such L/C Participant, as the case may
be (a copy of which notice shall be sent by the Letter of Credit Issuer or such
L/C Participant to the Administrative Agent), the Borrower shall pay to the
Letter of Credit Issuer or such L/C Participant such additional amount or
amounts as will compensate the Letter of Credit Issuer or such L/C Participant
for such increased cost or reduction, it being understood and agreed, however,
that the Letter of Credit Issuer or a L/C Participant shall not be entitled to
such compensation as a result of such Person's compliance with, or pursuant to
any request or directive to comply with, any such law, rule or regulation as in
effect on the date hereof. A certificate submitted to the Borrower by the
Letter of Credit Issuer or a L/C Participant, as the case may be (a copy of
which certificate shall be sent by the Letter of Credit Issuer or such
L/C Participant to the Administrative Agent), setting forth in reasonable detail
the basis for the determination of such additional amount or amounts necessary
to compensate the Letter of Credit Issuer or such L/C Participant as aforesaid
shall be conclusive and binding on the Borrower absent clearly demonstrable
error.
3.6 Successor Letter of Credit Issuer. The Letter of Credit Issuer
---------------------------------
may resign as Letter of Credit Issuer upon 60 days' prior written notice to the
Administrative Agent, the Lenders and the Borrower. If the Letter of Credit
Issuer shall resign as Letter of Credit Issuer under this Agreement, then the
Borrower shall appoint from among the Lenders a successor issuer of Letters of
Credit, whereupon such successor issuer shall succeed to the rights, powers and
duties of the Letter of Credit Issuer, and the term "Letter of Credit Issuer"
shall mean such successor issuer effective upon such appointment. At the time
such resignation shall become effective, the Borrower shall pay to the resigning
Letter of Credit Issuer all accrued and unpaid fees pursuant to Section 4.1(c).
The acceptance of any appointment as the Letter of Credit Issuer hereunder by a
successor Lender shall be evidenced by an agreement entered into by such
successor, in a form satisfactory to the Borrower and the Administrative Agent
and, from and after the effective date of such agreement, such successor Lender
shall have all the rights and obligations of the previous Letter of Credit
Issuer under this Agreement and the other Credit Documents. After the
resignation of the Letter of Credit Issuer hereunder, the resigning Letter
<PAGE>
37
of Credit Issuer shall remain a party hereto and shall continue to have all the
rights and obligations of a Letter of Credit Issuer under this Agreement and the
other Loan Documents with respect to Letters of Credit issued by it prior to
such resignation, but shall not be required to issue additional Letters of
Credit. After any retiring Letter of Credit Issuer's resignation as Letter of
Credit Issuer, the provisions of this Agreement relating to the Letter of Credit
Issuer shall inure to its benefit as to any actions taken or omitted to be taken
by it (a) while it was Letter of Credit Issuer under this Agreement or (b) at
any time with respect to Letters of Credit issued by such Letter of Credit
Issuer.
SECTION 4. Fees; Commitments.
-----------------
4.1 Fees. (a) The Borrower agrees to pay to the Administrative
----
Agent, for the account of each Lender having a Tranche A Commitment or a
Revolving Credit Commitment (in each case pro rata according to the respective
--- ----
Commitments of all such Lenders), a commitment fee for each day (i) in the case
of the Tranche A Commitments, from and including the Closing Date to but
excluding the last day of the Tranche A Availability Period and (ii) in the case
of the Revolving Credit Commitments, from and including the Closing Date to but
excluding the Final Date. Such commitment fee shall be payable (i) in the case
of the Tranche A Commitments, in arrears (A) on the last day of September 1995
(for the period ended on such day) and (B) on the last day of the Tranche A
Availability Period (for the period ended on such date for which no payment has
been received pursuant to clause (A) above) and (ii) in the case of the
Revolving Credit Commitments, in arrears on (A) the last day of each March,
June, September and December (for the three-month period (or portion thereof)
ended on the such day) and (B) on the Final Date (for the period ended on such
date for which no payment has been received pursuant to clause (A) above) and
shall be computed for each day during such period at a rate per annum equal to
the Commitment Fee Rates in effect on such day on the Available Commitments in
effect on such day. Notwithstanding the foregoing, the Borrower shall not be
obligated to pay any amounts to any Defaulting Lender pursuant to this Section
4.1.
(b) The Borrower agrees to pay to the Administrative Agent for the
account of the Lenders pro rata on the basis of their respective Letter of
--- ----
Credit Exposure, a fee in respect of each Letter of Credit (the "Letter of
---------
Credit Fee"), for the period from and including the date of issuance of such
----------
Letter of Credit to but not including the termination date of such Letter of
Credit computed at the per annum rate for each day equal to the Applicable
Eurodollar Margin for Revolving Credit Loans minus 1/8 of 1% per annum on the
average daily Stated Amount of such Letter of Credit. Such Letter of Credit
Fees shall be due and payable quarterly in arrears on the last day of each
March, June, September and December and on the date upon which the Total
Revolving Credit Commitment terminates and the Letter of Credit Outstandings
shall have been reduced to zero.
(c) The Borrower agrees to pay to the Administrative Agent for the
account of the Letter of Credit Issuer a fee in respect of each Letter of Credit
issued by it (the "Fronting Fee"), for the period from and including the date of
------------
issuance of such Letter of Credit to but not including the termination date of
such Letter of Credit, computed at the rate for each day equal to 1/8 of 1% per
annum on the average daily Stated Amount of such Letter of Credit. Such
Fronting Fees shall be due and payable quarterly in arrears on the last day of
each March, June, September and December and on the date upon which the Total
Revolving Credit Commitment terminates and the Letter of Credit Outstandings
shall have been reduced to zero.
(d) The Borrower agrees to pay directly to the Letter of Credit
Issuer upon each issuance of, drawing under, and/or amendment of, a Letter of
Credit issued by it such amount as the Letter of Credit Issuer and the Borrower
shall have agreed upon for issuances of, drawings under or amendments of,
letters of credit issued by it.
(e) The Borrower agrees to pay to the Administrative Agent, on the
Closing Date, the fees in the amounts and on the dates previously agreed to in
writing by the Borrower and the Administrative Agent. The Administrative Agent
agrees to pay to each Lender, for its own account on the Closing Date, the fees
in the amounts and on the dates previously agreed to in writing by the
Administrative Agent and such Lender.
<PAGE>
38
4.2 Voluntary Reduction of Revolving Credit Commitments. Upon at
---------------------------------------------------
least one Business Day's prior written notice (or telephonic notice promptly
confirmed in writing) to the Administrative Agent at the Administrative Agent's
Office (which notice the Administrative Agent shall promptly transmit to each of
the Lenders), the Borrower shall have the right, without premium or penalty, on
any day, permanently to terminate or reduce the Revolving Credit Commitments in
whole or in part, provided that (a) any such reduction shall apply
--------
proportionately and permanently to reduce the Revolving Credit Commitment of
each of the Lenders, (b) any partial reduction pursuant to this Section 4.2
shall be in the amount of at least $1,000,000 and (c) after giving effect to
such termination or reduction and to any prepayments of the Loans made on the
date thereof in accordance with this Agreement, the sum of the aggregate
outstanding principal amount of the Revolving Credit Loans and the Letter of
Credit Outstandings shall not exceed the Total Revolving Credit Commitment.
4.3 Mandatory Termination of Commitments. (a) The Total Term Loan
------------------------------------
Commitment (other than the Total Tranche A Commitment) shall terminate at
5:00 P.M. (New York time) on the Closing Date. The Total Tranche A Commitment
shall be reduced at 5:00 P.M. (New York time) on the Closing Date in an amount
equal to the greater of (i) $275,000,000 and (ii) the aggregate principal amount
of Tranche A Term Loans borrowed on the Closing Date. Upon any borrowing of
Tranche A Term Loans following the Closing Date, the Total Tranche A Commitment
shall be reduced by the amount of such Tranche A Term Loans. The Total Tranche
A Commitment shall terminate at 5:00 P.M. (New York time) on the date that is
180 days following the Closing Date.
(b) The Total Revolving Credit Commitment shall terminate at
5:00 P.M. (New York time) on the Revolving Credit Maturity Date.
(c) The Swingline Commitment shall terminate at 5:00 P.M. (New York
time) on the Swingline Maturity Date.
SECTION 5. Payments.
--------
5.1 Voluntary Prepayments. The Borrower shall have the right to
---------------------
prepay Term Loans, Revolving Credit Loans and Swingline Loans, without premium
or penalty, in whole or in part from time to time on the following terms and
conditions: (a) the Borrower shall give the Administrative Agent at the
Administrative Agent's Office written notice (or telephonic notice promptly
confirmed in writing) of its intent to make such prepayment, the amount of such
prepayment and (in the case of Eurodollar Term Loans and Eurodollar Revolving
Credit Loans) the specific Borrowing(s) pursuant to which made, which notice
shall be given by the Borrower no later than (i) in the case of Term Loans or
Revolving Credit Loans, 10:00 A.M. (New York time) one Business Day prior to, or
(ii) in the case of Swingline Loans, 10:00 A.M. (New York time) on, the date of
such prepayment and shall promptly be transmitted by the Administrative Agent to
each of the Lenders or Chemical, as the case may be; (b) each partial prepayment
of any Borrowing of Term Loans or Revolving Credit Loans shall be in a multiple
of $100,000 and in an aggregate principal amount of at least $2,000,000 and each
partial prepayment of Swingline Loans shall be in a multiple of $100,000 and in
an aggregate principal amount of at least $500,000, provided that no partial
--------
prepayment of Eurodollar Term Loans or Eurodollar Revolving Credit Loans made
pursuant to a single Borrowing shall reduce the outstanding Eurodollar Term
Loans or Eurodollar Revolving Credit Loans made pursuant to such Borrowing to an
amount less than the Minimum Borrowing Amount for Eurodollar Term Loans or
Eurodollar Revolving Credit Loans; (c) any prepayment of Eurodollar Term Loans
or Eurodollar Revolving Credit Loans pursuant to this Section 5.1 on any day
other than the last day of an Interest Period applicable thereto shall be
subject to compliance by the Borrower with the applicable provisions of Section
2.11; and (d) each prepayment in respect of any one or more tranches of Term
Loans or Revolving Credit Loans made pursuant to a Borrowing shall be applied
pro rata among such tranches of Term Loans or Revolving Credit Loans, provided
--- ---- --------
that at the Borrower's election in connection with any prepayment pursuant to
this Section 5.1, such prepayment shall not be applied to any Term Loan or
Revolving Credit Loan of a Defaulting Lender. Each prepayment of Term Loans
pursuant to this Section 5.1 shall be (a) applied to Tranche A Term Loans,
Tranche B Term Loans, Tranche C Term Loans, Tranche D Term Loans or Revolving
Credit Loans in such manner as the Borrower may determine and
<PAGE>
39
(b) applied to reduce the Repayment Amounts with respect to any such Term Loans
in such order as the Borrower may determine.
5.2 Mandatory Prepayments. (a) Term Loan Prepayments. (i) On each
--------------------- ---------------------
occasion that a Prepayment Event occurs, the Borrower shall, within five
Business Days after the occurrence of such Prepayment Event, repay the principal
amount of Term Loans in an amount equal to 100% of the Net Cash Proceeds from
such Prepayment Event, in each case in accordance with paragraph (c) below.
(ii) Not later than the date on which the financial statements with
respect to any fiscal year (commencing with the fiscal year ending June 29,
1996) are or are required to be delivered pursuant to Section 9.1, the Borrower
shall, in each case in accordance with paragraph (c) below, repay the principal
of Term Loans in an amount equal to (A) 50% of Excess Cash Flow for such fiscal
year (or, in the case of the fiscal year ending June 29, 1996, for the period
from and including the Closing Date to and including June 29, 1996) minus (B)
-----
any mandatory prepayments declined and retained by the Borrower pursuant to
Section 5.2(c)(ii) during such fiscal year to the extent that such prepayments
would otherwise constitute Excess Cash Flow for such fiscal year.
(b) Aggregate Revolving Credit Outstandings. If on any date the sum
---------------------------------------
of the outstanding principal amount of the Revolving Credit Loans and Swingline
Loans and the aggregate amount of Letter of Credit Outstandings (all the
foregoing, collectively, the "Aggregate Revolving Credit Outstandings") exceeds
---------------------------------------
the Total Revolving Credit Commitment as then in effect, the Borrower shall
forthwith repay on such date the principal amount of Swingline Loans and, after
all Swingline Loans have been paid in full, Revolving Credit Loans, in an amount
equal to such excess. If, after giving effect to the prepayment of all
outstanding Swingline Loans and Revolving Credit Loans, the Aggregate Revolving
Credit Outstandings exceed the Total Revolving Credit Commitment then in effect,
the Borrower shall pay to the Administrative Agent an amount in cash equal to
such excess and the Administrative Agent shall hold such payment for the benefit
of the Lenders as security for the obligations of the Borrower hereunder
(including, without limitation, obligations in respect of Letter of Credit
Outstandings) pursuant to a cash collateral agreement to be entered into in form
and substance satisfactory to the Administrative Agent (which shall permit
certain investments in Permitted Investments satisfactory to the Administrative
Agent, until the proceeds are applied to the secured obligations).
(c) Application to Repayment Amounts. (i) An amount equal to each
--------------------------------
prepayment of Term Loans required by this Section 5.2 shall be (i) allocated pro
---
rata among the Tranche A Term Loans, the Tranche B Term Loans, the Tranche C
----
Term Loans and the Tranche D Term Loans and (ii) applied (A) in the case of the
Tranche A Loans, to reduce the Tranche A Repayment Amounts, in the manner
described in paragraph (iii) below and (B) in the case of each of the Tranche B
Term Loans. the Tranche C Term Loans and the Tranche D Term Loans, to reduce the
Repayment Amounts with respect to such Loans in the manner described in
paragraph (ii) below.
(ii) Notwithstanding paragraph (i) above, with respect to the amount
of any mandatory prepayment described in Section 5.2(a) that is allocated to the
then-outstanding Tranche B Term Loans, Tranche C Term Loans or Tranche D Term
Loans (such amounts, the "Tranche B Prepayment Amount", the "Tranche C
--------------------------- ---------
Prepayment Amount" and the "Tranche D Prepayment Amount", respectively), the
----------------- ---------------------------
Borrower will, in lieu of applying such amount to the prepayment of Tranche B
Term Loans, Tranche C Term Loans and Tranche D Term Loans, respectively, as
provided in paragraph (i) above, on the date specified in Section 5.2(a) for
such prepayment, give the Administrative Agent telephonic notice (promptly
confirmed in writing) requesting that the Administrative Agent prepare and
provide to each Tranche B Lender, Tranche C Lender and Tranche D Lender a notice
(each, a "Prepayment Option Notice") as described below. As promptly as
------------------------
practicable after such notice, the Administrative Agent will send to each
Tranche B Lender, Tranche C Lender and Tranche D Lender a Prepayment Option
Notice, which shall be in the form of Exhibit H-1, H-2 or H-3, as applicable,
and shall include an offer by the Borrower to prepay on a specified date (each a
"Mandatory Prepayment Date"), which shall not be less than 20 days or more than
-------------------------
25 days after the date of the Prepayment Option Notice, the Term Loans of such
Lender by an amount equal to the portion of the Prepayment Amount indicated in
such Lender's Prepayment Option Notice as being applicable to such Lender and
such Lender's Tranche B Term Loans,
<PAGE>
40
Tranche C Term Loans and Tranche D Term Loans, respectively. On the Mandatory
Prepayment Date, (A) the Borrower shall pay to the Administrative Agent the
aggregate amount necessary to prepay that portion of the outstanding Term Loans
in respect of which Tranche B Lenders, Tranche C Lenders and Tranche D Lenders
have accepted prepayment as described above (such Lenders, the "Accepting
---------
Lenders"), and such amount shall be applied pro rata to reduce the Tranche B
------- --- ----
Repayment Amounts, Tranche C Repayment Amounts or Tranche D Repayment Amounts,
as applicable, with respect to each Accepting Lender, (B) the Borrower shall pay
to the Administrative Agent an amount equal to 50% of the portion of the
Tranche B Prepayment Amount, Tranche C Prepayment Amount and Tranche D
Prepayment Amount not accepted by the Accepting Lenders, and such amount shall
be applied to reduce the Tranche A Repayment Amounts in the manner described in
paragraph (iii) below, and (C) the Borrower shall be entitled to retain the
remaining 50% of the portion of the Tranche B Prepayment Amount, Tranche C
Prepayment Amount and Tranche D Prepayment Amount not accepted by the Accepting
Lenders; provided, however, that in the event of any Prepayment Event that is a
-------- -------
Permitted Mortgage Financing, (x) the Borrower shall, in lieu of complying with
the provisions of clause (B) above, pay to the Administrative Agent an amount
equal to 75% of the portion of the Tranche B Repayment Amount, Tranche C
Repayment Amount and Tranche D Repayment Amount not accepted by the Accepting
Lenders in respect of such Permitted Mortgage Financing, and such amount shall
be applied to reduce the Tranche A Repayment Amounts in the manner described in
paragraph (iii) below, and (y) the Borrower shall be entitled to retain the
remaining 25% of the portion of the Tranche B Prepayment Amount, Tranche C
Prepayment Amount and Tranche D Prepayment Amount not accepted by the Accepting
Lenders.
(iii) An amount equal to each prepayment of Tranche A Term Loans
required by this Section 5.2 (including any such prepayment required by the
provisions of paragraph (ii) above) shall be applied (A) first, to reduce, in
-----
such order as the Borrower may determine, the Tranche A Repayment Amounts due on
any Tranche A Repayment Date occurring within the two-year period commencing on
the date of such prepayment and (B) second, pro rata to reduce the remaining
------ --- ----
Tranche A Repayment Amounts.
(d) Application to Term Loans. With respect to each prepayment of
-------------------------
Term Loans required by Section 5.2(a), the Borrower may designate the Types of
Loans that are to be prepaid and the specific Borrowing(s) pursuant to which
made, provided that (i) Eurodollar Term Loans may be designated for prepayment
--------
pursuant to this Section 5.2 only on the last day of an Interest Period
applicable thereto unless all Eurodollar Term Loans with Interest Periods ending
on such date of required prepayment and all ABR Term Loans have been paid in
full; and (ii) if any prepayment of Eurodollar Term Loans made pursuant to a
single Borrowing shall reduce the outstanding Term Loans made pursuant to such
Borrowing to an amount less than the Minimum Borrowing Amount for Eurodollar
Term Loans, such Borrowing shall immediately be converted into ABR Loans. In
the absence of a designation by the Borrower as described in the preceding
sentence, the Administrative Agent shall, subject to the above, make such
designation in its reasonable discretion with a view, but no obligation, to
minimize breakage costs owing under Section 2.11.
(e) Application to Revolving Credit Loans. With respect to each
-------------------------------------
prepayment of Revolving Credit Loans required by Section 5.2(b), the Borrower
may designate the Types of Loans that are to be prepaid and the specific
Borrowing(s) pursuant to which made, provided that (i) Eurodollar Revolving
--------
Credit Loans may be designated for prepayment pursuant to this Section 5.2 only
on the last day of an Interest Period applicable thereto unless all Eurodollar
Revolving Credit Loans with Interest Periods ending on such date of required
prepayment and all ABR Loans have been paid in full; (ii) if any prepayment of
Eurodollar Revolving Credit Loans made pursuant to a single Borrowing shall
reduce the outstanding Revolving Credit Loans made pursuant to such Borrowing to
an amount less than the Minimum Borrowing Amount for Eurodollar Revolving Credit
Loans, such Borrowing shall immediately be converted into ABR Loans; (iii) each
prepayment of any Loans made pursuant to a Borrowing shall be applied pro rata
--- ----
among such Loans; and (iv) notwithstanding the provisions of the preceding
clause (iii), no prepayment made pursuant to Section 5.2(b) of Revolving Credit
Loans shall be applied to the Revolving Credit Loans of any Defaulting Lender.
In the absence of a designation by the Borrower as described in the preceding
sentence, the Administrative Agent shall, subject to the above, make such
designation in its reasonable discretion with a view, but no obligation, to
minimize breakage costs owing under Section 2.11.
<PAGE>
41
(f) Eurodollar Interest Periods. In lieu of making any payment
---------------------------
pursuant to this Section 5.2 in respect of any Eurodollar Loan other than on the
last day of the Interest Period therefor, so long as no Default or Event of
Default shall have occurred and be continuing, the Borrower at its option may
deposit with the Administrative Agent an amount equal to the amount of the
Eurodollar Loan to be prepaid and such Eurodollar Loan shall be repaid on the
last day of the Interest Period therefor in the required amount. Such deposit
shall be held by the Administrative Agent in a corporate time deposit account
established on terms reasonably satisfactory to the Administrative Agent,
earning interest at the then-customary rate for accounts of such type. Such
deposit shall constitute cash collateral for the Obligations, provided that the
--------
Borrower may at any time direct that such deposit be applied to make the
applicable payment required pursuant to this Section 5.2.
(g) Minimum Amount. No prepayment shall be required pursuant to
--------------
Section 5.2(a) during any year unless and until the amount of all Net Cash
Proceeds from all Prepayment Events during such year not prepaid pursuant to
this Section 5.2 exceeds $15,000,000 in the aggregate.
5.3 Method and Place of Payment. (a) Except as otherwise
---------------------------
specifically provided herein, all payments under this Agreement shall be made,
without set-off, counterclaim or deduction of any kind, to the Administrative
Agent for the ratable account of the Lenders entitled thereto, the Letter of
Credit Issuer or Chemical, as the case may be, not later than 12:00 Noon (New
York time) on the date when due and shall be made in immediately available funds
and in lawful money of the United States of America at the Administrative
Agent's Office, it being understood that written or facsimile notice by the
Borrower to the Administrative Agent to make a payment from the funds in the
Borrower's account at the Administrative Agent's Office shall constitute the
making of such payment to the extent of such funds held in such account. The
Administrative Agent will thereafter cause to be distributed on the same day (if
payment was actually received by the Administrative Agent prior to 2:00 P.M.
(New York time) on such day) like funds relating to the payment of principal or
interest or Fees ratably to the Lenders entitled thereto.
(b) Any payments under this Agreement that are made later than
2:00 P.M. (New York time) shall be deemed to have been made on the next
succeeding Business Day. Whenever any payment to be made hereunder shall be
stated to be due on a day that is not a Business Day, the due date thereof shall
be extended to the next succeeding Business Day and, with respect to payments of
principal, interest shall be payable during such extension at the applicable
rate in effect immediately prior to such extension.
5.4 Net Payments. (a) All payments made by the Borrower under this
------------
Agreement shall be made free and clear of, and without deduction or withholding
for or on account of, any current or future income, stamp or other taxes,
levies, imposts, duties, charges, fees, deductions or withholdings, now or
hereafter imposed, levied, collected, withheld or assessed by any Governmental
Authority, excluding (i) net income taxes and franchise taxes (imposed in lieu
of net income taxes) imposed on the Administrative Agent or any Lender and
(ii) any taxes imposed on the Administrative Agent or any Lender as a result of
a current or former connection between the Administrative Agent or such Lender
and the jurisdiction of the Governmental Authority imposing such tax or any
political subdivision or taxing authority thereof or therein (other than any
such connection arising solely from the Administrative Agent or such Lender
having executed, delivered or performed its obligations or received a payment
under, or enforced, this Agreement). If any such non-excluded taxes, levies,
imposts, duties, charges, fees, deductions or withholdings ("Non-Excluded
------------
Taxes") are required to be withheld from any amounts payable to the
-----
Administrative Agent or any Lender hereunder, the amounts so payable to the
Administrative Agent or such Lender shall be increased to the extent necessary
to yield to the Administrative Agent or such Lender (after payment of all Non-
Excluded Taxes) interest or any such other amounts payable hereunder at the
rates or in the amounts specified in this Agreement; provided, however, that the
-------- -------
Borrower shall not be required to increase any such amounts payable to any
Lender that is not organized under the laws of the United States of America or a
state thereof if such Lender fails to comply with the requirements of paragraph
(b) of this Section 5.4. Whenever any Non-Excluded Taxes are payable by the
Borrower, as promptly as possible thereafter the Borrower shall send to the
Administrative Agent for its own account or for the account of such Lender, as
the case may be, a certified copy of an original official receipt received by
the Borrower showing payment thereof. If the Borrower fails to pay any Non-
Excluded Taxes when due to the appropriate taxing authority or fails to remit to
the Administrative Agent the required receipts or other required documentary
evidence, the Borrower
<PAGE>
42
shall indemnify the Administrative Agent and the Lenders for any incremental
taxes, interest, costs or penalties that may become payable by the
Administrative Agent or any Lender as a result of any such failure. The
agreements in this Section 5.4(a) shall survive the termination of this
Agreement and the payment of the Loans and all other amounts payable hereunder.
(b) Each Lender that is not incorporated or organized under the laws
of the United States of America or a state thereof shall:
(i) deliver to the Borrower and the Administrative Agent two copies
of either United States Internal Revenue Service Form 1001 or Form 4224 or,
in the case of Non-U.S. Lender claiming exemption from U.S. Federal
withholding tax under Section 871(h) or 881(c) of the Code with respect to
payments of "portfolio interest", a Form W-8, or any subsequent versions
thereof or successors thereto (and, if such Non-U.S. Lender delivers a
Form W-8, a certificate representing that such Non-U.S. Lender is not a
bank for purposes of Section 881(c) of the Code, is not a 10-percent
shareholder (within the meaning of Section 871(h)(3)(B) of the Code) of the
Borrower and is not a controlled foreign corporation related to the
Borrower (within the meaning of Section 864(d)(4) of the Code)), properly
completed and duly executed by such Non-U.S. Lender claiming complete
exemption from, or reduced rate of, U.S. Federal withholding tax on
payments by the Borrower under this Agreement;
(ii) deliver to the Borrower and the Administrative Agent two
further copies of any such form or certification on or before the date that
any such form or certification expires or becomes obsolete and after the
occurrence of any event requiring a change in the most recent form
previously delivered by it to the Borrower; and
(iii) obtain such extensions of time for filing and complete such
forms or certifications as may reasonably be requested by the Borrower or
the Administrative Agent;
unless in any such case any change in treaty, law or regulation has occurred
prior to the date on which any such delivery would otherwise be required that
renders any such form inapplicable or would prevent such Lender from duly
completing and delivering any such form with respect to it and such Lender so
advises the Borrower and the Administrative Agent. Each Person that shall
become a Participant pursuant to Section 13.6 or a Lender pursuant to Section
13.6 shall, upon the effectiveness of the related transfer, be required to
provide all the forms and statements required pursuant to this Section 5.4(b),
provided that in the case of a Participant such Participant shall furnish all
such required forms and statements to the Lender from which the related
participation shall have been purchased.
(c) The Borrower shall not be required to indemnify any Non-U.S.
Lender, or to pay any additional amounts to any Non-U.S. Lender, in respect of
U.S. Federal withholding tax pursuant to paragraph (a) above to the extent that
(i) the obligation to withhold amounts with respect to U.S. Federal withholding
tax existed on the date such Non-U.S. Lender became a party to this Agreement
(or, in the case of a Non-U.S. Participant, on the date such Participant became
a Participant hereunder); provided, however, that this clause (i) shall not
-------- -------
apply to the extent that (x) the indemnity payments or additional amounts any
Lender (or Participant) would be entitled to receive (without regard to this
clause (i)) do not exceed the indemnity payment or additional amounts that the
person making the assignment, participation or transfer to such Lender (or
Participant) would have been entitled to receive in the absence of such
assignment, participation or transfer, or (y) such assignment, participation or
transfer had been requested by the Borrower, (ii) the obligation to pay such
additional amounts would not have arisen but for a failure by such Non-U.S.
Lender or Non-U.S. Participant to comply with the provisions of paragraph (b)
above or (iii) any of the representations or certifications made by a Non-U.S.
Lender or Non-U.S. Participant pursuant to paragraph (b) above are incorrect at
the time a payment hereunder is made, other than by reason of any change in
treaty, law or regulation having effect after the date such representations or
certifications were made.
(d) If the Borrower determines in good faith that a reasonable basis
exists for contesting any taxes for which indemnification has been demanded
hereunder, the relevant Lender or the Administrative Agent,
<PAGE>
43
as applicable, shall cooperate with the Borrower in challenging such taxes at
the Borrower's expense if so requested by the Borrower. If any Lender or the
Administrative Agent, as applicable, receives a refund of a tax for which a
payment has been made by the Borrower pursuant to this Agreement, which refund
in the good faith judgment of such Lender or Administrative Agent, as the case
may be, is attributable to such payment made by the Borrower, then the Lender or
the Administrative Agent, as the case may be, shall reimburse the Borrower for
such amount as the Lender or Administrative Agent, as the case may be,
determines to be the proportion of the refund as will leave it, after such
reimbursement, in no better or worse position than it would have been in if the
payment had not been required. A Lender or Administrative Agent shall claim any
refund that it determines is available to it, unless it concludes in its
reasonable discretion that it would be adversely affected by making such a
claim. Neither the Lender nor the Administrative Agent shall be obliged to
disclose any information regarding its tax affairs or computations to the
Borrower in connection with this paragraph (d) or any other provision of this
Section 5.4.
(e) Each Lender represents and agrees that, on the date hereof and at
all times during the term of this Agreement, it is not and will not be a conduit
entity participating in a conduit financing arrangement (as defined in Section
7701(1) of the Code and the regulations thereunder) with respect to the
Borrowings hereunder unless the Borrower has consented to such arrangement prior
thereto.
5.5 Computations of Interest and Fees. (a) Interest on Eurodollar
---------------------------------
Loans and, except as provided in the next succeeding sentence, ABR Loans shall
be calculated on the basis of a 360-day year for the actual days elapsed.
Interest on ABR Loans in respect of which the rate of interest is calculated on
the basis of the Prime Rate and interest on overdue interest shall be calculated
on the basis of a 365- (or 366-, as the case may be) day year for the actual
days elapsed.
(b) Fees and Letter of Credit Outstandings shall be calculated on the
basis of a 365- (or 366-, as the case may be) day year for the actual days
elapsed.
SECTION 6. Conditions Precedent to Initial Borrowing.
-----------------------------------------
The initial Borrowing under this Agreement is subject to the
satisfaction of the following conditions precedent:
6.1 Credit Documents. The Administrative Agent shall have
----------------
received (a) this Agreement, executed and delivered by a duly authorized
officer of the Borrower and each Lender, (b) the Guarantee, executed and
delivered by a duly authorized officer of each Guarantor, (c) the Pledge
Agreement, executed and delivered by each pledgor party thereto and (d) all
certificates representing securities pledged under the Pledge Agreement,
accompanied by instruments of transfer and stock powers endorsed in blank.
6.2 Closing Certificate. The Administrative Agent shall have
-------------------
received a certificate of each Credit Party, dated the Closing Date,
substantially in the form of Exhibit G, with appropriate insertions,
executed by the President or any Vice President and the Secretary or any
Assistant Secretary of such Credit Party, and attaching the documents
referred to in Sections 6.3 and 6.4.
6.3 Corporate Proceedings of Each Credit Party. The
------------------------------------------
Administrative Agent shall have received a copy of the resolutions, in form
and substance satisfactory to the Administrative Agent, of the Board of
Directors of each Credit Party (or a duly authorized committee thereof)
authorizing (a) the execution, delivery and performance of the Credit
Documents to which it is a party and (b) in the case of the Borrower, the
extensions of credit contemplated hereunder.
6.4 Corporate Documents. The Administrative Agent shall
-------------------
have received true and complete copies of the certificate of incorporation
and by-laws of each Credit Party.
<PAGE>
44
6.5 No Material Adverse Change. There shall have been no
--------------------------
material adverse change in the business, assets, operations, properties,
financial condition or prospects of the Borrower and its Subsidiaries taken
as a whole since July 2, 1994, except as disclosed in the Borrower's
prospectus dated August 10, 1995, as supplemented by the prospectus
supplement dated as of August 10, 1995, relating to the sale of the
Subordinated Notes.
6.6 Fees. The Administrative Agent shall have received the fees
----
referred to in Section 4.1(e) to be received on the Closing Date.
6.7 Equity Contributions. The Equity Contribution shall have
--------------------
been made or shall be made simultaneously with the making of the initial
Loans.
6.8 Merger. (i) The Merger shall have been consummated, or
------
shall be consummated simultaneously with the making of the initial Loans,
in accordance with applicable law and the Merger Agreement,
(ii) approximately 94.70% of the shares of Borrower Common Stock
outstanding immediately prior to the Merger shall have been converted into
the right to receive approximately $880,000,000 in cash in the aggregate,
(iii) approximately 5.30% of the shares of Borrower Common Stock
outstanding immediately prior to the Merger, representing approximately
16.67% of the shares of Borrower Common Stock expected to be outstanding
immediately after the Merger shall have been converted into the right to
retain shares of Borrower Common Stock, (iv) the Partnership shall have
received shares representing approximately 83.33% of the Borrower Common
Stock expected to be outstanding immediately after the Merger and (v) the
Lenders shall (a) be reasonably satisfied with the capitalization,
structure and equity ownership of the Borrower and its subsidiaries (it
being agreed that such capitalization, structure and ownership on the date
hereof are satisfactory) and (b) be reasonably satisfied that the aggregate
level of fees and expenses to be paid in connection with the Merger, the
financing therefor and the other transactions contemplated hereby shall not
exceed $75,000,000. The Merger Agreement shall not have been amended in
any material respect that is, in the reasonable judgment of the
Administrative Agent, adverse to the interests of the Lenders, since
June 22, 1995.
6.9 Other Indebtedness. After giving effect to the Merger and
------------------
the other transactions contemplated hereby, the Borrower and its
Subsidiaries shall have outstanding no Indebtedness or preferred stock
other than (a) the extensions of credit under this Agreement, (b) the
Subordinated Notes and (c) the Indebtedness listed on Schedule 10.2.
6.10 Closing Date Balance Sheet. The Lenders shall have received
--------------------------
a pro forma consolidated closing balance sheet of the Borrower, dated the
--- -----
Closing Date and reasonably satisfactory to the Lenders.
6.11 Solvency Letter. The Lenders shall have received a solvency
---------------
letter from Murray, Devine & Co., in form and substance reasonably
satisfactory to the Lenders, as to the solvency of the Borrower and its
Subsidiaries on a consolidated basis after giving effect to the Merger, the
making of the initial Loans and the consummation of the other transactions
contemplated hereby, together with such other evidence of solvency
reasonably requested by the Lenders.
6.12 Required Approvals. All requisite material governmental
------------------
authorities and third parties shall have approved or consented to the
Merger and the other transactions contemplated hereby to the extent
required, all applicable appeal periods shall have expired and there shall
be no governmental or judicial action, actual or threatened, that has or
could have a reasonable likelihood of restraining, preventing or imposing
burdensome conditions on the Merger or the other transactions contemplated
hereby.
6.13 Existing Indebtedness of the Borrower. The Administrative
-------------------------------------
Agent shall have received satisfactory evidence that the Senior Notes shall
have been prepaid pursuant to the note
<PAGE>
45
purchase agreement for such Senior Notes, that any amounts owing in respect
of such Senior Notes by the Borrower shall have been (or shall upon the
occurrence of the Closing Date be) paid in full.
6.14 Legal Opinions. The Administrative Agent shall have
--------------
received, with a counterpart for each Lender, the executed legal opinions
of (a) Simpson Thacher & Bartlett, special New York counsel to the
Borrower, substantially in the form of Exhibit E-1, and (b) Sirote &
Permutt, Alabama counsel to the Borrower, substantially in the form of
Exhibit E-2, and the Borrower hereby instructs such counsel to deliver such
legal opinions.
6.15 Audited Financial Statements. The Administrative Agent
----------------------------
shall have received the consolidated balance sheets of the Borrower and its
Subsidiaries for the fiscal period ended July 2, 1994, and the related
consolidated statements of income and retained earnings and of cash flows
for such fiscal period and certified by Arthur Anderson & Co. whose opinion
shall not be qualified as to the scope of the audit or as to the status of
the Borrower or any of the Specified Subsidiaries as a going concern.
6.16 Environmental and Safety Conditions. The Lenders shall be
-----------------------------------
reasonably satisfied as to the amount and nature of any environmental and
employee health and safety exposures to which the Borrower and the
Subsidiaries may be subject and the plans of the Borrower with respect
thereto.
6.17 Subordinated Notes. The Borrower shall have received gross
------------------
proceeds of not less than $400,000,000 from the sale at par of the
Subordinated Notes.
SECTION 7. Conditions Precedent to All Credit Events. The
-----------------------------------------
agreement of each Lender to make any Loan requested to be made by it on any date
(including, without limitation, its initial Loan, but excluding Mandatory
Borrowings) and the obligation of the Letter of Credit Issuer to issue Letters
of Credit on any date is subject to the satisfaction of the following conditions
precedent:
7.1 No Default; Representations and Warranties. At the time of
------------------------------------------
each Credit Event and also after giving effect thereto (a) there shall
exist no Default or Event of Default and (b) all representations and
warranties made by any Credit Party contained herein or in the other Credit
Documents shall be true and correct in all material respects with the same
effect as though such representations and warranties had been made on and
as of the date of such Credit Event (except where such representations and
warranties expressly relate to an earlier date, in which case such
representations and warranties shall have been true and correct in all
material respects as of such earlier date).
7.2 Notice of Borrowing; Letter of Credit Request. (a) Prior
---------------------------------------------
to the making of each Term Loan, each Revolving Credit Loan (other than any
Revolving Credit Loan made pursuant to Section 3.4(a)) and each Swingline
Loan, the Administrative Agent shall have received a Notice of Borrowing
(whether in writing or by telephone) meeting the requirements of Section
2.3.
(b) Prior to the issuance of each Letter of Credit, the
Administrative Agent and the Letter of Credit Issuer shall have
received a Letter of Credit Request meeting the requirements of
Section 3.2(a).
The acceptance of the benefits of each Credit Event shall constitute a
representation and warranty by each Credit Party to each of the Lenders
that all the applicable conditions specified above exist as of that time.
SECTION 8. Representations, Warranties and Agreements. In order
------------------------------------------
to induce the Lenders to enter into this Agreement, to make the Loans and issue
or participate in Letters of Credit as provided for herein, the Borrower makes
the following representations and warranties to, and agreements with, the
Lenders,
<PAGE>
46
all of which shall survive the execution and delivery of this Agreement and the
making of the Loans and the issuance of the Letters of Credit:
8.1 Corporate Status. Each Credit Party (a) is a duly organized and
----------------
validly existing corporation or other entity in good standing under the laws of
the jurisdiction of its organization and has the corporate or other
organizational power and authority to own its property and assets and to
transact the business in which it is engaged and (b) has duly qualified and is
authorized to do business and is in good standing in all jurisdictions where it
is required to be so qualified, except where the failure to be so qualified
could not reasonably be expected to result in a Material Adverse Effect.
8.2 Corporate Power and Authority. Each Credit Party has the
-----------------------------
corporate power and authority to execute, deliver and carry out the terms and
provisions of the Credit Documents to which it is a party and has taken all
necessary corporate action to authorize the execution, delivery and performance
of the Credit Documents to which it is a party. Each Credit Party has duly
executed and delivered each Credit Document to which it is a party and each such
Credit Document constitutes the legal, valid and binding obligation of such
Credit Party enforceable in accordance with its terms, except as the
enforceability thereof may be limited by bankruptcy, insolvency or similar laws
affecting creditors' rights generally and subject to general principles of
equity.
8.3 No Violation. Neither the execution, delivery and performance by
------------
any Credit Party of the Credit Documents to which it is a party nor compliance
with the terms and provisions thereof nor the consummation of the Merger and the
other transactions contemplated therein will (a) contravene any applicable
provision of any material law, statute, rule, regulation, order, writ,
injunction or decree of any court or governmental instrumentality, (b) result
in any breach of any of the terms, covenants, conditions or provisions of, or
constitute a default under, or result in the creation or imposition of (or the
obligation to create or impose) any Lien upon any of the property or assets of
the Borrower or any of its Subsidiaries pursuant to the terms of any material
indenture, loan agreement, lease agreement, mortgage, deed of trust, agreement
or other material instrument to which the Borrower or any of its Subsidiaries is
a party or by which it or any of its property or assets is bound or (c) violate
any provision of the charter or By-Laws of the Borrower or any of its
Subsidiaries.
8.4 Litigation. Except as set forth in the Recent SEC Documents (as
----------
such term is defined in the Merger Agreement), in the Borrower's Form 10-K for
the fiscal year ended July 2, 1994, or in the Borrower's Form 10-Q for the
fiscal quarter ended April 8, 1995, in each case as filed with the Securities
and Exchange Commission (the "SEC"), there are no actions, suits or proceedings
---
(including, without limitation, Environmental Claims) pending or, to the
knowledge of the Borrower, threatened with respect to the Borrower or any of its
Subsidiaries that could reasonably be expected to result in a Material Adverse
Effect.
8.5 Margin Regulations. Neither the making of any Loan hereunder nor
------------------
the use of the proceeds thereof will violate the provisions of Regulation G, T,
U or X of the Board.
8.6 Governmental Approvals. No order, consent, approval, license,
----------------------
authorization, or validation of, or filing, recording or registration with, or
exemption by, any foreign or domestic governmental or public body or authority,
or any subdivision thereof, is required to authorize or is required in
connection with (a) the execution, delivery and performance of any Credit
Document or (b) the legality, validity, binding effect or enforceability of any
Credit Document, except any of the foregoing the failure to obtain or make could
not reasonably be expected to have a Material Adverse Effect.
8.7 Investment Company Act. The Borrower is not an "investment
----------------------
company" or a company "controlled" by an "investment company," within the
meaning of the Investment Company Act of 1940, as amended.
8.8 True and Complete Disclosure. (a) All factual information
----------------------------
(taken as a whole) heretofore or contemporaneously furnished by the Borrower or
any of its Subsidiaries in writing to the Administrative Agent and/or any Lender
on or before the Closing Date (including, without limitation, (i) the
Confidential
<PAGE>
47
Information Memorandum and (ii) all information contained in the Credit
Documents) for purposes of or in connection with this Agreement or any
transaction contemplated herein is true and complete in all material respects on
the date as of which such information is dated or certified and not incomplete
by omitting to state any material fact necessary to make such information (taken
as a whole) not misleading at such time in light of the circumstances under
which such information was provided, it being understood and agreed that for
purposes of this Section 8.8(a), such factual information shall not include
projections and pro forma financial information.
(b) The projections and pro forma financial information contained in
the factual information referred to in paragraph (a) above were based on good
faith estimates and assumptions believed by such Persons to be reasonable at the
time made, it being recognized by the Lenders that such projections as to future
events are not to be viewed as facts and that actual results during the period
or periods covered by any such projections may differ from the projected
results.
8.9 Financial Condition; Financial Statements. The consolidated
-----------------------------------------
balance sheets of the Borrower and its Subsidiaries at July 2, 1994, and the
related consolidated statements of income and cash flows for the twelve-month
period ended as of such date, which statements have been audited by Arthur
Andersen & Co., independent certified public accountants, who delivered an
unqualified opinion with respect thereto, present fairly in all material
respects the consolidated financial position of the Borrower and its
Subsidiaries at the date of said statements and the results of operations for
the period covered thereby. All such financial statements have been prepared in
accordance with GAAP consistently applied except to the extent provided in the
notes to said financial statements. There has been no Material Adverse Change
since July 2, 1994.
8.10 Tax Returns and Payments. Each of the Borrower and its
------------------------
Subsidiaries has filed all federal income tax returns and all other material tax
returns, domestic and foreign, required to be filed by it and has paid all
material taxes and assessments payable by it that have become due, other than
those not yet delinquent or contested in good faith. The Borrower and each of
its Subsidiaries have paid, or have provided adequate reserves (in the good
faith judgment of the management of the Borrower) in accordance with GAAP for
the payment of, all material federal, state and foreign income taxes applicable
for all prior fiscal years and for the current fiscal year to the Closing Date.
8.11 Compliance with ERISA. Each Plan is in compliance with ERISA,
---------------------
the Code and any applicable Requirement of Law; no Reportable Event has occurred
(or is reasonably likely to occur) with respect to any Plan; no Plan is
insolvent or in reorganization (or is reasonably likely to be insolvent or in
reorganization), and no written notice of any such insolvency or reorganization
has been given to the Borrower, any Subsidiary or any ERISA Affiliate; no Plan
(other than a multiemployer plan) has an accumulated or waived funding
deficiency (or is reasonably likely to have such a deficiency); neither the
Borrower nor any Subsidiary nor any ERISA Affiliate has incurred (or is
reasonably likely expected to incur) any liability to or on account of a Plan
pursuant to Section 409, 502(i), 502(l), 515, 4062, 4063, 4064, 4069, 4201 or
4204 of ERISA or Section 4971 or 4975 of the Code or has been notified in
writing that it will incur any liability under any of the foregoing Sections
with respect to any Plan; no proceedings have been instituted (or are reasonably
likely to be instituted) to terminate or to reorganize any Plan or to appoint a
trustee to administer any Plan, and no written notice of any such proceedings
has been given to the Borrower, any Subsidiary or any ERISA Affiliate; and no
lien imposed under the Code or ERISA on the assets of the Borrower or any
Subsidiary or any ERISA Affiliate exists (or is reasonably likely to exist) nor
has the Borrower, any Subsidiary or any ERISA Affiliate been notified in writing
that such a lien will be imposed on the assets of the Borrower, any Subsidiary
or any ERISA Affiliate on account of any Plan, except to the extent that a
------
breach of any of the foregoing representations, warranties or agreements in this
Section 8.11 would not result, individually or in the aggregate, in an amount of
liability that would be reasonably likely to have a Material Adverse Effect. No
Plan (other than a multiemployer plan) has an Unfunded Current Liability that
would, individually or when taken together with any other liabilities referenced
in this Section 8.11, be reasonably likely to have a Material Adverse Effect.
With respect to Plans that are multiemployer plans (as defined in Section 3(37)
of ERISA), the representations and warranties in this Section 8.11, other than
any made with respect to (a) liability under Section 4201 or 4204 of ERISA or
(b) liability for termination or reorganization of such Plans under ERISA, are
made to the best knowledge of the Borrower.
<PAGE>
48
8.12 Subsidiaries. Schedule 8.12 lists each Subsidiary of the
------------
Borrower (and the direct and indirect ownership interest of the Borrower
therein), in each case existing on the Closing Date. To the knowledge of the
Borrower, each Specified Subsidiary as of the Closing Date has been so
designated on Schedule 8.12.
8.13 Patents, etc. The Borrower and each of its Subsidiaries have
-------------
obtained all patents, trademarks, servicemarks, trade names, copyrights,
licenses and other rights, free from burdensome restrictions, that are necessary
for the operation of their respective businesses as currently conducted and as
proposed to be conducted, except where the failure to obtain any such rights
could not reasonably be expected to have a Material Adverse Effect.
8.14 Environmental Laws. (a) Other than instances of noncompliance
------------------
that could not reasonably be expected to have a Material Adverse Effect: (i) the
Borrower and each of its Subsidiaries are in compliance with all Environmental
Laws in all jurisdictions in which the Borrower and each of its Subsidiaries are
currently doing business (including, without limitation, having obtained all
material permits required under Environmental Laws); and (ii) the Borrower will
comply and cause each of its Subsidiaries to comply with all such Environmental
Laws (including, without limitation, all permits required under Environmental
Laws).
(b) Neither the Borrower nor any of its Subsidiaries has treated,
stored, transported or disposed of Hazardous Materials at or from any currently
or formerly owned Real Estate or facility relating to its business in a manner
that could reasonably be expected to have a Material Adverse Effect.
8.15 Properties. The Borrower and each of its Subsidiaries have good
----------
title to or leasehold interest in all properties that are necessary for the
operation of their respective businesses as currently conducted and as proposed
to be conducted, free and clear of all Liens (other than any Liens permitted by
this Agreement) and except where the failure to have such good title could not
reasonably be expected to have a Material Adverse Effect.
SECTION 9. Affirmative Covenants. The Borrower hereby covenants
---------------------
and agrees that on the Closing Date and thereafter, for so long as this
Agreement is in effect and until the Commitments, the Swingline Commitment and
each Letter of Credit have terminated and the Loans and Unpaid Drawings,
together with interest, Fees and all other Obligations incurred hereunder, are
paid in full:
9.1 Information Covenants. The Borrower will furnish to each Lender
---------------------
and the Administrative Agent:
(a) Annual Financial Statements. On or before the date on which such
---------------------------
financial statements are required to be filed with the SEC, the
consolidated balance sheet of the Borrower and its Subsidiaries as at the
end of such fiscal year and the related consolidated statement of income
and retained earnings and of cash flows for such fiscal year, setting forth
comparative consolidated figures for the preceding fiscal year, and
certified by independent certified public accountants of recognized
national standing whose opinion shall not be qualified as to the scope of
audit or as to the status of the Borrower or any of the Specified
Subsidiaries as a going concern, together in any event with a certificate
of such accounting firm stating that in the course of its regular audit of
the business of the Borrower, which audit was conducted in accordance with
generally accepted auditing standards, such accounting firm has obtained no
knowledge of any Default or Event of Default relating to accounting matters
that has occurred and is continuing or, if in the opinion of such
accounting firm such a Default or Event of Default has occurred and is
continuing, a statement as to the nature thereof.
(b) Quarterly Financial Statements. As soon as available and in any
------------------------------
event on or before the date on which such financial statements are
required to be filed with the SEC with respect to each of the first three
quarterly accounting periods in each fiscal year of the Borrower, the
consolidated balance sheet of the Borrower and its Subsidiaries as at the
end of such quarterly period and the related consolidated statement of
income for such quarterly accounting period and for the elapsed portion of
the
<PAGE>
49
fiscal year ended with the last day of such quarterly period, and the
related consolidated statement of cash flows for the elapsed portion of the
fiscal year ended with the last day of such quarterly period, and setting
forth comparative consolidated figures for the related periods in the prior
fiscal year or, in the case of such consolidated balance sheet, for the
last day of the prior fiscal year, all of which shall be certified by an
Authorized Officer of the Borrower, subject to changes resulting from audit
and normal year-end audit adjustments.
(c) Monthly Financial Statements. As soon as available and in any
----------------------------
event within 30 days after the close of each fiscal month of the Borrower,
commencing with February 1996, the consolidated statement of income for
such fiscal month and for the elapsed portion of the fiscal year ended with
the last day of such fiscal month, and the related consolidated statement
of cash flows for the elapsed portion of the fiscal year ended with the
last day of such fiscal month, and setting forth comparative consolidated
figures for the related fiscal month or months in the prior fiscal year,
all of which shall be in the format prepared by management of the Borrower
for its internal use.
(d) Budgets. Within 60 days after the commencement of each fiscal
-------
year of the Borrower, budgets of the Borrower in reasonable detail for the
fiscal year as customarily prepared by management of the Borrower for its
internal use, setting forth the principal assumptions upon which such
budgets are based.
(e) Officer's Certificates. At the time of the delivery of the
----------------------
financial statements provided for in Section 9.1(a) and (b), a certificate
of an Authorized Officer of the Borrower to the effect that no Default or
Event of Default exists or, if any Default or Event of Default does exist,
specifying the nature and extent thereof, which certificate shall set forth
(i) the calculations required to establish whether the Borrower and its
Subsidiaries were in compliance with the provisions of Sections 10.9,
10.10, 10.11 and 10.12 as at the end of such fiscal year or period, as the
case may be, (ii) a specification of any change in the identity of the
Subsidiaries and the Specified Subsidiaries as at the end of such fiscal
year or period, as the case may be, from the Subsidiaries and the Specified
Subsidiaries, respectively, provided to the Lenders on the Closing Date or
the most recent fiscal year or period, as the case may be and (iii) the
Status that is effective on the date of such delivery.
(f) Notice of Default or Litigation. Promptly after an Authorized
-------------------------------
Officer of the Borrower or any of its Subsidiaries obtains knowledge
thereof, notice of (i) the occurrence of any event that constitutes a
Default or Event of Default, which notice shall specify the nature thereof,
the period of existence thereof and what action the Borrower proposes to
take with respect thereto and (ii) any litigation or governmental
proceeding pending against the Borrower or any of its Subsidiaries that
could reasonably be expected to result in a Material Adverse Effect.
(g) Environmental Matters. The Borrower will promptly advise the
---------------------
Lenders in writing after obtaining knowledge of any one or more of the
following environmental matters, unless such environmental matters would
not, individually or when aggregated with all other such matters, be
reasonably expected to result in a Material Adverse Effect:
(i) Any pending or threatened Environmental Claim against the
Borrower or any of its Subsidiaries or any Real Estate;
(ii) Any condition or occurrence on any Real Estate that (x)
results in noncompliance by the Borrower or any of its Subsidiaries
with any applicable Environmental Law or (y) could reasonably be
anticipated to form the basis of an Environmental Claim against the
Borrower or any of its subsidiaries or any Real Estate;
(iii) Any condition or occurrence on any Real Estate that could
reasonably be anticipated to cause such Real Estate to be subject to
any restrictions on the ownership, occupancy, use or transferability
of such Real Estate under any Environmental Law; and
<PAGE>
50
(iv) The taking of any removal or remedial action in response
to the actual or alleged presence of any Hazardous Material on any
Real Estate.
All such notices shall describe in reasonable detail the nature of the
claim, investigation, condition, occurrence or removal or remedial action
and the Borrower's response thereto.
(h) Other Information. Promptly upon filing thereof, copies of any
-----------------
filings on Form 10-K, 10-Q or 8-K or registrations with, and reports to,
the SEC by the Borrower or any of its Subsidiaries (other than amendments
to any registration statement (to the extent such registration statement,
in the form it becomes effective, is delivered to the Lenders), exhibits to
any registration statement and any registration statements on Form S-8) and
copies of all financial statements, proxy statements, notices and reports
that the Borrower or any of its Subsidiaries shall send to the holders of
any publicly issued debt of the Borrower and/or any of its Subsidiaries in
their capacity as such holders (in each case to the extent not theretofore
delivered to the Lenders pursuant to this Agreement) and, with reasonable
promptness, such other information (financial or otherwise) as the
Administrative Agent on its own behalf or on behalf of any Lender may
reasonably request in writing from time to time.
9.2 Books, Records and Inspections. The Borrower will, and will
------------------------------
cause each of the Specified Subsidiaries to, permit officers and designated
representatives of the Administrative Agent or the Required Lenders to visit and
inspect any of the properties or assets of the Borrower and any of its
Subsidiaries in whomsoever's possession to the extent that it is within the
Borrower's or such Subsidiary's control to permit such inspection, and to
examine the books of account of the Borrower and any of its Subsidiaries and
discuss the affairs, finances and accounts of the Borrower and of any of its
Subsidiaries with, and be advised as to the same by, its and their officers and
independent accountants, all at such reasonable times and intervals and to such
reasonable extent as the Administrative Agent or the Required Lenders may
desire.
9.3 Maintenance of Insurance. The Borrower will, and will cause each
------------------------
of the Specified Subsidiaries to, at all times maintain in full force and effect
insurance in such amounts, covering such risks and liabilities and with such
deductibles or self-insured retentions as are in accordance with normal industry
practice.
9.4 Payment of Taxes. The Borrower will pay and discharge, and will
----------------
cause each of its Subsidiaries to pay and discharge, all material taxes,
assessments and governmental charges or levies imposed upon it or upon its
income or profits, or upon any properties belonging to it, prior to the date on
which material penalties attach thereto, and all lawful material claims that, if
unpaid, could reasonably be expected to become a material Lien upon any
properties of the Borrower or any of the Specified Subsidiaries, provided that
--------
neither the Borrower nor any of its Subsidiaries shall be required to pay any
such tax, assessment, charge, levy or claim that is being contested in good
faith and by proper proceedings if it has maintained adequate reserves (in the
good faith judgment of the management of the Borrower) with respect thereto in
accordance with GAAP.
9.5 Consolidated Corporate Franchises. The Borrower will do, and
---------------------------------
will cause each Specified Subsidiary to do, or cause to be done, all things
necessary to preserve and keep in full force and effect its existence, corporate
rights and authority, except to the extent that the failure to do so could
reasonably be expected to have a Material Adverse Effect; provided, however,
-------- -------
that the Borrower and its Subsidiaries may consummate any transaction permitted
under Section 10.4 or 10.5.
9.6 Compliance with Statutes, Obligations, etc. The Borrower will,
-------------------------------------------
and will cause each Subsidiary to, comply with all applicable laws, rules,
regulations and orders, except to the extent the failure to do so could not
reasonably be expected to have a Material Adverse Effect.
9.7 ERISA. Promptly after the Borrower or any Subsidiary or any
-----
ERISA Affiliate knows or has reason to know of the occurrence of any of the
following events that, individually or in the aggregate (including in the
aggregate such events previously disclosed or exempt from disclosure hereunder,
to the extent the liability therefor remains outstanding), would be reasonably
likely to have a Material Adverse Effect, the
<PAGE>
51
Borrower will deliver to each of the Lenders a certificate of an Authorized
Officer or any other senior officer of the Borrower setting forth details as to
such occurrence and the action, if any, that the Borrower, such Subsidiary or
such ERISA Affiliate is required or proposes to take, together with any notices
(required, proposed or otherwise) given to or filed with or by the Borrower,
such Subsidiary, such ERISA Affiliate, the PBGC, a Plan participant (other than
notices relating to an individual participant's benefits) or the Plan
administrator with respect thereto: that a Reportable Event has occurred; that
an accumulated funding deficiency has been incurred or an application is to be
made to the Secretary of the Treasury for a waiver or modification of the
minimum funding standard (including any required installment payments) or an
extension of any amortization period under Section 412 of the Code with respect
to a Plan; that a Plan having an Unfunded Current Liability has been or is to be
terminated, reorganized, partitioned or declared insolvent under Title IV of
ERISA (including the giving of written notice thereof); that a Plan has an
Unfunded Current Liability that has or will result in a lien under ERISA or the
Code; that proceedings will be or have been instituted to terminate a Plan
having an Unfunded Current Liability (including the giving of written notice
thereof); that a proceeding has been instituted against the Borrower, a
Subsidiary or an ERISA Affiliate pursuant to Section 515 of ERISA to collect a
delinquent contribution to a Plan; that the PBGC has notified the Borrower, any
Subsidiary or any ERISA Affiliate of its intention to appoint a trustee to
administer any Plan; that the Borrower, any Subsidiary or any ERISA Affiliate
has failed to make a required installment or other payment pursuant to Section
412 of the Code with respect to a Plan; or that the Borrower, any Subsidiary or
any ERISA Affiliate has incurred or will incur (or has been notified in writing
that it will incur) any liability (including any contingent or secondary
liability) to or on account of a Plan pursuant to Section 409, 502(i), 502(l),
515, 4062, 4063, 4064, 4069, 4201 or 4204 of ERISA or Section 4971 or 4975 of
the Code.
9.8 Good Repair. The Borrower will, and will cause each of its
-----------
Subsidiaries to, ensure that its properties and equipment used or useful in its
business in whomsoever's possession they may be to the extent that it is within
the Borrower's or such Subsidiary's control to cause same, are kept in good
repair, working order and condition, normal wear and tear excepted, and that
from time to time there are made in such properties and equipment all needful
and proper repairs, renewals, replacements, extensions, additions, betterments
and improvements thereto, to the extent and in the manner customary for
companies in similar businesses and consistent with third party leases, except
in each case to the extent the failure to do so could be reasonably expected to
have a Material Adverse Effect.
9.9 Transactions with Affiliates. The Borrower will conduct, and
----------------------------
cause each of its Subsidiaries to conduct, all transactions with any of its
Affiliates on terms that are substantially as favorable to the Borrower or such
Subsidiary as it would obtain in a comparable arm's-length transaction with a
Person that is not an Affiliate, provided that the foregoing restrictions shall
--------
not apply to (a) the payment of customary annual fees to KKR and its Affiliates
for management, consulting and financial services rendered to the Borrower and
its Subsidiaries, and investment banking fees paid to KKR and its Affiliates for
services rendered to the Borrower and its Subsidiaries in connection with
divestitures, acquisitions, financings and other transactions, (b) customary
fees paid to members of the Board of Directors of the Borrower and its
Subsidiaries and (c) transactions permitted by Section 10.7.
9.10 End of Fiscal Years; Fiscal Quarters. The Borrower will, for
------------------------------------
financial reporting purposes, cause (a) each of its, and each of its
Subsidiaries', fiscal years to end on the Saturday nearest June 30 of each year
and (b) each of its, and each of its Subsidiaries', fiscal quarters to end on
(i) the Saturday 12 weeks after, (ii) the Saturday 26 weeks after and (iii) the
Saturday 40 weeks after, the Saturday nearest June 30 of each year; provided,
--------
however, that the Borrower may, upon written notice to the Administrative Agent,
-------
change the financial reporting convention specified above to any other financial
reporting convention reasonably acceptable to the Administrative Agent, in which
case the Borrower and the Administrative Agent will, and are hereby authorized
by the Lenders to, make any adjustments to this Agreement that are necessary in
order to reflect such change in financial reporting.
9.11 Additional Guarantors. The Borrower will cause any direct or
---------------------
indirect domestic Subsidiary formed or otherwise purchased or acquired after the
date hereof to execute a supplement to the
<PAGE>
52
Guarantee, in form and substance reasonably satisfactory to the Administrative
Agent, in order to become a Guarantor.
9.12 Pledges of Additional Stock and Evidence of Indebtedness. The
--------------------------------------------------------
Borrower will pledge to the Administrative Agent, for the benefit of the
Lenders, (a) all the capital stock of each direct domestic Subsidiary (or 65% of
the capital stock of each direct foreign Subsidiary) formed or otherwise
purchased or acquired after the date hereof, in each case pursuant to a
supplement to the Pledge Agreement in form and substance reasonably satisfactory
to the Administrative Agent, (b) all the capital stock of any direct domestic
Subsidiary (or 65% of the capital of each direct foreign Subsidiary) that is not
a direct Subsidiary on the date hereof but subsequently becomes a direct
Subsidiary, in each case pursuant to a supplement to the Pledge Agreement in
form and substance reasonably satisfactory to the Administrative Agent, and
(c) all evidences of Indebtedness in excess of $5,000,000 received by the
Borrower or any of the direct Subsidiaries in connection with any disposition of
assets pursuant to Section 10.5(b), in each case pursuant to a supplement to the
Pledge Agreement in form and substance reasonably satisfactory to the
Administrative Agent.
9.13 Use of Proceeds. The Borrower will use the Letters of Credit and
---------------
the proceeds of all Loans for the purposes set forth in the introductory
statement to this Agreement.
SECTION 10. Negative Covenants. The Borrower hereby covenants and
------------------
agrees that on the Closing Date and thereafter, for so long as this Agreement is
in effect and until the Commitments, the Swingline Commitment and each Letter of
Credit have terminated and the Loans and Unpaid Drawings, together with
interest, Fees and all other Obligations incurred hereunder, are paid in full:
10.1 Changes in Business. The Borrower and its Subsidiaries taken as
-------------------
a whole will not fundamentally and substantively alter the character of their
business taken as a whole from the business conducted by the Borrower and its
Subsidiaries taken as a whole on the date hereof and other business activities
incidental or related thereto, except that the Borrower and its Subsidiaries may
engage in the Permitted Business and other business activities reasonably
incidental thereto.
10.2 Limitation on Indebtedness. The Borrower will not, and will not
--------------------------
permit any of its Subsidiaries to, create, incur, assume or suffer to exist any
Indebtedness, except:
(a) Indebtedness arising under the Credit Documents;
(b) Indebtedness of (i) the Borrower to any Subsidiary of the Borrower
and (ii) Indebtedness of any Subsidiary to the Borrower or any other
Subsidiary;
(c) Indebtedness in respect of any bankers' acceptance, letter of
credit, warehouse receipt or similar facilities entered into in the
ordinary course of business;
(d) Guarantee Obligations in respect of obligations that are permitted
to be incurred under this Agreement;
(e) Contingent Obligations incurred in the ordinary course of business
in respect of obligations of suppliers, customers, franchisees, lessors and
licensees;
(f) (i) Indebtedness arising under Capital Leases in an aggregate
amount not exceeding $40,000,000 at any time outstanding, (ii) additional
Indebtedness incurred within 270 days of the acquisition, construction or
improvement of fixed or capital assets to finance the acquisition,
construction or improvement of such fixed or capital assets or otherwise
incurred in respect of Capital Expenditures permitted by Section 10.12,
provided that, at any time at which the Consolidated Total Debt to
--------
Consolidated EBITDA Ratio for the most recently ended Test Period is
greater than 4.00:1.00, the aggregate principal amount of any such
additional Indebtedness incurred and remaining outstanding
<PAGE>
53
pursuant to this clause (ii) shall not exceed $100,000,000, and (iii) any
refinancing, refunding, renewal or extension of any Indebtedness specified
in clause (ii) above, provided that the principal amount thereof is not
--------
increased above the principal amount thereof outstanding immediately prior
to such refinancing refunding, renewal or extension;
(g) Indebtedness outstanding on the date hereof and listed on
Schedule 10.2 and any refinancing, refunding, renewal or extension thereof,
provided that (i) the principal amount thereof is not increased above the
--------
principal amount thereof outstanding immediately prior to such refinancing,
refunding, renewal or extension and (ii) the direct and contingent obligors
with respect to such Indebtedness are not changed;
(h) Indebtedness in respect of Hedge Agreements;
(i) Indebtedness in respect of the Subordinated Notes;
(j) Indebtedness incurred in connection with any Permitted Mortgage
Financing;
(k) (i) additional Indebtedness of the Borrower not contemplated by
clauses (a) through (j) above and (ii) any refinancing, refunding, renewal
or extension of any Indebtedness specified in clause (i) above, provided
--------
that (A) the Borrower shall remain the sole direct obligor with respect to
such Indebtedness and (B) the amount of Indebtedness incurred and remaining
outstanding pursuant to this clause (k) shall not at any time exceed
$50,000,000; and
(n) Indebtedness that is incurred in the ordinary course of business
for working capital purposes and matures within one year from the date
incurred, provided that the aggregate principal amount of Indebtedness of
--------
the Borrower and its Subsidiaries incurred pursuant to this clause (n)
shall not exceed $5,000,000 at any time outstanding.
10.3 Limitation on Liens. The Borrower will not, and will not permit
-------------------
any of its Subsidiaries to, create, incur, assume or suffer to exist any Lien
upon any property or assets of any kind (real or personal, tangible or
intangible) of the Borrower or any Subsidiary, whether now owned or hereafter
acquired, except:
(a) Liens arising under the Credit Documents;
(b) Permitted Liens;
(c) Liens securing Indebtedness permitted pursuant to Section 10.2(f),
provided that such Liens attach only to the assets so financed;
--------
(d) Liens existing on the date hereof on assets of the Borrower or any
of its Subsidiaries;
(e) Liens securing Indebtedness incurred in connection with any
Permitted Mortgage Financing;
(f) the replacement, extension or renewal of any Lien permitted by
clauses (a) through (e) above upon or in the same assets theretofore
subject to such Lien or the replacement, extension or renewal (without
increase in the amount or change in any direct or contingent obligor) of
the Indebtedness secured thereby; and
(g) additional Liens securing Indebtedness of the Borrower or any
Subsidiary so long as the aggregate principal amount of the Indebtedness so
secured does not exceed $10,000,000 at any time outstanding.
<PAGE>
54
10.4 Limitation on Fundamental Changes. The Borrower will not, and
---------------------------------
will not permit any of its Subsidiaries to, enter into any merger, consolidation
or amalgamation, or liquidate, wind up or dissolve itself (or suffer any
liquidation or dissolution), or convey, sell, lease, assign, transfer or
otherwise dispose of, all or substantially all its business units, assets or
other properties, except that:
(a) the Borrower may effect the Merger;
(b) so long as no Default or Event of Default would result from the
consummation of any merger or consolidation described in this clause (b),
(i) any Subsidiary of the Borrower or any other Person may be merged or
consolidated with or into the Borrower, provided that the Borrower shall be
--------
the continuing or surviving corporation, and (ii) any Subsidiary of the
Borrower or any other Person may be merged or consolidated with any one or
more other Subsidiaries of the Borrower, provided that, in the case of any
--------
merger or consolidation involving one or more Guarantors, a Guarantor shall
be the continuing or surviving corporation;
(c) any Subsidiary that is not a Guarantor may sell, lease, transfer
or otherwise dispose of any or all of its assets (upon voluntary
liquidation or otherwise) to the Borrower, a Guarantor or any other
Subsidiary of the Borrower; and
(d) any Guarantor may sell, lease, transfer or otherwise dispose of
any or all of its assets (upon voluntary liquidation or otherwise) to the
Borrower or any other Guarantor.
10.5 Limitation on Sale of Assets. The Borrower will not, and will
----------------------------
not permit any of its Subsidiaries to, (i) convey, sell, lease, assign, transfer
or otherwise dispose of any of its property, business or assets (including,
without limitation, receivables and leasehold interests), whether now owned or
hereafter acquired (other than any such sale, transfer, assignment or other
disposition resulting from any casualty or condemnation, of any assets of the
Borrower or its Subsidiaries) or (ii) issue or sell any shares of a Subsidiary's
capital stock to any Person other than the Borrower or a Guarantor, except that:
(a) the Borrower and its Subsidiaries may sell, transfer or otherwise
dispose of used or surplus equipment, vehicles, inventory and other assets
in the ordinary course of business;
(b) the Borrower and its Subsidiaries may sell, transfer or otherwise
dispose of other assets for fair value, provided that (i) the aggregate
--------
amount of such sales, transfers and disposals by the Borrower and its
Subsidiaries taken as a whole pursuant to this clause (b) shall not
exceed the aggregate $225,000,000 during the term of this Agreement and
(ii) any consideration in excess of $5,000,000 received by the Borrower or
any direct Subsidiary in connection with such sales, transfers and other
dispositions of assets pursuant to this clause (b) that is in the form of
Indebtedness shall be pledged to the Administrative Agent pursuant to
Section 9.12;
(c) the Borrower and its Subsidiaries may make sales of assets for
fair value to any Subsidiary of the Borrower;
(d) any Subsidiary may effect any transaction permitted by
Section 10.4; and
(e) the Borrower and its Subsidiaries may sell or discount without
recourse accounts receivable arising in the ordinary course of business in
connection with the compromise or collection thereof.
10.6 Limitation on Investments. The Borrower will not, and will not
-------------------------
permit any of its Subsidiaries to, make any advance, loan, extensions of credit
or capital contribution to, or purchase any stock, bonds, notes, debentures or
other securities of or any assets of, or make any other investment in, any
Person, except:
(a) extensions of trade credit in the ordinary course of business;
<PAGE>
55
(b) Permitted Investments;
(c) loans and advances to officers, directors and employees of the
Borrower or any of its Subsidiaries (i) to finance the purchase of capital
stock of the Borrower and (ii) for additional purposes not contemplated by
clause (i) above in an aggregate principal amount at any time outstanding
with respect to this clause (ii) not exceeding $2,500,000;
(d) investments existing on the date hereof (including the investment
on the date hereof in PM Associates) and any extensions, renewals or
reinvestments thereof, so long as the aggregate amount of all investments
pursuant to this clause (d) is not increased at any time above the amount
of such investments existing on the date hereof;
(e) investments in Hedge Agreements permitted by Section 10.2(h);
(f) investments received in connection with the bankruptcy or
reorganization of suppliers or customers and in settlement of delinquent
obligations of, and other disputes with, customers arising in the ordinary
course of business;
(g) investments payment for which is made solely with capital stock of
the Borrower;
(h) investments constituting non-cash proceeds of sales of assets to
the extent permitted by Section 10.5;
(i) investments by the Borrower or any of its Subsidiaries to the
extent that such investments constitute the proceeds from capital
contributions to the Borrower or issuances of equity securities of the
Borrower;
(j) investments by the Borrower and its Subsidiaries in any domestic
Subsidiary; and
(k) additional investments (including investments in connection with
any Permitted Acquisition) not contemplated by clauses (a) through (j)
above in an aggregate amount at the time of such investment not in excess
of (i) the Available Investment Amount at such time minus (ii) the
-----
aggregate amount of all investments that have been made pursuant to this
clause (k) and remain outstanding at such time (it being understood that
each investment made pursuant to this clause (k) shall be deemed not to be
outstanding to the extent of any return or repayment of such investment).
10.7 Limitation on Dividends. The Borrower will not declare or pay
-----------------------
any dividends (other than dividends payable solely in its capital stock or
rights, warrants or options to purchase its capital stock) or return any capital
to its stockholders or make any other distribution, payment or delivery of
property or cash to its stockholders as such, or redeem, retire, purchase or
otherwise acquire, directly or indirectly, for consideration, any shares of any
class of its capital stock now or hereafter outstanding (or any warrants for or
options or stock appreciation rights in respect of any of such shares), or set
aside any funds for any of the foregoing purposes, or permit any of its
Subsidiaries to purchase or otherwise acquire for consideration (other than in
connection with an investment permitted by Section 10.6) any shares of any class
of the capital stock of the Borrower or any other Subsidiary of the Borrower, as
the case may be, now or hereafter outstanding (or any options or warrants or
stock appreciation rights issued by such Person with respect to its capital
stock) (all of the foregoing "Dividends"), provided that, so long as no Event of
--------- --------
Default exists or would exist after giving effect thereto, (a) the Borrower may
redeem in whole or in part any capital stock of the Borrower for another class
of capital stock or rights to acquire capital stock of the Borrower, provided
--------
that such other class of capital stock contains terms and provisions at least as
advantageous to the Lenders as those contained in the capital stock redeemed
thereby, and (b) the Borrower may repurchase shares of its capital stock (and/or
options or warrants in respect thereof) held by its officers, directors and
employees so long as such repurchase is pursuant to, and in accordance with the
terms of, management and/or employee stock plans, stock subscription agreements
or shareholder agreements.
<PAGE>
56
10.8 Limitation on Debt Payments. The Borrower will not optionally
---------------------------
prepay, repurchase or redeem or otherwise defease any subordinated Indebtedness
for borrowed money of the Borrower or any Subsidiary (including the Subordinated
Notes); provided, however, that so long as no Default or Event of Default has
-------- -------
occurred and is continuing, the Borrower may optionally prepay, repurchase or
redeem any Subordinated Notes or other subordinated Indebtedness of the Borrower
or any of its Subsidiaries with a portion of the Net Cash Proceeds of any
issuance by the Borrower of equity securities (provided, however, that the
-------- -------
aggregate price of such prepayment, repurchase or redemption shall not exceed
50% of the Net Cash Proceeds received by the Borrower from the issuance of
equity securities by the Borrower).
10.9 Consolidated Total Debt to Consolidated EBITDA Ratio. The
----------------------------------------------------
Borrower will not permit the ratio of (a) Consolidated Total Debt as of the last
day of any Test Period ending during any period set forth below to
(b) Consolidated EBITDA for such Test Period to be greater than the ratio set
forth below opposite such period:
Period Ratio
------ -----
Closing Date through October 31, 1996 6.70:1.00
December 31, 1996 through March 31, 1997 6.30:1.00
June 30, 1997 through March 31, 1998 5.60:1.00
June 30, 1998 through March 31, 1999 4.80:1.00
June 30, 1999 through March 31, 2000 4.20:1.00
June 30, 2000 through March 31, 2001 3.50:1.00
June 30, 2001 through March 31, 2002 3.25:1.00
June 30, 2002 through March 31, 2003 3.25:1.00
June 30, 2003 through March 31, 2004 3.25:1.00
June 30, 2004 through the Maturity Date 3.25:1.00
10.10 Consolidated EBITDA to Consolidated Interest Expense Ratio.
----------------------------------------------------------
The Borrower will not permit the ratio of (a) Consolidated EBITDA for any Test
Period ending during any period set forth below to (b) Consolidated Interest
Expense for such Test Period to be less than the ratio set forth below opposite
such period:
Period Ratio
------ -----
Closing Date through March 31, 1996 1.35:1.00
June 30, 1996 through October 31, 1996 1.45:1.00
December 31, 1996 through March 31, 1997 1.65:1.00
June 30, 1997 through March 31, 1998 1.85:1.00
June 30, 1998 through March 31, 1999 2.15:1.00
June 30, 1999 through March 31, 2000 2.55:1.00
June 30, 2000 through March 31, 2001 2.95:1.00
June 30, 2001 through March 31, 2002 3.35:1.00
June 30, 2002 through March 31, 2003 3.50:1.00
June 30, 2003 through March 31, 2004 3.50:1.00
June 30, 2004 through the Maturity Date 3.50:1.00
<PAGE>
57
10.11 Consolidated Fixed Charge Coverage Ratio. The Borrower will
----------------------------------------
not permit the ratio of (a) the sum of (i) Consolidated EBITDA for any Test
Period ending during any period set forth below and (ii) Consolidated Rental
Expense for such Test Period to (b) the sum of (i) Consolidated Interest Expense
for such Test Period and (ii) Consolidated Rental Expense for such Test Period
to be less than the ratio set forth below opposite such period:
Period Amount
------ ------
Closing Date through March 31, 1996 1.25:1.00
June 30, 1996 through October 31, 1996 1.30:1.00
December 31, 1996 though March 31, 1997 1.40:1.00
June 30, 1997 through March 31, 1998 1.50:1.00
June 30, 1998 through March 31, 1999 1.65:1.00
June 30, 1999 through March 31, 2000 1.80:1.00
June 30, 2000 through March 31, 2001 1.95:1.00
June 30, 2001 through March 31, 2002 2.05:1.00
June 30, 2002 through March 31, 2003 2.20:1.00
June 30, 2003 through March 31, 2004 2.20:1.00
June 30, 2004 through the Maturity Date 2.20:1.00
10.12 Capital Expenditures. The Borrower will not, and will
--------------------
not permit any of its Subsidiaries, to make any Capital Expenditures (other
than Permitted Acquisitions that constitute Capital Expenditures) that
would cause the aggregate amount of all Capital Expenditures made by the
Borrower and its Subsidiaries in any fiscal year of the Borrower set forth
below to exceed the amount set forth below opposite such fiscal year:
Fiscal Year Ending on
---------------------
the Saturday Nearest Amount
-------------------- ------
June 30, 1996 $80,000,000
June 30, 1997 80,000,000
June 30, 1998 90,000,000
June 30, 1999 95,000,000
June 30, 2000 105,000,000
June 30, 2001 105,000,000
June 30, 2002 105,000,000
June 30, 2003 105,000,000
June 30, 2004 105,000,000
Any Capital Expenditure permitted to be made but not made in any fiscal
year set forth above may be carried forward to the next succeeding fiscal
year and added to the amounts set forth above for such next succeeding
fiscal year; provided, however, that the aggregate amount of all Capital
-------- -------
Expenditures made by the Borrower and its Subsidiaries shall not exceed (a)
$120,000,000 in the case of the fiscal year of the Borrower ending on the
Saturday nearest June 30, 1997; (b) $120,000,000 in the case of the fiscal
year of the Borrower ending on the Saturday nearest June 30, 1998; (c)
$130,000,000 in the case of the fiscal year of the Borrower ending on the
Saturday nearest June 30, 1999; (d) $140,000,000 in the case of the fiscal
year of the Borrower ending on the Saturday nearest June 30, 2000; and (e)
$150,000,000 in the case of any fiscal year of the Borrower thereafter.
<PAGE>
58
SECTION 11. Events of Default. Upon the occurrence of any of the
-----------------
following specified events (each an "Event of Default"):
----------------
11.1 Payments. The Borrower shall (a) default in the payment when due
--------
of any principal of the Loans or (b) default, and such default shall continue
for five or more days, in the payment when due of any interest on the Loans or
any Fees or any Unpaid Drawings or of any other amounts owing hereunder or under
any other Credit Document; or
11.2 Representations, etc. Any representation, warranty or statement
---------------------
made or deemed made by any Credit Party herein or in the Guarantee, the Pledge
Agreement or any certificate delivered or required to be delivered pursuant
hereto or thereto shall prove to be untrue in any material respect on the date
as of which made or deemed made; or
11.3 Covenants. Any Credit Party shall (a) default in the due
---------
performance or observance by it of any term, covenant or agreement contained in
Section 9.1(f) and Section 10 or (b) default in the due performance or
observance by it of any term, covenant or agreement (other than those referred
to in Section 11.1, 11.2 or clause (a) of this Section 11.3) contained in this
Agreement, the Guarantee or the Pledge Agreement and such default shall continue
unremedied for a period of at least 30 days after receipt of written notice by
the Borrower from the Administrative Agent or the Required Lenders; or
11.4 Default Under Other Agreements. (a) The Borrower or any of its
------------------------------
Subsidiaries shall (i) default in any payment with respect to any Indebtedness
(other than the Obligations) in excess of $20,000,000 in the aggregate, for the
Borrower and such Subsidiaries, beyond the period of grace, if any, provided in
the instrument or agreement under which such Indebtedness was created or
(ii) default in the observance or performance of any agreement or condition
relating to any such Indebtedness or contained in any instrument or agreement
evidencing, securing or relating thereto, or (except in the case of Indebtedness
consisting of any Hedge Agreement) any other event shall occur or condition
exist, the effect of which default or other event or condition is to cause, or
to permit the holder or holders of such Indebtedness (or a trustee or agent on
behalf of such holder or holders) to cause, any such Indebtedness to become due
prior to its stated maturity; or (b) without limiting the provisions of
clause (a) above, any such Indebtedness (other than Indebtedness consisting of
any Hedge Agreement) shall be declared to be due and payable, or required to be
prepaid other than by a regularly scheduled required prepayment or as a
mandatory prepayment, prior to the stated maturity thereof; or
11.5 Bankruptcy, etc. The Borrower or any Specified Subsidiary shall
----------------
commence a voluntary case concerning itself under Title 11 of the United States
Code entitled "Bankruptcy," as now or hereafter in effect, or any successor
thereto (the "Bankruptcy Code"); or an involuntary case is commenced against the
---------------
Borrower or any Specified Subsidiary and the petition is not controverted within
10 days after commencement of the case; or an involuntary case is commenced
against the Borrower or any Specified Subsidiary and the petition is not
dismissed within 60 days after commencement of the case; or a custodian (as
defined in the Bankruptcy Code) is appointed for, or takes charge of, all or
substantially all of the property of the Borrower or any Specified Subsidiary;
or the Borrower or any Specified Subsidiary commences any other proceeding under
any reorganization, arrangement, adjustment of debt, relief of debtors,
dissolution, insolvency or liquidation or similar law of any jurisdiction
whether now or hereafter in effect relating to the Borrower or any Specified
Subsidiary; or there is commenced against the Borrower or any Specified
Subsidiary any such proceeding that remains undismissed for a period of 60 days;
or the Borrower or any Specified Subsidiary is adjudicated insolvent or
bankrupt; or any order of relief or other order approving any such case or
proceeding is entered; or the Borrower or any Specified Subsidiary suffers any
appointment of any custodian or the like for it or any substantial part of its
property to continue undischarged or unstayed for a period of 60 days; or the
Borrower or any Specified Subsidiary makes a general assignment for the benefit
of creditors; or any corporate action is taken by the Borrower or any Specified
Subsidiary for the purpose of effecting any of the foregoing; or
11.6 ERISA. (a) Any Plan shall fail to satisfy the minimum funding
-----
standard required for any plan year or part thereof or a waiver of such standard
or extension of any amortization period is sought or granted under Section 412
of the Code; any Plan is or shall have been terminated or is the subject of
termination
<PAGE>
59
proceedings under ERISA (including the giving of written notice thereof); an
event shall have occurred or a condition shall exist in either case entitling
the PBGC to terminate any Plan or to appoint a trustee to administer any Plan
(including the giving of written notice thereof); any Plan shall have an
accumulated funding deficiency (whether or not waived); the Borrower or any
Subsidiary or any ERISA Affiliate has incurred or is likely to incur a liability
to or on account of a Plan under Section 409, 502(i), 502(l), 515, 4062, 4063,
4064, 4069, 4201 or 4204 of ERISA or Section 4971 or 4975 of the Code (including
the giving of written notice thereof); (b) there could result from any event or
events set forth in clause (a) of this Section 11.6 the imposition of a lien,
the granting of a security interest, or a liability, or the reasonable
likelihood of incurring a lien, security interest or liability; and (c) such
lien, security interest or liability will or would be reasonably likely to have
a Material Adverse Effect; or
11.7 Guarantee. The Guarantee or any material provision thereof shall
---------
cease to be in full force or effect or any Guarantor thereunder or any Credit
Party shall deny or disaffirm in writing such Guarantor's obligations under the
Guarantee; or
11.8 Pledge Agreement. The Pledge Agreement or any material provision
----------------
thereof shall cease to be in full force or effect (other than pursuant to the
terms hereof or thereof or as a result of acts or omissions of the
Administrative Agent or any Lender) or any Pledgor thereunder or any Credit
Party shall deny or disaffirm in writing such Pledgor's obligations under the
Pledge Agreement; or
11.9 Judgments. One or more judgments or decrees shall be entered
---------
against the Borrower or any of its Subsidiaries involving a liability of
$20,000,000 or more in the aggregate for all such judgments and decrees for the
Borrower and its Subsidiaries (to the extent not paid or fully covered by
insurance provided by a carrier that has acknowledged coverage in writing) and
any such judgments or decrees shall not have been vacated, discharged or stayed
or bonded pending appeal within 60 days from the entry thereof; or
11.10 Change of Control. A Change of Control shall occur;
-----------------
then, and in any such event, and at any time thereafter, if any Event of Default
shall then be continuing, the Administrative Agent shall, upon the written
request of the Required Lenders, by written notice to the Borrower, take any or
all of the following actions, without prejudice to the rights of the
Administrative Agent or any Lender to enforce its claims against the Borrower,
except as otherwise specifically provided for in this Agreement (provided that,
--------
if an Event of Default specified in Section 11.5 shall occur with respect to the
Borrower or any Material Subsidiary, the result that would occur upon the giving
of written notice by the Administrative Agent as specified in clauses (i), (ii)
and (iv) below shall occur automatically without the giving of any such notice):
(i) declare the Total Term Loan Commitment and the Total Revolving Commitment
terminated, whereupon the Commitments and Swingline Commitment, if any, of each
Lender or Chemical, as the case may be, shall forthwith terminate immediately
and any Fees theretofore accrued shall forthwith become due and payable without
any other notice of any kind; (ii) declare the principal of and any accrued
interest in respect of all Loans and all Obligations owing hereunder and
thereunder to be, whereupon the same shall become, forthwith due and payable
without presentment, demand, protest or other notice of any kind, all of which
are hereby waived by the Borrower; (iii) terminate any Letter of Credit that may
be terminated in accordance with its terms; and/or (iv) direct the Borrower to
pay (and the Borrower agrees that upon receipt of such notice, or upon the
occurrence of an Event of Default specified in Section 11.5 with respect to the
Borrower or any Material Subsidiary, it will pay) to the Administrative Agent at
the Administrative Agent's Office such additional amounts of cash, to be held as
security for the Borrower's reimbursement obligations for Drawings that may
subsequently occur thereunder, equal to the aggregate Stated Amount of all
Letters of Credit issued and then outstanding.
SECTION 12. The Administrative Agent.
------------------------
12.1 Appointment. Each Lender hereby irrevocably designates and
-----------
appoints the Administrative Agent as the agent of such Lender under this
Agreement and the other Credit Documents, and each such Lender
<PAGE>
60
irrevocably authorizes the Administrative Agent, in such capacity, to take such
action on its behalf under the provisions of this Agreement and the other Credit
Documents and to exercise such powers and perform such duties as are expressly
delegated to the Administrative Agent by the terms of this Agreement and the
other Credit Documents, together with such other powers as are reasonably
incidental thereto. Notwithstanding any provision to the contrary elsewhere in
this Agreement, the Administrative Agent shall not have any duties or
responsibilities, except those expressly set forth herein, or any fiduciary
relationship with any Lender, and no implied covenants, functions,
responsibilities, duties, obligations or liabilities shall be read into this
Agreement or any other Credit Document or otherwise exist against the
Administrative Agent.
12.2 Delegation of Duties. The Administrative Agent may execute any
--------------------
of its duties under this Agreement and the other Credit Documents by or through
agents or attorneys-in-fact and shall be entitled to advice of counsel
concerning all matters pertaining to such duties. The Administrative Agent
shall not be responsible for the negligence or misconduct of any agents or
attorneys in-fact selected by it with reasonable care.
12.3 Exculpatory Provisions. Neither the Administrative Agent nor any
----------------------
of its officers, directors, employees, agents, attorneys-in-fact or Affiliates
shall be (a) liable for any action lawfully taken or omitted to be taken by it
or such Person under or in connection with this Agreement or any other Credit
Document (except for its or such Person's own gross negligence or willful
misconduct) or (b) responsible in any manner to any of the Lenders for any
recitals, statements, representations or warranties made by the Borrower or any
Guarantor or any officer thereof contained in this Agreement or any other Credit
Document or in any certificate, report, statement or other document referred to
or provided for in, or received by the Administrative Agent under or in
connection with, this Agreement or any other Credit Document or for the value,
validity, effectiveness, genuineness, enforceability or sufficiency of this
Agreement or any other Credit Document or for any failure of the Borrower or any
Guarantor to perform its obligations hereunder or thereunder. The
Administrative Agent shall not be under any obligation to any Lender to
ascertain or to inquire as to the observance or performance of any of the
agreements contained in, or conditions of, this Agreement or any other Credit
Document, or to inspect the properties, books or records of the Borrower.
12.4 Reliance by Administrative Agent. The Administrative Agent shall
--------------------------------
be entitled to rely, and shall be fully protected in relying, upon any writing,
resolution, notice, consent, certificate, affidavit, letter, telecopy, telex or
teletype message, statement, order or other document or conversation believed by
it to be genuine and correct and to have been signed, sent or made by the proper
Person or Persons and upon advice and statements of legal counsel (including,
without limitation, counsel to the Borrower), independent accountants and other
experts selected by the Administrative Agent. The Administrative Agent may deem
and treat the Lender specified in the Register with respect to any amount owing
hereunder as the owner thereof for all purposes unless a written notice of
assignment, negotiation or transfer thereof shall have been filed with the
Administrative Agent. The Administrative Agent shall be fully justified in
failing or refusing to take any action under this Agreement or any other Credit
Document unless it shall first receive such advice or concurrence of the
Required Lenders as it deems appropriate or it shall first be indemnified to its
satisfaction by the Lenders against any and all liability and expense that may
be incurred by it by reason of taking or continuing to take any such action.
The Administrative Agent shall in all cases be fully protected in acting, or in
refraining from acting, under this Agreement and the other Credit Documents in
accordance with a request of the Required Lenders, and such request and any
action taken or failure to act pursuant thereto shall be binding upon all the
Lenders and all future holders of the Loans.
12.5 Notice of Default. The Administrative Agent shall not be deemed
-----------------
to have knowledge or notice of the occurrence of any Default or Event of Default
hereunder unless the Administrative Agent has received notice from a Lender or
the Borrower referring to this Agreement, describing such Default or Event of
Default and stating that such notice is a "notice of default". In the event
that the Administrative Agent receives such a notice, the Administrative Agent
shall give notice thereof to the Lenders. The Administrative Agent shall take
such action with respect to such Default or Event of Default as shall be
reasonably directed by the Required Lenders, provided that unless and until the
--------
Administrative Agent shall have received such directions, the
<PAGE>
61
Administrative Agent may (but shall not be obligated to) take such action, or
refrain from taking such action, with respect to such Default or Event of
Default as it shall deem advisable in the best interests of the Lenders.
12.6 Non-Reliance on Administrative Agent and Other Lenders. Each
------------------------------------------------------
Lender expressly acknowledges that neither the Administrative 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
Administrative Agent hereinafter taken, including any review of the affairs of
the Borrower or any Guarantor, shall be deemed to constitute any representation
or warranty by the Administrative Agent to any Lender. Each Lender represents
to the Administrative Agent that it has, independently and without reliance upon
the Administrative Agent or any other Lender, and based on such documents and
information as it has deemed appropriate, made its own appraisal of and
investigation into the business, operations, property, financial and other
condition and creditworthiness of the Borrower and any Guarantor and made its
own decision to make its Loans hereunder and enter into this Agreement. Each
Lender also represents that it will, independently and without reliance upon the
Administrative Agent or any other Lender, and based on such documents and
information as it shall deem appropriate at the time, continue to make its own
credit analysis, appraisals and decisions in taking or not taking action under
this Agreement and the other Credit Documents, and to make such investigation as
it deems necessary to inform itself as to the business, operations, property,
financial and other condition and creditworthiness of the Borrower and any
Guarantor. Except for notices, reports and other documents expressly required
to be furnished to the Lenders by the Administrative Agent hereunder, the
Administrative Agent shall not have any duty or responsibility to provide any
Lender with any credit or other information concerning the business, assets,
operations, properties, financial condition, prospects or creditworthiness of
the Borrower or any Guarantor that may come into the possession of the
Administrative Agent or any of its officers, directors, employees, agents,
attorneys-in-fact or Affiliates.
12.7 Indemnification. The Lenders agree to indemnify the
---------------
Administrative Agent in its capacity as such (to the extent not reimbursed by
the Borrower and without limiting the obligation of the Borrower to do so),
ratably according to their respective portions of the Total Credit Exposure in
effect on the date on which indemnification is sought (or, if indemnification is
sought after the date upon which the Commitments shall have terminated and the
Loans shall have been paid in full, ratably in accordance with their respective
portions of the Total Credit Exposure in effect immediately prior to such date),
from and against any and all liabilities, obligations, losses, damages,
penalties, actions, judgments, suits, costs, expenses or disbursements of any
kind whatsoever that may at any time (including, without limitation, at any time
following the payment of the Loans) be imposed on, incurred by or asserted
against the Administrative Agent in any way relating to or arising out of, the
Commitments, this Agreement, any of the other Credit Documents or any documents
contemplated by or referred to herein or therein or the transactions
contemplated hereby or thereby or any action taken or omitted by the
Administrative Agent under or in connection with any of the foregoing, provided
--------
that no Lender shall be liable for the payment of any portion of such
liabilities, obligations, losses, damages, penalties, actions, judgments, suits,
costs, expenses or disbursements resulting from the Administrative Agent's gross
negligence or willful misconduct. The agreements in this Section 12.7 shall
survive the payment of the Loans and all other amounts payable hereunder.
12.8 Administrative Agent in Its Individual Capacity. The
-----------------------------------------------
Administrative Agent and its Affiliates may make loans to, accept deposits from
and generally engage in any kind of business with the Borrower and any Guarantor
as though the Administrative Agent were not the Administrative Agent hereunder
and under the other Credit Documents. With respect to the Loans made by it, the
Administrative Agent shall have the same rights and powers under this Agreement
and the other Credit Documents as any Lender and may exercise the same as though
it were not the Administrative Agent, and the terms "Lender" and "Lenders" shall
include the Administrative Agent in its individual capacity.
12.9 Successor Agent. The Administrative Agent may resign as
---------------
Administrative Agent upon 20 days' prior written notice to the Lenders and the
Borrower. If the Administrative Agent shall resign as Administrative Agent
under this Agreement and the other Credit Documents, then the Required Lenders
shall appoint from among the Lenders a successor agent for the Lenders, which
successor agent shall be approved by the Borrower (which approval shall not be
unreasonably withheld), whereupon such successor agent shall
<PAGE>
62
succeed to the rights, powers and duties of the Administrative Agent, and the
term "Administrative Agent" shall mean such successor agent effective upon such
appointment and approval, and the former Administrative Agent's rights, powers
and duties as Administrative Agent shall be terminated, without any other or
further act or deed on the part of such former Administrative Agent or any of
the parties to this Agreement or any holders of the Loans. After any retiring
Administrative Agent's resignation as Administrative Agent, the provisions of
this Section 12 shall inure to its benefit as to any actions taken or omitted to
be taken by it while it was Administrative Agent under this Agreement and the
other Credit Documents.
SECTION 13. Miscellaneous.
-------------
13.1 Amendments and Waivers. Neither this Agreement nor any other
----------------------
Credit Document, nor any terms hereof or thereof may be amended, supplemented or
modified except in accordance with the provisions of this Section 13.1. The
Required Lenders may, or, with the written consent of the Required Lenders, the
Administrative Agent may, from time to time, (a) enter into with the relevant
Credit Party or Credit Parties written amendments, supplements or modifications
hereto and to the other Credit Documents for the purpose of adding any
provisions to this Agreement or the other Credit Documents or changing in any
manner the rights of the Lenders or of the Borrower hereunder or thereunder or
(b) waive, on such terms and conditions as the Required Lenders or the
Administrative Agent, as the case may be, may specify in such instrument, any of
the requirements of this Agreement or the other Credit Documents or any Default
or Event of Default and its consequences; provided, however, that no such waiver
-------- -------
and no such amendment, supplement or modification shall directly (i) forgive any
portion of any Loan or extend the final scheduled maturity date of any Loan, or
reduce the stated rate of any interest or fee payable hereunder (other than as a
result of waiving the applicability of any post-default increase in interest
rates) or extend the final expiration date of any Lender's Commitment or
increase the aggregate amount of the Commitments of any Lender, in each case
without the written consent of each Lender directly and adversely affected
thereby, or (ii) amend, modify or waive any provision of this Section 13.1 or
reduce the percentages specified in the definitions of the terms "Required
Lenders", "Required Tranche A Lenders", "Required Tranche B, C and D Lenders",
"Supermajority Tranche A Lenders" and "Supermajority Tranche B, C and D
Lenders", or consent to the assignment or transfer by the Borrower of its rights
and obligations under any Credit Document to which it is a party, in each case
without the written consent of each Lender directly and adversely affected
thereby, or (iii) amend, modify or waive any provision of Section 12 without the
written consent of the then-current Administrative Agent, or (iv) amend, modify
or waive any provision of Section 3 without the written consent of the Letter of
Credit Issuer, or (v) amend, modify or waive any provisions hereof relating to
Swingline Loans without the written consent of Chemical, or (vi) change any
Revolving Credit Commitment to any other Commitment (other than a Tranche A
Commitment), change any Tranche A Commitment to any other Commitment (other than
a Revolving Credit Commitment) or change any Tranche B Commitment, Tranche C
Commitment or Tranche D Commitment to any other Commitment, in each case without
the prior written consent of each Lender directly and adversely affected
thereby, or (vii) decrease any Tranche A Repayment Amount, extend any scheduled
Tranche A Repayment Date or decrease the amount of any mandatory prepayment to
be received by any Lender holding any Tranche A Loans, in each case without the
written consent of the Required Tranche A Lenders, or (viii) decrease any
scheduled Tranche B Repayment Amount, Tranche C Repayment Amount or Tranche D
Repayment Amount, extend any Tranche B Repayment Date, Tranche C Repayment Date
or Tranche D Repayment Date or decrease the amount of any mandatory prepayment
to be received by any Lender holding any Tranche B Loans, Tranche C Loans or
Tranche D Loans, in each case without the written consent of the Required
Tranche B, C, and D Lenders, or (ix) release all or substantially all the
Collateral or release all or substantially all the Guarantors under the
Guarantee, in each case without the written consent of (A) the Supermajority
Tranche A Lenders and (B) the Supermajority Tranche B, C and D Lenders. Any
such waiver and any such amendment, supplement or modification shall apply
equally to each of the affected Lenders and shall be binding upon the Borrower,
such Lenders, the Administrative Agent and all future holders of the affected
Loans. In the case of any waiver, the Borrower, the Lenders and the
Administrative Agent shall be restored to their former positions and rights
hereunder and under the other Credit Documents, and any Default or Event of
Default waived shall be deemed to be cured and not continuing, it being
understood that no such waiver shall extend to any subsequent or other Default
or Event of Default or impair any right consequent thereon.
<PAGE>
63
13.2 Notices. All notices, requests and demands to or upon the
-------
respective parties hereto to be effective shall be in writing (including by
facsimile transmission), and, unless otherwise expressly provided herein, shall
be deemed to have been duly given or made when delivered, or three days after
being deposited in the mail, postage prepaid, or, in the case of telecopy
notice, when received, addressed as follows in the case of the Borrower and the
Administrative Agent, and as set forth on Schedule 1.1 in the case of the other
parties hereto, or to such other address as may be hereafter notified by the
respective parties hereto:
The Borrower: Bruno's Inc.
800 Lakeshore Parkway
Birmingham, AL 35211
Attention: Chief Financial Officer
Fax: 205-940-9400
with a copy to:
Bruno's, Inc.
In care of Kohlberg Kravis Roberts & Co.
9 West 57th Street
New York, NY 10019
Attention: Nils Brous
Fax: 212-750-0003
The Administrative Agent: Chemical Bank Agency
Services Corporation
Grand Central Tower
140 East 45th Street
New York, NY 10017
Attention: Janet Belden
Fax: 212-622-0002
with a copy to:
Chemical Bank
270 Park Avenue
New York, New York 10017
Attention: Robert Gaynor
Fax: 212-972-0009
provided that any notice, request or demand to or upon the Administrative
--------
Agent or the Lenders pursuant to Sections 2.3, 2.6, 2.9, 4.2 and 5.1 shall
not be effective until received.
13.3 No Waiver; Cumulative Remedies. No failure to exercise and
------------------------------
no delay in exercising, on the part of the Administrative Agent or any
Lender, any right, remedy, power or privilege hereunder or under the other
Credit Documents shall operate as a waiver thereof, nor shall any single or
partial exercise of any right, remedy, power or privilege hereunder
preclude any other or further exercise thereof or the exercise of any other
right, remedy, power or privilege. The rights, remedies, powers and
privileges herein provided are cumulative and not exclusive of any rights,
remedies, powers and privileges provided by law.
13.4 Survival of Representations and Warranties. All
------------------------------------------
representations and warranties made hereunder, in the other Credit
Documents and in any document, certificate or statement delivered pursuant
hereto or in connection herewith shall survive the execution and delivery
of this Agreement and the making of the Loans hereunder.
<PAGE>
64
13.5 Payment of Expenses and Taxes. The Borrower agrees (a) to pay or
-----------------------------
reimburse the Administrative Agent for all its reasonable out-of-pocket costs
and expenses incurred in connection with the development, preparation and
execution of, and any amendment, supplement or modification to, this Agreement
and the other Credit Documents and any other documents prepared in connection
herewith or therewith, and the consummation and administration of the
transactions contemplated hereby and thereby, including, without limitation, the
reasonable fees, disbursements and other charges of counsel to the
Administrative Agent, (b) to pay or reimburse each Lender and the Administrative
Agent for all its reasonable and documented costs and expenses incurred in
connection with the enforcement or preservation of any rights under this
Agreement, the other Credit Documents and any such other documents, including,
without limitation, the reasonable fees, disbursements and other charges of
counsel to each Lender and of counsel to the Administrative Agent, (c) to pay,
indemnify, and hold harmless each Lender and the Administrative Agent from, any
and all recording and filing fees and any and all liabilities with respect to,
or resulting from any delay in, paying, stamp, excise and other similar taxes,
if any, that may be payable or determined to be payable in connection with the
execution and delivery of, or consummation or administration of any of the
transactions contemplated by, or any amendment, supplement or modification of,
or any waiver or consent under or in respect of, this Agreement, the other
Credit Documents and any such other documents, and (d) to pay, indemnify, and
hold harmless each Lender and the Administrative Agent and their respective
directors, officers, employees and agents from and against any and all other
liabilities, obligations, losses, damages, penalties, actions, judgments, suits,
costs, expenses or disbursements of any kind or nature whatsoever including
reasonable and documented fees, disbursements and other charges of counsel with
respect to the execution, delivery, enforcement, performance and administration
of this Agreement, the other Credit Documents and any such other documents,
including, without limitation, any of the foregoing relating to the violation
of, noncompliance with or liability under, any Environmental Law applicable to
the operations of the Borrower, any of its Subsidiaries or any of the Properties
(all the foregoing in this clause (d), collectively, the "indemnified
liabilities"), provided that the Borrower shall have no obligation hereunder to
--------
the Administrative Agent or any Lender nor any of their respective directors,
officers, employees and agents with respect to indemnified liabilities arising
from (i) the gross negligence or willful misconduct of the party to be
indemnified or (ii) disputes among the Administrative Agent, the Lenders and/or
their transferees. The agreements in this Section 13.5 shall survive repayment
of the Loans and all other amounts payable hereunder.
13.6 Successors and Assigns; Participations and Assignments. (a)
------------------------------------------------------
(i) This Agreement shall be binding upon and inure to the benefit of the
Borrower, the Lenders, the Administrative Agent and their respective successors
and assigns, except that the Borrower may not assign or transfer any of its
rights or obligations under this Agreement without the prior written consent of
each Lender.
(ii) 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 Commitment of such Lender or any other interest of such Lender
hereunder and under the other Credit Documents. In the event of any such sale
by a Lender of a participating interest to a Participant, such Lender's
obligations under this Agreement to the other parties to this Agreement shall
remain unchanged, such Lender shall remain solely responsible for the
performance thereof, such Lender shall remain the holder of any such Loan for
all purposes under this Agreement and the other Credit Documents, and the
Borrower and the Administrative Agent shall continue to deal solely and directly
with such Lender in connection with such Lender's rights and obligations under
this Agreement and the other Credit Documents. In no event shall any
Participant under any such participation have any right to approve any amendment
or waiver of any provision of any Credit Document, or any consent to any
departure by any Credit Party therefrom, except to the extent that such
amendment, waiver or consent would directly forgive any principal of, or
interest on (other than as a result of waiving the applicability of any post-
default increase in interest rates), the Loans or any Fees payable hereunder, or
postpone the date of the final scheduled maturity of any Loan, in each case to
the extent subject to such participation. The Borrower agrees that if amounts
outstanding under this Agreement are due or unpaid, or shall have been declared
or shall have become due and payable upon the occurrence of an Event of Default,
each Participant shall, to the maximum extent permitted by applicable law, be
deemed to have the right of setoff in respect of its participating interest in
amounts owing under this Agreement to the same extent as if the amount of its
participating interest were owing directly to it as a Lender under this
Agreement, provided that,
--------
<PAGE>
65
in purchasing such participating interest, such Participant shall be deemed to
have agreed to share with the Lenders the proceeds thereof as provided in
Section 13.7 as fully as if it were a Lender hereunder. The Borrower also
agrees that each Participant shall be entitled to the benefits of Sections 2.10
and 2.11 with respect to its participation in the Commitments and the Loans
outstanding from time to time as if it were a Lender, provided that no
--------
Participant shall be entitled to receive any greater amount pursuant to any such
Section than the transferor Lender would have been entitled to receive in
respect of the amount of the participation transferred by such transferor Lender
to such Participant had no such transfer occurred.
(iii) Any Lender may, in the ordinary course of its business and in
accordance with applicable law, at any time and from time to time assign to any
Lender or any Affiliate (with the consent of the Borrower if any increased costs
would result therefrom) thereof or, with the consent of the Borrower and the
Administrative Agent (which in each case shall not be unreasonably withheld, it
being understood that, without limitation, the Borrower shall have the right to
withhold its consent to any assignment if, in order for such assignment to
comply with applicable law, the Borrower would be required to obtain the consent
of, or make any filing or registration with, any Governmental Authority), to an
additional bank or financial institution (an "Assignee") all or any part of its
--------
rights and obligations under this Agreement and the other Credit Documents
pursuant to an Assignment and Acceptance, substantially in the form of Exhibit
F, executed by such Assignee, such assigning Lender (and, in the case of an
Assignee that is not then a Lender or an Affiliate thereof, by the Borrower and
the Administrative Agent) and delivered to the Administrative Agent for its
acceptance and recording in the Register, provided that, except in the case of
--------
an assignment of all of a Lender's interests under this Agreement, unless
otherwise agreed to by the Borrower and the Administrative Agent, no such
assignment to an Assignee (other than any Lender or any Affiliate thereof) shall
be in an aggregate principal amount of less than (A) $10,000,000 in the case of
Revolving Credit Loans, Revolving Credit Commitments and Tranche A Term Loans in
the aggregate and (B) $5,000,000 in the case of Tranche B Term Loans, Tranche C
Term Loans and Tranche D Term Loans in the aggregate. Upon such execution,
delivery, acceptance and recording, from and after the effective date determined
pursuant to such Assignment and Acceptance, (x) the Assignee thereunder shall be
a party hereto and, to the extent provided in such Assignment and Acceptance,
have the rights and obligations of a Lender hereunder with a Commitment as set
forth therein and (y) the assigning Lender thereunder shall, to the extent
provided in such Assignment and Acceptance, be released from its obligations
under this Agreement (and, in the case of an Assignment and Acceptance covering
all or the remaining portion of an assigning Lender's rights and obligations
under this Agreement, such assigning Lender shall cease to be a party hereto).
Notwithstanding any provision of this Agreement to the contrary, the consent of
the Borrower shall not be required for any assignment that occurs at any time
when any of the events described in Section 11.5 shall have occurred and be
continuing with respect to the Borrower.
(b) Nothing herein shall prohibit any Lender from pledging or
assigning all or any portion of its Loans to any Federal Reserve Bank in
accordance with applicable law. In order to facilitate such pledge or
assignment, the Borrower hereby agrees that, upon request of any Lender at any
time and from time to time after the Borrower has made its initial borrowing
hereunder, the Borrower shall provide to such Lender, at the Borrower's own
expense, a promissory note, substantially in the form of Exhibit C-1 or C-2, as
the case may be, evidencing the Term Loans and Revolving Credit Loans,
respectively, owing to such Lender.
(c) The Administrative Agent, on behalf of the Borrower, shall
maintain at the address of the Administrative Agent referred to in Section 13.2
a copy of each Assignment and Acceptance delivered to it and a register (the
"Register") for the recordation of the names and addresses of the Lenders and
--------
the Commitment of, and principal amount of the Loans owing to, each Lender from
time to time. The entries in the Register shall be conclusive, in the absence
of manifest error, and the Borrower, the Administrative Agent and the Lenders
shall treat each Person whose name is recorded in the Register as the owner of a
Loan or other obligation hereunder as the owner thereof for all purposes of this
Agreement and the other Credit Documents, notwithstanding any notice to the
contrary. Any assignment of any Loan or other obligation hereunder shall be
effective only upon appropriate entries with respect thereto being made in the
Register. 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.
<PAGE>
66
(d) (i) Upon its receipt of an Assignment and Acceptance executed by
an assigning Lender and an Assignee (and, in the case of an Assignee that is not
then a Lender or an Affiliate thereof, by the Borrower and the Administrative
Agent) together with payment to the Administrative Agent of a registration and
processing fee of $3,500, the Administrative Agent shall (i) promptly accept
such Assignment and Acceptance and (ii) on the effective date determined
pursuant thereto record the information contained therein in the Register and
give notice of such acceptance and recordation to the Lenders and the Borrower.
(e) Subject to Section 13.16, the Borrower authorizes each Lender to
disclose to any Participant or Assignee (each, a "Transferee") and any
----------
prospective Transferee any and all financial information in such Lender's
possession concerning the Borrower and its Affiliates that has been delivered to
such Lender by or on behalf of the Borrower pursuant to this Agreement or which
has been delivered to such Lender by or on behalf of the Borrower in connection
with such Lender's credit evaluation of the Borrower and its Affiliates prior to
becoming a party to this Agreement, provided that neither the Administrative
--------
Agent nor any Lender shall provide to any Transferee or prospective Transferee
any of the Confidential Information unless such person shall have previously
executed a Confidentiality Agreement in the form of Exhibit I.
13.7 Replacements of Lenders under Certain Circumstances. The
---------------------------------------------------
Borrower shall be permitted to replace any Lender that (a) requests
reimbursement for amounts owing pursuant to Section 2.10, 2.12, 3.5 or 5.4, (b)
is affected in the manner described in Section 2.10(a)(iii) and as a result
thereof any of the actions described in such Section is required to be taken or
(c) becomes a Defaulting Lender, with a replacement bank or other financial
institution, provided that (i) such replacement does not conflict with any
--------
Requirement of Law, (ii) no Event of Default shall have occurred and be
continuing at the time of such replacement, (iii) the Borrower shall repay (or
the replacement bank or institution shall purchase, at par) all Loans and other
amounts (other than any disputed amounts), pursuant to Section 2.10, 2.12, 3.5
or 5.4, as the case may be) owing to such replaced Lender prior to the date of
replacement, (iv) the replacement bank or institution, if not already a Lender,
and the terms and conditions of such replacement, shall be reasonably
satisfactory to the Administrative Agent, (v) the replaced Lender shall be
obligated to make such replacement in accordance with the provisions of Section
13.6 (provided that the Borrower shall be obligated to pay the registration and
processing fee referred to therein), and (vi) any such replacement shall not be
deemed to be a waiver of any rights that the Borrower, the Administrative Agent
or any other Lender shall have against the replaced Lender.
13.8 Adjustments; Set-off. (a) If any Lender (a "benefitted Lender")
-------------------- -----------------
shall at any time receive any payment of all or part of its Loans, or interest
thereon, or receive any collateral in respect thereof (whether voluntarily or
involuntarily, by set-off, pursuant to events or proceedings of the nature
referred to in Section 11.5, or otherwise), in a greater proportion than any
such payment to or collateral received by any other Lender, if any, in respect
of such other Lender's Loans, or interest thereon, such benefitted Lender shall
purchase for cash from the other Lenders a participating interest in such
portion of each such other Lender's Loan, or shall provide such other Lenders
with the benefits of any such collateral, or the proceeds thereof, as shall be
necessary to cause such benefitted Lender to share the excess payment or
benefits of such collateral or proceeds ratably with each of the Lenders;
provided, however, that if all or any portion of such excess payment or benefits
-------- -------
is thereafter recovered from such benefitted Lender, such purchase shall be
rescinded, and the purchase price and benefits returned, to the extent of such
recovery, but without interest.
(b) After the occurrence and during the continuance of an Event of
Default, in addition to any rights and remedies of the Lenders provided by law,
each Lender shall have the right, without prior notice to the Borrower, any such
notice being expressly waived by the Borrower to the extent permitted by
applicable law, upon any amount becoming due and payable by the Borrower
hereunder (whether at the stated maturity, by acceleration or otherwise) to
set-off and appropriate and apply against such amount any and all deposits
(general or special, time or demand, provisional or final), in any currency, and
any other credits, indebtedness or claims, in any currency, in each case whether
direct or indirect, absolute or contingent, matured or unmatured, at any time
held or owing by such Lender or any branch or agency thereof to or for the
credit or the account of the Borrower. Each Lender agrees promptly to notify
the Borrower and the Administrative Agent after any such set-off and application
made by such Lender, provided that the failure to give such notice shall not
--------
affect the validity of such set-off and application.
<PAGE>
67
13.9 Counterparts. This Agreement may be executed by one or more of
------------
the parties to this Agreement on any number of separate counterparts (including
by facsimile transmission), and all of said counterparts taken together shall be
deemed to constitute one and the same instrument. A set of the copies of this
Agreement signed by all the parties shall be lodged with the Borrower and the
Administrative Agent.
13.10 Severability. Any provision of this Agreement that is
------------
prohibited or unenforceable in any jurisdiction shall, as to such jurisdiction,
be ineffective to the extent of such prohibition or unenforceability without
invalidating the remaining provisions hereof, and any such prohibition or
unenforceability in any jurisdiction shall not invalidate or render
unenforceable such provision in any other jurisdiction.
13.11 Integration. This Agreement and the other Credit Documents
-----------
represent the agreement of the Borrower, the Administrative Agent and the
Lenders with respect to the subject matter hereof, and there are no promises,
undertakings, representations or warranties by the Administrative Agent or any
Lender relative to subject matter hereof not expressly set forth or referred to
herein or in the other Credit Documents.
13.12 GOVERNING LAW. THIS AGREEMENT AND THE RIGHTS AND
-------------
OBLIGATIONS OF THE PARTIES HEREUNDER SHALL BE GOVERNED BY, AND CONSTRUED AND
INTERPRETED IN ACCORDANCE WITH, THE LAW OF THE STATE OF NEW YORK.
13.13 Submission To Jurisdiction; Waivers. The Borrower hereby
-----------------------------------
irrevocably and unconditionally:
(a) submits for itself and its property in any legal action or
proceeding relating to this Agreement and the other Credit Documents to
which it is a party, or for recognition and enforcement of any judgement in
respect thereof, to the non-exclusive general jurisdiction of the Courts of
the State of New York, the courts of the United States of America for the
Southern District of New York, and appellate courts from any thereof;
(b) consents that any such action or proceeding may be brought in
such courts and waives any objection that it may now or hereafter have to
the venue of any such action or proceeding in any such court or that such
action or proceeding was brought in an inconvenient court and agrees not to
plead or claim the same;
(c) agrees that service of process in any such action or proceeding
may be effected by mailing a copy thereof by registered or certified mail
(or any substantially similar form of mail), postage prepaid, to the
Borrower at its address set forth in Section 13.2 or at such other address
of which the Administrative Agent shall have been notified pursuant
thereto;
(d) agrees that nothing herein shall affect the right to effect
service of process in any other manner permitted by law or shall limit the
right to sue in any other jurisdiction; and
(e) waives, to the maximum extent not prohibited by law, any right it
may have to claim or recover in any legal action or proceeding referred to
in this Section 13.13 any special, exemplary, punitive or consequential
damages.
13.14 Acknowledgements. The Borrower hereby acknowledges that:
----------------
(a) it has been advised by counsel in the negotiation, execution and
delivery of this Agreement and the other Credit Documents;
(b) neither the Administrative Agent nor any Lender has any fiduciary
relationship with or duty to the Borrower arising out of or in connection
with this Agreement or any of the other Credit Documents, and the
relationship between Administrative Agent and Lenders, on one hand, and the
<PAGE>
68
Borrower, on the other hand, in connection herewith or therewith is solely
that of debtor and creditor; and
(c) no joint venture is created hereby or by the other Credit
Documents or otherwise exists by virtue of the transactions contemplated
hereby among the Lenders or among the Borrower and the Lenders.
13.15 WAIVERS OF JURY TRIAL. THE BORROWER, THE ADMINISTRATIVE
---------------------
AGENT AND THE LENDERS HEREBY IRREVOCABLY AND UNCONDITIONALLY WAIVE TRIAL BY JURY
IN ANY LEGAL ACTION OR PROCEEDING RELATING TO THIS AGREEMENT OR ANY OTHER CREDIT
DOCUMENT AND FOR ANY COUNTERCLAIM THEREIN.
13.16 Confidentiality. The Administrative Agent and each Lender
---------------
shall hold all non-public information furnished by or on behalf of the Borrower
in connection with such Lender's evaluation of whether to become a Lender
hereunder or obtained by such Lender or the Administrative Agent pursuant to the
requirements of this Agreement ("Confidential Information"), in accordance with
------------------------
its customary procedure for handling confidential information of this nature and
in accordance with safe and sound banking practices and in any event may make
disclosure as required or requested by any governmental agency or representative
thereof or pursuant to legal process or to such Lender's or the Administrative
Agent's attorneys or independent auditors, provided that unless specifically
--------
prohibited by applicable law or court order, each Lender and the Administrative
Agent shall notify the Borrower of any request by any governmental agency or
representative thereof (other than any such request in connection with an
examination of the financial condition of such Lender by such governmental
agency) for disclosure of any such non-public information prior to disclosure of
such information, and provided further that in no event shall any Lender or the
----------------
Administrative Agent be obligated or required to return any materials furnished
by the Borrower or any Subsidiary of the Borrower. Each Lender and the
Administrative Agent agrees that it will not provide to prospective Transferees
any of the Confidential Information unless such Person shall have previously
executed a Confidentiality Agreement in the form of Exhibit I.
13.17 Pre-Funding Escrow Arrangements. The Borrower intends that
-------------------------------
the Closing Date occur on August 18, 1995, and desires that the Lenders make on
the Closing Date Revolving Credit Loans in an aggregate principal amount equal
to $0, Tranche A Term Loans in an aggregate principal amount equal to
$270,000,000, Tranche B Term Loans in an aggregate principal amount equal to
$75,000,000, Tranche C Term Loans in an aggregate principal amount equal to
$75,000,000 and Tranche D Term Loans in an aggregate principal amount equal to
$50,000,000 (such aggregate amount of the Loans to be made on the Closing Date,
the "Initial Loan Amount"). In order to ensure that the Initial Loan Amount
-------------------
will be available at 10:00 a.m. (New York time) on August 18, 1995, the Borrower
(a) will deliver a notice of Borrowing (the "Pre-Funding Request") to the
-------------------
Administrative Agent not later than 1:30 p.m. (New York time) on August 16,
1995, and (b) requests that the Lenders, pursuant to the Pre-Funding Request,
transfer on August 17, 1995, an amount equal to the Initial Loan Amount (such
amount, the "Delivered Funds") to an account designated by the Administrative
---------------
Agent (such account, solely for the purposes of this Section 13.17, the "Escrow
------
Account"). The following agreements and understandings will apply with respect
-------
to (a) the arrangements for the availability of funds to enable the funding by
the Lenders of the Initial Loan Amount upon the satisfaction of the conditions
set forth in Section 6 and 7 of this Agreement (the "Closing") and (b) the
-------
release of the Delivered Funds as the Initial Loan Amount upon the Closing:
(i) The Administrative Agent, on behalf of the Lenders, shall
have sole and exclusive dominion over and control of the Escrow
Account and all property from time to time deposited therein.
(ii) Upon receipt from the Borrower of the Pre-Funding Request on
August 16, 1995, the Administrative Agent will provide notice to each
Lender, in the manner that would be applicable to a notice of
Borrowing under Section 2.3, that such Lender should make available to
the Administrative Agent not later than 2:00 p.m. (New York time) on
August 17, 1995,
<PAGE>
69
such Lender's pro rata portion of the Delivered Funds, as such pro
rata portion may be determined by the Administrative Agent pursuant to
the respective Commitments of the Lenders as set forth in
Schedule 1.1. Each Lender shall make its pro rata portion of the
Delivered Funds available to the Administrative Agent by wire transfer
of immediately available funds to the Escrow Account.
(iii) Notwithstanding anything in this Agreement or any other
document to the contrary, (A) the Administrative Agent shall hold the
Delivered Funds for the account of the Lenders pending release of the
Delivered Funds pursuant to paragraph (v) below and (B) the Borrower
shall have no right, title or interest in or to the Delivered Funds
pending such release. To the extent that the Administrative Agent has
any interest in the Delivered Funds, the Administrative Agent hereby
grants a Lien on such interest to the Administrative Agent for the
benefit of the Lenders. The Administrative Agent shall use
commercially reasonable efforts to invest (in any of (1) a time
deposit with the Nassau, Bahamas, branch of Chemical, (2) United
States government repurchase obligations or (3) commercial paper
issued by Chemical Banking Corporation, as determined by the
Administrative Agent in consultation with the Borrower) such of the
Delivered Funds as are on deposit in the Escrow Account at 2:00 p.m.
(New York time) on August 17, 1995. All earnings on the Delivered
Funds (the "Investment Earnings") shall be paid into the Escrow
-------------------
Account. The Administrative Agent shall not be liable to any person
for any loss suffered (other than as a result of gross negligence or
wilful misconduct of the Administrative Agent) in connection with any
investment of funds made by it in accordance with this Section 13.17.
(iv) The Borrower shall compensate each Lender for its delivery
of the Delivered Funds to the Administrative Agent. Such compensation
shall, as to each Lender, be equal to the product of (A) such Lender's
pro rata portion (determined as set forth above) of the Delivered
Funds multiplied by (B) a percentage equal to the ABR plus the margin
-------------
that would be applicable to each Lender's ABR Loans as of the Closing
Date multiplied by (C) a fraction the numerator of which is the actual
-------------
number of days elapsed from and including August 17, 1995, to but
excluding the date such Delivered Funds are released pursuant to
paragraph (v) below and the denominator of which is 365. Such
compensation in respect of the Delivered Funds shall be paid by the
Borrower to the Administrative Agent on behalf of the Lenders on the
first Interest Payment Date to occur after the Closing Date pursuant
to the terms of this Agreement; provided, however, that if the
-----------------
Delivered Funds are released to the Lenders (and not to the Borrower)
pursuant to paragraph (v) below, such compensation shall be payable by
the Borrower immediately upon release of the Delivered Funds.
(v) Upon the occurrence of the Closing, the Administrative Agent
is authorized to release to and thereby make available to the Borrower
(A) the Delivered Funds as the Initial Loan Amount and (B) all
Investment Earnings. If the Closing has not occurred by 11:59 p.m.
(New York time) on August 24, 1995, the Delivered Funds shall be
distributed by the Agent to the Lenders on August 25, 1995, and all
Investment Earnings shall be released to the Agent to the extent
necessary to offset amounts payable by the Borrower to the Lenders.
IN WITNESS WHEREOF, each of the parties hereto has caused a
counterpart of this Agreement to be duly executed and delivered as of the date
first above written.
BRUNO'S, INC.,
by /s/ Ronald G. Bruno
__________________________
Name: Ronald G. Bruno
Title: Chief Executive Officer
<PAGE>
70
CHEMICAL BANK, as Administrative
Agent and as a Lender,
by /s/ Robert K. Gaynor
__________________________
Name: Robert K. Gaynor
Title: Vice President
AMSOUTH BANK OF ALABAMA,
by /s/ David A. Simmons
__________________________
Name: David A Simmons
Title: Senior Vice President
BANK OF AMERICA ILLINOIS,
by /s/ Michael J. Bacevich
__________________________
Name: Michael J. Bacevich
Title: Vice President
THE BANK OF NEW YORK,
by /s/ Gregory L. Batson
__________________________
Name: Gregory L. Batson
Title: Vice President
THE BANK OF NOVA SCOTIA
by /s/ P. M. Brown
__________________________
Name: P. M. Brown
Title: Relationship Manager
BANKERS TRUST COMPANY,
by /s/ Robert R. Telesca
__________________________
Name: Robert R. Telesca
Title: Assistant Vice President
<PAGE>
71
CAISSE NATIONALE DE CREDIT AGRICOLE,
by /s/ David Bouhl
__________________________
Name: David Bouhl, F.V.P.
Title: Head of Corporate Banking,
Chicago
CHL HIGH YIELD LOAN PORTFOLIO
(a unit of Chemical Bank),
by /s/ Richard W. Stewart
__________________________
Name: Richard W. Stewart
Title: Vice President
CIBC Inc,
by /s/ Roger Colden
__________________________
Name: Roger Colden
Title: Vice President
COMPAGNIE FINANCIERE DE CIC ET DE
L'UNION EUROPEENNE,
by /s/ Sean Mounier
__________________________
Name: Sean Mounier
Title: First Vice President
by /s/ Brian O'Leary
__________________________
Name: Brian O'Leary
Title: Vice President
COOPERATIEVE CENTRALE RAIFFEISEN-
BOERENLEENBANK B.A., "RABOBANK
NEDERLAND", New York Branch,
by /s/ J. Scott Taylor
__________________________
Name: J. Scott Taylor
Title: Vice President
by /s/ Ian Reece
__________________________
Name: Ian Reece
Title: Vice President & Manager
THE DAI-ICHI KANGYO BANK, LTD.,
by /s/ Stephanie Rogers
__________________________
Name: Stephanie Rogers
Title: Vice President
<PAGE>
72
THE INDUSTRIAL BANK OF JAPAN, LIMITED,
by /s/ Junri Oda
__________________________
Name: Junri Oda
Title: Senior Vice President & Senior
MIDLAND BANK plc,
by /s/ John Howker
__________________________
Name: John Howker
Title: Executive Director
THE MITSUBISHI BANK, LIMITED - NEW YORK
BRANCH,
by /s/ Randy Szuch
__________________________
Name: Randy Szuch
Title: Vice President
THE MITSUBISHI TRUST AND BANKING CORPORATION,
by /s/ Patricia Loret de Mola
__________________________
Name: Patricia Loret de Mola
Title: Senior Vice President
MITSUI LEASING (U.S.A.) INC.,
by /s/ Toshiaki Nagano
__________________________
Name: Toshiaki Nagano
Title: Executive Vice President
NATIONSBANK OF GEORGIA, N.A.,
by /s/ Jan Seraten
__________________________
Name: Jan Seraten
Title: Senior Vice President
THE NIPPON CREDIT BANK, LTD.,
by /s/ Lori A. Ravit
__________________________
Name: Lori A. Ravit
Title: Assistant Vice President
<PAGE>
73
PILGRIM PRIME RATE TRUST,
by /s/ Michael D. Hatley
__________________________
Name: Michael D. Hatley
Title: Asstant Portfolio Manager
PRIME INCOME TRUST,
by
__________________________
Name:
Title:
PROTECTIVE LIFE INSURANCE COMPANY,
by /s/ James Dondero
__________________________
Name: James Dondero
Title: Vice President
SOUTHTRUST BANK OF ALABAMA, N.A.,
by /s/ T. Knudsen
__________________________
Name: T. Knudsen
Title: Senior Vice President
VAN KAMPEN MERRITT PRIME RATE INCOME TRUST,
by /s/ Jeffrey W. Maillet
__________________________
Name: Jeffrey W. Maillet
Title: Senior Vice President &
Portfolio Manager
WACHOVIA BANK OF GEORGIA N.A.,
by /s/ Leif Murphy
__________________________
Name: Leif Murphy
Title: Commercial Officer
<PAGE>
74
THE YASUDA TRUST AND BANKING CO., LTD.,
NEW YORK BRANCH,
by /s/ Neil T. Chau
__________________________
Name: Neil T. Chau
Title: First Vice President
EXHIBIT 12
<TABLE><CAPTION>
Bruno's, Inc.
Ratio of Earnings to Fixed Charges
(Dollar amounts in thousands)
Pro-forma
June 30, June 29, June 27, July 3, July 2, April 9, April 8, April 8,
1990 1991 1992 1993 1994 1994 1995 1995
(52 Weeks) (52 Weeks) (52 Weeks) (53 Weeks) (52 Weeks) (40 Weeks) (40 Weeks) (40 Weeks)
---------- ---------- ---------- ---------- ---------- ---------- ---------- ----------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
Earnings (1):
Pre Tax Income $ 99,911 $ 111,665 $ 87,142 $ 73,387 $ 68,770 $ 48,687 $ 33,914 $ (15,986)
Interest Expense 16,781 14,384 14,152 18,210 20,527 15,930 20,732 66,932
Rent Expense 11,085 13,011 14,040 15,216 15,473 11,522 12,209 12,209
--------- ---------- --------- ---------- ---------- ---------- ---------- ----------
$ 127,777 $ 139,060 $115,334 $106,813 $104,770 $ 76,139 $ 66,855 $ 63,155
--------- ---------- --------- ---------- ---------- ---------- ---------- ----------
--------- ---------- --------- ---------- ---------- ---------- ---------- ----------
Fixed Charges(2):
Interest Expense $ 16,781 $ 14,384 $ 14,152 $ 18,210 $ 20,527 $ 15,930 $ 20,732 $ 66,932
Rent Expense 11,085 13,011 14,040 15,216 15,473 11,522 12,209 12,209
--------- ---------- --------- ---------- ---------- ---------- ---------- ----------
$ 27,866 $ 27,395 $ 28,192 $ 33,426 $ 36,000 $ 27,452 $ 32,941 $ 79,141
--------- ---------- --------- ---------- ---------- ---------- ---------- ----------
--------- ---------- --------- ---------- ---------- ---------- ---------- ----------
Ratio $ 4.59 $ 5.08 $ 4.09 $ 3.20 $ 2.91 $ 2.77 $ 2.03 $ 0.80
--------- ---------- --------- ---------- ---------- ---------- ---------- ----------
--------- ---------- --------- ---------- ---------- ---------- ---------- ----------
</TABLE>
(1) Earnings consist of income before income taxes and extraordinary loss
on extinguishment of debt, plus fixed charges.
(2) Fixed charges consist of interest expense and one-third of rental
expense (the portion deemed representative of the interest factor).
EXHIBIT 99.1
[BRUNO'S, INC. LETTERHEAD]
NEWS RELEASE CONTACT: CATHERINE BYRD
FOR IMMEDIATE RELEASE 205-940-9400
BIRMINGHAM, ALABAMA-- Shareholders of Bruno's, Inc.
today approved the previously announced merger of Bruno's with a
company organized by Kohlberg Kravis Roberts & Co., as well as
certain related matters. Approximately 77% of the outstanding
shares of Bruno's common stock were voted in favor of the merger.
Trading of Bruno's common stock on Nasdaq is expected to be
terminated upon completion of the merger, which is scheduled to
occur today.
As previously announced, pursuant to the merger
approximately 73.1 million of the 77.5 million shares of Bruno's
common stock outstanding prior to the merger will be converted
into $12 in cash. The remaining approximately 4.2 million shares
of Bruno's common stock outstanding prior to the merger will be
retained by Bruno's existing shareholders. Since Bruno's
shareholders elected to retain fewer than 4.2 million shares of
Bruno's common stock, all shares with respect to which a properly
completed election was made to retain shares will be retained.
With respect to shares of Bruno's common stock which did not
elect to be retained, approximately 97% will be converted on a
pro rata basis into cash at $12 per share and the remaining
shares will be converted into the right to retain shares of
Bruno's common stock.
Ronald G. Bruno, Chairman and Chief Executive Officer,
said "When Bruno's first offered shares to the public in 1971,
they sold for $14.75 per share. So if you purchased 1,000 shares
then, taking into account six two-for-one stock splits and the
spin off of Big B Drugs, your investment would be worth almost
$800,000 today. For long-time shareholders, Bruno's has been a
good investment. We feel very good about that."
"Throughout its history, Bruno's has worked to build a
strong foundation for the future. I am confident that Bruno's
will continue to grow and prosper under its new leadership for a
very long time to come."
"Bruno's is entering a very exciting new stage in its
development," said Henry Kravis and George Roberts, founding
partners of KKR. "We believe that together with our new
colleagues at Bruno's we have the opportunity to continue to
develop the Company's full business potential."
Bruno's is a leading regional food retailer operating a
total of 254 supermarkets in Alabama, Georgia, Mississippi,
Florida, South Carolina and Tennessee.
EXHIBIT 99.2
[BRUNO'S, INC. LETTERHEAD]
NEWS RELEASE CONTACT: CATHERINE BYRD
FOR IMMEDIATE RELEASE 205-940-9449
BIRMINGHAM, AL (August 22, 1995) -- Bruno's, Inc. announced today that
William J. Bolton has been named Chairman and Chief Executive Officer of the
Company. His appointment is effective immediately.
Bolton, 49, is a 29-year veteran of American Stores, the second
largest food and drug retailer in the country, and its predecessor companies.
He has been President of Chicago-based Jewel Food Stores, a subsidiary of
American Stores, since 1991. Since early 1995 he has also been Chief Operating
Officer, Markets for American Stores, where he was responsible for the capital
growth plans of the corporation.
During his tenure at American Stores, Bolton held executive level
positions in grocery merchandising, bakery/deli, general merchandise, marketing
and real estate. He also has store-level retail experience. Bolton is a
graduate of Western Michigan University's Food Co-op Program.
"Bruno's reputation is tremendous. I have been familiar with the
family, the Company, and its fine tradition for many years," said Bolton. "I
look forward to focusing on the future growth of this outstanding Company."
"Bruno's has a strong tradition of customer service. Our southeastern
markets are very attractive areas for growth. The potential for a company with
such a solid foundation is exciting. I believe my responsibility is to help
lead the Bruno's team of employees in aggressively building our business," said
Bolton.
"Bill Bolton brings a wealth of industry knowledge and experience to
Bruno's," said outgoing Chairman and CEO Ronald G. Bruno. "I am confident the
Company will continue to grow and prosper under his leadership as he develops a
new senior management team."
"Ronald Bruno will continue to work at the Company during a transition
period. He will remain a member of Bruno's board of directors.
"Bill brings strong leadership skills and a breadth of supermarket
experience to Bruno's," said Paul Racther and Jamie Greene, general partners of
Kohlberg Kravis Roberts & Co (KKR). "In particular, his success in emphasizing
customer service and consistent growth in cash flow at Jewel through astute
marketing and merchandising programs will be invaluable to Bruno's future
growth".
<PAGE>
Bill Bolton
Bruno's, Inc.
Page 2
Shareholders of Bruno's, Inc. approved on Friday, August 18 the
previously announced merger of Bruno's with Crimson Acquisition Corp., a company
organized by KKR. Bruno's is a leading regional food retailer operating a total
of 252 supermarkets in Alabama, Georgia, Mississippi, Florida, South Carolina
and Tennessee.
