<PAGE> 1
AS FILED WITH THE SECURITIES AND EXCHANGE COMMISSION ON APRIL 13, 1995
Registration No. 33-__________
===============================================================================
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
--------------------
FORM S-3
REGISTRATION STATEMENT
Under
The Securities Act of 1933
EDISON BROTHERS STORES, INC.
(Exact name of registrant as specified in its charter)
Delaware 43-0254900
- --------------------------------------- -------------------------------------
(State or other jurisdiction of (IRS employer
incorporation or organization) identification number)
501 North Broadway
St. Louis, Missouri 63102
(314) 331-6000
(Address, including zip code, and telephone number, including area code,
of registrant's principal executive offices)
Alan A. Sachs, Esq.
Edison Brothers Stores, Inc.
501 North Broadway
St. Louis, Missouri 63102
(314) 331-6565
(Name, address, including zip code, and telephone
number, including area code, of agent for service)
Copies to:
James L. Nouss, Jr.
Bryan Cave
211 North Broadway, Suite 3600
St. Louis, Missouri 63102-2750
(314) 259-2000
--------------------
Approximate date of commencement of proposed sale to the public: From
time to time after the effective date of this Registration Statement.
If the only securities being registered on the form are being offered
pursuant to dividend or interest reinvestment plans, please check the following
box. [ ]
If any of the securities registered on this form are to be offered on
a delayed or continuous basis pursuant to Rule 415 under the Securities Act of
1933, other than securities offered only in connection with dividend or
interest reinvestment plans, check the following box. [X]
<PAGE> 2
<TABLE>
CALCULATION OF REGISTRATION FEE
=======================================================================================================
<CAPTION>
Proposed Maximum Proposed Maximum
Title of Each Class of Amount to Offering Price Aggregate Amount of
Securities to be Registered be Registered Per Unit <F1> Offering Price <F2> Registration Fee
- -------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Debt Securities <F4>
Preferred Stock <F5><F6>
Depositary Shares <F6>
Common Stock, par value <F3> <F3> <F3> <F3>
$1.00 per share <F7>
Warrants <F8>
- -------------------------------------------------------------------------------------------------------
Total $250,000,000 <F9> 100% $250,000,000 <F9> $86,207
=======================================================================================================
<FN>
<F1> The proposed maximum offering price per unit will be determined from time to time by the registrant
in connection with the issuance by the registrant of the securities registered hereunder.
<F2> The proposed maximum aggregate offering price has been estimated solely for the purpose of
calculating the registration fee pursuant to Rule 457(o) under the Securities Act of 1933.
<F3> Not applicable pursuant to General Instruction II.D. of Form S-3.
<F4> Subject to note (9) below, there is being registered hereunder an indeterminate principal amount of
Debt Securities as may be sold, from time to time, by the registrant and as may be issuable upon
exercise of Warrants registered hereunder. If any Debt Securities are issued at an original issue
discount, then the offering price shall be in such greater principal amount as shall result in an
aggregate initial offering price not to exceed $250,000,000 less the dollar amount of any securities
previously issued hereunder.
<F5> Subject to note (9) below, there is being registered hereunder an indeterminate number of shares of
Preferred Stock as may be sold, from time to time, by the registrant and as may be issuable upon
exercise of Warrants registered hereunder.
<F6> Subject to note (9) below, there is being registered hereunder an indeterminate number of Depositary
Shares to be evidenced by Depositary Receipts issued pursuant to a Deposit Agreement. In the event
the registrant elects to offer to the public fractional interests in shares of Preferred Stock
registered hereunder, Depositary Receipts will be distributed to those persons purchasing such
fractional interests and the shares of Preferred Stock will be issued to the Depositary under the
Deposit Agreement.
<F7> Subject to note (9) below, there is being registered hereunder an indeterminate number of shares of
Common Stock as may be sold, from time to time, by the registrant. There are also being registered
hereunder an indeterminate number of shares of Common Stock as shall be issuable upon conversion or
redemption of Preferred Stock or Debt Securities registered hereunder or upon exercise of Warrants
registered hereunder. Common Stock includes associated rights to purchase shares of Common Stock
(the "Rights"). Until the occurrence of certain prescribed events, none of which has occurred, the
Rights are not exercisable, are evidenced by the certificates representing the Common Stock, and
will be transferred along with and only with the Common Stock.
<F8> Subject to note (9) below, there is being registered hereunder an indeterminate amount and number of
Warrants, representing rights to purchase Debt Securities, Preferred Stock, or Common Stock
registered hereunder.
<F9> In no event will the aggregate initial offering price of all securities issued from time to time
pursuant to this Registration Statement exceed $250,000,000 or the equivalent thereof in one or more
foreign currencies, foreign currency units, or composite currencies. The aggregate amount of Common
Stock registered hereunder is further limited to that which is permissible under Rule 415(a)(4)
under the Securities Act of 1933. The securities registered hereunder may be sold separately or as
units with other securities registered hereunder.
</TABLE>
<PAGE> 3
THE REGISTRANT HEREBY AMENDS THIS REGISTRATION STATEMENT ON SUCH DATE
OR DATES AS MAY BE NECESSARY TO DELAY ITS EFFECTIVE DATE UNTIL THE REGISTRANT
SHALL FILE A FURTHER AMENDMENT WHICH SPECIFICALLY STATES THAT THIS REGISTRATION
STATEMENT SHALL THEREAFTER BECOME EFFECTIVE IN ACCORDANCE WITH SECTION 8(A) OF
THE SECURITIES ACT OF 1933 OR UNTIL THE REGISTRATION STATEMENT SHALL BECOME
EFFECTIVE ON SUCH DATE AS THE COMMISSION, ACTING PURSUANT TO SAID SECTION 8(A),
MAY DETERMINE.
===============================================================================
<PAGE> 4
INFORMATION CONTAINED HEREIN IS SUBJECT TO COMPLETION OR AMENDMENT. A
REGISTRATION STATEMENT RELATING TO THESE SECURITIES HAS BEEN FILED WITH THE
SECURITIES AND EXCHANGE COMMISSION. THESE SECURITIES MAY NOT BE SOLD NOR MAY
OFFERS TO BUY BE ACCEPTED PRIOR TO THE TIME THE REGISTRATION STATEMENT BECOMES
EFFECTIVE. THIS PROSPECTUS SHALL NOT CONSTITUTE AN OFFER TO SELL OR THE
SOLICITATION OF AN OFFER TO BUY NOR SHALL THERE BE ANY SALE OF THESE SECURITIES
IN ANY STATE IN WHICH SUCH OFFER, SOLICITATION OR SALE WOULD BE UNLAWFUL PRIOR
TO REGISTRATION OR QUALIFICATION UNDER THE SECURITIES LAWS OF ANY SUCH STATE.
SUBJECT TO COMPLETION, DATED APRIL 13, 1995
PROSPECTUS
[CORPORATE LOGO] Edison Brothers Stores, Inc.
Debt Securities
Preferred Stock
Depositary Shares
Common Stock
Warrants
Edison Brothers Stores, Inc. (the "Company"), a Delaware corporation,
may offer from time to time (a) in one or more series, unsecured debentures,
notes, or other obligations ("Debt Securities"), which may be subordinated to
other indebtedness of the Company, (b) warrants to purchase Debt Securities
("Debt Warrants"), (c) shares of preferred stock of one or more series
("Preferred Stock"), (d) warrants to purchase shares of Preferred Stock
("Preferred Stock Warrants"), (e) depositary shares representing entitlement to
all rights and preferences of a fraction of a share of Preferred Stock of a
specified series ("Depositary Shares"), (f) shares of common stock, par value
$1.00 per share ("Common Stock"), or (g) warrants to purchase shares of Common
Stock ("Common Stock Warrants"), all having an aggregate initial public
offering price not to exceed $250,000,000 or the equivalent thereof in one or
more foreign currencies, foreign currency units, or composite currencies,
including European Currency Units. The Debt Warrants, Preferred Stock
Warrants, and Common Stock Warrants are referred to herein collectively as
"Warrants," and the Debt Securities, Preferred Stock, Depositary Shares, Common
Stock, and Warrants are referred to herein collectively as the "Offered
Securities." The Offered Securities may be offered separately or as units with
other Offered Securities, in separate series in amounts, at prices, and on
terms to be determined at or prior to the time of sale.
The specific terms of the Offered Securities with respect to which
this Prospectus is being delivered will be set forth in a supplement to this
Prospectus (a "Prospectus Supplement"), together with the terms of the offering
and sale of the Offered Securities and the initial offering price and the net
proceeds to the Company from the sale thereof. The Prospectus Supplement will
include, with regard to the particular Offered Securities, the following
information: (a) in the case of Debt Securities, the specific designation,
aggregate principal amount, ranking, authorized denomination, maturity, rate or
method of calculation of interest and dates for payment thereof, any index or
formula for determining the amount of any principal, premium, or interest
payment, any exchangeability, conversion, redemption, prepayment, or sinking
fund provisions, the currency or currency unit in which principal, premium, or
interest is payable, whether the securities are issuable in registered form or
in the form of global securities, and the designation of the trustee acting
under the applicable indenture; (b) in the case of Preferred Stock, the
<PAGE> 5
designation, number of shares, liquidation preference per share, dividend rate
(or method of calculation thereof), dividend payment dates and dates from which
dividends shall accrue, any redemption or sinking fund provisions, any
conversion or exchange rights, whether the Company has elected to offer the
Preferred Stock in the form of Depositary Shares, and, if so, the fraction of a
share of Preferred Stock which each such Depositary Share will represent; (c)
in the case of Common Stock, the number of shares; (d) in the case of Warrants,
the number and terms thereof, the designation and number of securities issuable
upon exercise, the exercise price, and the duration and detachability thereof
where applicable; and (e) in the case of all Offered Securities, whether such
Offered Securities will be offered separately or as a unit with other Offered
Securities. The Prospectus Supplement will also contain information, where
applicable, about material United States federal income tax considerations
relating to, and any listings on a securities exchange of, the Offered
Securities covered by such Prospectus Supplement.
The Company's Common Stock is listed on the New York Stock Exchange.
Any Common Stock offered will be listed, subject to notice of issuance, on such
exchange.
The Company may sell the Offered Securities directly, through agents
designated from time to time, or through underwriters or dealers. If any
agents, underwriters, or dealers are involved in the sale of the Offered
Securities, the names of such agents, underwriters, or dealers and any
applicable commissions or discounts and the net proceeds to the Company from
such sale will be set forth in the applicable Prospectus Supplement.
THIS PROSPECTUS MAY NOT BE USED TO CONSUMMATE SALES OF OFFERED
SECURITIES UNLESS ACCOMPANIED BY A PROSPECTUS SUPPLEMENT.
--------------------
THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE SECURITIES AND
EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION NOR HAS THE
SECURITIES AND EXCHANGE COMMISSION OR ANY STATE SECURITIES
COMMISSION PASSED UPON THE ACCURACY OR ADEQUACY OF THIS
PROSPECTUS. ANY REPRESENTATION TO THE CONTRARY IS
A CRIMINAL OFFENSE.
--------------------
The date of this Prospectus is _____________ , 1995.
<PAGE> 6
IN CONNECTION WITH AN OFFERING OF OFFERED SECURITIES, THE
UNDERWRITERS, IF ANY, FOR SUCH OFFERING MAY OVER-ALLOT OR EFFECT TRANSACTIONS
WHICH STABILIZE OR MAINTAIN THE MARKET PRICES OF THE OFFERED SECURITIES AT
LEVELS ABOVE THOSE WHICH MIGHT OTHERWISE PREVAIL IN THE OPEN MARKET. SUCH
STABILIZING, IF COMMENCED, MAY BE DISCONTINUED AT ANY TIME.
AVAILABLE INFORMATION
The Company is subject to the informational requirements of the
Securities Exchange Act of 1934, as amended (the "Exchange Act"), and in
accordance therewith files reports, proxy statements, and other information
with the Securities and Exchange Commission (the "SEC"). Those reports, proxy
statements, and other information can be inspected and copied at the public
reference facilities maintained by the SEC at Room 1024, Judiciary Plaza, 450
Fifth Street, N.W., Washington, D.C. 20549, and at the following SEC regional
offices: 13th Floor, 7 World Trade Center, New York, New York 10048; and Suite
1400, Citicorp Center, 500 West Madison Street, Chicago, Illinois 60661.
Copies of such materials can be obtained at prescribed rates from the Public
Reference Section of the SEC at Judiciary Plaza, 450 Fifth Street, N.W.,
Washington, D.C. 20549. Such reports, proxy statements, and other information
also may be inspected at the offices of the New York Stock Exchange, 20 Broad
Street, New York, New York 10005.
The Company has filed with the SEC a Registration Statement on Form
S-3 (the "Registration Statement") under the Securities Act of 1933, as amended
(the "Securities Act"), with respect to the Offered Securities. This
Prospectus does not contain all the information set forth in the Registration
Statement, certain parts of which are omitted in accordance with the rules and
regulations of the SEC. For further information with respect to the Company
and the Offered Securities, reference is made to the Registration Statement and
to the exhibits thereto. Statements contained herein concerning the provisions
of certain documents are not necessarily complete, and in each instance,
reference is made to the copy of such document filed as an exhibit to the
Registration Statement or otherwise filed with the SEC. Each such statement is
qualified in its entirety by such reference.
INCORPORATION OF CERTAIN DOCUMENTS BY REFERENCE
The Company's Annual Report on Form 10-K for the fiscal year ended
January 28, 1995 which has been filed by the Company with the SEC pursuant to
the Exchange Act (File No. 1-1394), is incorporated by reference into this
Prospectus and shall be deemed to be a part hereof.
All documents filed by the Company pursuant to Section 13(a), 14, or
15(d) of the Exchange Act subsequent to the date of this Prospectus and prior
to the termination of the offering made hereby shall be deemed to be
incorporated by reference into this Prospectus and to be a part hereof from the
date of the filing of such documents. Any statement contained herein or in a
document incorporated or deemed to be incorporated by reference herein shall be
deemed to be modified or superseded for purposes of this Prospectus to the
extent that a statement contained herein or in any subsequently filed document
that also is or is deemed to be incorporated by reference herein or in any
Prospectus Supplement modifies or supersedes such statement. Any statement so
modified or superseded shall not be deemed to constitute a part of this
Prospectus, except as so modified or superseded.
<PAGE> 7
The Company will provide without charge to each person to whom a copy
of this Prospectus has been delivered, on the written or oral request of any
such person, a copy of any or all of the documents referred to above that have
been or may be incorporated by reference into this Prospectus, other than
exhibits to such documents (unless such exhibits are specifically incorporated
by reference into such documents). Written or telephone requests for such
copies should be directed to Edison Brothers Stores, Inc., Attention: Corporate
Secretary, 501 North Broadway, St. Louis, Missouri 63102 (telephone (314) 331-
6000).
THE COMPANY
The Company is a leading specialty retailer of fashion apparel and
footwear operating more than 2,700 stores in all fifty states of the United
States, Puerto Rico, the Virgin Islands, Mexico, and Canada. The Company
conducts its principal operations through subsidiaries and divisions in two
segments: apparel and footwear. Stores within the apparel and footwear
segments, with the exception of the Repp, Ltd. chain of big-and-tall mens
stores, are almost exclusively mall-based and generally range in size from
1,300 to 3,000 square feet. Both the apparel and the footwear segments
primarily feature private label merchandise in the moderate price range. The
Company also operates an entertainment division composed of predominantly mall-
based entertainment centers and five free-standing restaurant/entertainment
complexes. In February 1995, the Company announced plans to spin off its
subsidiaries that own and operate the five Dave & Buster's
restaurant/entertainment complexes as a separate publicly-held corporation
later in the spring of 1995.
At fiscal year-end 1994, the apparel segment operated 1,941 stores in
eight chains. The six menswear chains--JW/Jeans West, Oaktree, J.Riggings,
Coda, Repp Ltd., and Zeidler & Zeidler--target specific male age and lifestyle
profiles with different product selections. Phoenix, the Company's first
catalog operation, supplies menswear to big and tall consumers. The womenswear
chains--5-7-9 and Spirale--primarily market casual wear and accessories to
young adults, teens, and pre-teens.
The footwear segment operated 681 stores in three chains at the end of
fiscal 1994. The footwear chains are Bakers/Leeds and Precis, which
offer popular-priced women's fashion shoes, and Wild Pair, which focuses on
advanced shoe fashion for both young men and women.
The Company's executive offices and operating headquarters are located
at 501 North Broadway, St. Louis, Missouri 63102, and its telephone number at
those offices is (314) 331-6000.
USE OF PROCEEDS
Unless otherwise specified in the applicable Prospectus Supplement,
the net proceeds from the sale of the Offered Securities will be used for
general corporate purposes, which may include the repayment of indebtedness,
acquisitions, additions to working capital, and capital expenditures.
<PAGE> 8
RATIOS OF EARNINGS TO FIXED CHARGES AND
EARNINGS TO FIXED CHARGES AND PREFERRED STOCK DIVIDENDS
The following sets forth the Company's consolidated ratios of earnings to
fixed charges and earnings to combined fixed charges and preferred stock
dividends for each of fiscal years 1994, 1993, 1992, 1991, and 1990.
<TABLE>
<CAPTION>
Fiscal Year <F1>
------------------------------------------------
1994 1993 1992 1991 1990
-------- -------- -------- -------- --------
<S> <C> <C> <C> <C> <C>
Ratio of earnings to fixed charges <F2>................... 1.5 1.5 2.8 2.5 2.8
Ratio of earnings to fixed charges
and preferred stock dividends <F3>...................... 1.5 1.5 2.8 2.5 2.8
- ---------------
<FN>
<F1> The Company's fiscal year ends on the Saturday closest to January 31. References to fiscal years
1994, 1993, 1992, 1991, and 1990 are to the 52 weeks ended January 28, 1995, January 29, 1994,
January 30, 1993, February 1, 1992, and February 2, 1991, respectively.
<F2> For purposes of computing such ratio, earnings consist of income before income taxes plus fixed
charges net of interest capitalized, and fixed charges consist of interest expense, interest
capitalized, and the portion of rental expense attributable to interest.
<F3> For purposes of computing such ratio, earnings consist of income before income taxes plus fixed
charges and preferred stock dividends net of interest capitalized, and fixed charges and preferred
stock dividends consist of interest expense, interest capitalized, the portion of rental expense
attributable to interest, and preferred stock dividends.
</TABLE>
DESCRIPTION OF DEBT SECURITIES
The Debt Securities will constitute either senior or subordinated debt
of the Company and will be issued, in the case of senior Debt Securities
("Senior Debt Securities"), under one or more indentures (collectively, the
"Senior Indenture"), between the Company and Fleet Bank of Massachusetts, N.A.,
(the "Senior Trustee"), and, in the case of subordinated Debt Securities
("Subordinated Debt Securities"), under one or more indentures (collectively,
the "Subordinated Indenture"), between the Company and one or more trustees to
be selected by the Company (collectively, the "Subordinated Trustee"). The
Senior Indenture and the Subordinated Indenture are sometimes hereinafter
referred to individually as the "Indenture" and collectively as the
"Indentures," and the Senior Trustee and the Subordinated Trustee are
hereinafter referred to as the "Trustee."
<PAGE> 9
The following description of the terms of the Debt Securities sets
forth certain general terms and provisions of the Debt Securities to which any
Prospectus Supplement may relate. The particular terms of the Debt Securities
offered by any Prospectus Supplement and the extent, if any, to which such
general provisions may apply to the Debt Securities so offered will be
described in the Prospectus Supplement relating to such Debt Securities.
Accordingly, for a description of the terms of a particular issue of Debt
Securities, reference must be made to both the Prospectus Supplement relating
thereto and to the following description. The discussion of the terms of the
Debt Securities and certain provisions of the Indentures is a summary only,
does not purport to be complete, and is qualified in its entirety by reference
to the provisions of the Indentures, including the definitions therein of
capitalized terms used below.
General
The Debt Securities will be general unsecured obligations of the
Company and may be subordinated to certain other indebtedness of the Company to
the extent set forth in the Prospectus Supplement relating thereto. See
"Description of Debt Securities--Subordination of Subordinated Debt Securities"
below. The Indentures do not limit the aggregate principal amount of Debt
Securities that can be issued thereunder. The Debt Securities may be issued in
one or more series as may be authorized from time to time by the Company.
Reference is made to the applicable Prospectus Supplement for the terms of the
Debt Securities of the series with respect to which such Prospectus Supplement
is being delivered, including: (i) the title, aggregate principal amount, and
authorized denominations of the Debt Securities; (ii) the percentage of their
principal amount at which such Debt Securities will be issued; (iii) the date
or dates on which the Debt Securities will mature; (iv) the rate or rates
(which may be fixed or variable) per annum, if any, at which the Debt
Securities will bear interest and the date or dates from which such interest
may accrue; (v) the times and places at which principal and any premium and
interest will be payable; (vi) whether the Debt Securities are convertible into
any other securities and the terms and conditions of such convertibility;
(vii) the period or periods within which, the price or prices at which, and the
terms and conditions on which any of such Debt Securities may be redeemed, in
whole or in part, at the option of the Company; (viii) the obligation, if any,
of the Company to redeem or purchase any of such Debt Securities pursuant to
any sinking fund or analogous provision or at the option of the holder thereof,
and the period or periods within which, the price or prices at which, and the
terms and conditions on which any of such Debt Securities will be redeemed or
purchased, in whole or in part, pursuant to any such obligation; (ix) if other
than United States currency, the currency of payment of principal of, premium,
if any, and interest on the Debt Securities and the manner of determining the
equivalent thereof in the currency of the United States of America for any
purpose; (x) any index or other basis used to determine the amount of payments
of principal of and any premium and interest on the Debt Securities; (xi)
whether the Debt Securities will be represented by a single global note
registered in the name of a depositary or a depositary's nominee and, if so,
the depositary for, the method of transferring beneficial interests in the
global note and the form of any legend which shall be borne on such Global
Securities; (xii) ranking as Subordinated Debt Securities, if applicable, and
the terms of any such subordination; (xiii) any addition to or change in the
Events of Default applicable to such Debt Securities, any change in the right
of the Trustee or the holders to declare the principal amount of any such Debt
Securities due and payable, and, if other than the principal amount thereof,
the amount payable upon acceleration of the maturity thereof; (xiv) any
<PAGE> 10
addition to or change in the covenants in the Senior Indenture described under
"Description of Debt Securities--Certain Covenants of the Company" applicable
to such Debt Securities; (xv) whether the Debt Securities shall be defeasible
at the option of the Company and the manner in which such election shall be
evidenced; and (xvi) any other terms relating to the Debt Securities of the
series not inconsistent with the applicable Indenture, including any terms that
may be required by or advisable under United States laws or applicable
regulations, or advisable in connection with the marketing of the Debt
Securities.
The Prospectus Supplement will also describe any material United
States federal income tax consequences or other special considerations
applicable to the series of Debt Securities to which such Prospectus Supplement
relates, including those applicable to (a) Debt Securities with respect to
which payments of principal, premium, or interest are determined with reference
to an index or formula (including changes in prices of particular securities,
currencies, or commodities), (b) Debt Securities with respect to which
principal, premium, or interest is payable in a currency other than the
currency of the United States, (c) Debt Securities that are issued at a
discount below their stated principal amount, bearing no interest or interest
at a rate that at the time of issuance is below market rates ("Original Issue
Discount Debt Securities"), and (d) variable rate Debt Securities that are
exchangeable for fixed rate Debt Securities.
Unless otherwise provided in the applicable Prospectus Supplement,
Debt Securities may be transferred or exchanged at the office of the Trustee at
which its corporate trust business is principally administered in the United
States or at the office of the Trustee or the Trustee's agent at which its
corporate agency business is conducted, subject to the limitations provided in
the Indenture, without the payment of any service charge, other than any
applicable tax or governmental charge.
All funds paid by the Company to the Trustee or a paying agent, or
held in trust by the Company for the payment of principal, premium, or interest
with respect to any Debt Securities and remaining unclaimed at the end of two
years after such principal, premium, or interest shall have become due and
payable will be repaid to the Company or released from such trust, and the
holders of such Debt Securities will thereafter look only to the Company for
payment thereof.
Global Securities
The Debt Securities of a series may be issued in whole or in part in
the form of one or more Global Securities. A Global Security is a Debt
Security that represents, and is denominated in an amount equal to the
aggregate principal amount of, all outstanding Debt Securities of the series,
or any portion thereof, in either case having the same terms, including the
same original issue date, principal and interest payment dates, and interest
rate or method of determining interest. A Global Security will be deposited
with, or on behalf of, a Depositary, which will be identified in the Prospectus
Supplement relating to such Debt Securities. Global Securities may be issued
in either temporary or definitive registered form. Unless and until it is
exchanged in whole or in part for the individual Debt Securities represented
thereby, a Global Security may not be transferred except as a whole by the
Depositary to a nominee of the Depositary, by a nominee of the Depositary to
the Depositary or another nominee of the Depositary, or by the Depositary or
<PAGE> 11
any nominee of the Depositary to a successor Depositary or any nominee of such
successor.
The specific terms of the depositary arrangement with respect to a
series of Debt Securities will be described in the Prospectus Supplement
relating to such Debt Securities. The Company anticipates that the following
provisions will generally apply to depositary arrangements.
Upon the issuance of a Global Security, the Depositary for such Global
Security will credit, on its book-entry registration and transfer system, the
respective principal amounts of the individual Debt Securities represented by
such Global Security to the accounts of persons that have accounts with the
Depositary ("participants"). Such accounts shall be designated by the dealers
or underwriters with respect to such Debt Securities or, if such Debt
Securities are offered and sold directly by the Company or through one or more
agents, by the Company or such agents. Ownership of beneficial interests in a
Global Security will be limited to participants or persons that hold beneficial
interests through participants. Ownership of beneficial interests in such
Global Security will be shown on, and the transfer of that ownership will be
effected only through, records maintained by the Depositary (with respect to
interests of participants) or records maintained by participants (with respect
to interests of persons other than participants). The laws of some states
require that certain purchasers of securities take physical delivery of such
securities in definitive form. Such limitations and laws may impair the
ability to transfer beneficial interests in a Global Security.
So long as the Depositary for a Global Security, or its nominee, is
the registered owner or holder of such Global Security, such Depositary or
nominee, as the case may be, will be considered the sole owner or holder of the
individual Debt Securities represented by such Global Security for all purposes
under the Indenture. Except as provided below, owners of beneficial interests
in a Global Security will not be entitled to have any of the individual Debt
Securities represented by such Global Security registered in their names, will
not receive or be entitled to receive physical delivery of any of such Debt
Securities in definitive form, and will not be considered the owners or holders
thereof under the Indenture.
Payments of principal, premium, and interest with respect to
individual Debt Securities represented by a Global Security will be made to the
Depositary or its nominee, as the case may be, as the registered owner or
holder of such Global Security. Neither the Company, the Trustee, any paying
agent or registrar for such Debt Securities, nor any agent of the Company or
the Trustee will have any responsibility or liability for (a) any aspect of the
records relating to or payments made by the Depositary, its nominee, or any
participants on account of beneficial interests in the Global Security or for
maintaining, supervising, or reviewing any records relating to such beneficial
interests, (b) the payment to the owners of beneficial interests in the Global
Security of amounts paid to the Depositary or its nominee, or (c) any other
matter relating to the actions and practices of the Depositary, its nominee, or
its participants. Neither the Company, the Trustee, any paying agent or
registrar for such Debt Securities, or any agent of the Company or the Trustee
will be liable for any delay by the Depositary, its nominee, or any of its
participants in identifying the owners of beneficial interests in the Global
Security, and the Company and the Trustee may conclusively rely on, and will be
protected in relying on, instructions from the Depositary or its nominee for
all purposes.
<PAGE> 12
The Company expects that the Depositary for a series of Debt
Securities or its nominee, upon receipt of any payment of principal, premium,
or interest with respect to a definitive Global Security representing any of
such Debt Securities, will immediately credit participants' accounts with
payments in amounts proportionate to their respective beneficial interests in
the principal amount of such Global Security, as shown on the records of the
Depositary or its nominee. The Company also expects that payments by
participants to owners of beneficial interests in such Global Security held
through such participants will be governed by standing instructions and
customary practices, as is the case with securities held for the accounts of
customers and registered in "street name." Such payments will be the
responsibility of such participants.
If the Depositary for a series of Debt Securities is at any time
unwilling, unable, or ineligible to continue as depositary, the Company shall
appoint a successor depositary. If a successor depositary is not appointed by
the Company within 90 days, the Company will issue individual Debt Securities
of such series in exchange for the Global Security representing such series of
Debt Securities. In addition, the Company may at any time and in its sole
discretion, subject to any limitations described in the Prospectus Supplement
relating to such Debt Securities, determine no longer to have Debt Securities
of a series represented by a Global Security and, in such event, will issue
individual Debt Securities of such series in exchange for the Global Security
representing such series of Debt Securities. Furthermore, if the Company so
specifies with respect to the Debt Securities of a series, an owner of a
beneficial interest in a Global Security representing Debt Securities of such
series may, on terms acceptable to the Company, the Trustee, and the Depositary
for such Global Security, receive individual Debt Securities of such series in
exchange for such beneficial interests, subject to any limitations described in
the Prospectus Supplement relating to such Debt Securities. In any such
instance, an owner of a beneficial interest in a Global Security will be
entitled to physical delivery of individual Debt Securities of the series
represented by such Global Security equal in principal amount to such
beneficial interest and to have such Debt Securities registered in its name.
Individual Debt Securities of such series so issued will be issued in
registered form in denominations, unless otherwise specified by the Company, of
$1,000 and integral multiples thereof.
Subordination of Subordinated Debt Securities
If Subordinated Debt Securities are issued, a Prospectus Supplement
relating thereto will describe the terms whereby such Subordinated Debt
Securities will be made subordinate and subject in right of payment to the
prior payment in full of senior indebtedness of the Company, and such
description will include a definition of what constitutes "senior indebtedness"
of the Company.
Certain Covenants of the Company
Unless otherwise indicated in the applicable Prospectus Supplement,
the Debt Securities will not have the benefit of any covenants that limit or
restrict the Company's business or operations or the incurrence of indebtedness
by the Company. If so indicated in the applicable Prospectus Supplement
relating to a series of Senior Debt Securities, certain covenants contained in
the Senior Indenture which are summarized below will be applicable (unless
waived or amended) to such series of Senior Debt Securities. The covenants
<PAGE> 13
contained in the Senior Indenture and any series of Senior Debt Securities
would not necessarily afford holders of such Debt Securities protection in the
event of a highly leveraged or other transaction involving the Company that may
adversely affect holders.
Limitations on Liens
The Company covenants that it will not issue, incur, create, assume or
guarantee, and will not permit any Restricted Subsidiary (as defined below) to
issue, incur, create, assume or guarantee, any debt for borrowed money secured
by a mortgage, security interest, pledge, lien, charge or other encumbrance
("mortgages") upon any Principal Property (as defined below) of the Company or
any Restricted Subsidiary or upon any shares of stock or indebtedness of any
Restricted Subsidiary (whether such Principal Property, shares or indebtedness
are now existing or owned or hereafter created or acquired) without in any such
case effectively providing concurrently with the issuance, incurrence,
creation, assumption or guarantee of any such secured debt, or the grant of a
mortgage with respect to any such indebtedness, that the Debt Securities
(together with, if the Company shall so determine, any other indebtedness of or
guarantee by the Company or such Restricted Subsidiary ranking equally with the
Debt Securities) shall be secured equally and ratably with (or, at the option
of the Company, prior to) such secured debt. The foregoing restriction,
however, will not apply to: (a) mortgages on property existing at the time of
acquisition thereof by the Company or any Subsidiary, provided that such
mortgages were in existence prior to the contemplation of such acquisition;
(b) mortgages on property, shares of stock or indebtedness or other assets of
any corporation existing at the time such corporation becomes a Restricted
Subsidiary, provided that such mortgages are not incurred in anticipation of
such corporation becoming a Restricted Subsidiary; (c) mortgages on property,
shares of stock or indebtedness existing at the time of acquisition thereof by
the Company or a Restricted Subsidiary or mortgages thereon to secure the
payment of all or any part of the purchase price thereof, or mortgages on
property, shares of stock or indebtedness to secure any indebtedness for
borrowed money incurred prior to, at the time of, or within 270 days after, the
latest of the acquisition thereof, or, in the case of property, the completion
of construction, the completion of improvements, or the commencement of
substantial commercial operation of such property for the purpose of financing
all or any part of the purchase price thereof, such construction, or the making
of such improvements; (d) mortgages to secure indebtedness owing to the Company
or to a Restricted Subsidiary; (e) mortgages existing at the date of the
Indenture relating to such Debt Securities; (f) mortgages on property of a
corporation existing at the time such corporation is merged into or
consolidated with the Company or a Restricted Subsidiary or at the time of a
sale, lease or other disposition of the properties of a corporation as an
entirety or substantially as an entirety to the Company or a Restricted
Subsidiary, provided that such mortgage was not incurred in anticipation of
such merger or consolidation or sale, lease or other disposition; (g) mortgages
in favor of the United States or any State, territory or possession thereof (or
the District of Columbia), or any department, agency, instrumentality or
political subdivision of the United States or any State, territory or
possession thereof (or the District of Columbia), to secure partial, progress,
advance or other payments pursuant to any contract or statute or to secure any
indebtedness incurred for the purpose of financing all or any part of the
purchase price or the cost of constructing or improving the property subject to
such mortgages; (h) mortgages created in connection with the acquisition of
assets or a project financed with, and created to secure, a Nonrecourse
Obligation (as defined below); and (i) extensions, renewals, refinancings or
<PAGE> 14
replacements of any mortgage referred to in the foregoing clauses (a), (b),
(c), (e), (f), (g) and (h); provided, however, that any mortgages permitted by
any of the foregoing clauses (a), (b), (c), (e), (f), (g) and (h) shall not
extend to or cover any property of the Company or such Restricted Subsidiary,
as the case may be, other than the property, if any, specified in such clauses
and improvements thereto, and provided further that any refinancing or
replacement of any mortgages permitted by the foregoing clauses (g) and (h)
shall be of the type referred to in such clauses (g) or (h), as the case may
be.
Notwithstanding the restrictions outlined in the preceding paragraph,
the Company or any Restricted Subsidiary will be permitted to issue, incur,
create, assume or guarantee debt secured by a mortgage which would otherwise be
subject to such restrictions, without equally and ratably securing the Debt
Securities, provided that after giving effect thereto, the aggregate amount of
all debt so secured by mortgages (not including mortgages permitted under
clauses (a) through (i) above) does not exceed 10% of the Consolidated Net
Tangible Assets (as defined below) of the Company.
Limitations on Sale and Lease-Back Transactions
The Company covenants that it will not, nor will it permit any
Restricted Subsidiary to, enter into any Sale and Lease-Back Transaction (as
defined below) with respect to any Principal Property, other than any such
transaction involving a lease for a term of not more than three years or any
such transaction between the Company and a Restricted Subsidiary or between
Restricted Subsidiaries, unless: (a) the Company or such Restricted Subsidiary
would be entitled to incur indebtedness secured by a mortgage on the Principal
Property involved in such transaction at least equal in amount to the
Attributable Debt (as defined below) with respect to such Sale and Lease-Back
Transaction, without equally and ratably securing the Debt Securities, pursuant
to the limitation on liens in the Indenture; or (b) the Company shall apply an
amount equal to the greater of the net proceeds of such sale or the
Attributable Debt with respect to such Sale and Lease-Back Transaction within
180 days of such sale to either (or a combination of) the retirement (other
than any mandatory retirement, mandatory prepayment or sinking fund payment or
by payment at maturity) of debt for borrowed money of the Company or a
Restricted Subsidiary that matures more than 12 months after the creation of
such indebtedness or the purchase, construction or development of other
comparable property.
Certain Definitions Applicable to Covenants
The term "Attributable Debt" when used in connection with a Sale and
Lease-Back Transaction involving a Principal Property shall mean, at the time
of determination, the lesser of: (a) the fair value of such property (as
determined in good faith by the Board of Directors of the Company); or (b) the
present value of the total net amount of rent required to be paid under such
lease during the remaining term thereof (including any renewal term or period
for which such lease has been extended), discounted at the rate of interest set
forth or implicit in the terms of such lease or, if not practicable to
determine such rate, the weighted average interest rate per annum (in the case
of Original Issue Discount Securities, the imputed interest rate) borne by the
Debt Securities of each series outstanding pursuant to the Indenture compounded
semi-annually. For purposes of the foregoing definition, rent shall not
include amounts required to be paid by the lessee, whether or not designated as
<PAGE> 15
rent or additional rent, on account of or contingent upon maintenance and
repairs, insurance, taxes, assessments, water rates and similar charges. In
the case of any lease which is terminable by the lessee upon the payment of a
penalty, such net amount shall be the lesser of the net amount determined
assuming termination upon the first date such lease may be terminated (in which
case the net amount shall also include the amount of the penalty, but no rent
shall be considered as required to be paid under such lease subsequent to the
first date upon which it may be so terminated) or the net amount determined
assuming no such termination.
The term "Consolidated Net Tangible Assets" shall mean, as of any
particular time, total assets (excluding applicable reserves and other properly
deductible items) less: (a) total current liabilities, except for (1) notes and
loans payable, (2) current maturities of long-term debt, and (3) current
maturities of obligations under capital leases; and (b) goodwill, patents and
trademarks, to the extent included in total assets; all as set forth on the
most recent consolidated balance sheet of the Company and its consolidated
subsidiaries and computed in accordance with generally accepted accounting
principles.
The term "Nonrecourse Obligation" means indebtedness or other
obligations substantially related to (i) the acquisition of assets not
previously owned by the Company or any Restricted Subsidiary or (ii) the
financing of a project involving the development or expansion of properties of
the Company or any Restricted Subsidiary, as to which the obligee with respect
to such indebtedness or obligation has no recourse to the Company or any
Restricted Subsidiary or any assets of the Company or any Restricted Subsidiary
other than the assets which were acquired with the proceeds of such transaction
or the project financed with the proceeds of such transaction (and the proceeds
thereof).
The term "Principal Property" shall mean the land, land improvements,
buildings and fixtures (to the extent they constitute real property interests)
(including any leasehold interest therein) constituting the principal corporate
office or any distribution center (whether now owned or hereafter acquired)
which: (a) is owned by the Company or any Subsidiary; (b) is located within any
of the present 50 states of the United States (or the District of Columbia);
(c) has not been determined in good faith by the Board of Directors of the
Company not to be materially important to the total business conducted by the
Company and its Subsidiaries taken as a whole; and (d) has a market value on
the date as of which the determination is being made in excess of 1.0% of
Consolidated Net Tangible Assets of the Company as most recently determined on
or prior to such date.
The term "Restricted Subsidiary" shall mean any Subsidiary that owns
any Principal Property.
The term "Sale and Lease-Back Transaction" shall mean any arrangement
with any person providing for the leasing by the Company or any Restricted
Subsidiary of any Principal Property which property has been or is to be sold
or transferred by the Company or such Restricted Subsidiary to such person.
The term "Subsidiary" shall mean any corporation of which at least a
majority of the outstanding voting stock having the power to elect a majority
of the board of directors of such corporation is at the time owned, directly or
indirectly, by the Company or by one or more other Subsidiaries, or by the
Company and one or more other Subsidiaries. For the purposes of this
definition, "voting stock" means stock which ordinarily has voting power for
<PAGE> 16
the election of directors, whether at all times or only so long as no senior
class of stock has such voting power by reason of any contingency.
Consolidation, Merger, and Sale of Assets
Under the terms of the Indenture, the Company shall not consolidate
with or merge into any other person or convey, transfer or lease its properties
and assets substantially as an entirety to any person, and the Company shall
not permit any person to consolidate with or merge into the Company or convey,
transfer or lease its properties and assets substantially as an entirety to the
Company, unless:
(1) in case the Company shall consolidate with or merge into another
person or convey, transfer or lease its properties and assets substantially
as an entirety to any person, the person 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 shall be a corporation, partnership or trust,
shall be organized and validly existing under the laws of the United
States, any State thereof or the District of Columbia and shall expressly
assume, by a supplemental Indenture executed and delivered to the Trustee,
in form satisfactory to the Trustee, the due and punctual payment of the
principal of and any premium and interest on all the Debt Securities and
the performance or observance of every covenant of the Indenture on the
part of the Company to be performed or observed;
(2) immediately after giving effect to such transaction and treating
any indebtedness which becomes an obligation of the Company or any
Subsidiary as a result of such transaction as having been incurred by the
Company or such Subsidiary at the time of 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; and
(3) if, as a result of any such consolidation or merger or such
conveyance, transfer or lease, properties or assets of the Company would
become subject to a mortgage, pledge, lien, security interest or other
encumbrance which would not be permitted by the Indenture, the Company or
such successor person, as the case may be, shall take such steps as shall
be necessary effectively to secure the Debt Securities equally and ratably
with (or prior to) all indebtedness secured thereby.
Events of Default and Remedies
The Indentures will define "Events of Default" with respect to a
series of Debt Securities as being any one of the following events:
(1) default in the payment of any interest upon any Debt Security of
that series when it becomes due and payable, and the continuance of such
default for a period of 30 days; or
(2) default in the payment of the principal of or any premium on any
Debt Security of that 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 that series; or
<PAGE> 17
(4) default in the performance, or breach, of any covenant or warranty
of the Company in the Indenture (other than a covenant or warranty included
in the Indenture solely for the benefit of any series of Debt Securities
other than that series), and the continuance of such default or breach for
60 days after written notice has been given to the Company by the Trustee
or to the Company and the Trustee by the holders of at least 25% in
principal amount of the outstanding Debt Securities of that series, as
provided in the Indenture; or
(5) a default with respect to any indebtedness for money borrowed by
the Company or any Restricted Subsidiary (including a default with respect
to Debt Securities of any series other than that series) having an
aggregate principal amount outstanding of at least $10,000,000, or under
any mortgage, indenture or instrument (including the Indenture) under which
there may be issued or by which there may be secured or evidenced any
indebtedness for money borrowed by the Company or any Restricted Subsidiary
having an aggregate principal amount outstanding of at least $10 million,
whether such indebtedness now exists or is hereafter created, which default
(A) shall constitute a failure to pay any portion of the principal of such
indebtedness when due and payable after the expiration of any applicable
grace period with respect thereto, or (B) shall have resulted in the
acceleration of such indebtedness, if, in the case of clause (A), such
indebtedness has not been discharged or, in the case of clause (B), such
indebtedness has not been discharged or such acceleration has not been
rescinded or annulled, in each case within 10 days after written notice has
been given to the Company by the Trustee or to the Company and the Trustee
by the holders of at least 25% in principal amount of the outstanding Debt
Securities of that series, as provided in the Indenture; or
(6) certain voluntary or involuntary events of bankruptcy, insolvency
or reorganization in respect of the Company; or
(7) any other events as may be provided with respect to Debt
Securities of that series.
An Event of Default with respect to one series of Debt Securities is
not necessarily an Event of Default for another series.
If an Event of Default with respect to Debt Securities of any series
at the time outstanding occurs and is continuing (other than an Event of
Default described under clause (6) above), then in every such case the Trustee
or the holders of not less than 25% in principal amount of the outstanding Debt
Securities of that series may declare the principal amount of all the Debt
Securities of that series (or, if any Debt Securities of that series are
Original Issue Discount Securities, such portion of the principal amount of
such Debt Securities as may be specified by the terms thereof) to be due and
payable, by written notice to the Company (and to the Trustee if given by
holders), and upon any such declaration such principal amount (or specified
amount) shall become immediately due and payable. In the case of an Event of
Default specified under clause (6) above with respect to Debt Securities of any
series at the time outstanding, the principal amount of all the Debt Securities
of such series (or, in the case of Original Issue Discount Securities, such
portion of the principal amount of such Debt Securities as may be specified by
the terms thereof) shall automatically, and without any declaration or other
action on the part of the Trustee or any holder, become immediately due and
payable.
<PAGE> 18
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, the holders of a
majority in principal amount of the outstanding Debt Securities of that 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 sufficient to pay (A) all overdue interest on all Debt
Securities of that series, (B) the principal of (and premium, if any, on) any
Debt Securities of that series which has become due otherwise than by such
acceleration and any interest thereon at the rate prescribed in such Debt
Securities, (C) to the extent that payment of such interest is lawful, interest
upon overdue interest at the rate prescribed in such Debt Securities, and (D)
all sums payable by the Company to the Trustee under the Indenture; and (2) all
Events of Default with respect to Debt Securities of that series, other than
the non-payment of the principal (and premium, if any, on) of Debt Securities
of that series which has become due solely by such acceleration, have been
cured or waived.
The holders of a majority in principal amount of the outstanding Debt
Securities of a series by notice to the Trustee may on behalf of all holders of
Debt Securities of such series waive any existing default or Event of Default
under the Indenture, except (i) a default in the payment of any interest or
premium on, or the principal of such Debt Securities, or (ii) a default in
respect of a covenant or provision of the Indenture which under the terms
thereof may not be modified or amended without the consent of the holder of
each outstanding Debt Security of such series affected.
Modification of the Indenture
Each Indenture will provide that, with certain exceptions, the
Indenture, the rights and obligations of the Company, and the rights of the
holders of the Debt Securities issued thereunder may be modified by the Company
and the Trustee with the consent of the holders of a majority in aggregate
principal amount of outstanding Debt Securities of a series directly affected
by such modification; provided, however, that, without the consent of each
holder of such Debt Securities affected thereby, no such modification may (a)
reduce the percentage in principal amount of Debt Securities of any series
whose holders must consent to an amendment or waiver, (b) reduce the rate of or
change the time for payment of interest on any Debt Security, (c) reduce the
principal of or change the stated maturity of any Debt Security, (d) reduce the
amount of principal of any Original Issue Discount Security or any other Debt
Security that would be due and payable upon a declaration of acceleration
thereof, (e) reduce the premium payable upon the redemption of any Debt
Security or change the time at which any Debt Security may or shall be
redeemed, (f) change the currency in which, or the place or places where,
principal of and any premium and interest on any Debt Security is payable, (g)
modify the provisions of the Subordinated Indenture with respect to the
subordination of the Subordinated Debt Securities in a manner adverse to the
holders thereof, or (h) make any change in the provisions of the Indenture
relating to waivers of defaults or amendments that require unanimous consent.
Satisfaction and Discharge of the Indenture; Defeasance
The Indentures shall generally cease to be of any further effect with
respect to a series of Debt Securities if (a) the Company has delivered to the
Trustee for cancellation all Debt Securities of such series (with certain
<PAGE> 19
limited exceptions) or (b) all Debt Securities of such series not theretofore
delivered to the Trustee for cancellation shall have become due and payable, or
are by their terms to become due and payable within one year or are to be
called for redemption within one year, and the Company shall have deposited
with the Trustee as trust funds the entire amount sufficient to pay at maturity
or upon redemption, as the case may be, all such Debt Securities (and if, in
either case, the Company shall also pay or cause to be paid all other sums
payable under the Indentures by the Company).
In addition, the Company shall have a defeasance option (pursuant to
which it may terminate, with respect to the Debt Securities of a particular
series, all of its obligations under such Debt Securities and the Indenture
with respect to such Debt Securities) and a covenant defeasance option
(pursuant to which it may terminate, with respect to the Debt Securities of a
particular series, its obligations with respect to such Debt Securities under
certain specified covenants contained in the Indenture). If the Company
exercises its defeasance option with respect to a series of Debt Securities,
Payment of such Debt Securities may not be accelerated because of any Event of
Default. If the Company exercises its defeasance option or its covenant
defeasance option with respect to a series of Debt Securities, payment of such
Debt Securities may not be accelerated because of any Event of Default.
The Company may exercise its defeasance option or its covenant
defeasance option with respect to the Debt Securities of a series only if (a)
the Company irrevocably deposits in trust with the Trustee, in the case of Debt
Securities payable in United States currency, cash or U.S. Government
Obligations (as defined in the Indentures), and, in the case of Debt Securities
payable in a currency other than United States currency, funds in such
currency, for the payment of any principal, premium, and interest with respect
to such Debt Securities to maturity or redemption, as the case may be, (b) the
Company delivers to the Trustee a certificate from a nationally recognized firm
of independent accountants expressing their opinion that the payments of
principal and interest when due and without reinvestment on any deposited U.S.
Government Obligations plus any deposited money without investment will provide
cash at such times and in such amounts as will be sufficient to pay any
principal, premium, and interest when due with respect to all the Debt
Securities of such series to maturity or redemption, as the case may be, (c) 90
days pass after the deposit is made and during the 90-day period no default
described in clause (6) under "Description of Debt Securities--Events of
Default and Remedies" above with respect to the Company occurs that is
continuing at the end of such period, (d) the deposit does not constitute a
default under any other material agreement binding on the Company and, in the
case of Subordinated Debt Securities, is not prohibited by the provisions of
the Indenture relating to subordination, (e) the Company delivers to the
Trustee an opinion of counsel to the effect that the trust resulting from the
deposit does not constitute, or is qualified as, a regulated investment company
under the Investment Company Act of 1940, (f) the Company shall have delivered
to the Trustee an opinion of counsel addressing certain federal income tax
matters relating to the defeasance, (g) the Company delivers to the Trustee an
officers' certificate and an opinion of counsel, each stating that all
conditions precedent to the defeasance and discharge of the Debt Securities of
such series as contemplated by the Indenture have been complied with, (h) the
Company shall have delivered to the Trustee an officers' certificate stating
that the Debt Securities, if listed on a national exchange, will be delisted as
a result of such deposit, and (i) the defeasance shall not cause the Trustee to
have a conflicting interest within the meaning of the Trust Indenture Act.
<PAGE> 20
The Trustee shall hold in trust cash or U.S. Government Obligations
deposited with it as described above and shall apply the deposited cash and the
proceeds from any deposited U.S. Government Obligations to the payment of any
principal, premium, and interest with respect to the Debt Securities of the
defeased series. In the case of Subordinated Debt Securities, the money and
U.S. Government Obligations so held in trust will not be subject to the
subordination provisions of the Indenture.
The Trustee
The Company may appoint a separate Trustee for any series of Debt
Securities. As used herein in the description of a series of Debt Securities,
the term "Trustee" refers to the Trustee appointed with respect to such series
of Debt Securities. The Company may maintain banking and other commercial
relationships with the Trustee and its affiliates in the ordinary course of
business, and the Trustee may own Debt Securities.
DESCRIPTION OF CAPITAL STOCK
The following description of the capital stock of the Company does not
purport to be complete or to give full effect to the terms of the provisions of
statutory or common law and is subject to, and qualified in its entirety by
reference to, the Company's Certificate of Incorporation, as amended (the
"Certificate of Incorporation"), the Company's Bylaws, and the Rights Agreement
(as defined below), all of which are filed or incorporated by reference as
exhibits to the Registration Statement of which this Prospectus is a part.
Common Stock
The Company's Certificate of Incorporation authorizes the issuance of
100,000,000 shares of Common Stock, par value $1.00 per share. As of March 10,
1995, there were 22,022,803 shares of Common Stock outstanding, 5,531,429
shares held in the Company's treasury, and [4,000,000] shares reserved for
issuance under the Company's 1982, 1986 and 1992 stock option plans. As of
such date, there were also outstanding 22,022,803 Rights to purchase Common
Stock. See "Description of Capital Stock--Certain Provisions of the Certificate
of Incorporation and Bylaws--Common Stock Purchase Rights" below.
Subject to the rights of the holders of any Preferred Stock, each
holder of Common Stock on the applicable record date is entitled to receive
such dividends as may be declared by the Board of Directors out of funds
legally available therefor, and, in the event of liquidation, to share pro rata
in any distribution of the Company's assets after payment of liabilities. Each
holder of Common Stock is entitled to one vote for each share held of record on
the applicable record date on all matters presented to a vote of stockholders.
The outstanding Common Stock is fully paid and non-assessable.
Preferred Stock
The Company's Certificate of Incorporation currently authorizes the
issuance of 65,000 shares of Cumulative Preferred Stock, par value $100.00 per
share, issuable in series. All of the shares of Cumulative Preferred Stock
have been designated as 4 1/4% Cumulative Preferred Stock. As of March 10,
1995, there were 1,137 shares of 4 1/4% Cumulative Preferred Stock outstanding
<PAGE> 21
and 63,863 shares held as treasury stock (which cannot be reissued). The
Company has called for redemption all of the outstanding shares of 4 1/4%
Cumulative Preferred Stock on April 24, 1995 (the "Redemption Date"). Shares
of 4 1/4% Cumulative Preferred Stock redeemed by the Company will be cancelled
and cannot be reissued.
The 4 1/4% Cumulative Preferred Stock is preferred as to dividends and
has a liquidation preference of $104 in the event of voluntary liquidation and
of $100 in the event of involuntary liquidation. The Company may at any time
redeem the shares at $104 per share. Each year, the Company must set aside in
a sinking fund an amount sufficient to redeem, or, in lieu of such sinking
fund, the Company may purchase, at $104 per share, 1,300 shares from the
holders thereof. The holders of 4 1/4% Cumulative Preferred Stock generally
have no right to vote unless their dividends are in arrears for six quarters,
in which event they have the right to elect one-third of the Board of
Directors. On and after the Redemption Date, the rights of the holders of 4
1/4% Cumulative Preferred Stock will cease, other than the right to receive the
redemption price.
The Company's Certificate of Incorporation currently does not
authorize the issuance of any additional shares of Cumulative Preferred Stock
or any other designation of Preferred Stock. Accordingly, the Board of
Directors of the Company has adopted, subject to stockholder approval, an
amendment to the Certificate of Incorporation to authorize the issuance of up
to 10,000,000 shares of Preferred Stock in one or more series and to authorize
the Board of Directors, without further stockholder action, to designate one or
more series of Preferred Stock with such terms as the Board may determine (the
"Amendment"). However, the holders of shares of Preferred Stock will not be
entitled to more than one vote per share, when voting as a class with the
holders of shares of Common Stock. The adoption of the Amendment requires the
affirmative vote of the holders of a majority of the outstanding shares of the
Company's Common Stock. Management will propose the Amendment at the next
annual meeting of stockholders of the Company, which is scheduled to be held
on June 14, 1995. The issuance by the Company of any shares of Preferred Stock
pursuant to a Prospectus Supplement is subject to the adoption of the
Amendment by the Company's stockholders.
Certain Provisions of the Certificate of Incorporation and Bylaws
The following summary of certain provisions of the Company's
Certificate of Incorporation and Bylaws does not purport to be complete and is
subject to, and qualified in its entirety by reference to, the Certificate of
Incorporation and the Bylaws which are filed or incorporated by reference as
exhibits to the Registration Statement of which this Prospectus is a part.
Fair Price Provisions
The Company's Certificate of Incorporation requires approval by at
least 80% of the Company's outstanding voting stock for mergers and certain
other corporate transactions ("Business Combinations") that involve a
beneficial owner of 20% or more of the voting stock of the Company (an
"Interested Shareholder"), unless the transaction has been approved by a
majority of certain directors (the "Disinterested Directors") or certain fair
price criteria and procedural requirements are satisfied. These provisions of
the Certificate of Incorporation may be amended only by the vote of the holders
of 80% or more of the voting stock of the Company.
<PAGE> 22
A "Disinterested Director" is any member of the Board of Directors who
is not an affiliate or associate of an Interested Shareholder and was or
becomes a director prior to the time that the Interested Shareholder became an
Interested Shareholder, was a director on March 6, 1985 or is elected or
recommended for election by the stockholders by a majority of the then
Disinterested Directors.
The fair price criteria require that in the event of a Business
Combination in which cash or other consideration would be paid to the Company's
stockholders, (1) the consideration to be received by the stockholders be
either cash or the same type of consideration used by the Interested
Shareholder to acquire the largest portion of his shares, and (2) the fair
market value of such consideration to be received per share of Common Stock be
not less than the highest of the following, subject to price adjustments for
stock splits and dividends: (a) the highest per share price paid by the
Interested Shareholder in acquiring any Common Stock of the Company in either
(i) the two-year period prior to the first public announcement of such proposed
Business Combination, or (ii) the transaction in which such Interested
Shareholder became an Interested Shareholder, whichever is higher, or (b) the
fair market value of such shares on the date of the first public announcement
of such proposed Business Combination, or the date on which the Interested
Shareholder became an Interested Shareholder, whichever is higher.
The fair price provisions also require that the aggregate amount of
cash and fair market value of other consideration to be received by holders of
shares of voting stock other than Common Stock shall be the highest of the
following, subject to price adjustments for stock splits and dividends:
(1) the highest per share price paid by the Interested Shareholder in acquiring
such voting stock in the two-year period prior to the first public announcement
of the proposed Business Combination, or in the transaction in which such
Interested Shareholder became an Interested Shareholder, whichever is higher,
(2) the highest preferential liquidation, dissolution or winding up amount per
share to which such voting shares are entitled, and (3) the fair market value
of such shares on the date of the first public announcement of such proposed
Business Combination.
The procedural requirements would not be satisfied if, after an
Interested Shareholder became an Interested Shareholder, (1) the Company failed
to pay any dividend on its Preferred Stock or reduced the annual rate of
dividends paid on its Common Stock (except as necessary to reflect any
subdivision of the Common Stock) or failed to increase the annual rate of
dividends as necessary to reflect any reclassification recapitalization,
reorganization or similar transaction having the effect of reducing the number
of outstanding shares of Common Stock (in each case unless approved by a
majority of the Disinterested Directors), (2) the Interested Shareholder became
the beneficial owner of any additional shares of voting stock of the Company,
or (3) the Interested Shareholder received the benefit of any financial
assistance or tax advantage provided by the Company not shared proportionately
by all stockholders. In addition, the proposed Business Combination would have
to be described in a proxy information statement.
Common Stock Purchase Rights
On January 26, 1988, the Board of Directors declared a dividend of one
right ("Right") for each outstanding share of Common Stock of the Company. The
dividend was payable on February 12, 1988, to the stockholders of record at the
close of business on that date. In addition, the Board authorized and directed
<PAGE> 23
the issuance of one Right (subject to adjustment) with respect to each share of
Common Stock issued prior to the earlier of the Distribution Date, as
hereinafter defined, and the redemption or expiration of the Rights. The
Rights were issued under a rights agreement dated January 26, 1988 by and
between the Company and Boatmen's Trust Company (as successor Rights Agent to
Mellon Securities Trust Company), as amended November 30, 1989 and
September 29, 1992 (the "Rights Agreement"). The Rights Agreement is filed or
incorporated by reference as an exhibit to the Registration Statement of which
this Prospectus is a part. This summary does not purport to be complete and is
subject to, and qualified in its entirety by reference to, the Rights
Agreement.
Each Right, when exercisable, represents the right to purchase from
the Company one share of Common Stock at an exercise price of $93 per share
(the "Exercise Price"), subject to anti-dilution adjustments. Currently, the
Rights are attached to all Common Stock certificates representing outstanding
shares. Until the earlier to occur of (i) a public announcement that, without
the prior consent of the Company, a person or group of affiliated or associated
persons (an "Acquiring Person") has acquired, or obtained the right to acquire,
beneficial ownership of securities having 50% or more of the voting power of
all outstanding voting securities of the Company, or (ii) ten days (unless such
date is extended by the Board of Directors) following the commencement of (or a
public announcement of an intention to make) a tender offer or exchange offer
which would result in any person or group of related persons becoming an
Acquiring Person, without the prior consent of the Company (the earlier of such
dates being called the "Distribution Date"), the Rights will be evidenced by
the outstanding Common Stock certificates. The Rights Agreement provides that,
until the Distribution Date, the Rights will be transferred with and only with
Common Stock certificates. Until the Distribution Date (or earlier redemption
or expiration of the Rights), new Common Stock certificates issued upon
transfer or new issuance of Common Stock will contain a notation incorporating
the Rights Agreement by reference. Until the Distribution Date (or earlier
redemption or expiration of the Rights), the surrender for transfer of any
certificates for Common Stock will also constitute the transfer of the Rights
associated with the Common Stock represented by such certificate. As soon as
practicable following the Distribution Date, separate certificates evidencing
the Rights ("Rights Certificates") will be mailed to holders of record of the
Common Stock as of the close of business on the Distribution Date, and the
separate Rights Certificates alone will evidence the Rights.
The Rights will expire on the earliest of (i) January 26, 1998,
(ii) the consummation of a merger transaction with a person or group who
acquired Common Stock pursuant to a Permitted Offer (as defined below), and is
offering in the merger the same price per share and form of consideration paid
in the Permitted Offer, or (iii) the redemption of the Rights by the Company as
described below.
The Exercise Price payable, and the number of shares of Common Stock
or other securities or property issuable, upon exercise of the Rights are
subject to adjustment from time to time to prevent dilution (i) in the event of
a stock dividend on, or a subdivision, combination or reclassification of, the
Common Stock, (ii) upon the grant to holders of the Common Stock of certain
rights or warrants to subscribe for Common Stock, certain convertible
securities or securities having the same or more favorable rights, privileges
and preferences as the Common Stock at less than the current market price of
the Common Stock or (iii) upon the distribution to holders of the Common Stock
of evidences of indebtedness or assets (excluding regular quarterly cash
<PAGE> 24
dividends out of earnings or retained earnings) or of subscription rights or
warrants (other than those referred to above).
In the event that, after the first date of public announcement by the
Company or an Acquiring Person that an Acquiring Person has become such, the
Company is involved in a merger or other business combination transaction in
which the Common Stock is exchanged or changed, or 50% or more of the Company's
assets or earning power are sold (in one transaction or a series of
transactions), proper provision shall be made so that each holder of a Right
shall thereafter have the right to receive, upon the exercise thereof at the
then current Exercise Price of the Right, that number of shares of common stock
of the acquiring company (or, in the event there is more than one acquiring
company, the acquiring company receiving the greatest portion of the assets or
earning power transferred) which at the time of such transaction would have a
market value of two times the Exercise Price of the Right (such right being
called the "Merger Right"). In the event that a person becomes the beneficial
owner of securities having 50% or more of the voting power of all then
outstanding voting securities of the Company (unless pursuant to a tender offer
or exchange offer for all outstanding shares of Common Stock at a price and on
terms determined by at least a majority of the members of the Board of
Directors to be both adequate and otherwise in the best interests of the
Company and its stockholders (a "Permitted Offer")), proper provision shall be
made so that each holder of a Right will for a 60 day period thereafter have
the right to receive upon exercise that number of shares of Common Stock having
a market value of two times the Exercise Price of the Right, subject to the
availability of a sufficient number of authorized but unissued shares (such
right being called the "Subscription Right"). The holder of a Right will
continue to have the Merger Right whether or not such holder exercises the
Subscription Right. Upon the occurrence of any of the events giving rise to
the exercisability of the Subscription Right or the Merger Right, any Rights
that are or were at any time owned by an Acquiring Person engaging in any of
such transactions or receiving the benefits thereof on or after the time the
Acquiring Person became such shall become void insofar as they relate to the
Subscription Right or the Merger Right.
With certain exceptions, no adjustments in the Exercise Price will be
required until cumulative adjustments require an adjustment of at least 1% in
such Exercise Price. No fractions of shares will be issued and, in lieu
thereof, an adjustment in cash will be made based on the market price of the
Common Stock on the last trading date prior to the date of exercise.
At any time prior to the earlier to occur of (i) a person becoming an
Acquiring Person or (ii) the expiration of the Rights, the Company may redeem
the Rights in whole, but not in part, at a price of $.05 per Right (the
"Redemption Price"), which redemption shall be effective upon the action of the
Board of Directors. Additionally, the Company may thereafter redeem the then
outstanding Rights in whole, but not in part, at the Redemption Price provided
that such redemption is incidental to a merger or other business combination
transaction or series of transactions involving the Company but not involving
an Acquiring Person or any person who was an Acquiring Person or following an
event giving rise to, and the expiration of the exercise period for, the
Subscription Right if and for as long as an Acquiring Person beneficially owns
securities representing less than 50% of the voting power of the Company's
voting securities. The redemption of Rights described in the preceding
sentence shall be effective only as of such time when the Subscription Right is
not exercisable, and in any event, only after 10 business days prior notice.
Upon the effective date of the redemption of the Rights, the right to exercise
<PAGE> 25
the Rights will terminate and the only right of the holders of Rights will be
to receive the Redemption Price.
Until a Right is exercised, the holder thereof, as such, will have no
rights as a stockholder of the Company, including, without limitation, the
right to vote or to receive dividends.
If the Amendment to the Company's Certificate is adopted (see
"Description of Capital Stock--Preferred Stock" above), the ability of the
Board to issue shares of Preferred Stock could make more difficult or
discourage an attempt to acquire control of the Company by means of a merger,
tender offer, proxy contest, or other means, and increase the Board's ability
to continue then current management. For example, subject to the Preferred
Stock voting limitations contained in the Amendment, shares of Preferred Stock
could be used to create voting impediments for, or to dilute the stock
ownership of, persons seeking to gain control of the Company. Shares of
Preferred Stock could also be sold to purchasers opposing such action. In
addition, the Board of Directors could authorize the holders of a series of
Preferred Stock to vote either separately as a class or with the holders of the
Company's common stock, with respect to any merger or sale of assets of the
Company or any other extraordinary corporate transaction. However, the Company
is not considering the use of preferred stock for such purposes and is not
aware of any present effort by any party to accumulate the Company's securities
for the purpose of gaining control of the Company. In the Company's Proxy
Statement for its 1995 Annual Meeting of Stockholders, the Board and management
of the Company represented that, without the prior approval of the common
stockholders, preferred stock will not be used for any anti-takeover purpose,
including, without limitation, to implement any stockholders' rights plan or
with features intended to make any attempted acquisition of Company more
difficult or costly.
The Company's By-laws currently contain provisions that could have an
anti-takeover effect. The By-Laws require 90 days advance notice in order for
a stockholder to nominate a person for election as a director at an annual
meeting and 60 days advance notice in order for a stockholder to bring other
business before a stockholders' meeting. The By-Laws also permit only the
Chairman, the President and the Board of Directors to call special meetings of
stockholders, unless otherwise required by law.
Certain Anti-Takeover Provisions of Delaware Law
The Company is a Delaware corporation and is subject to Section 203 of
the Delaware General Corporation Law. In general, Section 203 prevents an
"interested stockholder" (defined generally as a person owning 15% or more of
the Company's outstanding voting stock) from engaging in a "business
combination" (as defined in Section 203) with the Company (or its majority-
owned subsidiaries) for three years following the date such person became an
interested stockholder, unless: (i) before such person became an interested
stockholder, the Company's Board of Directors approved the transaction in which
the interested stockholder became an interested stockholder or approved the
business combination; (ii) upon consummation of the transaction that resulted
in the interested stockholder becoming an interested stockholder, the
interested stockholder owns at least 85% of the Company's voting stock
outstanding at the time the transaction commenced (excluding stock held by
directors who are also officers of the Company and by employee stock plans that
do not provide employees with the rights to determine confidentially whether
shares held subject to the plan will be tendered in a tender or exchange
<PAGE> 26
offer); or (iii) following the transaction in which such person became an
interested stockholder, the business combination is approved by the Company's
Board of Directors and approved at a meeting of stockholders by the affirmative
vote of the holders of at least two-thirds of the Company's outstanding voting
stock not owned by the interested stockholder. Under Section 203, the
restrictions described above also do not apply to certain business combinations
proposed by an interested stockholder following the earlier of the announcement
or notification of one of certain extraordinary transactions involving the
Company and a person who had not been an interested stockholder during the
previous three years or who became an interested stockholder with the approval
of a majority of the Company's directors, if such extraordinary transaction is
approved or not opposed by a majority of the directors who were directors prior
to any person becoming an interested stockholder during the previous three
years or were recommended for election or elected to succeed such directors by
a majority of such directors.
DESCRIPTION OF DEPOSITARY SHARES
The description set forth below and in any Prospectus Supplement of
certain provisions of the Deposit Agreement (as defined below) and of the
Depositary Shares (as defined below) and Depositary Receipts (as defined below)
does not purport to be complete and is subject to and qualified in its entirety
by reference to the forms of Deposit Agreement and Depositary Receipts relating
to each series of Preferred Stock that will be filed with the SEC in connection
with the offering of such series of Preferred Stock.
General
The Company may, at its option, elect to offer fractional interests in
shares of Preferred Stock, rather than full shares of Preferred Stock. In the
event such option is exercised, the Company will provide for the issuance by a
depositary to the public of receipts for depositary shares ("Depositary
Shares"), each of which will represent a specified fractional interest in a
share of a particular series of Preferred Stock (which will be set forth in the
Prospectus Supplement relating to a particular series of Preferred Stock).
The shares of any series of Preferred Stock underlying the Depositary
Shares will be deposited under a separate Deposit Agreement (the "Deposit
Agreement") between the Company and a bank or trust company selected by the
Company having its principal office in the United States and having a combined
capital and surplus of at least $50 million. The Prospectus Supplement
relating to a series of Depositary Shares will set forth the name and address
of the depositary (the "Depositary") with respect to such Depositary Shares.
Subject to the terms of the Deposit Agreement, each owner of Depositary Shares
will be entitled, in proportion to the applicable fractional interests in
shares of Preferred Stock underlying such Depositary Shares, to all the rights
and preferences of the Preferred Stock underlying such Depositary Shares
(including dividend, voting, redemption, conversion, and liquidation rights).
The Depositary Shares will be evidenced by Depositary receipts issued
pursuant to the Deposit Agreement ("Depositary Receipts"). Depositary Receipts
will be distributed to those persons purchasing the fractional interests in
shares of the related series of Preferred Stock in accordance with the terms of
the offering described in the related Prospectus Supplement.
<PAGE> 27
The Prospectus Supplement relating to any Depositary Shares will
describe any material United States federal income tax consequences applicable
to such Depositary Shares.
Dividends and Other Distributions
The Depositary will distribute all cash dividends or other cash
distributions received with respect to Preferred Stock to the record holders of
Depositary Shares relating to such Preferred Stock in proportion to the numbers
of such Depositary Shares owned by such holders on the relevant record date.
The Depositary shall distribute only such amount, however, as can be
distributed without attributing to any holder of Depositary Shares a fraction
of one cent, and the balance not so distributed shall be added to and treated
as part of the next sum received by the Depositary for distribution to record
holders of Depositary Shares.
In the event of a distribution other than in cash, the Depositary will
distribute property received by it to the record holders of Depositary Shares
entitled thereto, unless the Depositary determines that it is not feasible to
make such distribution, in which case the Depositary may, with the approval of
the Company, sell such property and distribute the net proceeds from such sale
to such holders.
The Deposit Agreement will also contain provisions relating to the
manner in which any subscription or similar rights offered by the Company to
holders of the Preferred Stock shall be made available to the holders of
Depositary Shares.
Redemption of Depositary Shares
If a series of the Preferred Stock underlying the Depositary Shares is
subject to redemption, the Depositary Shares will be redeemed from the proceeds
received by the Depositary resulting from the redemption, in whole or in part,
of such series of the Preferred Stock held by the Depositary. The Depositary
shall mail notice of redemption not less than 30 and not more than 60 days
prior to the date fixed for redemption to the record holders of the Depositary
Shares to be so redeemed at their respective addresses appearing in the
Depositary's books. The redemption price per Depositary Share will be equal to
the applicable fraction of the redemption price per share payable with respect
to such series of the Preferred Stock. Whenever the Company redeems shares of
Preferred Stock held by the Depositary, the Depositary will redeem as of the
same redemption date the number of Depositary Shares relating to shares of
Preferred Stock so redeemed. If less than all the Depositary Shares are to be
redeemed, the Depositary Shares to be redeemed will be selected by lot or pro
rata as may be determined by the Depositary.
After the date fixed for redemption, the Depositary Shares so called
for redemption will no longer be outstanding and all rights of the holders of
the Depositary Shares will cease, except the right to receive the money,
securities, or other property payable upon such redemption and any money,
securities, or other property to which the holders of such Depositary Shares
were entitled upon such redemption upon surrender to the Depositary of the
Depositary Receipts evidencing such Depositary Shares.
<PAGE> 28
Conversion or Exchange
Whenever the Company converts, pursuant to the terms of the Preferred
Stock, all of the shares of a particular series of Preferred Stock held by the
Depositary into other Preferred Stock or Common Stock or exchanges all such
shares for securities of another issuer, the Depositary will convert or
exchange as of the same date all Depositary Shares representing the shares of
the Preferred Stock so converted or exchanged, provided that the Company shall
have deposited with the Depositary the other Preferred Stock, Common Stock, or
other securities into or for which all such shares of Preferred Stock are to be
converted or exchanged. The exchange rate per Depositary Share shall be equal
to the exchange rate per share of Preferred Stock multiplied by the fraction of
a share of Preferred Stock represented by one Depositary Share, plus all money
and other property, if any, represented by such Depositary Share, including all
amounts paid by the Company in respect of dividends which on the exchange date
have accrued on the shares of Preferred Stock to be so converted or exchanged
and have not theretofore been paid.
The Depositary Shares, as such, are not convertible or exchangeable
into other Preferred Stock, Common Stock, securities of another issuer, or any
other securities or property of the Company. Nevertheless, if so specified in
the applicable Prospectus Supplement, the Depositary Receipts may be
surrendered by holders thereof to the Depositary with written instructions to
the Depositary to instruct the Company to cause conversion of the Preferred
Stock represented by the Depositary Shares evidenced by such receipts into
other shares of Preferred Stock or Common Stock of the Company or exchange of
such Preferred Stock for securities of another issuer, as the case may be, and
the Company has agreed that upon receipt of such instructions and any amounts
payable in respect thereof, it will cause the conversion or exchange thereof
utilizing the same procedures as those provided for delivery of Preferred Stock
to effect such conversion or exchange. If the Depositary Shares represented by
a Depositary Receipt are to be converted in part only, a new Depositary Receipt
or Receipts will be issued for any Depositary Shares not to be converted or
exchanged.
Voting the Preferred Stock
Upon receipt of notice of any meeting at which the holders of the
Preferred Stock are entitled to vote, the Depositary will mail the information
contained in such notice of meeting to the record holders of the Depositary
Shares relating to such Preferred Stock. Each record holder of such Depositary
Shares on the record date (which will be the same date as the record date for
the Preferred Stock) will be entitled to instruct the Depositary as to the
exercise of the voting rights pertaining to the number of shares of Preferred
Stock underlying such holder's Depositary Shares. The Depositary will
endeavor, insofar as practicable, to vote the number of shares of Preferred
Stock underlying such Depositary Shares in accordance with such instructions,
and the Company will agree to take all action that may be deemed necessary by
the Depositary in order to enable the Depositary to do so. The Depositary will
abstain from voting shares of the Preferred Stock to the extent it does not
receive specific instructions from the holders of Depositary Shares
representing such Preferred Stock.
<PAGE> 29
Amendment and Termination of Depositary Agreement
The form of Depositary Receipt evidencing the Depositary Shares and
any provision of the Deposit Agreement may at any time be amended by agreement
between the Company and the Depositary. However, any amendment that materially
and adversely alters the rights of the existing holders of Depositary Shares
will not be effective unless such amendment has been approved by the record
holders of at least a majority of the Depositary Shares then outstanding. The
Deposit Agreement may be terminated by the Company or the Depositary only if
(a) all outstanding Depositary Shares relating thereto have been redeemed or
(b) there has been a final distribution with respect to the Preferred Stock of
the relevant series in connection with any liquidation, dissolution, or winding
up of the Company and such distribution has been distributed to the holders of
the related Depositary Shares.
Charges of Depositary
The Company will pay all transfer and other taxes and governmental
charges arising solely from the existence of the Depositary arrangements. The
Company will pay the charges of the Depositary in connection with the initial
deposit of the Preferred Stock and any redemption of the Preferred Stock.
Holders of Depositary Shares will pay transfer and other taxes and governmental
charges and such other charges as are expressly provided in the Deposit
Agreement to be for their accounts.
Resignation and Removal of Depositary
The Depositary may resign at any time by delivering to the Company
notice of its election to do so, and the Company may at any time remove the
Depositary. Any such resignation or removal will take effect upon the
appointment of a successor depositary and its acceptance of such appointment.
Such successor depositary must be appointed within 60 days after delivery of
the notice of resignation or removal and must be a bank or trust company having
its principal office in the United States and having a combined capital and
surplus of at least $50 million.
Miscellaneous
The Depositary will forward to the holders of Depositary Shares all
reports and communications from the Company that are delivered to the
Depositary and that the Company is required to furnish to the holders of the
Preferred Stock.
Neither the Depositary nor the Company will be liable if it is
prevented or delayed by law or any circumstance beyond its control in
performing its obligations under the Deposit Agreement. The obligations of the
Company and the Depositary under the Deposit Agreement will be limited to
performance in good faith of their duties thereunder and they will not be
obligated to prosecute or defend any legal proceeding with respect to any
Depositary Shares or Preferred Stock unless satisfactory indemnity is
furnished. They may rely upon written advice of counsel or accountants, or
information provided by persons presenting Preferred Stock for deposit, holders
of Depositary Shares, or other persons believed to be competent and on
documents believed to be genuine.
<PAGE> 30
DESCRIPTION OF WARRANTS
The Company may issue Warrants for the purchase of Debt Securities,
Preferred Stock, or Common Stock. Warrants may be issued independently or
together with Debt Securities, Preferred Stock, or Common Stock offered by any
Prospectus Supplement and may be attached to or separate from any such Offered
Securities. Each series of Warrants will be issued under a separate warrant
agreement (a "Warrant Agreement") to be entered into between the Company and a
bank or trust company, as warrant agent (the "Warrant Agent"). The Warrant
Agent will act solely as an agent of the Company in connection with the
Warrants and will not assume any obligation or relationship of agency or trust
for or with any holders or beneficial owners of Warrants. The following
summary of certain provisions of the Warrants does not purport to be complete
and is subject to, and qualified in its entirety by reference to, the
provisions of the Warrant Agreement that will be filed with the SEC in
connection with the offering of such Warrants.
The Prospectus Supplement relating to a particular issue of Common
Stock Warrants, Preferred Stock Warrants, or Debt Warrants will describe the
terms of such Warrants, including the following: (a) the title of such
Warrants; (b) the offering price for such Warrants, if any; (c) the aggregate
number of such Warrants; (d) the designation and terms of the Common Stock,
Preferred Stock, or Debt Securities purchasable upon exercise of such Warrants;
(e) if applicable, the designation and terms of the Offered Securities with
which such Warrants are issued and the number of such Warrants issued with each
such Offered Security; (f) if applicable, the date from and after which such
Warrants and any Offered Securities issued therewith will be separately
transferable; (g) in the case of Common Stock Warrants or Preferred Stock
Warrants, the number of shares of Common Stock or Preferred Stock purchasable
upon exercise of a Warrant and the price at which such shares may be purchased
upon exercise (which price may be payable in cash, securities, or other
property); (h) in the case of Debt Warrants, the principal amount of Debt
Securities purchasable upon exercise of a Debt Warrant and the price at which
such principal amount of Debt Securities may be purchased upon exercise (which
price may be payable in cash, securities, or other property); (i) the date on
which the right to exercise such Warrants shall commence and the date on which
such right shall expire; (j) if applicable, the minimum or maximum amount of
such Warrants that may be exercised at any one time; (k) in the case of Debt
Warrants, whether the Warrants represented by the Debt Warrant certificates or
Debt Securities that may be issued upon exercise of the Debt Warrants will be
issued in registered form or in the form of global securities, and information
with respect to book-entry procedures, if any; (l) the currency or currency
units in which the offering price, if any, and the exercise price are payable;
(m) if applicable, a discussion of material federal income tax considerations;
(n) the anti-dilution provisions of such Warrants, if any; (o) the redemption
or call provisions, if any, applicable to such Warrants; and (p) any additional
terms of the Warrants, including terms, procedures, and limitations relating to
the exchange and exercise of such Warrants.
PLAN OF DISTRIBUTION
The Company may sell the Offered Securities in or outside the United
States through underwriters or dealers, directly to one or more purchasers, or
through agents. The Prospectus Supplement with respect to the Offered
Securities will set forth the terms of the offering of the Offered Securities,
including the name or names of any underwriters, dealers, or agents, the
purchase price of the Offered Securities and the proceeds to the Company from
<PAGE> 31
such sale, any delayed delivery arrangements, any underwriting discounts and
other items constituting underwriters' compensation, the initial public
offering price, any discounts or concessions allowed or re-allowed or paid to
dealers, and any securities exchanges on which the Offered Securities may be
listed.
If underwriters are used in the sale, the Offered Securities will be
acquired by the underwriters for their own account and may be resold from time
to time in one or more transactions, including negotiated transactions, at a
fixed public offering price or at varying prices determined at the time of
sale. The Offered Securities may be offered to the public either through
underwriting syndicates represented by one or more managing underwriters or
directly by one or more firms acting as underwriters. The underwriter or
underwriters with respect to a particular underwritten offering of Offered
Securities will be named in the Prospectus Supplement relating to such
offering, and if an underwriting syndicate is used, the managing underwriter or
underwriters will be set forth on the cover of such Prospectus Supplement.
Unless otherwise set forth in the Prospectus Supplement relating thereto, the
obligations of the underwriters or agents to purchase the Offered Securities
will be subject to conditions precedent and the underwriters will be obligated
to purchase all the Offered Securities if any are purchased. The initial
public offering price and any discounts or concessions allowed or re-allowed or
paid to dealers may be changed from time to time.
If dealers are used in the sale of Offered Securities with respect to
which this Prospectus is delivered, the Company will sell such Offered
Securities to the dealers as principals. The dealers may then resell such
Offered Securities to the public at varying prices to be determined by such
dealers at the time of resale. The names of the dealers and the terms of the
transaction will be set forth in the Prospectus Supplement relating thereto.
Offered Securities may be sold directly by the Company or through
agents designated by the Company from time to time at fixed prices, which may
be changed, or at varying prices determined at the time of sale. Any agent
involved in the offer or sale of the Offered Securities with respect to which
this Prospectus is delivered will be named, and any commissions payable by the
Company to such agent will be set forth, in the Prospectus Supplement relating
thereto. Unless otherwise indicated in the Prospectus Supplement, any such
agent will be acting on a best efforts basis for the period of its appointment.
In connection with the sale of the Offered Securities, underwriters or
agents may receive compensation from the Company or from purchasers of Offered
Securities for whom they may act as agents in the form of discounts,
concessions, or commissions. Underwriters, agents, and dealers participating
in the distribution of the Offered Securities may be deemed to be underwriters,
and any discounts or commissions received by them from the Company and any
profit on the resale of the Offered Securities by them may be deemed to be
underwriting discounts or commissions under the Securities Act.
If so indicated in the Prospectus Supplement, the Company will
authorize agents, underwriters, or dealers to solicit offers from certain types
of institutions to purchase Offered Securities from the Company at the public
offering price set forth in the Prospectus Supplement pursuant to delayed
delivery contracts providing for payment and delivery on a specified date in
the future. Such contracts will be subject only to those conditions set forth
in the Prospectus Supplement, and the Prospectus Supplement will set forth the
commission payable for solicitation of such contracts.
<PAGE> 32
Agents, dealers, and underwriters may be entitled under agreements
entered into with the Company to indemnification by the Company against certain
civil liabilities, including liabilities under the Securities Act, or to
contribution with respect to payments that such agents, dealers, or
underwriters may be required to make with respect thereto. Agents, dealers,
and underwriters may be customers of, engage in transactions with, or perform
services for the Company in the ordinary course of business.
The Offered Securities may or may not be listed on a national
securities exchange. No assurances can be given that there will be a market
for the Offered Securities.
LEGAL OPINION
Certain legal matters in connection with the Offered Securities will
be passed upon for the Company by Bryan Cave of St. Louis, Missouri and for any
underwriters or agents by a firm named in the Prospectus Supplement relating to
a particular issue of Offered Securities.
EXPERTS
The consolidated financial statements of the Company as of January 28,
1995 and January 29, 1994, and for each of the years in the three-year period
ended January 28, 1995, have been incorporated by reference herein in reliance
upon the report of Ernst & Young LLP, independent auditors, also incorporated
by reference herein, given on their authority as experts in accounting and
auditing.
<PAGE> 33
PART II
INFORMATION NOT REQUIRED IN PROSPECTUS
Item 14 - Other Expenses of Issuance and Distribution
The following table sets forth those expenses to be incurred by the
registrant, Edison Brothers Stores, Inc. (the "Company"), in connection with
the issuance and distribution of the securities being registered. Except for
the Securities and Exchange Commission registration fee, all amounts shown are
estimates.
Securities and Exchange Commission registration fee......... $ 86,207
Accounting fees and expenses................................ 25,000
Legal fees and expenses..................................... 150,000
Blue Sky fees and expenses, including counsel fees.......... 20,000
Miscellaneous............................................... 118,793
--------
Total................................................... $400,000
========
Item 15 - Indemnification of Directors and Officers
On July 22, 1986 the Company entered into an Indemnification Agreement
with each of its then incumbent directors. Similar agreements have been
entered into with newly-elected directors and will be entered into from time to
time with future directors. The Agreement provides for indemnification of
directors of the Company to the fullest extent permitted under Section 145 of
the Delaware General Corporation Law. Within certain limitations the Agreement
provides additional indemnification against judgments, penalties, expenses,
fines, and settlements incurred by the indemnitee while serving at the request
of the Company as a director, officer, employee, agent or trustee of another
corporation, partnership, joint venture, trust, or other enterprise.
Pursuant to Section 145 of the Delaware General Corporation Law, the
registrant generally has the power to indemnify its present and former
directors and officers against expenses and liabilities incurred by them in
connection with any suit to which they are, or are threatened to be made, a
party by reason of their serving in those positions so long as they acted in
good faith and in a manner they reasonably believed to be in, or not opposed
to, the best interests of the registrant, and with respect to any criminal
action, they had no reasonable cause to believe their conduct was unlawful.
With respect to suits by or in the right of the registrant, however,
indemnification is generally limited to attorneys' fees and other expenses and
is not available if the person is adjudged to be liable to the registrant
unless the court determines that indemnification is appropriate. The statute
expressly provides that the power to indemnify authorized thereby is not
exclusive of any rights granted under any by-law, agreement, vote of
stockholders or disinterested directors, or otherwise. The registrant also has
the power to purchase and maintain insurance for its directors and officers.
<PAGE> 34
Article Fourteenth of the Company's Certificate of Incorporation
provides that a director of the Company shall not be personally liable to the
Company or its stockholders for monetary damages for breach of fiduciary duty
as a director, except for liability (i) for any breach of the director's duty
of loyalty to the Company or its stockholders, (ii) for acts or omissions not
in good faith or which involve intentional misconduct or a knowing violation of
law, (iii) under Section 174 of the Delaware General Corporation Law (which
relates to unlawful payment of dividends) or (iv) for any transaction from
which the director derived any improper personal benefit.
The preceding discussion of the registrant's Certificate of
Incorporation, Section 145 of the Delaware General Corporation Law, and the
Indemnification Agreements is not intended to be exhaustive and is qualified in
its entirety by the Restated Certificate of Incorporation, Section 145 of the
Delaware General Corporation Law, and the Indemnification Agreements.
Item 16 - Exhibits
1.1 Form of Underwriting Agreement for Debt Securities.
1.2 Form of Underwriting Agreement for Preferred Stock and/or Depositary
Shares (to be filed by post-effective amendment or incorporated
herein by reference prior to the issuance of Preferred Stock and/or
Depositary Shares).
1.3 Form of Underwriting Agreement for Common Stock (to be filed by post-
effective amendment or incorporated herein by reference prior to the
issuance of Common Stock).
1.4 Form of Underwriting Agreement for Warrants (to be filed by post-
effective amendment or incorporated herein by reference prior to the
issuance of Warrants).
3.1 Certificate of Incorporation, as amended (incorporated by reference
to Exhibit 3(a) to the Company's annual report on Form 10-K for the
year ended February 2, 1991, File 1-1394).
3.2 Bylaws, as amended (incorporated by reference to Exhibit 3(a) to the
Company's annual report on Form 10-K for the year ended January 28,
1995, File 1-1394).
4.1 Rights Agreement dated as of January 26, 1988 between Edison Brothers
Stores, Inc. and Mellon Securities Trust Company, as Rights Agent
(incorporated by reference to Exhibit 1 to the Company's current
report on Form 8-K dated February 17, 1988, File 1-1394).
4.2 Amendment to Rights Agreement dated as of November 30, 1989
(incorporated by reference to Exhibit 1 to the Company's current
report on Form 8-K dated December 11, 1989, File 1-1394).
4.3 Second Amendment to Rights Agreement dated as of September 29, 1992,
(incorporated by reference to Exhibit 1 to the Company's current
report on Form 8-K dated October 28, 1992, File 1-1394).
<PAGE> 35
4.4 Note Agreements and Senior Notes dated March 1, 1993, between Edison
Brothers Stores, Inc. and a number of institutional lenders relating
to $150 million of unsecured debt (incorporated by reference to
Exhibit 4(b) to the Company's annual report on Form 10-K for the year
ended January 30, 1993, File 1-1394).
4.5 Amendment Agreement dated as of January 15, 1994, amending the Note
Agreements dated March 1, 1993 (incorporated by reference to Exhibit
4(c) to the Company's annual report on Form 10-K for the year ended
January 29, 1994, File 1-1394).
4.6 Amendment Agreement dated as of February 1, 1994, amending the Note
Agreements dated March 1, 1993 (incorporated by reference to Exhibit
4(c) to the Company's annual report on Form 10-K for the year ended
January 29, 1994, File 1-1394).
4.7 Amendment Agreement dated as of April 1, 1995 amending the Note
Agreements dated March 1, 1993 (incorporated by reference to
Exhibit 4(c) to the Company's annual report on Form 10-K for the year
ended January 28, 1995, File 1-1394).
5 Opinion of Bryan Cave as to the legality of the securities to be
registered.
10.1 Form of Indemnification Agreement between the Company and each of its
directors was filed as Exhibit 10(b) to the Company's annual report
on Form 10-K for the year ended January 3, 1987 (file 1-1394), and is
incorporated herein by reference.
10.2 Form of Termination Agreement entered into by the Company with
Alan D. Miller, Chairman of the Board, President and Chief Executive
Officer of the Company (incorporated by reference to Exhibit 10(b)
of the Company's annual report on Form 10-K for the year ended
January 28, 1995 (File 1-1394)).
10.3 Form of Termination Agreement entered into by the Company with other
executive officers of the Company was filed as Exhibit 10(b) to the
Company's annual report on Form 10-K for the year ended February 3,
1990 (file 1-1394), and is incorporated herein by reference.
10.4 The Edison Brothers Stores, Inc. 1992 Stock Option Plan, as amended
March 3, 1994, was filed as an Exhibit to the Company's annual report
on Form 10-K for the year ended January 29, 1994, and is incorporated
herein by reference.
10.5 The Edison Brothers Stores, Inc. 1986 Stock Option Plan, as amended
April 27, 1987 and March 3, 1994, was filed as an Exhibit to the
Company's annual report on Form 10-K for the year ended January 29,
1994, and is incorporated herein by reference.
10.6 The Edison Brothers Stores, Inc. 1982 Incentive Stock Option Plan, as
amended effective October 25, 1983, January 28, 1986 and March 3,
1986, is incorporated by reference from the Company's Registration
Statement on Form S-8 (No. 2-84838) filed with the Commission.
10.7 Non-Qualified Retirement Plan for Outside Directors is described
under the caption "Election of Directors" in the proxy statement for
<PAGE> 36
the Company's 1995 annual stockholders meeting, which description
is incorporated herein by reference.
10.8 Credit Agreement dated as of June 4, 1993 between Edison Brothers
Stores, Inc. and a number of financial institutions relating to a
$150 million revolving credit facility.
10.9 First Amendment to Credit Agreement dated as of January 24, 1994
amending the Credit Agreement dated June 4, 1993.
10.10 Second Amendment to Credit Agreement dated as of February 17, 1994
amending the Credit Agreement dated June 4, 1993.
10.11 Third Amendment to Credit Agreement dated as of March 29, 1995
amending the Credit Agreement dated June 4, 1993.
10.12 Form of Senior Indenture between the Company and Fleet Bank of
Massachusetts, N.A., as trustee.
10.13 Form of Subordinated Indenture between the Company and one or more
commercial banks to be named, as trustee.
10.14 Form of Senior Debt Security.
10.15 Form of Subordinated Debt Security.
10.16 Form of Deposit Agreement.
10.17 Form of Depositary Receipt.
10.18 Form of Warrant Agreement.
10.19 Form of Warrant Certificate.
12 Computation of Consolidated Ratios of Earnings to Fixed Charges.
23.1 Consent of Ernst & Young LLP.
23.2 Consent of Bryan Cave (included in the opinion filed as Exhibit 5 to
this Registration Statement).
24 Powers of Attorney of the Company (see signature page herein).
25 Form T-1 Statement of Eligibility under the Trust Indenture Act of
1939, as amended, of Fleet Bank of Massachusetts, N.A., as Trustee
under the Senior Indenture.
Item 17 - Undertakings
The undersigned registrant hereby undertakes:
(a) To file, during any period in which offers or sales are being
made, a post-effective amendment to this registration statement:
(1) To include any prospectus required by Section 10(a)(3) of the
Securities Act of 1933, as amended (the "Securities Act");
(2) To reflect in the prospectus any facts or events arising after
<PAGE> 37
the effective date of this registration statement (or the most recent
post-effective amendment thereof) which, individually or in the
aggregate, represent a fundamental change in the information set
forth in this registration statement; and
(3) To include any material information with respect to the plan
of distribution not previously disclosed in this registration
statement or any material change to such information in this
registration statement;
provided, however, that clauses (1) and (2) above do not apply if the
information required to be included in a post-effective amendment by those
clauses is contained in periodic reports filed by the registrant pursuant
to Section 13 or Section 15(d) of the Exchange Act of 1934 ("Exchange Act")
that are incorporated by reference into this registration statement;
(b) That, for the purpose of determining any liability under the
Securities Act, each such post-effective amendment shall be deemed to be a
new registration statement relating to the securities offered therein, and
the offering of such securities at that time shall be deemed to be the
initial bona fide offering thereof; and
(c) To remove from registration by means of a post-effective
amendment any of the securities being registered that remain unsold at the
termination of the offering.
(d) That for purposes of determining any liability under the
Securities Act, each filing of the registrant's annual report pursuant to
Section 13(a) or 15(d) of the Exchange Act that is incorporated by
reference in this registration statement shall be deemed to be a new
registration statement relating to the securities offered therein, and the
offering of such securities at that time shall be deemed to be the initial
bona fide offering thereof.
The undersigned registrant hereby undertakes to file an application
for the purpose of determining the eligibility of the trustee to act under
subsection (a) of Section 310 of the Trust Indenture Act ("Act") in accordance
with the rules and regulations prescribed by the Commission under Section
305(b)(2) of the Act.
Insofar as indemnification for liabilities arising under the
Securities Act may be permitted to directors, officers, and controlling persons
of the registrant pursuant to the provisions described in Item 15 above or
otherwise, the registrant has been advised that in the opinion of the
Securities and Exchange Commission such indemnification is against public
policy as expressed in the Securities Act and is, therefore, unenforceable. In
the event that a claim for indemnification against such liabilities (other than
the payment by the registrant of expenses incurred or paid by a director,
officer, or controlling persons of the registrant in the successful defense of
any action, suit, or proceeding) is asserted by such director, officer, or
controlling person in connection with the securities being registered, the
registrant will, unless in the opinion of its counsel the matter has been
settled by controlling precedent, submit to a court of appropriate jurisdiction
the question whether such indemnification by it is against public policy as
expressed in the Securities Act and will be governed by the final adjudication
of such issue.
<PAGE> 38
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, the
registrant certifies that it has reasonable grounds to believe that it meets
all of the requirements for filing on Form S-3 and has duly caused this
registration statement to be signed on its behalf by the undersigned, thereunto
duly authorized, in the City of St. Louis, State of Missouri on the 12th day
of April, 1995.
EDISON BROTHERS STORES, INC.
By /s/ Alan D. Miller
-------------------------------------
Alan D. Miller
Chairman of the Board, President,
Chief Executive Officer and Director
POWER OF ATTORNEY
Each person whose signature appears below hereby constitutes and appoints
Alan D. Miller, David B. Cooper, Jr., and Alan A. Sachs, and each of them, his
or her true and lawful attorneys-in-fact and agents, with full power of
substitution and resubstitution to sign on his or her behalf, individually and
in each capacity stated below, all amendments and post-effective amendments to
this registration statement on Form S-3 and to file the same, with all exhibits
thereto, and all amendments and supplements to any prospectus relating thereto
and any other documents in connection therewith, with the Securities and
Exchange Commission under the Securities Act of 1933, granting unto said
attorneys-in-fact and agents full power and authority to do and perform each
and every act and thing requisite and necessary to be done in and about the
premises, as fully and to all intents and purposes as each might or could do in
person, hereby ratifying and confirming each act that said attorneys-in-fact
and agents, or any of them, or any substitute thereof, may lawfully do or cause
to be done by virtue hereof.
Pursuant to the requirements of the Securities Act of 1933, this
registration statement has been signed by the following persons in the
capacities and on the dates indicated.
Signature Title Date
- ------------------------------ ------------------------------- --------------
/s/ Alan D. Miller Chairman of the Board, April 12, 1995
- ------------------------------ President, Chief Executive
Alan D. Miller Officer and Director (principal
executive officer)
/S/ David B. Cooper, Jr. Executive Vice President, Chief April 12, 1995
- ------------------------------ Financial Officer and Director
David B. Cooper, Jr. (principal financial officer)
/s/ Andrew E. Newman Director April 12, 1995
- ------------------------------
Andrew E. Newman
/s/ Martin Sneider Director April 12, 1995
- ------------------------------
Martin Sneider
<PAGE> 39
Signature Title Date
- ------------------------------ ------------------------------- --------------
/s/ Karl W. Michner Senior Executive Vice President, April 12, 1995
- ------------------------------ President of Menswear Group and
Karl W. Michner Director
/s/ Peter A. Edison
- ------------------------------ Senior Executive Vice President, April 12, 1995
Peter A. Edison Director of Corporate
Development and Director
/s/ Michael H. Freund Executive Vice President April 12, 1995
- ------------------------------ -Administration and Director
Michael H. Freund
/s/ Alan A. Sachs Executive Vice President, April 12, 1995
- ------------------------------ General Counsel, Secretary and
Alan A. Sachs Director
/s/ Julian I. Edison Director April 12, 1995
- ------------------------------
Julian I. Edison
Director April __, 1995
- ------------------------------
Jane Evans
/s/ Eric P. Newman Director April 12, 1995
- ------------------------------
Eric P. Newman
Director April __, 1995
- ------------------------------
Craig D. Schnuck
Director April __, 1995
- ------------------------------
Robert W. Staley
/S/ Norman Gold Vice President and Corporate April 12, 1995
- ------------------------------ Controller (chief accounting
Norman Gold officer)
<PAGE> 40
INDEX TO EXHIBITS
Exhibit
Number Exhibit
- -------- ----------------------------------------------------------------------
1.1 Form of Underwriting Agreement for Debt Securities.
1.2 Form of Underwriting Agreement for Preferred Stock and/or Depositary
Shares (to be filed by post-effective amendment or incorporated herein
by reference prior to the issuance of Preferred Stock and/or
Depositary Shares).
1.3 Form of Underwriting Agreement for Common Stock (to be filed by post-
effective amendment or incorporated herein by reference prior to the
issuance of Common Stock).
1.4 Form of Underwriting Agreement for Warrants (to be filed by post-
effective amendment or incorporated herein by reference prior to the
issuance of Warrants).
3.1 Certificate of Incorporation, as amended (incorporated by reference to
Exhibit 3(a) to the Company's annual report on Form 10-K for the year
ended February 2, 1991, File 1-1394).
3.2 Bylaws, as amended (incorporated by reference to Exhibit 3(a) to the
Company's annual report on Form 10-K for the year ended January 28,
1995, File 1-1394).
4.1 Rights Agreement dated as of January 26, 1988 between Edison Brothers
Stores, Inc. and Mellon Securities Trust Company, as Rights Agent
(incorporated by reference to Exhibit 1 to the Company's current
report on Form 8-K dated February 17, 1988, File 1-1394).
4.2 Amendment to Rights Agreement dated as of November 30, 1989
(incorporated by reference to Exhibit 1 to the Company's current
report on Form 8-K dated December 11, 1989, File 1-1394).
4.3 Second Amendment to Rights Agreement dated as of September 29, 1992
(incorporated by reference to Exhibit 1 to the Company's current
report on Form 8-K dated October 28, 1992, File 1-1394).
4.4 Note Agreements and Senior Notes dated March 1, 1993, between Edison
Brothers Stores, Inc. and a number of institutional lenders relating
to $150 million of unsecured debt (incorporated by reference to
Exhibit 4(b) to the Company's annual report on Form 10-K for the year
ended January 30, 1993, File 1-1394).
4.5 Amendment Agreement dated as of January 15, 1994, amending the Note
Agreements dated March 1, 1993 (incorporated by reference to Exhibit
4(c) to the Company's annual report on Form 10-K for the year ended
January 29, 1994, File 1-1394).
4.6 Amendment Agreement dated as of February 1, 1994, amending the Note
Agreements dated March 1, 1993 (incorporated by reference to Exhibit
4(c) to the Company's annual report on Form 10-K for the year ended
January 29, 1994, File 1-1394).
<PAGE> 41
Exhibit
Number Exhibit
- -------- ----------------------------------------------------------------------
4.7 Amendment Agreement dated as of April 1, 1995 amending the Note
Agreements dated March 1, 1993 (incorporated by reference to
Exhibit 4(c) to the Company's annual report on Form 10-K for the year
ended January 28, 1995, File 1-1394).
10.1 Form of Indemnification Agreement between the Company and each of its
directors was filed as Exhibit 10(b) to the Company's annual report
on Form 10-K for the year ended January 3, 1987 (file 1-1394), and is
incorporated herein by reference.
10.2 Form of Termination Agreement entered into by the Company with
Alan D. Miller, Chairman of the Board, President and Chief Executive
Officer of the Company (incorporated by reference to Exhibit 10(b)
of the Company's annual report on Form 10-K for the year ended
January 28, 1995 (File 1-1394)).
10.3 Form of Termination Agreement entered into by the Company with other
executive officers of the Company was filed as Exhibit 10(b) to the
Company's annual report on Form 10-K for the year ended February 3,
1990 (file 1-1394), and is incorporated herein by reference.
10.4 The Edison Brothers Stores, Inc. 1992 Stock Option Plan, as amended
March 3, 1994, was filed as an Exhibit to the Company's annual report
on Form 10-K for the year ended January 29, 1994, and is incorporated
herein by reference.
10.5 The Edison Brothers Stores, Inc. 1986 Stock Option Plan, as amended
April 27, 1987 and March 3, 1994, was filed as an Exhibit to the
Company's annual report on Form 10-K for the year ended January 29,
1994, and is incorporated herein by reference.
10.6 The Edison Brothers Stores, Inc. 1982 Incentive Stock Option Plan, as
amended effective October 25, 1983, January 28, 1986 and March 3,
1986, is incorporated by reference from the Company's Registration
Statement on Form S-8 (No. 2-84838) filed with the Commission.
10.7 Non-Qualified Retirement Plan for Outside Directors is described
under the caption "Election of Directors" in the proxy statement for
the Company's 1995 annual stockholders meeting, which description
is incorporated herein by reference.
10.8 Credit Agreement dated as of June 4, 1993 between Edison Brothers
Stores, Inc. and a number of financial institutions relating to a $150
million revolving credit facility.
10.9 First Amendment to Credit Agreement dated as of January 24, 1994
amending the Credit Agreement dated June 4, 1993.
10.10 Second Amendment to Credit Agreement dated as of February 17, 1994
amending the Credit Agreement dated June 4, 1993.
10.11 Third Amendment to Credit Agreement dated as of March 29, 1995
amending the Credit Agreement dated June 4, 1993.
<PAGE> 42
Exhibit
Number Exhibit
- -------- ----------------------------------------------------------------------
10.12 Form of Senior Indenture between the Company and Fleet Bank of
Massachusetts, N.A., as trustee.
10.13* Form of Subordinated Indenture between the Company and one or more
commercial banks to be named, as trustee.
10.14* Form of Senior Debt Security.
10.15* Form of Subordinated Debt Security.
10.16* Form of Deposit Agreement.
10.17* Form of Depositary Receipt.
10.18* Form of Warrant Agreement.
10.19* Form of Warrant Certificate.
5 Opinion of Bryan Cave as to the legality of the securities to be
registered.
12 Computation of Consolidated Ratios of Earnings to Fixed Charges.
23.1 Consent of Ernst & Young LLP.
23.2 Consent of Bryan Cave (included in the opinion filed as Exhibit 5 to
this Registration Statement).
24 Powers of Attorney of the Company (see signature page herein).
25 Form T-1 Statement of Eligibility under the Trust Indenture Act of
1939, as amended, of Fleet Bank of Massachusetts, N.A. as Trustee
under the Senior Indenture.
* To be filed by amendment.
<PAGE> 1
EXHIBIT 1.1
Draft of March 21, 1995
EDISON BROTHERS STORES, INC.
Debt Securities
--------------------
Underwriting Agreement
----------------------
, 1995
To the Representative(s) of the
several Underwriters named in the
respective Pricing Agreement
hereinafter described.
Ladies and Gentlemen:
From time to time Edison Brothers Stores, Inc., a Delaware corporation
(the "Company"), proposes to enter into one or more Pricing Agreements (each a
"Pricing Agreement") in the form of Annex I hereto, with such additions and
deletions as the parties thereto may determine, and, subject to the terms and
conditions stated herein and therein, to issue and sell to the firms named in
Schedule I to the applicable Pricing Agreement (such firms constituting the
"Underwriters" with respect to such Pricing Agreement and the securities
specified therein) certain of its debt securities (the "Securities") specified
in Schedule II to such Pricing Agreement (with respect to such Pricing
Agreement, the "Designated Securities").
The terms and rights of any particular issuance of Designated Securities
shall be as specified in the Pricing Agreement relating thereto and in or
pursuant to the indenture (the "Indenture") identified in such Pricing
Agreement.
1. Particular sales of Designated Securities may be made from time to
time to the Underwriters of such Securities, for whom the firms designated as
representatives of the Underwriters of such Securities in the Pricing Agreement
relating thereto will act as representatives (the "Representatives"). The term
"Representatives" also refers to a single firm acting as sole representative of
the Underwriters and to an Underwriter or Underwriters who act without any firm
being designated as its or their representatives. This Underwriting Agreement
shall not be construed as an obligation of the Company to sell any of the
Securities or as an obligation of any of the Underwriters to purchase the
Securities. The obligation of the Company to issue and sell any of the
Securities and the obligation of any of the Underwriters to purchase any of the
Securities shall be evidenced by the Pricing Agreement with respect to the
Designated Securities specified therein. Each Pricing Agreement shall specify
the aggregate principal amount of such Designated Securities, the initial
public offering price of such Designated Securities, the purchase price to the
Underwriters of such Designated Securities, the names of the Underwriters of
such Designated Securities, the names of the Representatives of such
Underwriters and the principal amount of such Designated Securities to be
purchased by each Underwriter and shall set forth the date, time and manner of
<PAGE> 2
delivery of such Designated Securities and payment therefor. The Pricing
Agreement shall also specify (to the extent not set forth in the Indenture and
the registration statement and prospectus with respect thereto) the terms of
such Designated Securities. A Pricing Agreement shall be in the form of an
executed writing (which may be in counterparts), and may be evidenced by an
exchange of telegraphic communications or any other rapid transmission device
designed to produce a written record of communications transmitted. The
obligations of the Underwriters under this Agreement and each Pricing Agreement
shall be several and not joint.
2. The Company represents and warrants to, and agrees with, each of the
Underwriters that:
(a) A registration statement on Form S-3 (File No. 33-_____) in
respect of the Securities has been filed with the Securities and
Exchange Commission (the "Commission"); such registration statement
and any post-effective amendment thereto, each in the form heretofore
delivered or to be delivered to the Representatives and, excluding
exhibits to such registration statement, but including all documents
or portions thereof incorporated by reference in the prospectus
contained therein, to the Representatives for each of the other
Underwriters, have been declared effective by the Commission in such
form; no other document with respect to such registration statement
and no other document incorporated by reference therein has heretofore
been filed or transmitted for filing with the Commission (other than
prospectuses filed pursuant to Rule 424(b) of the rules and
regulations of the Commission under the Securities Act of 1933, as
amended (the "Act"), each in the form heretofore delivered to the
Representatives); and no stop order suspending the effectiveness of
such registration statement has been issued and no proceeding for that
purpose has been initiated or threatened by the Commission (any
preliminary prospectus included in such registration statement or
filed with the Commission pursuant to Rule 424(a) under the Act, is
hereinafter called a "Preliminary Prospectus"; the various parts of
such registration statement, including all exhibits thereto and the
documents or portions thereof incorporated by reference in the
prospectus contained in the registration statement at the time such
part of the registration statement became effective but excluding any
Form T-1, each as amended at the time such part of the registration
statement became effective, are hereinafter collectively called the
"Registration Statement"; the prospectus relating to the Securities,
in the form in which it has most recently been filed, or transmitted
for filing, with the Commission on or prior to the date of this
Agreement, being hereinafter called the "Prospectus"; any reference
herein to any Preliminary Prospectus or the Prospectus shall be deemed
to refer to and include the documents or portions thereof incorporated
by reference therein pursuant to the applicable form under the Act, as
of the date of such Preliminary Prospectus or Prospectus, as the case
may be; any reference to any amendment or supplement to any
Preliminary Prospectus or the Prospectus shall be deemed to refer to
and include any documents filed after the date of such Preliminary
Prospectus or Prospectus, as the case may be, under the Securities
Exchange Act of 1934, as amended (the "Exchange Act"), to the extent
incorporated by reference in such Preliminary Prospectus or
Prospectus, as the case may be; any reference to any amendment to the
Registration Statement shall be deemed to refer to and include any
annual report of the Company filed pursuant to Sections 13(a) or 15(d)
of the Exchange Act after the effective date of the Registration
<PAGE> 3
Statement to the extent incorporated by reference in the Registration
Statement; and any reference to the Prospectus as amended or
supplemented shall be deemed to refer to the Prospectus as amended or
supplemented in relation to the applicable Designated Securities in
the form in which it is filed with the Commission pursuant to Rule
424(b) under the Act in accordance with Section 5(a) hereof, including
any documents or portions thereof incorporated by reference therein as
of the date of such filing);
(b) The documents incorporated by reference in the Prospectus,
when they became effective or were filed with the Commission, as the
case may be, conformed in all material respects to the requirements of
the Act or the Exchange Act, as applicable, and the rules and
regulations of the Commission thereunder, and none of such documents
at the time they were filed or became effective, as the case may be,
contained an untrue statement of a material fact or omitted to state a
material fact required to be stated therein or necessary to make the
statements therein not misleading; and any further documents so filed
and incorporated by reference in the Prospectus or any further
amendment or supplement thereto, when such documents become effective
or are filed with the Commission, as the case may be, will conform in
all material respects to the requirements of the Act or the Exchange
Act, as applicable, and the rules and regulations of the Commission
thereunder and will not contain an untrue statement of a material fact
or omit to state a material fact required to be stated therein or
necessary to make the statements therein not misleading; provided,
however, that this representation and warranty shall not apply to any
statements or omissions made in reliance upon and in conformity with
information furnished in writing to the Company by an Underwriter of
Designated Securities through the Representatives expressly for use in
the Prospectus as amended or supplemented relating to such Securities;
(c) The Registration Statement and the Prospectus conform, and any
further amendments or supplements to the Registration Statement or the
Prospectus will conform, in all material respects to the requirements
of the Act and the Trust Indenture Act of 1939, as amended (the "Trust
Indenture Act") and the rules and regulations of the Commission
thereunder and do not and will not, as of the applicable effective
date as to the Registration Statement and any amendment thereto and as
of the applicable filing date as to the Prospectus and any amendment
or supplement thereto, contain an untrue statement of a material fact
or omit to state a material fact required to be stated therein or
necessary to make the statements therein (in the case of the
Prospectus and any amendment or supplement thereto in the light of the
circumstances under which they were made) not misleading; provided,
however, that this representation and warranty shall not apply to any
statements or omissions made in reliance upon and in conformity with
information furnished in writing to the Company by an Underwriter of
Designated Securities through the Representatives expressly for use in
the Prospectus as amended or supplemented relating to such Securities;
(d) Neither the Company nor any of its subsidiaries has sustained
since the date of the latest audited financial statements included or
incorporated by reference in the Prospectus any material loss or
interference with its business from fire, explosion, flood or other
calamity, whether or not covered by insurance, or from any labor
dispute or court or governmental action, order or decree, otherwise
than as set forth or contemplated in the Prospectus; and, since the
<PAGE> 4
respective dates as of which information is given in the Registration
Statement and the Prospectus, there has not been any change in the
capital stock (other than pursuant to employee benefit plans in the
ordinary course of business) or long-term debt of the Company or any
of its subsidiaries or any material adverse change, or any development
particular to the Company involving a prospective material adverse
change, in or affecting the general affairs, management, financial
position, stockholders' equity or results of operations of the Company
and its subsidiaries taken as a whole, otherwise than as set forth or
contemplated in the Prospectus;
(e) The Company has been duly incorporated and is validly existing
as a corporation in good standing under the laws of the jurisdiction
of its incorporation, with corporate power and authority to own its
properties and conduct its business as described in the Prospectus;
(f) The Company has an authorized capitalization as set forth in
the Prospectus, and all of the issued shares of capital stock of the
Company have been duly and validly authorized and issued and are fully
paid and non-assessable;
(g) The Securities have been duly authorized, and, when Designated
Securities are issued and delivered pursuant to this Agreement and the
Pricing Agreement with respect to such Designated Securities against
payment in full therefor and when authenticated and delivered by the
Trustee in accordance with the terms of the Indenture relating to such
Designated Securities, such Designated Securities will have been duly
executed, authenticated, issued and delivered and will constitute
valid and legally binding obligations of the Company entitled to the
benefits provided by the Indenture, which will be substantially in the
form filed as an exhibit to the Registration Statement; the Indenture
has been duly authorized and duly qualified under the Trust Indenture
Act and, at the Time of Delivery for such Designated Securities (as
defined in Section 4 hereof), the Indenture will constitute a valid
and legally binding instrument, enforceable in accordance with its
terms, subject, as to enforcement, to bankruptcy, insolvency,
reorganization and other laws of general applicability relating to or
affecting creditors' rights and to general equity principles; and the
Indenture conforms, and the Designated Securities will conform, to the
descriptions thereof contained in the Prospectus as amended or
supplemented with respect to such Designated Securities;
(h) The issue and sale of the Securities and the compliance by the
Company with all of the provisions of the Securities, the Indenture,
this Agreement and any Pricing Agreement, and the consummation of the
transactions herein and therein contemplated will not conflict with or
result in a material breach or violation of any of the terms or
provisions of, or constitute a material default under, any indenture,
mortgage, deed of trust, loan agreement or other agreement or
instrument to which the Company is a party or by which the Company is
bound or to which any of the property or assets of the Company is
subject, nor will such action result in any violation of the
provisions of the Certificate of Incorporation or By-Laws of the
Company or any statute or any order, rule or regulation of any court
or governmental agency or body having jurisdiction over the Company or
any of its properties; and no consent, approval, authorization, order,
registration or qualification of or with any such court or
governmental agency or body is required for the issue and sale of the
<PAGE> 5
Securities or the consummation by the Company of the transactions
contemplated by this Agreement or any Pricing Agreement or the
Indenture, except such as have been, or will have been prior to the
Time of Delivery, obtained under the Act and the Trust Indenture Act
and such consents, approvals, authorizations, registrations or
qualifications as may be required under state securities or Blue Sky
laws in connection with the purchase and distribution of the
Securities by the Underwriters;
(i) The statements set forth in the Prospectus under the captions
"Description of Debt Securities" and "Description of Notes", insofar
as they purport to constitute a summary of the terms of the
Securities, and under the captions "Plan of Distribution" and
"Underwriting", insofar as they purport to describe the provisions of
the documents referred to therein, are accurate, complete and fair in
all material respects;
(j) Neither the Company nor any of its subsidiaries is in
violation of its Certificate of Incorporation or By-Laws or in default
in the performance or observance of any material obligation,
agreement, covenant or condition contained in any indenture, mortgage,
deed of trust, loan agreement, lease or other agreement or instrument
to which it is a party or by which it or any of its properties is
bound except for any such violation or default which would not have a
material adverse effect on the consolidated financial position,
stockholder's equity or results of operations of the Company and its
subsidiaries taken as a whole;
(k) Other than as set forth or contemplated in the Prospectus,
there are no legal or governmental proceedings pending to which the
Company or any of its subsidiaries is a party or of which any property
of the Company or any of its subsidiaries is the subject which, if
determined adversely to the Company or any of its subsidiaries, would
individually or in the aggregate have a material adverse effect on the
current or future consolidated financial position, stockholders'
equity or results of operations of the Company and its subsidiaries
taken as a whole; and, to the Company's knowledge, no such proceedings
are threatened or contemplated by governmental authorities or
threatened by others;
(l) The Company is not and, after giving effect to the offering
and sale of the Securities, will not be an "investment company" or an
entity "controlled" by an "investment company", as such terms are
defined in the Investment Company Act of 1940, as amended (the
"Investment Company Act");
(m) Neither the Company nor any of its affiliates does business
with the government of Cuba or with any person or affiliate located in
Cuba within the meaning of Section 517.075, Florida Statutes; and
(n) Ernst & Young, who have certified certain financial statements
of the Company and its subsidiaries, are independent public
accountants as required by the Act and the rules and regulations of
the Commission thereunder.
3. Upon the execution of the Pricing Agreement applicable to any
Designated Securities and authorization by the Representatives of the release
of such Designated Securities, the several Underwriters propose to offer such
<PAGE> 6
Designated Securities for sale upon the terms and conditions set forth in the
Prospectus as amended or supplemented.
4. Designated Securities to be purchased by each Underwriter pursuant to
the Pricing Agreement relating thereto, in the form specified in such Pricing
Agreement, and in such authorized denominations and registered in such names as
the Representatives may request upon at least forty-eight hours' prior notice
to the Company, shall be delivered by or on behalf of the Company to the
Representatives for the account of such Underwriter, against payment by such
Underwriter or on its behalf of the purchase price therefor by certified or
official bank check or checks, payable to the order of the Company in the funds
specified in such Pricing Agreement, all in the manner and at the place and
time and date specified in such Pricing Agreement or at such other place and
time and date as the Representatives and the Company may agree upon in writing,
such time and date being herein called the "Time of Delivery" for such
Designated Securities.
5. The Company agrees with each of the Underwriters of any Designated
Securities:
(a) To prepare the Prospectus as amended or supplemented in
relation to the applicable Designated Securities in a form reasonably
approved by the Representatives and to file such Prospectus pursuant
to Rule 424(b) under the Act not later than the Commission's close of
business on the second business day following the execution and
delivery of the Pricing Agreement relating to the applicable
Designated Securities or, if applicable, such earlier time as may be
required by Rule 424(b); to make no further amendment or any
supplement to the Registration Statement or Prospectus as amended or
supplemented after the date of the Pricing Agreement relating to such
Securities and prior to the Time of Delivery for such Securities which
shall be disapproved by the Representatives for such Securities
promptly after reasonable notice thereof; to advise the
Representatives promptly of any such amendment or supplement after
such Time of Delivery and furnish the Representatives with copies
thereof; to file timely all reports and any definitive proxy or
information statements required to be filed by the Company with the
Commission pursuant to Section 13(a), 13(c), 14 or 15(d) of the
Exchange Act for so long as the delivery of a prospectus is required
in connection with the offering or sale of such Designated Securities,
and during such same period to advise the Representatives, promptly
after it receives notice thereof, of the time when any amendment to
the Registration Statement has been filed or becomes effective or any
supplement to the Prospectus or any amended Prospectus has been filed
with the Commission, of the issuance by the Commission of any stop
order or of any order preventing or suspending the use of any
prospectus relating to the Securities, of the suspension of the
qualification of such Securities for offering or sale in any
jurisdiction, of the initiation or threatening of any proceeding for
any such purpose, or of any request by the Commission for the amending
or supplementing of the Registration Statement or Prospectus or for
additional information; and, in the event of the issuance of any such
stop order or of any such order preventing or suspending the use of
any prospectus relating to the Securities or suspending any such
qualification, to promptly use its best efforts to obtain the
withdrawal of such order;
<PAGE> 7
(b) Promptly from time to time to take such action as the
Representatives may reasonably request to qualify such Designated
Securities for offering and sale under the securities laws of such
jurisdictions as the Representatives may request and to comply with
such laws so as to permit the continuance of sales and dealings
therein in such jurisdictions for as long as may be necessary to
complete the distribution of such Securities, provided that in
connection therewith the Company shall not be required to qualify as a
foreign corporation or to file a general consent to service of process
in any jurisdiction;
(c) To furnish the Underwriters with copies of the Prospectus as
amended or supplemented relating to the Designated Securities in such
quantities as the Representatives may from time to time reasonably
request, and, if the delivery of a prospectus is required at any time
in connection with the offering or sale of the Designated Securities
and if at such time any event shall have occurred as a result of which
the Prospectus as then amended or supplemented would include an untrue
statement of a material fact or omit to state any material fact
necessary in order to make the statements therein, in the light of the
circumstances under which they were made when such Prospectus is
delivered, not misleading, or, if for any other reason it shall be
necessary during such same period to amend or supplement the
Prospectus or to file under the Exchange Act any document incorporated
by reference in the Prospectus in order to comply with the Act, the
Exchange Act or the Trust Indenture Act, to notify the Representatives
and upon their request to file such document and to prepare and
furnish without charge to each Underwriter and to any dealer in
securities as many copies as the Representatives may from time to time
reasonably request of an amended Prospectus or a supplement to the
Prospectus which will correct such statement or omission or effect
such compliance;
(d) To make generally available to its securityholders as soon as
practicable, but in any event not later than eighteen months after the
effective date of the Registration Statement (as defined in Rule
158(c) under the Act), an earnings statement of the Company and its
subsidiaries (which need not be audited) complying with Section 11(a)
of the Act and the rules and regulations of the Commission thereunder
(including, at the option of the Company, Rule 158); and
(e) During the period beginning from the date of the Pricing
Agreement for such Designated Securities and continuing to and
including the later of (i) the termination of trading restrictions for
such Designated Securities, as notified to the Company by the
Representatives and (ii) the Time of Delivery for such Designated
Securities, not to offer, sell, contract to sell or otherwise dispose
of any debt securities of the Company which mature more than one year
after such Time of Delivery and which are substantially similar to
such Designated Securities, without the prior written consent of the
Representatives.
6. The Company covenants and agrees with the several Underwriters that
the Company will pay or cause to be paid the following: (i) the fees,
disbursements and expenses of the Company's counsel and accountants in
connection with the registration of the Securities under the Act and all other
expenses in connection with the preparation, printing and filing of the
Registration Statement, any Preliminary Prospectus and the Prospectus and
<PAGE> 8
amendments and supplements thereto and the mailing and delivering of copies
thereof to the Underwriters and dealers; (ii) the cost of printing or producing
any Agreement among Underwriters, this Agreement, any Pricing Agreement, any
Indenture, any Blue Sky and Legal Investment Memoranda, closing documents
(including any compilations thereof) and any other documents in connection with
the offering, purchase, sale and delivery of the Securities; (iii) all expenses
in connection with the qualification of the Securities for offering and sale
under state securities laws as provided in Section 5(b) hereof, including the
reasonable fees and disbursements of counsel for the Underwriters in connection
with such qualification and in connection with the Blue Sky and Legal
Investment Surveys; (iv) any fees charged by securities rating services for
rating the Securities; (v) any filing fees incident to any required review by
the National Association of Securities Dealers, Inc. of the terms of the sale
of the Securities; (vi) the cost of preparing the Securities; (vii) the fees
and expenses of any Trustee and any agent of any Trustee and the fees and
disbursements of counsel for any Trustee in connection with any Indenture and
the Securities to the extent properly incurred under the terms of the
applicable Indenture; and (viii) all other costs and expenses incident to the
performance of the Company's obligations hereunder which are not otherwise
specifically provided for in this Section. It is understood, however, that,
except as provided in this Section, and Sections 8 and 11 hereof, the
Underwriters will pay all of their own costs and expenses, including the fees
of their counsel, transfer taxes on resale of any of the Securities by them,
and any advertising expenses connected with any offers they may make.
7. The obligations of the Underwriters of any Designated Securities under
the Pricing Agreement relating to such Designated Securities shall be subject,
in the discretion of the Representatives to waive the same, to the condition
that all representations and warranties and other statements of the Company in
or incorporated by reference in the Pricing Agreement relating to such
Designated Securities are, at and as of the Time of Delivery for such
Designated Securities, true and correct, the condition that the Company shall
have performed all of its obligations hereunder theretofore to be performed,
and the following additional conditions:
(a) The Prospectus as amended or supplemented in relation to the
applicable Designated Securities shall have been filed with the
Commission pursuant to Rule 424(b) within the applicable time period
prescribed for such filing by the rules and regulations under the Act
and in accordance with Section 5(a) hereof; no stop order suspending
the effectiveness of the Registration Statement or any part thereof
shall have been issued and no proceeding for that purpose shall have
been initiated or threatened by the Commission; and all requests for
additional information on the part of the Commission shall have been
complied with to the Representatives' reasonable satisfaction;
(b) Counsel for the Underwriters shall have furnished to the
Representatives such opinion or opinions, dated the Time of Delivery
for such Designated Securities, with respect to the incorporation of
the Company, the validity of the Designated Securities being delivered
at such time of Delivery, the Registration Statement, the Prospectus
and such other related matters as the Representatives may reasonably
request, and such counsel shall have received such papers and
information as they may reasonably request to enable them to pass upon
such matters;
<PAGE> 9
(c) Counsel for the Company reasonably satisfactory to the
Representatives shall have furnished to the Representatives their
written opinion, dated the Time of Delivery for such Designated
Securities, in form and substance reasonably satisfactory to the
Representatives, to the effect that:
(i) The Company has been duly incorporated and is validly
existing as a corporation in good standing under the laws of
the jurisdiction of its incorporation, with corporate power
and authority to own its properties and conduct its business
as described in the Prospectus as amended or supplemented;
(ii) The Company has an authorized capitalization as set
forth in the Prospectus as amended or supplemented and all of
the issued shares of capital stock of the Company have been
duly and validly authorized and issued and are fully paid and
non-assessable;
(iii) To such counsel's knowledge and other than as set
forth in the Prospectus, there are no legal or governmental
proceedings pending to which the Company or any of its
subsidiaries is a party or of which any property of the
Company or any of its subsidiaries is the subject which, if
determined adversely to the Company or any of its
subsidiaries, would individually or in the aggregate have a
material adverse effect on the consolidated financial
position, stockholders' equity or results of operations of the
Company and its subsidiaries taken as a whole; and, to such
counsel's knowledge, no such proceedings are threatened or
contemplated by governmental authorities or threatened by
others;
(iv) This Agreement and the Pricing Agreement with respect
to the Designated Securities have been duly authorized,
executed and delivered by the Company;
(v) The Designated Securities have been duly authorized,
executed, authenticated, issued and delivered and constitute
valid and legally binding obligations of the Company entitled
to the benefits provided by the Indenture; and the Designated
Securities and the Indenture conform in all material respects
to the descriptions thereof in the Prospectus as amended or
supplemented;
(vi) The Indenture has been duly authorized, executed and
delivered by the parties thereto and constitutes a valid and
legally binding instrument, enforceable in accordance with its
terms, subject, as to enforcement, to bankruptcy, insolvency,
reorganization and other laws of general applicability
relating to or affecting creditors' rights and to general
equity principles; and the Indenture has been duly qualified
under the Trust Indenture Act;
(vii) The issue and sale of the Designated Securities and
the compliance by the Company with all of the provisions of
the Designated Securities, the Indenture, this Agreement and
the Pricing Agreement with respect to the Designated
Securities and the consummation of the transactions herein and
<PAGE> 10
therein contemplated will not result in a material breach or
violation of any of the terms or provisions of, or constitute
a material default under, any material indenture, mortgage,
deed of trust, loan agreement or other agreement or instrument
known to such counsel to which the Company is a party or by
which the Company is bound or to which any of the property or
assets of the Company is subject except for any such breach,
violation or default that has been waived in writing and with
respect to which the Representatives have received copies of
such written waiver nor will such actions result in any
violation of the provisions of the Certificate of
Incorporation or By-Laws of the Company or any statute or any
order, rule or regulation known to such counsel of any court
or governmental agency or body having jurisdiction over the
Company or any of its properties;
(viii) No consent, approval, authorization, order,
registration or qualification of or with any such court or
governmental agency or body is required for the issue and sale
of the Designated Securities or the consummation by the
Company of the transactions contemplated by this Agreement or
such Pricing Agreement or the Indenture, except such as have
been obtained under the Act and the Trust Indenture Act and
such consents, approvals, authorizations, orders,
registrations or qualifications as may be required under state
securities or Blue Sky laws in connection with the purchase
and distribution of the Designated Securities by the
Underwriters;
(ix) To such Counsel's knowledge, neither the Company nor
any of its Significant Subsidiaries (as identified on
Schedule III hereto) is in violation of its By-laws or
Certificate of Incorporation or in default in the performance
or observance of any material obligation, agreement, covenant
or condition contained in any material contract, indenture,
mortgage, loan agreement, note, lease or other instrument to
which it is a party or by which it or any of its properties
may be bound;
(x) The statements set forth in the Prospectus under the
captions "Description of Debt Securities", and "Description of
Notes" insofar as they purport to constitute a summary of the
terms of the Designated Securities, and under the caption
"Taxation", and under the captions "Plan of Distribution" and
"Underwriting", insofar as they purport to describe the
provisions of the laws and documents referred to therein, are
accurate and complete in all material respects;
(xi) The Company is not an "investment company" or an
entity "controlled" by an "investment company", as such terms
are defined in the Investment Company Act;
(xii) The documents incorporated by reference in the
Prospectus as amended or supplemented prior to the Time of
Delivery (other than numerical information included therein,
information covered by the letter to be delivered by the
independent accountants of the Company pursuant to Section
7(d) hereof, the financial statements and related schedules
<PAGE> 11
and other financial data included therein, as to which such
counsel need express no opinion), when they became effective
or were filed with the Commission, as the case may be,
complied as to form in all material respects with the
requirements of the Act or the Exchange Act, as applicable,
and the rules and regulations of the Commission thereunder;
and they have no reason to believe that any of such documents,
when they became effective or were so filed, as the case may
be, contained, in the case of a registration statement which
became effective under the Act, an untrue statement of a
material fact or omitted to state a material fact required to
be stated therein or necessary to make the statements therein
not misleading, or, in the case of other documents which were
filed under the Act or the Exchange Act with the Commission,
an untrue statement of a material fact or omitted to state a
material fact necessary in order to make the statements
therein, in the light of the circumstances under which they
were made when such documents were so filed, not misleading;
and
(xiii) The Registration Statement and the Prospectus as
amended or supplemented prior to the Time of Delivery and any
further amendments and supplements thereto made by the Company
prior to the Time of Delivery for the Designated Securities
(other than numerical information included therein,
Information covered by the letter to be delivered by the
independent accountants of the Company pursuant to
Section 7(d) hereof, the financial statements and related
schedules and other financial data included therein, as to
which such counsel need express no opinion) comply as to form
in all material respects with the requirements of the Act and
the Trust Indenture Act and the rules and regulations
thereunder; although they do not assume any responsibility for
the accuracy or completeness of the statements contained in
the Registration Statement or the Prospectus, except for those
referred to in the opinion in subsection (x) of this Section
7(c), no information has come to the attention of such counsel
which caused them to believe that, as of its effective date,
the Registration Statement or any further amendment thereto
made by the Company prior to the Time of Delivery (other than
numerical information included therein, information covered by
the letter to be delivered by the independent accountants of
the Company pursuant to Section 7(d) hereof, the financial
statements and related schedules and other financial data
included therein, as to which such counsel need express no
opinion) contained an untrue statement of a material fact or
omitted to state a material fact required to be stated therein
or necessary to make the statements therein not misleading or
that, as of its date, the Prospectus as amended or
supplemented or any further amendment or supplement thereto
made by the Company prior to the Time of Delivery (other than
numerical information included therein, information covered by
the letter to be delivered by the independent accountants of
the Company pursuant to Section 7(d) hereof, the financial
statements and related schedules and other financial data
included therein, as to which such counsel need express no
opinion) contained an untrue statement of a material fact or
omitted to state a material fact necessary to make the
<PAGE> 12
statements therein, in the light of the circumstances under
which they were made, not misleading or that, as of the Time
of Delivery, either the Registration Statement or the
Prospectus as amended or supplemented or any further amendment
or supplement thereto made by the Company prior to the Time of
Delivery (other than numerical information included therein,
information covered by the letter to be delivered by the
independent accountants of the Company pursuant to
Section 7(d) hereof, the financial statements and related
schedules and other financial data included therein, as to
which such counsel need express no opinion) contains an untrue
statement of a material fact or omits to state a material fact
necessary to make the statements therein (in the case of the
Prospectus as amended and supplemented and any such amendment
or supplement thereto, in the light of the circumstances under
which they were made) not misleading; and they do not know of
any amendment to the Registration Statement required to be
filed or any contracts or other documents of a character
required to be filed as an exhibit to the Registration
Statement or required to be incorporated by reference into the
Prospectus as amended or supplemented or required to be
described in the Registration Statement or the Prospectus as
amended or supplemented which are not filed or incorporated by
reference or described as required;
In rendering such opinion, such counsel may (i) rely
as to matters of fact, to the extent they deem proper, upon
certificates or affidavits of officers of the Company, and the
Trustee provided that in the case of any such reliance such
counsel shall state that such counsel believes that they, and
the Underwriters, are justified in relying upon such
certificates or affidavits for such matters and (ii) assume
that the Indenture has been duly authorized, executed and
delivered by the Trustee, that the Designated Securities
conform to the specimens examined by them, that the Trustee's
certificates of authentication of the Securities have been
manually signed by one of the Trustee's authorized officers
and that the signatures on all documents examined by them are
genuine.
(d) On the date of the Pricing Agreement for such Designated
Securities at a time prior to the execution of the Pricing Agreement
with respect to such Designated Securities and at the Time of Delivery
for such Designated Securities, the independent accountants of the
Company who have certified the financial statements of the Company and
its subsidiaries included or incorporated by reference in the
Registration Statement shall have furnished to the Representatives and
the Company a letter, dated the effective date of the Registration
Statement or the date of the most recent report filed with the
Commission containing financial statements and incorporated by
reference in the Registration Statement, if the date of such report is
later than such effective date, and a letter dated such Time of
Delivery, respectively, to the effect set forth in Annex II hereto,
and with respect to such letter dated such Time of Delivery, as to
such other matters as the Representatives may reasonably request and
in form and substance satisfactory to the Representatives;
<PAGE> 13
(e) (i) Neither the Company nor any of its subsidiaries shall have
sustained since the date of the latest audited financial statements
included or incorporated by reference in the Prospectus as amended
prior to the date of the Pricing Agreement relating to the Designated
Securities any loss or interference with its business from fire,
explosion, flood or other calamity, whether or not covered by
insurance, or from any labor dispute or court or governmental action,
order or decree, otherwise than as set forth or contemplated in the
Prospectus as amended prior to the date of the Pricing Agreement
relating to the Designated Securities, and (ii) since the respective
dates as of which information is given in the Prospectus as amended
prior to the date of the Pricing Agreement relating to the Designated
Securities there shall not have been any change in the capital stock
(other than pursuant to employee benefit plans in the ordinary course
of business) or long-term debt of the Company or any of its
subsidiaries or any change, or any development particular to the
Company involving a prospective change, in or affecting the general
affairs, management, financial position, stockholders' equity or
results of operations of the Company and its subsidiaries taken as a
whole, otherwise than as set forth or contemplated in the Prospectus
as amended prior to the date of the Pricing Agreement relating to the
Designated Securities, the effect of which, in any such case described
in Clause (i) or (ii), is in the judgment of the Representatives so
material and adverse as to make it impracticable or inadvisable to
proceed with the public offering or the delivery of the Designated
Securities on the terms and in the manner contemplated in the
Prospectus as first amended or supplemented relating to the Designated
Securities;
(f) On or after the date of the Pricing Agreement relating to the
Designated Securities (i) no downgrading shall have occurred in the
rating accorded the Company's debt securities or preferred stock by
any "nationally recognized statistical rating organization", as that
term is defined by the Commission for purposes of Rule 436(g)(2) under
the Act, and (ii) no such organization shall have publicly announced
that it has under surveillance or review, with possible negative
implications, its rating of any of the Company's debt securities or
preferred stock;
(g) On or after the date of the Pricing Agreement relating to the
Designated Securities there shall not have occurred any of the
following: (i) a suspension or material limitation in trading in
securities generally on the New York Stock Exchange; (ii) a suspension
or material limitation in trading in the Company's securities on the
New York Stock Exchange; (iii) a general moratorium on commercial
banking activities declared by either Federal or New York State
authorities; or (iv) the outbreak or escalation of hostilities
involving the United States or the declaration by the United States of
a national emergency or war, if the effect of any such event specified
in this Clause (iv) in the judgment of the Representatives makes it
impracticable or inadvisable to proceed with the public offering or
the delivery of the Designated Securities on the terms and in the
manner contemplated in the Prospectus as first amended or supplemented
relating to the Designated Securities; and
(h) The Company shall have furnished or caused to be furnished to
the Representatives at the Time of Delivery for the Designated
<PAGE> 14
Securities a certificate or certificates of officers of the Company
reasonably satisfactory to the Representatives as to the accuracy of
the representations and warranties of the Company herein at and as of
such Time of Delivery, as to the performance by the Company of all of
its obligations hereunder to be performed at or prior to such Time of
Delivery, as to the matters set forth in subsections (a) and (e) of
this Section and as to such other matters as the Representatives may
reasonably request.
8. (a) The Company will indemnify and hold harmless each Underwriter
against any losses, claims, damages or liabilities, joint or several, to which
such Underwriter may become subject, under the Act or otherwise, insofar as
such losses, claims, damages or liabilities (or actions in respect thereof)
arise out of or are based upon an untrue statement or alleged untrue statement
of a material fact contained in any Preliminary Prospectus, any preliminary
prospectus supplement, the Registration Statement, the Prospectus as amended or
supplemented and any other prospectus relating to the Securities, or any
amendment or supplement thereto, or arise out of or are based upon the omission
or alleged omission to state therein a material fact required to be stated
therein or necessary to make the statements therein not misleading, and subject
to clause (c) of this Section will reimburse each Underwriter for any
reasonable legal or other expenses reasonably incurred by such Underwriter in
connection with investigating or defending any such action or claim as such
expenses are incurred; provided, however, that the Company shall not be liable
in any such case to the extent that any such loss, claim, damage, liability or
action arises out of or is based upon an untrue statement or alleged untrue
statement or omission or alleged omission made in any Preliminary Prospectus,
any preliminary prospectus supplement, the Registration Statement, the
Prospectus as amended or supplemented and any other prospectus relating to the
Securities, or any such amendment or supplement in reliance upon and in
conformity with written information furnished to the Company by any Underwriter
of Designated Securities through the Representatives expressly for use in the
Prospectus as amended or supplemented relating to such Securities.
(b) Each Underwriter will indemnify and hold harmless the Company
against any losses, claims, damages or liabilities to which the Company may
become subject, under the Act or otherwise, insofar as such losses, claims,
damages or liabilities (or actions in respect thereof) arise out of or are
based upon an untrue statement or alleged untrue statement of a material fact
contained in any Preliminary Prospectus, any preliminary prospectus supplement,
the Registration Statement, the Prospectus as amended or supplemented and any
other prospectus relating to the Securities, or any amendment or supplement
thereto, or arise out of or are based upon the omission or alleged omission to
state therein a material fact required to be stated therein or necessary to
make the statements therein not misleading, in each case to the extent, but
only to the extent, that such untrue statement or alleged untrue statement or
omission or alleged omission was made in any Preliminary Prospectus, any
preliminary prospectus supplement, the Registration Statement, the Prospectus
as amended or supplemented and any other prospectus relating to the Securities,
or any such amendment or supplement in reliance upon and in conformity with
written information furnished to the Company by such Underwriter through the
Representatives expressly for use therein; and, subject to clause (c) of this
Section, will reimburse the Company for any reasonable legal or other expenses
reasonably incurred by the Company in connection with investigating or
defending any such action or claim as such expenses are incurred.
(c) Promptly after receipt by an indemnified party under
subsection (a) or (b) above of notice of the commencement of any action, such
<PAGE> 15
indemnified party shall, if a claim in respect thereof is to be made against
the indemnifying party under such subsection, notify the indemnifying party in
writing of the commencement thereof; but the omission so to notify the
indemnifying party shall not relieve it from any liability which it may have to
any indemnified party otherwise than under the foregoing subsections (a) or (b)
to the extent that such indemnifying party did not otherwise learn of such
action and the failure to give such notice substantially prejudices such
indemnifying party. In case any such action shall be brought against any
indemnified party and it shall notify the indemnifying party of the
commencement thereof, the indemnifying party shall be entitled to participate
therein and, to the extent that it shall wish, jointly with any other
indemnifying party similarly notified, to assume the defense thereof, with
counsel reasonably satisfactory to such indemnified party (who shall not,
except with the consent of the indemnified party, be counsel to the
indemnifying party), and, after notice from the indemnifying party to such
indemnified party of its election so to assume the defense thereof, the
indemnifying party shall not be liable to such indemnified party under such
subsection for any legal expenses of other counsel or any other expenses, in
each case subsequently incurred by such indemnified party, in connection with
the defense thereof other than reasonable costs of investigation. No
indemnifying party shall, without the written consent of the indemnified party,
effect the settlement or compromise of, or consent to the entry of any judgment
with respect to, any pending or threatened action or claim in respect of which
indemnification or contribution may be sought hereunder (whether or not the
indemnified party is an actual or potential party to such action or claim)
unless such settlement, compromise or judgment (i) includes an unconditional
release of the indemnified party from all liability arising out of such action
or claim and (ii) does not include a statement as to or an admission of fault,
culpability or a failure to act, by or on behalf of any indemnified party. No
indemnifying party shall be liable for the cost of any settlement effected by
an indemnified party without the written consent of such indemnifying party
which consent shall not be unreasonably withheld. In no event shall any
indemnifying party be liable for the fees and expenses of more than one firm or
counsel (in addition to any local counsel) to represent all indemnified parties
with respect to a single action or separate but similar or related actions in
the same jurisdiction arising out of the same general allegations or
circumstances, which firm or counsel shall be designated in writing by the
Representatives, if one or more Underwriters or controlling persons are
indemnified parties, and by the Company, if the Company or any of its
directors, officers or controlling persons are indemnified parties.
(d) If the indemnification provided for in this Section 8 is
unavailable to or insufficient to hold harmless an indemnified party under
subsection (a) or (b) above in respect of any losses, claims, damages or
liabilities (or actions in respect thereof) referred to therein, then each
indemnifying party shall contribute to the amount paid or payable by such
indemnified party as a result of such losses, claims, damages or liabilities
(or actions in respect thereof) in such proportion as is appropriate to reflect
the relative benefits received by the Company on the one hand and the
Underwriters of the Designated Securities on the other from the offering of the
Designated Securities to which such loss, claim, damage or liability (or action
in respect thereof) relates. If, however, the allocation provided by the
immediately preceding sentence is not permitted by applicable law or if the
indemnified party failed to give the notice required under subsection (c)
above, then each indemnifying party shall contribute to such amount paid or
payable by such indemnified party in such proportion as is appropriate to
reflect not only such relative benefits but also the relative fault of the
Company on the one hand and the Underwriters of the Designated Securities on
<PAGE> 16
the other in connection with the statements or omissions which resulted in such
losses, claims, damages or liabilities (or actions in respect thereof), as well
as any other relevant equitable considerations. The relative benefits received
by the Company on the one hand and such Underwriters on the other shall be
deemed to be in the same proportion as the total net proceeds from such
offering (before deducting expenses) received by the Company bear to the total
underwriting discounts and commissions received by such Underwriters. The
relative fault shall be determined by reference to, among other things, whether
the untrue or alleged untrue statement of a material fact or the omission or
alleged omission to state a material fact relates to information supplied by
the Company on the one hand or such Underwriters on the other and the parties'
relative intent, knowledge, access to information and opportunity to correct or
prevent such statement or omission. The Company and the Underwriters agree
that it would not be just and equitable if contribution pursuant to this
subsection (d) were determined by pro rata allocation (even if the Underwriters
were treated as one entity for such purpose) or by any other method of
allocation which does not take account of the equitable considerations referred
to above in this subsection (d). The amount paid or payable by an indemnified
party as a result of the losses, claims, damages or liabilities (or actions in
respect thereof) referred to above in this subsection (d) shall be deemed to
include any reasonable legal or other expenses reasonably incurred by such
indemnified party in connection with investigating or defending any such action
or claim. Notwithstanding the provisions of this subsection (d), no Underwriter
shall be required to contribute any amount in excess of the amount by which the
total price at which the applicable Designated Securities underwritten by it
and distributed to the public were offered to the public exceeds the amount of
any damages which such Underwriter has otherwise been required to pay by reason
of such untrue or alleged untrue statement or omission or alleged omission. No
person guilty of fraudulent misrepresentation (within the meaning of Section
11(f) of the Act) shall be entitled to contribution from any person who was not
guilty of such fraudulent misrepresentation. The obligations of the
Underwriters of Designated Securities in this subsection (d) to contribute are
several in proportion to their respective underwriting obligations with respect
to such Securities and not joint.
(e) The obligations of the Company under this Section 8 shall be
in addition to any liability which the Company may otherwise have and shall
extend, upon the same terms and conditions, to each person, if any, who
controls any Underwriter within the meaning of the Act; and the obligations of
the Underwriters under this Section 8 shall be in addition to any liability
which the respective Underwriters may otherwise have and shall extend, upon the
same terms and conditions, to each officer and director of the Company and to
each person, if any, who controls the Company within the meaning of the Act.
9. (a) If any Underwriter shall default in its obligation to purchase
the Designated Securities which it has agreed to purchase under the Pricing
Agreement relating to such Designated Securities, the Representatives may in
their discretion arrange for themselves or another party or other parties to
purchase such Designated Securities on the terms contained herein. If within
thirty-six hours after such default by any Underwriter the Representatives do
not arrange for the purchase of such Designated Securities, then the Company
shall be entitled to a further period of thirty-six hours within which to
procure another party or other parties reasonably satisfactory to the
Representatives to purchase such Designated Securities on such terms. In the
event that, within the respective prescribed period, the Representatives notify
the Company that they have so arranged for the purchase of such Designated
Securities, or the Company notifies the Representatives that it has so arranged
for the purchase of such Designated Securities, the Representatives or the
<PAGE> 17
Company shall have the right to postpone the Time of Delivery for such
Designated Securities for a period of not more than seven days, in order to
effect whatever changes may thereby be made necessary in the Registration
Statement or the Prospectus as amended or supplemented, or in any other
documents or arrangements, and the Company agrees to file promptly any
amendments or supplements to the Registration Statement or the Prospectus which
in the opinion of the Representatives may thereby be made necessary. Nothing
herein shall relieve a defaulting Underwriter from liability for its default.
The term "Underwriter" as used in this Agreement shall include any person
substituted under this Section with like effect as if such person had
originally been a party to the Pricing Agreement with respect to such
Designated Securities.
(b) If, after giving effect to any arrangements for the purchase
of the Designated Securities of a defaulting Underwriter or Underwriters by the
Representatives and the Company as provided in subsection (a) above, the
aggregate principal amount of such Designated Securities which remains
unpurchased does not exceed one-eleventh of the aggregate principal amount of
the Designated Securities, then the Company shall have the right to require
each non-defaulting Underwriter to purchase the principal amount of Designated
Securities which such Underwriter agreed to purchase under the Pricing
Agreement relating to such Designated Securities and, in addition, to require
each non-defaulting Underwriter to purchase its pro rata share (based on the
principal amount of Designated Securities which such Underwriter agreed to
purchase under such Pricing Agreement) of the Designated Securities of such
defaulting Underwriter or Underwriters for which such arrangements have not
been made; but nothing herein shall relieve a defaulting Underwriter from
liability for its default.
(c) If, after giving effect to any arrangements for the purchase
of the Designated Securities of a defaulting Underwriter or Underwriters by the
Representatives and the Company as provided in subsection (a) above, the
aggregate principal amount of Designated Securities which remains unpurchased
exceeds one-eleventh of the aggregate principal amount of the Designated
Securities, as referred to in subsection (b) above, or if the Company shall not
exercise the right described in subsection (b) above to require non-defaulting
Underwriters to purchase Designated Securities of a defaulting Underwriter or
Underwriters, then the Pricing Agreement relating to such Designated Securities
shall thereupon terminate, without liability on the part of any non-defaulting
Underwriter or the Company, except for the expenses to be borne by the Company
and the Underwriters as provided in Section 6 hereof and the indemnity and
contribution agreements in Section 8 hereof; but nothing herein shall relieve a
defaulting Underwriter from liability for its default.
10. The respective indemnities, agreements, representations,
warranties and other statements of the Company and the several Underwriters, as
set forth in this Agreement or made by or on behalf of them, respectively,
pursuant to this Agreement, shall remain in full force and effect, regardless
of any investigation (or any statement as to the results thereof) made by or on
behalf of any Underwriter or any controlling person of any Underwriter, or the
Company, or any officer or director or controlling person of the Company, and
shall survive delivery of and payment for the Securities.
11. If any Pricing Agreement shall be terminated pursuant to
Section 9 hereof, the Company shall not then be under any liability to any
Underwriter with respect to the Designated Securities covered by such Pricing
Agreement except as provided in Sections 6 and 8 hereof; but, if for any other
reason Designated Securities are not delivered by or on behalf of the Company
<PAGE> 18
as provided herein, the Company will reimburse the Underwriters through the
Representatives for all out-of-pocket expenses approved in writing by the
Representatives, including fees and disbursements of counsel, reasonably
incurred by the Underwriters in making preparations for the purchase, sale and
delivery of such Designated Securities, but the Company shall then be under no
further liability to any Underwriter with respect to such Designated Securities
except as provided in Sections 6 and 8 hereof.
12. In all dealings hereunder, the Representatives of the
Underwriters of Designated Securities shall act on behalf of each of such
Underwriters, and the parties hereto shall be entitled to act and rely upon any
statement, request, notice or agreement on behalf of any Underwriter made or
given by such Representatives jointly or by such of the Representatives, if
any, as may be designated for such purpose in the Pricing Agreement.
All statements, requests, notices and agreements hereunder shall be in
writing, and if to the Underwriters shall be delivered or sent by mail, telex
or facsimile transmission to the address of the Representatives as set forth in
the Pricing Agreement; and if to the Company shall be delivered or sent by
mail, telex or facsimile transmission to the address of the Company set forth
in the Registration Statement: Attention: Secretary; provided, however, that
any notice to an Underwriter pursuant to Section 8(c) hereof shall be delivered
or sent by mail, telex or facsimile transmission to such Underwriter at its
address set forth in its Underwriters' Questionnaire, or telex constituting
such Questionnaire, which address will be promptly supplied to the Company by
the Representatives upon request. Any such statements, requests, notices or
agreements shall take effect upon receipt thereof.
13. This Agreement and each Pricing Agreement shall be binding
upon, and inure solely to the benefit of, the Underwriters, the Company and, to
the extent provided in Sections 8 and 10 hereof, the officers and directors of
the Company and each person who controls the Company or any Underwriter, and
their respective heirs, executors, administrators, successors and assigns, and
no other person shall acquire or have any right under or by virtue of this
Agreement or any such Pricing Agreement. No purchaser of any of the Securities
from any Underwriter shall be deemed a successor or assign by reason merely of
such purchase.
14. Time shall be of the essence of each Pricing Agreement. As
used herein, "business day" shall mean any day when the Commission's office in
Washington, D.C. is open for business.
15. This Agreement and each Pricing Agreement shall be governed by
and construed in accordance with the laws of the State of New York.
16. This Agreement and each Pricing Agreement may be executed by
any one or more of the parties hereto and thereto in any number of
counterparts, each of which shall be deemed to be an original, but all such
respective counterparts shall together constitute one and the same instrument.
<PAGE> 19
If the foregoing is in accordance with your understanding, please sign and
return to us four (4) counterparts hereof.
Very truly yours,
Edison Brothers Stores, Inc.
By:..................................
Name:
Title:
Accepted as of the date hereof:
Representative(s)
.........................................
<PAGE> 20
ANNEX I
Pricing Agreement
-----------------
Representative(s)
As Representative(s) of the several
Underwriters named in Schedule I hereto,
, 19..
Ladies and Gentlemen:
Edison Brothers Stores, Inc., a Delaware corporation (the "Company"),
proposes, subject to the terms and conditions stated herein and in the
Underwriting Agreement, dated . . . . . . . . . . . ., 1995 (the "Underwriting
Agreement"), between the Company on the one hand and [Representative(s)] on the
other hand, to issue and sell to the Underwriters named in Schedule I hereto
(the "Underwriters") the Securities specified in Schedule II hereto (the
"Designated Securities"). Each of the provisions of the Underwriting Agreement
is incorporated herein by reference in its entirety, and shall be deemed to be
a part of this Agreement to the same extent as if such provisions had been set
forth in full herein; and each of the representations and warranties set forth
therein shall be deemed to have been made at and as of the date of this Pricing
Agreement, except that each representation and warranty which refers to the
Prospectus in Section 2 of the Underwriting Agreement shall be deemed to be a
representation or warranty as of the date of the Underwriting Agreement in
relation to the Prospectus (as therein defined), and also a representation and
warranty as of the date of this Pricing Agreement in relation to the Prospectus
as amended or supplemented relating to the Designated Securities which are the
subject of this Pricing Agreement. Each reference to the Representatives
herein and in the provisions of the Underwriting Agreement so incorporated by
reference shall be deemed to refer to you. Unless otherwise defined herein,
terms defined in the Underwriting Agreement are used herein as therein defined.
The Representatives designated to act on behalf of the Representatives and on
behalf of each of the Underwriters of the Designated Securities pursuant to
Section 12 of the Underwriting Agreement and the address of the Representatives
referred to in such Section 12 are set forth at the end of Schedule II hereto.
An amendment to the Registration Statement, or a supplement to the
Prospectus, as the case may be, relating to the Designated Securities, in the
form heretofore delivered to you is now proposed to be filed with the
Commission.
Subject to the terms and conditions set forth herein and in the
Underwriting Agreement incorporated herein by reference, the Company agrees to
issue and sell to each of the Underwriters, and each of the Underwriters
agrees, severally and not jointly, to purchase from the Company, at the time
and place and at the purchase price to the Underwriters set forth in Schedule
II hereto, the principal amount of Designated Securities set forth opposite the
name of such Underwriter in Schedule I hereto.
If the foregoing is in accordance with your understanding, please sign and
return to us four (4) counterparts hereof, and upon acceptance hereof by you,
on behalf of each of the Underwriters, this letter and such acceptance hereof,
including the provisions of the Underwriting Agreement incorporated herein by
reference, shall constitute a binding agreement between each of the
Underwriters and the Company. It is understood that your acceptance of this
letter on behalf of each of the Underwriters is or will be pursuant to the
<PAGE> 21
authority set forth in a form of Agreement among Underwriters, the form of
which shall be submitted to the Company for examination upon request, but
without warranty on the part of the Representatives as to the authority of the
signers thereof.
Very truly yours,
Edison Brothers Stores, Inc.
By:..................................
Name:
Title:
Accepted as of the date hereof:
Representative(s)
.........................................
On behalf of each of the Underwriters
<PAGE> 22
<TABLE>
SCHEDULE I
<CAPTION>
Principal
Amount of
Designated
Securities
to be
Underwriter Purchased
- ----------------------------------------------------------------- ----------
<C> <C>
[Names of Underwriters]
Total $
</TABLE>
<PAGE> 23
SCHEDULE II
Title of Designated Securities:
[ %] [Floating Rate] [Zero Coupon] [Notes]
[Debentures] due ,
Aggregate principal amount:
[$]
Price to Public:
% of the principal amount of the Designated Securities, plus accrued
interest[, if any,] from to [and accrued
amortization[, if any,] from to ]
Purchase Price by Underwriters:
% of the principal amount of the Designated Securities, plus accrued
interest from
to [and accrued amortization[, if any,] from
to ]
Form of Designated Securities:
[Definitive form to be made available for checking and packaging at
least twenty-four hours prior to the Time of Delivery at the office of
[The Depository Trust Company or its designated custodian] [the
Representatives]]
[Book-entry only form represented by one or more global securities
deposited with The Depository Trust Company ("DTC") or its designated
custodian, to be made available for checking by the Representatives at
least twenty-four hours prior to the Time of Delivery at the office of
DTC.]
Specified funds for payment of purchase price:
New York Clearing House (next day) funds
Time of Delivery:
a.m. (New York City time), , 19
Indenture:
Indenture dated , 19 , between the Company
and , as Trustee
Maturity:
Interest Rate:
[ %] [Zero Coupon] [See Floating Rate Provisions]
Interest Payment Dates:
[months and dates, commencing ....................., 19..]
<PAGE> 24
Redemption Provisions:
[No provisions for redemption]
[The Designated Securities may be redeemed, otherwise than through the
sinking fund, in whole or in part at the option of the Company, in the
amount of [$ ] or an integral multiple thereof,
[on or after , at the following redemption prices (expressed
in percentages of principal amount). If [redeemed on or before
, %, and if] redeemed during the 12-month period beginning
,
Redemption
Year Price
---- ----------
and thereafter at 100% of their principal amount, together in
each case with accrued interest to the redemption date.]
[on any interest payment date falling on or after
, , at the election of the Company, at a redemption
price equal to the principal amount thereof, plus accrued
interest to
the date of redemption.]]
[Other possible redemption provisions, such as mandatory
redemption upon occurrence of certain events or redemption for
changes in tax law]
[Restriction on refunding]
Sinking Fund Provisions:
[No sinking fund provisions]
[The Designated Securities are entitled to the benefit of a sinking
fund to retire [$ ] principal amount of Designated Securities
on in each of the years through
at 100% of their principal amount plus accrued interest[,
together with [cumulative] [noncumulative] redemptions at the option
of the Company to retire an additional [$ ] principal amount
of Designated Securities in the years through at
100% of their principal amount plus accrued interest.]
[If Designated Securities are extendable debt securities, insert--
Extendable provisions:
Designated Securities are repayable on , [insert
date and years], at the option of the holder, at their principal
amount with accrued interest. The initial annual interest rate will
be %, and thereafter the annual interest rate will be adjusted
on , and to a rate not less than
% of the effective annual interest rate on U.S. Treasury obligations
with -year maturities as of the [insert date 15 days prior to
maturity date] prior to such [insert maturity date].]
[If Designated Securities are floating rate debt securities, insert--
Floating rate provisions:
Initial annual interest rate will be % through [and
thereafter will be adjusted [monthly] [on each , ,
and ] [to an annual rate of % above the average rate
for -year [month][securities][certificates of deposit]
issued by
and [insert names of banks].] [and the annual interest
rate [thereafter] [from through ] will be the interest
<PAGE> 25
yield equivalent of the weekly average per annum market discount rate
for -month Treasury bills plus % of Interest
Differential (the excess, if any, of (i) the then current weekly
average per annum secondary market yield for -month
certificates of deposit over (ii) the then current interest yield
equivalent of the weekly average per annum market discount rate for
-month Treasury bills); [from and thereafter the rate will be
the then current interest yield equivalent plus % of Interest
Differential].]
Defeasance provisions:
Closing location for delivery of Designated Securities:
Additional Closing Conditions:
Names and addresses of Representatives:
Designated Representatives:
Address for Notices, etc.:
[Other Terms]* :
- ---------------
* A description of particular tax, accounting or other unusual features
(such as the addition of event risk provisions) of the Designated Securities
should be set forth, or referenced to an attached and accompanying description,
if necessary, to ensure agreement as to the terms of the Designated Securities
to be purchased and sold. Such a description might appropriately be in the
form in which such features will be described in the Prospectus Supplement for
the offering.
<PAGE> 26
SCHEDULE III
Significant Subsidiaries
------------------------
1. Edison Brothers Redevelopment Corporation
2. Edison Brothers Apparel Stores, Inc.
3. EBSS-West, Inc.
4. Edison Brothers Stores International, Inc.
<PAGE> 27
ANNEX II
Pursuant to Section 7(d) of the Underwriting Agreement, the accountants
shall furnish letters to the Underwriters and the Company to the effect that:
(i) They are independent certified public accountants with respect
to the Company and its subsidiaries within the meaning of the Act and
the applicable published rules and regulations thereunder;
(ii) In their opinion, the financial statements and any
supplementary financial information and schedules audited (and, if
applicable, financial forecasts and/or pro forma financial
information) examined by them and included or incorporated by
reference in the Registration Statement or the Prospectus comply as to
form in all material respects with the applicable accounting
requirements of the Act or the Exchange Act, as applicable, and the
related published rules and regulations thereunder; and, if
applicable, they have made a review in accordance with standards
established by the American Institute of Certified Public Accountants
of the consolidated interim financial statements, selected financial
data, pro forma financial information, financial forecasts and/or
condensed financial statements derived from audited financial
statements of the Company for the periods specified in such letter, as
indicated in their reports thereon, copies of which have been
furnished to the representative or representatives of the Underwriters
(the "Representatives") such term to include an Underwriter or
Underwriters who act without any firm being designated as its or their
representatives and are attached hereto;
(iii) They have made a review in accordance with standards
established by the American Institute of Certified Public Accountants
of the unaudited condensed consolidated statements of income,
consolidated balance sheets and consolidated statements of cash flows
included in the Prospectus and/or included in the Company's quarterly
report on Form 10-Q incorporated by reference into the Prospectus as
indicated in their reports thereon copies of which are attached
hereto; and on the basis of specified procedures including inquiries
of officials of the Company who have responsibility for financial and
accounting matters regarding whether the unaudited condensed
consolidated financial statements referred to in paragraph (vi)(A)(i)
below comply as to form in all material respects with the applicable
accounting requirements of the Act and the Exchange Act and the
related published rules and regulations, nothing came to their
attention that caused them to believe that the unaudited condensed
consolidated financial statements do not comply as to form in all
material respects with the applicable accounting requirements of the
Act and the Exchange Act and the related published rules and
regulations;
(iv) The unaudited selected financial information with
respect to the consolidated results of operations and financial
position of the Company for the five most recent fiscal years included
in the Prospectus and included or incorporated by reference in Item 6
of the Company's Annual Report on Form 10-K for the most recent fiscal
year agrees with the corresponding amounts (after restatement where
applicable) in the audited consolidated financial statements for five
such fiscal years which were included or incorporated by reference in
the Company's Annual Reports on Form 10-K for such fiscal years;
<PAGE> 28
(v) They have compared the information in the Prospectus under
selected captions with the disclosure requirements of Regulation S-K
and on the basis of limited procedures specified in such letter
nothing came to their attention as a result of the foregoing
procedures that caused them to believe that this information does not
conform in all material respects with the disclosure requirements of
Items 301, 302, 402 and 503(d), respectively, of Regulation S-K;
(vi) On the basis of limited procedures, not constituting
an examination in accordance with generally accepted auditing
standards, consisting of a reading of the unaudited financial
statements and other information referred to below, a reading of the
latest available interim financial statements of the Company and its
subsidiaries, inspection of the minute books of the Company and its
subsidiaries since the date of the latest audited financial statements
included or incorporated by reference in the Prospectus, inquiries of
officials of the Company and its subsidiaries responsible for
financial and accounting matters and such other inquiries and
procedures as may be specified in such letter, nothing came to their
attention that caused them to believe that:
(A) (i) the unaudited condensed consolidated statements of
income, consolidated balance sheets and consolidated
statements of cash flows included in the Prospectus and/or
included or incorporated by reference in the Company's
Quarterly Reports on Form 10-Q incorporated by reference in
the Prospectus do not comply as to form in all material
respects with the applicable accounting requirements of the
Exchange Act and the related published rules and regulations,
or (ii) any material modifications should be made to the
unaudited condensed consolidated statements of income,
consolidated balance sheets and consolidated statements of
cash flows included in the Prospectus or included in the
Company's Quarterly Reports on Form 10-Q incorporated by
reference in the Prospectus for them to be in conformity with
generally accepted accounting principles;
(B) any other unaudited income statement data and balance
sheet items included in the Prospectus do not agree with the
corresponding items in the unaudited consolidated financial
statements from which such data and items were derived, and
any such unaudited data and items were not determined on a
basis substantially consistent with the basis for the
corresponding amounts in the audited consolidated financial
statements included or incorporated by reference in the
Company's Annual Report on Form 10-K for the most recent
fiscal year;
(C) the unaudited financial statements which were not
included in the Prospectus but from which were derived the
unaudited condensed financial statements referred to in clause
(A) and any unaudited income statement data and balance sheet
items included in the Prospectus and referred to in Clause (B)
were not determined on a basis substantially consistent with
the basis for the audited financial statements included or
incorporated by reference in the Company's Annual Report on
Form 10-K for the most recent fiscal year;
<PAGE> 29
(D) any unaudited pro forma consolidated condensed
financial statements included or incorporated by reference in
the Prospectus do not comply as to form in all material
respects with the applicable accounting requirements of the
Act and the published rules and regulations thereunder or the
pro forma adjustments have not been properly applied to the
historical amounts in the compilation of those statements;
(E) as of a specified date not more than five days prior
to the date of such letter, there have been any changes in the
consolidated capital stock (other than issuances of capital
stock upon exercise of options and stock appreciation rights,
upon earn-outs of performance shares and upon conversions of
convertible securities, in each case which were outstanding on
the date of the latest balance sheet included or incorporated
by reference in the Prospectus) or any increase in the
consolidated long-term debt of the Company and its
subsidiaries, or any decreases in consolidated net current
assets or stockholders' equity or other items specified by the
Representatives, or any increases in any items specified by
the Representatives, in each case as compared with amounts
shown in the latest balance sheet included or incorporated by
reference in the Prospectus, except in each case for changes,
increases or decreases which the Prospectus discloses have
occurred or may occur or which are described in such letter;
and
(F) for the period from the date of the latest financial
statements included or incorporated by reference in the
Prospectus to the specified date referred to in Clause (E)
there were any decreases in consolidated net revenues or
operating profit or the total or per share amounts of
consolidated net income or other items specified by the
Representatives, or any increases in any items specified by
the Representatives, in each case as compared with the
comparable period of the preceding year and with any other
period of corresponding length specified by the
Representatives, except in each case for increases or
decreases which the Prospectus discloses have occurred or may
occur or which are described in such letter; and
(vii) In addition to the audit referred to in their
report(s) included or incorporated by reference in the Prospectus and
the limited procedures, inspection of minute books, inquiries and
other procedures referred to in paragraphs (iii) and (vi) above, they
have carried out certain specified procedures, not constituting an
audit in accordance with generally accepted auditing standards, with
respect to certain amounts, percentages and financial information
specified by the Representatives which are derived from the general
accounting records of the Company and its subsidiaries, which appear
in the Prospectus (excluding documents incorporated by reference), or
in Part II of, or in exhibits and schedules to, the Registration
Statement specified by the Representatives or in documents
incorporated by reference in the Prospectus specified by the
Representatives, and have compared certain of such amounts,
percentages and financial information with the accounting records of
the Company and its subsidiaries and have found them to be in
agreement.
<PAGE> 30
All references in this Annex II to the Prospectus shall be deemed to refer
to the Prospectus (including the documents incorporated by reference therein)
as defined in the Underwriting Agreement as of the date of the letter delivered
on the date of the Pricing Agreement for purposes of such letter and to the
Prospectus as amended or supplemented (including the documents incorporated by
reference therein) in relation to the applicable Designated Securities for
purposes of the letter delivered at the Time of Delivery for such Designated
Securities.
<PAGE> 1
EXHIBIT 10.8
$150,000,000.00
CREDIT AGREEMENT
DATED EFFECTIVE AS OF
JUNE 4, 1993
BY AND AMONG
EDISON BROTHERS STORES, INC.,
THE BANKS LISTED HEREIN
AND
MERCANTILE BANK OF ST. LOUIS NATIONAL ASSOCIATION,
AS AGENT
<PAGE> 2
TABLE OF CONTENTS*
Page
ARTICLE I
DEFINITIONS
SECTION 1.01. Definitions . . . . . . . . . . . . . . . . . . . . . . . . . 5
SECTION 1.02. Accounting Terms and Determinations . . . . . . . . . . . . . 20
ARTICLE II
LOANS
SECTION 2.01. Commitments To Lend . . . . . . . . . . . . . . . . . . . . . 21
SECTION 2.02. Method of Borrowing . . . . . . . . . . . . . . . . . . . . . 23
SECTION 2.03. Notes . . . . . . . . . . . . . . . . . . . . . . . . . . . . 24
SECTION 2.04. Duration of Interest Periods and Selection of Interest Rates. 25
SECTION 2.05. Interest Rates. . . . . . . . . . . . . . . . . . . . . . . . 25
SECTION 2.06. Fees. . . . . . . . . . . . . . . . . . . . . . . . . . . . . 26
SECTION 2.07. Termination or Reduction of Commitments . . . . . . . . . . . 28
SECTION 2.08. Early Payments. . . . . . . . . . . . . . . . . . . . . . . . 29
SECTION 2.09. General Provisions as to Payments . . . . . . . . . . . . . . 30
SECTION 2.10. Funding Losses. . . . . . . . . . . . . . . . . . . . . . . . 30
SECTION 2.11. Computation of Interest . . . . . . . . . . . . . . . . . . . 30
SECTION 2.12 Maturity. . . . . . . . . . . . . . . . . . . . . . . . . . . 30
ARTICLE III
PRECONDITIONS TO LOANS
SECTION 3.01. Initial Loan. . . . . . . . . . . . . . . . . . . . . . . . . 30
SECTION 3.02. All Loans . . . . . . . . . . . . . . . . . . . . . . . . . . 31
ARTICLE IV
REPRESENTATIONS AND WARRANTIES
SECTION 4.01. Representations and Warranties. . . . . . . . . . . . . . . . 32
(a) Corporate Existence and Power . . . . . . . . . . . 32
(b) Corporate Authorization . . . . . . . . . . . . . . 32
(c) Binding Effect. . . . . . . . . . . . . . . . . . . 32
(d) Financial Information . . . . . . . . . . . . . . . 32
(e) Litigation. . . . . . . . . . . . . . . . . . . . . 33
(f) Pension and Welfare Plans . . . . . . . . . . . . . 33
(g) Tax Returns and Payment . . . . . . . . . . . . . . 33
(h) Compliance With Other Instruments; None
Burdensome. . . . . . . . . . . . . . . . . . . . . 33
(i) Existing Indebtedness . . . . . . . . . . . . . . . 34
(j) Labor Matters . . . . . . . . . . . . . . . . . . . 34
(k) Title to Property . . . . . . . . . . . . . . . . . 34
(l) Regulation U. . . . . . . . . . . . . . . . . . . . 34
(m) Multi-Employer Pension Plan Amendments Act of
1980. . . . . . . . . . . . . . . . . . . . . . . . 35
(n) Investment Company Act of 1940; Public
Utility Holding Company Act of 1935 . . . . . . . . 35
(o) Patents, Licenses, Trademarks, Etc. . . . . . . . . 35
(p) Environmental Safety and Health Matters . . . . . . 35
(q) Handyman Guarantees . . . . . . . . . . . . . . . . 35
(r) Subsidiaries. . . . . . . . . . . . . . . . . . . . 35
(s) Disclosure. . . . . . . . . . . . . . . . . . . . . 35
<PAGE> 3
ARTICLE V
COVENANTS
SECTION 5.01. Covenants of the Company. . . . . . . . . . . . . . . . . . . 36
(a) Information . . . . . . . . . . . . . . . . . . . . 36
(b) Consolidated Net Worth. . . . . . . . . . . . . . . 38
(c) Limitations on Current Debt and Funded Debt . . . . 38
(d) Fixed Charges Coverage Ratio. . . . . . . . . . . . 39
(e) Limitation on Liens . . . . . . . . . . . . . . . . 39
(f) Limitations on Sale and Leasebacks. . . . . . . . . 41
(g) Merger or Consolidation . . . . . . . . . . . . . . 42
(h) Certain Restrictions Relating to Subsidiaries . . . 42
(i) Consolidated Current Ratio. . . . . . . . . . . . . 44
(j) Transactions with Affiliates. . . . . . . . . . . . 44
(k) Restricted Investments. . . . . . . . . . . . . . . 44
(l) Payment of Indebtedness . . . . . . . . . . . . . . 45
(m) Payment of Liabilities. . . . . . . . . . . . . . . 45
(n) Consultations and Inspections . . . . . . . . . . . 45
(o) Payment of Taxes and Claims; Corporate
Existence; Maintenance of Properties;
Insurance . . . . . . . . . . . . . . . . . . . . . 45
(p) Maintenance of Books and Records. . . . . . . . . . 46
(q) Changes in Nature of Business . . . . . . . . . . . 47
(r) Compliance with Law . . . . . . . . . . . . . . . . 47
(s) Accountant. . . . . . . . . . . . . . . . . . . . . 47
(t) ERISA Compliance. . . . . . . . . . . . . . . . . . 47
(u) Further Assurances. . . . . . . . . . . . . . . . . 48
(v) Notices . . . . . . . . . . . . . . . . . . . . . . 48
(w) Pension Plans . . . . . . . . . . . . . . . . . . . 49
(x) Acquisitions. . . . . . . . . . . . . . . . . . . . 49
(y) Guaranties. . . . . . . . . . . . . . . . . . . . . 49
SECTION 5.02. Use of Proceeds . . . . . . . . . . . . . . . . . . . . . . . 49
ARTICLE VI
DEFAULTS
SECTION 6.01. Events of Default . . . . . . . . . . . . . . . . . . . . . . 49
SECTION 6.02. Notice of Default . . . . . . . . . . . . . . . . . . . . . . 52
ARTICLE VII
THE AGENT
SECTION 7.01. Appointment and Authorization . . . . . . . . . . . . . . . . 52
SECTION 7.02. Agent and Affiliates. . . . . . . . . . . . . . . . . . . . . 52
SECTION 7.03. Action by Agent . . . . . . . . . . . . . . . . . . . . . . . 53
SECTION 7.04. Consultation with Experts . . . . . . . . . . . . . . . . . . 53
SECTION 7.05. Liability of Agent. . . . . . . . . . . . . . . . . . . . . . 53
SECTION 7.06. Indemnification . . . . . . . . . . . . . . . . . . . . . . . 53
SECTION 7.07. Credit Decision . . . . . . . . . . . . . . . . . . . . . . . 54
SECTION 7.08. Resignation of Agent. . . . . . . . . . . . . . . . . . . . . 54
ARTICLE VIII
CHANGE IN CIRCUMSTANCES
AFFECTING FIXED RATE LOANS
SECTION 8.01. Basis for Determining Interest Rate Inadequate or Unfair. . . 54
SECTION 8.02. Illegality. . . . . . . . . . . . . . . . . . . . . . . . . . 55
SECTION 8.03. Increased or Decreased Cost . . . . . . . . . . . . . . . . . 55
<PAGE> 4
SECTION 8.04. Prime Loans Substituted for Affected Fixed Rate Loans . . . . 56
SECTION 8.05. Capital Adequacy. . . . . . . . . . . . . . . . . . . . . . . 57
ARTICLE IX
MISCELLANEOUS
SECTION 9.01. Notices . . . . . . . . . . . . . . . . . . . . . . . . . . . 57
SECTION 9.02. No Waivers. . . . . . . . . . . . . . . . . . . . . . . . . . 57
SECTION 9.03. Expenses; Documentary Taxes . . . . . . . . . . . . . . . . . 57
SECTION 9.04. General Indemnity . . . . . . . . . . . . . . . . . . . . . . 58
SECTION 9.05. Environmental Indemnity . . . . . . . . . . . . . . . . . . . 58
SECTION 9.06. Sharing of Setoffs. . . . . . . . . . . . . . . . . . . . . . 59
SECTION 9.07. Amendments and Waivers. . . . . . . . . . . . . . . . . . . . 59
SECTION 9.08. Successors and Assigns. . . . . . . . . . . . . . . . . . . . 60
SECTION 9.09. Severability. . . . . . . . . . . . . . . . . . . . . . . . . 60
SECTION 9.10. Missouri Law. . . . . . . . . . . . . . . . . . . . . . . . . 60
SECTION 9.11. Counterparts; Effectiveness . . . . . . . . . . . . . . . . . 60
SECTION 9.12. Authority to Act. . . . . . . . . . . . . . . . . . . . . . . 61
SECTION 9.13. CONSENT TO JURISDICTION . . . . . . . . . . . . . . . . . . . 61
SECTION 9.14. References; Headings for Convenience. . . . . . . . . . . . . 61
SECTION 9.15. NO ORAL AGREEMENTS; ENTIRE AGREEMENT. . . . . . . . . . . . . 61
SECTION 9.16. Resurrection of Loans . . . . . . . . . . . . . . . . . . . . 62
Exhibit A - Line of Credit Note
Exhibit B - Revolving Credit Note
Exhibit C - Opinion of Counsel
Exhibit D - Certificate of Chief Financial Officer
Schedule 4.01(d) - Contingent Liabilities
Schedule 4.01(e) - Litigation
Schedule 4.01(f) - Pension Plan Matters
Schedule 4.01(i) - Existing Indebtedness
Schedule 4.01(j) - Labor Matters
Schedule 4.01(k) - Liens
Schedule 4.01(o) - Patents, Trademarks and other Intellectual
Property
Schedule 4.01(p) - Environmental and Safety and Health Matters
Schedule 4.01(r) - Subsidiaries
- ---------------
* The Table of Contents is not a part of this Agreement.
<PAGE> 5
CREDIT AGREEMENT
THIS CREDIT AGREEMENT (this "Agreement") is made and entered into
effective as of the 4th day of June, 1993, by and among EDISON BROTHERS STORES,
INC., a Delaware corporation, and the undersigned Banks, including MERCANTILE
BANK OF ST. LOUIS NATIONAL ASSOCIATION in its capacity as a lender hereunder
and as agent for the Banks under this Agreement.
The parties hereto hereby agree as follows:
ARTICLE I
DEFINITIONS
SECTION 1.01. Definitions. In addition to the terms defined
elsewhere in this Agreement or in any Exhibit or Schedule hereto, when used in
this Agreement, the following terms shall have the following meanings (such
meanings shall be equally applicable to the singular and plural forms of the
terms used, as the context requires):
"Acceptable Acquisition" shall mean any Acquisition which has been (a)
in the event a corporation is the subject of such Acquisition, either
(i) approved by the Board of Directors of the corporation which is the subject
of such Acquisition or (ii) recommended by such Board of Directors to the
shareholders of such corporation, (b) in the event a partnership is the subject
of such Acquisition, approved by a majority (by percentage of voting power) of
the partners of the partnership which is the subject of such Acquisition,
(c) in the event an organization or entity other than a corporation or
partnership is the subject of such Acquisition, approved by a majority (by
percentage of voting power) of the governing body, if any, or by a majority (by
percentage of ownership interest) of the owners of the organization or entity
which is the subject of such Acquisition or (d) in the event the corporation,
partnership or other organization or entity which is the subject of such
Acquisition is in bankruptcy, approved by the bankruptcy court or another court
of competent jurisdiction.
"Acquisition" shall mean any transaction or series of related
transactions, consummated on or after the date of this Agreement, by which the
Company or any of its Subsidiaries (a) acquires any going business or all or
substantially all of the assets of any corporation, partnership or other
organization or entity, whether through purchase of assets, merger or otherwise
or (b) directly or indirectly acquires (in one transaction or as the most
recent transaction in a series of transactions) at least (i) a majority (in
number of votes) of the stock and/or other securities of a corporation having
ordinary voting power for the election of directors (other than stock
and/or other securities having such power only by reason of the
happening of a contingency), (ii) a majority (by percentage of voting power) of
the outstanding partnership interests of a partnership or (iii) a majority of
the ownership interests in any organization or entity other than a corporation
or partnership.
"Affiliate" shall mean any Person (a) which directly or indirectly
through one or more intermediaries controls, is controlled by or is under
common control with the Company or any Subsidiary, (b) which beneficially owns
or holds or has the power to direct the voting power of five percent (5%) or
more of any class of voting stock of the Company or any Subsidiary or (c) which
has five percent (5%) or more of its voting stock (or, in the case of a Person
which is not a corporation, five percent (5%) or more of its equity interest)
<PAGE> 6
beneficially owned or held, directly or indirectly, by the Company or any
Subsidiary. For purposes of this definition, "control" shall mean the power to
direct the management and policies of a Person, directly or indirectly, whether
through the ownership of voting securities, by contract or otherwise.
"Agent" shall mean Mercantile Bank of St. Louis National Association
in its capacity as agent for the Banks hereunder and its successors in such
capacity.
"Assessment Rate" shall mean for any day the annual assessment rate
(rounded upwards, if necessary, to the next higher 1/8 of 1% and determined
without regard to rebates or credits) charged to Mercantile by the Federal
Deposit Insurance Corporation (or any successor) for such Corporation's (or
such successor's) insuring time deposits at offices of Mercantile in the United
States on such day. The CD Rate shall be adjusted automatically on and as of
the effective date of any change in the Assessment Rate.
"Attributable Indebtedness" shall mean in connection with a Sale and
Leaseback Transaction not satisfying the requirements of Section 5.01(f)(i), as
of the date of any determination thereof, an amount equal to the aggregate
amount of the Minimum Rentals due and to become due (discounted from the
respective due dates thereof to such date at the interest rate implicit in such
lease per annum, with all such discounts to be computed on the basis on a 360-
day year of twelve 30-day months, and otherwise in accordance with GAAP) under
the lease relating to such Sale and Leaseback Transaction.
"Bank(s)" shall mean each bank listed on the signature pages hereof,
and its successors and assigns.
"Business Day" shall mean any day except a Saturday, Sunday or legal
holiday observed by the Agent or by commercial banks in New York, New York.
"Capitalized Lease" shall mean and include at any time any lease of
Property, real or personal, which in accordance with GAAP would at such time be
required to be capitalized on a balance sheet of the lessee.
"Capitalized Rentals" of any Person shall mean, as of the date of any
determination thereof, the amount at which the aggregate Minimum Rentals due
and to become due under all Capitalized Leases under which such Person is a
lessee would be reflected as a liability on a balance sheet of such Person.
"CD Base Rate" shall mean, with respect to the applicable Interest
Period, the rate per annum of interest determined by Mercantile to be the
average (rounded upwards, if necessary, to the next higher 1/8 of 1%) of the
rates per annum quoted to Mercantile at such time as Mercantile in its sole
discretion elects on the first day of such Interest Period by two certificate
of deposit dealers of recognized standing, selected by Mercantile in its sole
discretion, for the purchase at face value from Mercantile of its certificates
of deposit on the first day of the applicable Interest Period for a number of
days comparable to the number of days in such Interest Period and in an amount
approximately equal to the principal amount of the CD Loan to which such
Interest Period is to apply.
"CD Loan" shall mean any Loan bearing interest at the CD Rate.
<PAGE> 7
"CD Margin" shall mean: (a) with respect to each Line of Credit Loan,
(i) .50% during such time as the Company's commercial paper
is rated P-1 by Moody's and A-1 by S&P,
(ii) .50% during such time as the Company's commercial paper
is rated at least P-2 by Moody's and at least A-2 by S&P,
(iii) .6875% during such time as the Company's commercial
paper is rated at least P-3 by Moody's and at least A-3 by S&P, and
(iv) 1.0625% during such time as the Company's commercial
paper is (A) rated NP by Moody's or B, C or D by S&P or (B) not rated
by either or both of Moody's and/or S&P,
and if clauses (i) and (ii) are both applicable or if clauses (i), (ii) and
(iii) are all applicable, the CD Margin set forth in clause (i) shall be
applicable, and if both clauses (ii) and (iii) are applicable, the CD Margin
set forth in clause (ii) shall be applicable; and
(b) with respect to each Revolving Credit Loan,
(i) .50% during such time as the Company's commercial paper
is rated P-1 by Moody's and A-1 by S&P,
(ii) .50% during such time as the Company's commercial paper
is rated at least P-2 by Moody's and at least A-2 by S&P,
(iii) .6875% during such time as the Company's commercial
paper is rated at least P-3 by Moody's and at least A-3 by S&P, and
(iv) 1.0625% during such time as the Company's commercial
paper is (A) rated NP by Moody's or B, C or D by S&P or (B) not rated
by either or both of Moody's and/or S&P,
and if clauses (i) and (ii) are both applicable or if clauses (i), (ii) and
(iii) are all applicable, the CD Margin set forth in clause (i) shall be
applicable, and if both clauses (ii) and (iii) are applicable, the CD Margin
set forth in clause (ii) shall be applicable.
The CD Rate shall be adjusted automatically on and as of the effective
date of any change in the CD Margin.
"CD Rate" shall mean (a) the quotient of (i) the CD Base Rate divided
by (ii) one minus the CD Reserve Percentage, plus (b) the Assessment Rate, plus
(c) the CD Margin.
"CD Reserve Percentage" shall mean for any day the percentage
(including any supplemental percentage applied on a marginal basis or any other
reserve requirement having a similar effect), expressed as a decimal, which is
in effect on such day, as prescribed by the Board of Governors of the Federal
Reserve System (or any successor) for determining the reserve requirements for
Mercantile as a member bank of the Federal Reserve System in St. Louis,
Missouri, in respect to new non-personal time deposits in dollars in St. Louis,
Missouri, having a maturity comparable to the applicable Interest Period. The
CD Rate shall be adjusted automatically on and as of the effective date of any
change in the CD Reserve Percentage.
<PAGE> 8
"Change of Control" shall mean any Acquisition subsequent to the
Effective Date of this Agreement by any Person, or related Persons constituting
a "group" for purposes of Section 13(d) of the Securities Exchange Act of 1934,
of (a) the power to elect, appoint or cause the election or appointment of at
least a majority of the members of the Board of Directors of the Company,
through beneficial ownership of the capital stock of the Company or otherwise
or (b) all or substantially all of the Properties and assets of the Company;
provided, however, that a Change of Control shall not be deemed to have
occurred if (i) the Acquisition of such power or Properties and assets is
pursuant to a transaction in compliance with the provisions of Section 5.01(g)
and (ii) no Person, or related Persons constituting a "group" for purposes of
Section 13(d) of the Securities Exchange Act of 1934, shall have the power to
elect, appoint or cause the election or appointment of at least a majority of
the members of the Board of Directors of such successor or transferee. For
purposes of this definition, "Acquisition" of the power or Properties and
assets stated in the preceding sentence shall mean the earlier of (i) the
actual possession thereof or (ii) the consummation of any transaction or series
of related transactions which, with the passage of time, will give such Person
or Persons the actual possession thereof.
"Code" shall mean the Internal Revenue Code of 1986, as amended, and
any successor statute of similar import, together with the regulations
thereunder, in each case as in effect from time to time. References to
sections of the Code shall be construed to also refer to any successor
sections.
"Company" shall mean Edison Brothers Stores, Inc., a Delaware
corporation, and its successors.
"Consolidated", when used with respect to "Attributable Indebtedness",
"Funded Debt", "Secured Debt" or "Net Worth", shall mean the Attributable
Indebtedness, Funded Debt, Secured Debt or Net Worth, as the case may be, of
the Company and its Restricted Subsidiaries determined on a consolidated basis
in accordance with GAAP.
"Consolidated Current Ratio" shall mean, as of any particular time and
after eliminating inter-company items, the ratio of (a) the current assets of
the Company and its Subsidiaries to (b) the current liabilities of the Company
and its Subsidiaries, all as consolidated and determined in accordance with
GAAP. For purposes of this definition, if the last day of the Revolving Credit
Period (determined on a Bank by Bank basis) is at least one (1) year after the
applicable date of determination, the current liabilities of the Company and
its Subsidiaries shall not include an amount equal to the unused portion of the
Revolving Credit Commitments of the applicable Bank(s) as of the applicable
date of determination thereof.
"Consolidated Net Income" shall mean, for the period in question, the
gross revenues of the Company and its Restricted Subsidiaries for such period
less all expenses and other proper charges (including taxes on income),
determined on a consolidated basis after eliminating earnings or losses
attributable to outstanding Minority Interests, but excluding in any event:
(a) net earnings and losses of any corporation (other
than a Restricted Subsidiary), substantially all of the assets of
which have been acquired in any manner by the Company or any
Restricted Subsidiary, realized by such corporation prior to the date
of such acquisition;
<PAGE> 9
(b) net earnings and losses of any corporation (other
than a Restricted Subsidiary) with which the Company or a Restricted
Subsidiary shall have consolidated or which shall have merged into or
with the Company or a Restricted Subsidiary prior to the date of such
consolidation or merger;
(c) net earnings of any business entity (other than a
Restricted Subsidiary) in which the Company or any Restricted
Subsidiary has an ownership interest unless such net earnings shall
have actually been received by the Company or such Restricted
Subsidiary in the form of cash distributions;
(d) any portion of the net earnings of any Restricted
Subsidiary which for any reason is unavailable for payment of
dividends to the Company or any other Restricted Subsidiary; and
(e) any other unusual or extraordinary gains or losses.
"Consolidated Net Sales" shall mean, with respect to any period and
after eliminating inter-company items, the net sales of the Company and its
Subsidiaries, all as consolidated and determined in accordance with GAAP.
"Consolidated Net Tangible Assets" shall mean, without duplication, as
of the date of any determination thereof, the total amount of all assets of the
Company and its Restricted Subsidiaries less the sum of:
(a) the amount, if any, at which intangible assets
(including goodwill, trade names, trademarks, brand names, patents,
copyrights, patent applications, licenses, franchises, permits,
unamortized debt discount and expense, organizational costs and
expenses and other similar intangibles (but excluding unamortized
leasehold rights) appear on a consolidated balance sheet;
(b) any write-up of fixed assets after the date of this
Agreement; and
(c) all liabilities other than deferred taxes, the SFAS
106 Liability and Consolidated Funded Debt.
"Consolidated Subsidiary" shall mean, at any date, any Subsidiary or
other entity the assets and liabilities of which are or should be consolidated
with those of the Company in its consolidated financial statements as of such
date in accordance with GAAP.
"Current Debt" of any Person shall mean, as of the date of
determination thereof, (a) all Indebtedness of such Person for borrowed money
other than Funded Debt of such Person and (b) Guaranties by such Person of
Current Debt of others.
"Default" shall mean any condition or event which constitutes an Event
of Default or which with the giving of notice or lapse of time or both would,
unless cured or waived, become an Event of Default.
"Effective Date" shall mean the date on which this Agreement shall
become effective in accordance with Section 9.11.
<PAGE> 10
"Environmental Laws" shall mean the Comprehensive Environmental
Response, Compensation and Liability Act, the Resource Conservation and
Recovery Act ("RCRA"), the Clean Water Act, the Toxic Substances Control Act,
the Hazardous Materials Transportation Act, the Clean Air Act, superlien laws
and any other Federal, state or local statute, law, ordinance, code, rule or
regulation or judicial or administrative order or decree regulating, relating
to or imposing liability or standards of conduct concerning any Hazardous
Materials, and all amendments thereto, now or at any time hereinafter in
effect.
"Environmental Lien" shall mean any Lien in favor of any governmental
or regulatory entity or other Person for or with respect to (a) any liability
under any Environmental Law or (b) damages or costs incurred by such
governmental or regulatory entity or other Person in connection with any
actual, threatened or suspected spillage, disposal or other release of any
Hazardous Materials, including, without limitation, investigative costs related
thereto.
"ERISA" shall mean the Employee Retirement Income Security Act of
1974, as amended, and any successor statute of similar import, together with
the regulations thereunder, in each case as in effect from time to time.
References to sections of ERISA shall be construed to also refer to any
successor sections.
"ERISA Affiliate" shall mean any corporation, trade or business that
is, along with the Company, a member of a controlled group of corporations or a
controlled group of trades or businesses, as described in Sections 414(b) and
414(c), respectively, of the Code.
"Event of Default" shall have the meaning ascribed thereto in
Section 6.01.
"Fixed Charges" shall mean, for the period in question, the sum of
(i) all Gross Rentals under Operating Leases payable during such period by the
Company and its Restricted Subsidiaries and (ii) all Interest Charges during
such period on all Indebtedness (including the interest component of Minimum
Rentals on Capitalized Leases) of the Company and its Restricted Subsidiaries,
all determined on a consolidated basis.
"Fixed Rate Loans" shall mean CD Loans or IBOR Loans or both.
"Funded Debt" of any Person shall mean (i) all Indebtedness of such
Person for borrowed money or which has been incurred in connection with the
acquisition of assets in each case having a final maturity of one (1) year or
more from the date of origin thereof (or which is renewable or extendible at
the option of the obligor for a period or periods more than one (1) year from
the date of origin thereof), excluding all payments in respect thereof that are
required to be made within one (1) year from the date of any determination of
Funded Debt, so long as the obligation to make such payments shall constitute a
current liability of the obligor under GAAP, (ii) all Capitalized Rentals of
such Person other than that portion of Capitalized Rentals which are due within
one (1) year from the date of determination of Funded Debt and (iii) all
Guaranties by such Person of Funded Debt of others.
"GAAP" shall mean, as to a particular Person, such accounting
principles as, in the opinion of the "Big 6" accounting firm regularly retained
by such Person, conform at the time to generally accepted accounting
principles; provided that as to any Person who has not regularly retained such
<PAGE> 11
an accounting firm, "GAAP" shall mean generally accepted accounting principles
at the time in the United States.
"Gross Rentals" for any period shall mean the aggregate amounts
payable by the lessee during such period pursuant to the terms of Operating
Leases (net of any amounts received by the lessee for such period pursuant to
the terms of a sublease of all or part of the property demised by such
Operating Lease) for Minimum Rentals, common area maintenance charges and
percentage rentals, and any amounts actually paid pursuant to any guaranty of a
lessee's obligation under any Operating Lease (but only to the extent that such
amounts were for the payment of Minimum Rentals, common area maintenance
charges and/or percentage rentals).
"Guaranties" by any Person shall mean all obligations (other than
endorsements in the ordinary course of business of negotiable instruments for
deposit or collection) of such Person guaranteeing, or in effect guaranteeing,
any Indebtedness, dividend or other obligation of any other Person (the
"primary obligor") in any manner, whether directly or indirectly, including,
without limitation, all obligations incurred through an agreement, contingent
or otherwise, by such Person: (a) to purchase such Indebtedness or obligation
or any property or assets constituting security therefor, (b) to advance or
supply funds (i) for the purchase or payment of such Indebtedness or
obligation, (ii) to maintain working capital or other balance sheet condition
or otherwise to advance or make available funds for the purchase or payment of
such Indebtedness or obligation, (iii) to lease property or to purchase
securities or other property or services primarily for the purpose of assuring
the owner of such Indebtedness or obligation of the ability of the primary
obligor to make payment of the Indebtedness or obligation or (iv) otherwise to
assure the owner of the Indebtedness or obligation of the primary obligor
against loss in respect thereof; provided, however, that "Guaranties" shall not
include (a) the Handyman Guaranties, (b) Guaranties of any lessee's obligations
under any Operating Lease and/or (c) Guaranties as to which the primary
obligation has been taken into account pursuant to the definition of
"Indebtedness." For the purposes of all computations made under this Agreement,
a Guaranty in respect of any Indebtedness for borrowed money shall be deemed to
be Indebtedness equal to the then outstanding principal amount of such
Indebtedness for borrowed money which has been guaranteed, and a Guaranty in
respect of any other obligation or liability or any dividend shall be deemed to
be Indebtedness equal to the maximum aggregate amount of such obligation,
liability or dividend.
"Handyman Guaranties" shall mean all guaranties by the Company of
payments under any Capitalized Lease or Operating Lease of real property
previously used by the Company's former Subsidiary, the Handyman Corporation.
"Hazardous Materials" shall mean those materials, wastes and
substances defined as hazardous substances in 42 U.S.C. Section 9601(14), and
all other materials, wastes and substances (including, without limitation,
solids, liquids and gases), now or hereafter designated or defined as
hazardous, toxic, dangerous or otherwise regulated under any Federal, state or
local law, rule or regulation pertaining to environmental pollution,
contamination, protection or waste management, treatment, storage, handling or
disposal and any other materials or substances (including, without limitation,
petroleum and other substances specifically excluded from the definition of
hazardous substances under 42 U.S.C. Section 9601(14)), the exposure to which
is prohibited, limited or regulated by any governmental or regulatory authority
or under any Environmental Law.
<PAGE> 12
"Indebtedness" of any Person shall mean and include all obligations of
such Person which in accordance with GAAP shall be classified upon a balance
sheet of such Person as liabilities of such Person, and in any event shall
include all (a) obligations of such Person for borrowed money or which have
been incurred in connection with the acquisition of Property or assets, (b)
obligations secured by any Lien upon Property or assets owned by such Person,
even though such Person has not assumed or become liable for the payment of
such obligations, (c) obligations created or arising under any conditional sale
or other title retention agreement with respect to Property acquired by such
Person, notwithstanding the fact that the rights and remedies of the seller,
lender or lessor under such agreement in the event of default are limited to
repossession or sale of such Property, (d) Capitalized Rentals and
(e) Guaranties of obligations of others of the character referred to in this
definition.
"IBOR Base Rate" shall mean, with respect to the applicable Interest
Period, the rate per annum of interest determined by Mercantile to be the
average (rounded upwards, if necessary, to the next higher 1/8 of 1%) at which
dollar deposits in immediately available funds are offered to Mercantile in the
Interbank Eurodollar market by two Interbank Eurodollar brokers of recognized
standing, selected by Mercantile in its sole discretion, at such time as
Mercantile in its sole discretion elects on the first day of such Interest
Period, for delivery on the first day of the applicable Interest Period for a
number of days comparable to the number of days in such Interest Period and in
an amount approximately equal to the principal amount of the IBOR Loan to which
such Interest Period is to apply.
"IBOR Loan" shall mean any Loan bearing interest at the IBOR Rate.
"IBOR Margin" shall mean: (a) with respect to each Line of Credit
Loan,
(i) .375% during such time as the Company's commercial paper
is rated P-1 by Moody's and A-1 by S&P,
(ii) .50% during such time as the Company's commercial paper
is rated at least P-2 by Moody's and at least A-2 by S&P,
(iii) .6875% during such time as the Company's commercial
paper is rated at least P-3 by Moody's and at least A-3 by S&P, and
(iv) .9375% during such time as the Company's commercial paper
is (A) rated NP by Moody's or B, C or D by S&P or (B) not rated by
either or both of Moody's and/or S&P,
and if clauses (i) and (ii) are both applicable or if clauses (i), (ii) and
(iii) are all applicable, the IBOR Margin set forth in clause (i) shall be
applicable, and if both clauses (ii) and (iii) are applicable, the IBOR Margin
set forth in clause (ii) shall be applicable; and
(b) with respect to each Revolving Credit Loan,
(i) .375% during such time as the Company's commercial paper
is rated P-1 by Moody's and A-1 by S&P,
(ii) .50% during such time as the Company's commercial paper
is rated at least P-2 by Moody's and at least A-2 by S&P,
<PAGE> 13
(iii) .6875% during such time as the Company's commercial
paper is rated at least P-3 by Moody's and at least A-3 by S&P, and
(iv) .9375% during such time as the Company's commercial paper
is (A) rated NP by Moody's or B, C or D by S&P or (B) not rated by
either or both of Moody's and/or S&P,
and if clauses (i) and (ii) are both applicable or if clauses (i), (ii) and
(iii) are all applicable, the IBOR Margin set forth in clause (i) shall be
applicable, and if both clauses (ii) and (iii) are applicable, the IBOR Margin
set forth in clause (ii) shall be applicable.
The IBOR Rate shall be adjusted automatically on and as of the
effective date of any change in the IBOR Margin.
"IBOR Rate" shall mean (a) the quotient of (i) the IBOR Base Rate
divided by (ii) one minus the IBOR Reserve Percentage, plus (b) the IBOR
Margin.
"IBOR Reserve Percentage" shall mean for any day the reserve
percentage (including any supplemental percentage applied on a marginal basis
or any other reserve requirement having a similar effect), expressed as a
decimal, which is in effect on the first day of the applicable Interest Period,
as prescribed by the Board of Governors of the Federal Reserve System (or any
successor) under Regulation D (or any other applicable regulation of the Board
of Governors (or any successor)) with respect to "Eurocurrency Liabilities."
The IBOR Rate shall be adjusted automatically on and as of the effective date
of any change in the IBOR Reserve Percentage.
"Interest Charges" shall mean, for the period in question, all
interest paid or accrued (including imputed interest in respect of Capitalized
Rentals) and all amortization of debt discount and expense on any particular
Indebtedness for which such calculations are being made.
"Interest Period" shall mean:
(a) with respect to each IBOR Loan:
(i) Initially, the period commencing on the date of such
Loan and ending 1 day, 1, 2 or 3 weeks or 1, 2, 3, 4, 5 or 6 months
thereafter (or such other period agreed upon in writing by the Company
and all of the Banks), as the Company may elect in the applicable
Notice of Borrowing; and
(ii) Thereafter, each period commencing on the last day of
the next preceding Interest Period applicable to such Loan and ending
1 day, 1, 2 or 3 weeks or 1, 2, 3, 4, 5 or 6 months thereafter (or
such other period agreed upon in writing by the Company and all of the
Banks), as the Company may elect pursuant to Section 2.04;
provided that:
(iii) Subject to clauses (iv), (v) and (vi) below, if any
Interest Period would otherwise end on a day which is not a Business
Day, such Interest Period shall end on the immediately preceding
Business Day;
<PAGE> 14
(iv) No Interest Period with respect to any IBOR Loan which
is a Line of Credit Loan shall extend beyond the last day of the Line
of Credit Period;
(v) No Interest Period with respect to any IBOR Loan which
is a Revolving Credit Loan shall extend beyond the last day of the
Revolving Credit Period; and
(vi) Any Interest Period which includes a date on which a
payment of principal is required to be made on the applicable Loan(s)
shall end on such date.
(b) with respect to each CD Loan:
(i) Initially, the period commencing on the date of such
Loan and ending 30, 60, 90, 120 or 180 days thereafter (or such other
period agreed upon in writing by the Company and all of the Banks), as
the Company may elect in the applicable Notice of Borrowing; and
(ii) Thereafter, each period commencing on the last day of
the next preceding Interest Period applicable to such Loan and ending
30, 60, 90, 120 or 180 days thereafter (or such other period agreed
upon in writing by the Company and all of the Banks), as the Company
may elect pursuant to Section 2.04;
provided that:
(iii) Subject to clauses (iv), (v) and (vi) below, any
Interest Period which would otherwise end on a day which is not a
Business Day shall end on the immediately preceding Business Day;
(iv) No Interest Period with respect to any CD Loan which
is a Line of Credit Loan shall extend beyond the last day of the Line
of Credit Period;
(v) No Interest Period with respect to any CD Loan which
is a Revolving Credit Loan shall extend beyond the last day of the
Revolving Credit Period; and
(vi) Any Interest Period which includes a date on which a
payment of principal is required to be made on the Loans shall end on
such date.
"Lien" shall mean any mortgage, lien, pledge, security interest,
encumbrance or charge of any kind, any conditional sale or other title
retention agreement or any Capitalized Lease.
"Line of Credit Commitment" shall mean, subject to termination or
reduction as set forth in Section 2.01(c) and Section 2.07: with respect to
Mercantile, $10,000,000.00; with respect to The Boatmen's National Bank of
St. Louis, $17,500,000.00; with respect to Citibank, N.A., $10,000,000.00; with
respect to NBD Bank, N.A., $12,500,000.00; with respect to The Bank of Nova
Scotia, $10,000,000.00; with respect to The First National Bank of Chicago,
$10,000,000.00; and with respect to Bank of America National Trust and Savings
Association, $5,000,000.00.
"Line of Credit Extension Request" shall have the meaning ascribed
thereto in Section 2.01(c).
<PAGE> 15
"Line of Credit Loan" and "Line of Credit Loans" shall have the
respective meanings ascribed thereto in Section 2.01(a).
"Line of Credit Notes" shall mean the Line of Credit Notes of the
Company to be executed and delivered to the Banks pursuant to Section 2.03(a),
as the same may from time to time be amended, modified, extended or renewed.
"Line of Credit Period" shall have the meaning ascribed thereto in
Section 2.01(c).
"Loan" shall mean a Prime Loan, a CD Loan or an IBOR Loan (whether a
Line of Credit Loan or a Revolving Credit Loan) and "Loans" shall mean Prime
Loans, CD Loans and/or IBOR Loans (whether Line of Credit Loans or Revolving
Credit Loans).
"Loan Commitments" shall mean the total of the Line of Credit
Commitments and Revolving Credit Commitments of all of the Banks.
"Material Adverse Effect" shall mean a material adverse effect on (i)
the Properties, business, profits or condition (financial or otherwise) of the
Company and its Subsidiaries taken as a whole or (ii) the ability of the
Company to perform its obligations contained in this Agreement or in the Notes.
"Mercantile" shall mean Mercantile Bank of St. Louis National
Association, a national banking association, in its individual corporate
capacity and not as Agent hereunder.
"Minimum Rentals" shall mean and include as of the date of any
determination thereof all fixed payments (including as such all payments which
the lessee is obligated to make to the lessor on termination of the lease or
surrender of the leased Property) payable by the Company or a Restricted
Subsidiary, as lessee or sublessee under a lease of real or personal property,
but shall be exclusive of any amounts required to be paid by the Company or a
Restricted Subsidiary (whether or not designated as rents or additional rents)
on account of maintenance, repairs, insurance, taxes and similar charges.
Fixed rents under any so-called "percentage leases" shall be computed solely on
the basis of the minimum rents, if any, required to be paid by the lessee
regardless of sales volume or gross revenues.
"Minority Interests" shall mean any shares of stock of any class of a
Restricted Subsidiary (other than directors' qualifying shares as required by
law) that are not owned by the Company and/or one or more of its Restricted
Subsidiaries. Minority Interests shall be valued by valuing Minority Interests
constituting preferred stock at the voluntary or involuntary liquidation value
of such preferred stock, whichever is greater, and by valuing Minority
Interests constituting common stock at the book value of capital and surplus
applicable thereto, adjusted, if necessary, to reflect any changes from the
book value of such common stock required by the foregoing method of valuing
Minority Interests in preferred stock.
"Moody's" shall mean Moody's Investors Service, Inc.
"Multi-Employer Plan" shall mean a "multi-employer plan" as defined in
Section 4001(a)(3) of ERISA which is maintained for employees of the Company,
any ERISA Affiliate or any Subsidiary.
"Net Income Available for Fixed Charges" shall mean, for the period in
question, the sum of Consolidated Net Income during such period plus, to the
<PAGE> 16
extent deducted in determining Consolidated Net Income, (a) all provisions for
any Federal, state or other income taxes made by the Company and its Restricted
Subsidiaries during such period and (b) Fixed Charges of the Company and its
Restricted Subsidiaries during such period.
"Net Worth" shall mean, as of the date of any determination thereof,
the amount of the capital stock accounts (net of treasury stock, at cost) less
Minority Interests (to the extent included therein) plus (or less in the case
of a deficit) cumulative currency translation adjustments plus (or minus in the
case of a deficit) the surplus and retained earnings of the Company and its
Restricted Subsidiaries determined on a consolidated basis and in accordance
with GAAP, plus the after-tax effect of the SFAS 106 Adjustment.
"Note" shall mean a Line of Credit Note or a Revolving Credit Note,
and "Notes" shall mean the Line of Credit Notes and the Revolving Credit Notes.
"Note Agreements" shall have the meaning ascribed thereto in
Section 6.01(n).
"Notice of Borrowing" shall have the meaning ascribed thereto in
Section 2.02.
"Occupational Safety and Health Laws" shall mean the Occupational
Safety and Health Act of 1970, as amended, and any other Federal, state or
local statute, law, ordinance, code, rule or regulation or judicial or
administrative order or decree regulating, relating to or imposing liability or
standards of conduct concerning employee safety and/or health, as now or at any
time hereafter in effect.
"Operating Lease" shall mean any lease of real property under which
the Company or a Restricted Subsidiary is lessee, other than (1) leases between
the Company and its Restricted Subsidiaries or between Restricted Subsidiaries
of the Company and (2) Capitalized Leases.
"PBGC" shall mean the Pension Benefit Guaranty Corporation and any
entity succeeding to any or all of its functions under ERISA.
"Pension Plan" shall mean a "pension plan," as such term is defined in
Section 3(2) of ERISA, which is established or maintained by the Company, any
ERISA Affiliate or any Subsidiary, other than a Multi-Employer Plan.
"Person" shall mean any individual, sole proprietorship, partnership,
joint venture, trust, unincorporated organization, association, corporation,
institution, entity or government (whether national, Federal, state, county,
city, municipal or otherwise, including, without limitation, any
instrumentality, division, agency, body or department thereof).
"Prime Loan" shall mean any Loan bearing interest at the Prime Rate.
"Prime Rate" shall mean the interest rate announced from time to time
by Mercantile as its "prime rate" on commercial loans (which rate shall
fluctuate as and when said "prime rate" shall change).
"Property" shall mean any interest in any kind of property or asset,
whether real, personal or mixed, or tangible or intangible. Properties shall
mean the plural of Property. For purposes of this Agreement, the Company and
each Subsidiary shall be deemed to be the owner of any Property which it has
acquired or holds subject to a conditional sale agreement, financing lease or
<PAGE> 17
other arrangement pursuant to which title to the Property has been retained by
or vested in some other Person for security purposes.
"Pro Rata Share" shall mean, with respect to each Bank, such Bank's
percentage of the aggregate amount of Loans then outstanding or, if no Loans
are then outstanding, such Bank's percentage of the total Loan Commitments of
all of the Banks.
"Regulation D" shall mean Regulation D of the Board of Governors of
the Federal Reserve System, as amended.
"Regulatory Change" shall have the meaning ascribed thereto in Section
8.03(a).
"Reportable Event" shall have the meaning given to such term in ERISA.
"Restricted Investment" shall mean any investment by the Company or
any Subsidiary in any Person, whether payment therefor is made in cash or
capital stock of the Company, and whether such investment is by acquisition of
stock or Indebtedness, or by loan, advance, transfer of property out of the
ordinary course of business, capital contribution, extension of credit on terms
other than those normal in the ordinary course of business, guarantee or
otherwise becoming liable (contingently or otherwise) in respect of the
Indebtedness of any Person, or otherwise; provided, however, that the term
"Restricted Investment" shall not include:
(a) investments in marketable obligations issued or
guaranteed by the United States of America, and maturing not more than
one (1) year from the date of acquisition thereof;
(b) commercial paper rated A-1 or A-2 or better by S&P or P-1
or P-2 or better by Moody's;
(c) certificates of deposit in, or banker's acceptances
issued by, United States commercial banks or savings and loan
associations that are members of both the Federal Deposit Insurance
Corporation and the Federal Reserve System, that have combined capital
and surplus of at least $100,000,000.00 and that have a senior debt
rating of A- or better by S&P or A-3 or better by Moody's, provided
that such certificates of deposit or banker's acceptances mature not
more than one (1) year from the date of acquisition thereof;
(d) bonds or notes issued by any corporation organized and
existing under the laws of the United States of America or any state
thereof that (i) are rated at least BBB by S&P and Baa by Moody's and
(ii) have a maturity date of not more than one (1) year from the date
of acquisition thereof; provided, however, that the aggregate
outstanding principal amount of all such notes and/or bonds of any
single corporation owned by the Company and/or any one or more of its
Subsidiaries shall not exceed $5,000,000.00 at any one time;
(e) overnight repurchase agreements secured by the government
obligations described in clause (a) above between the Company and a
United States commercial bank or saving and loan association that is a
member of both the Federal Deposit Insurance Corporation and the
Federal Reserve System, that has combined capital and surplus of at
least $100,000,000.00 and that has a senior debt rating of A- or
better by S&P or A-3 or better by Moody's, and pursuant to which the
<PAGE> 18
Company and such institution do not have a commitment of more than
$5,000,000.00;
(f) money market mutual funds that have total assets in
excess of $1,000,000,000.00 and that invest substantially all of their
assets in the items described in clauses (a), (b) and (c) above;
(g) mutual funds that (i) have assets in excess of
$1,000,000,000.00, (ii) invest substantially all of their assets in
the items described in clauses (a), (b), (c) and/or (d) above and
(iii) are rated A or better by S&P and A or better by Moody's;
(h) endorsements of negotiable instruments or other
receivables for collection in the ordinary course of business, and
demand deposits in the ordinary course of business;
(i) investments in stock or other securities of, or loans,
advances, or capital contributions to, any entity which by reason
thereof will become a Subsidiary in compliance with
Section 5.01(g)(ii);
(j) loans or advances in the usual and ordinary course of
business to officers, directors and employees for business expenses;
(k) guarantees of any lessee's or sublessee's obligation
under any Operating Lease, whether such lessee or sublessee is the
Company, any Subsidiary or any other Person (provided that such lessee
or sublessee, if not the Company or a Subsidiary, is an assignee or
sublessee of the rights and obligations of the Company or a Subsidiary
under such Operating Lease), and any inter-company guarantees;
(l) to the extent not already included in item (k) above, the
Handyman Guarantees;
(m) investments of up to $500,000.00 in suppliers of goods
sold by the Company or any of its Subsidiaries in the ordinary course
of business necessary or desirable to develop or maintain sources of
supply; and
(n) de minimis investments in any Person made in the ordinary
course of business for the purpose of obtaining general information of
such Person.
"Restricted Subsidiary" shall mean any Subsidiary which is designated
a Restricted Subsidiary in Schedule 4.01(r) attached hereto or which may
hereafter be so designated by the Company by written notice to the Agent and
each of the Banks, accompanied by a resolution of the Board of Directors of the
Company or the Executive Committee of the Board of Directors of the Company, to
be included in the definition of Restricted Subsidiary for all purposes of this
Agreement; provided, however, that:
(a) (i) no corporation shall be designated a Restricted
Subsidiary if such corporation shall previously have been designated a
Restricted Subsidiary (including the initial designation contained in
Schedule 4.01(r) attached hereto), (ii) any corporation designated a
Restricted Subsidiary shall be deemed to have created, assumed or
incurred all Funded Debt of such corporation existing immediately
after it becomes a Restricted Subsidiary, (iii) the designation of a
<PAGE> 19
Restricted Subsidiary may only be made effective as at the end of a
fiscal quarter of the Company and (iv) at the time of such designation
and after giving effect thereto, (A) no Default or Event of Default
shall have occurred and be continuing, (B) all of the representations
and warranties of the Company contained in this Agreement shall be
true and correct in all material respects as if made on such date and
(C) the Company would be entitled, pursuant to the provisions of
Section 5.01(c)(i)(C) of this Agreement, to incur at least $1.00 of
additional Funded Debt; and
(b) any Restricted Subsidiary may be designated by the
Company, effective as at the end of a fiscal quarter of the Company,
by written notice to the Agent and each of the Banks, accompanied by a
resolution of the Board of Directors of the Company or the Executive
Committee of the Board of Directors of the Company, to be excluded
from the definition of Restricted Subsidiary for all purposes of this
Agreement if at the time of such designation and after giving effect
thereto, (i) no Default or Event of Default shall have occurred and be
continuing, (ii) all of the representations and warranties of the
Company contained in this Agreement shall be true and correct in all
material respects as if made on such date, (iii) such corporation
shall neither own, directly or indirectly, any Indebtedness for
borrowed money or capital stock of the Company or any Restricted
Subsidiary and (iv) the Company would be entitled pursuant to the
provisions of Section 5.01(c)(i)(C) of this Agreement, to incur at
least $1.00 of additional Funded Debt.
"Required Banks" shall mean at any time Banks having 67% of the
aggregate amount of Loans then outstanding or, if no Loans are then
outstanding, 67% of the total Loan Commitments of all of the Banks.
"Revolving Credit Commitment" shall mean, subject to termination or
reduction as set forth in Section 2.01(d) and Section 2.07: with respect to
Mercantile, $10,000,000.00; with respect to The Boatmen's National Bank of
St. Louis, $17,500,000.00; with respect to Citibank, N.A., $10,000,000.00; with
respect to NBD Bank, N.A., $12,500,000.00; with respect to The Bank of Nova
Scotia, $10,000,000.00; with respect to The First National Bank of Chicago,
$10,000,000.00; and respect to Bank of America National Trust and Savings
Association, $5,000,000.00.
"Revolving Credit Extension Request" shall have the meaning ascribed
thereto in Section 2.01(d).
"Revolving Credit Loan" and "Revolving Credit Loans" shall have the
respective meanings ascribed thereto in Section 2.01(b).
"Revolving Credit Notes" shall mean the Revolving Credit Notes of the
Company to be executed and delivered to the Banks pursuant to Section 2.03(b),
as the same may from time to time be amended, modified, extended or renewed.
"Revolving Credit Period" shall have the meaning ascribed thereto in
Section 2.01(d).
"Sale and Leaseback Transaction" shall have the meaning ascribed
thereto in Section 5.01(f).
"Secured Debt" shall, without duplication, mean all Current Debt
and/or Funded Debt which is secured by a mortgage, security interest, pledge,
<PAGE> 20
conditional sale or other title retention agreement or other Lien upon any
Property or assets of the Company or a Restricted Subsidiary but shall not
include Capitalized Rentals or liabilities incurred in connection with
industrial revenue bond financings or pollution control bond financings.
"SFAS 106" shall mean Statement of Financial Accounting Standards No.
106, Employer's Accounting for Postretirement Benefits Other Than Pensions,
issued by the Financial Accounting Standards Board.
"SFAS 106 Adjustment" shall mean (a) for any fiscal period ending with
or after the fiscal period in which the Company has elected to immediately
recognize the SFAS 106 Transition Obligation through a single charge against
the revenues of the Company and its Restricted Subsidiaries on a consolidated
basis, the amount charged against the revenues of the Company and its
Restricted Subsidiaries on a consolidated basis in the fiscal period in which
SFAS 106 is adopted by the Company to reflect the effect of a change in
accounting principle (resulting from the adoption of SFAS 106) and (b) for any
earlier fiscal period, zero.
"SFAS 106 Liability" shall mean, as of the end of any fiscal period,
the amount set forth as such on the balance sheet of the Company at the end of
such period with respect to the SFAS 106 Adjustment.
"SFAS 106 Transition Obligation" shall mean as of the date the Company
adopts SFAS 106, the difference between (a) the accumulated postretirement
benefit obligation determined in accordance with SFAS 106 and (b) the fair
value of the assets that the Company has segregated and restricted for the
Company's non-pension postretirement benefit plan, plus any accrued non-pension
postretirement benefit cost or less any prepaid non-pension postretirement
benefit cost as of such date.
"Significant Subsidiaries" shall mean EBSS-West, Inc., a California
corporation, Edison Brothers Apparel Stores, Inc., a Missouri corporation,
Edison Brothers Entertainment, Inc., a Missouri corporation, Edison Brothers
Redevelopment Corporation, a Missouri corporation, and Edison Brothers Stores
International, Inc., a Missouri corporation, and any other Subsidiary
accounting for more than (i) ten percent (10%) of the total Consolidated Net
Tangible Assets as of the last day of the fiscal year of the Company
immediately preceding the date of determination or (ii) ten percent (10%) of
the total Consolidated Net Sales for the fiscal year of the Company immediately
preceding the date of determination.
"S&P" shall mean Standard and Poor's Corporation.
"Subsidiary" shall mean any corporation at least a majority of whose
outstanding stock having ordinary voting power for the election of a majority
of the members of the Board of Directors (or other governing body) of such
corporation (other than stock having such power only by reason of the happening
of a contingency) shall at the time be owned by the Company and/or one or more
Subsidiaries of the Company.
"Transaction Documents" shall mean this Agreement, the Notes and all
other agreements, documents and instruments heretofore, now or hereafter
delivered to the Agent or any Bank with respect to or in connection with or
pursuant to this Agreement or any Loans made hereunder, and executed by or on
behalf of the Company, all as the same may from time to time be amended,
modified, extended or renewed.
<PAGE> 21
"Unrestricted Subsidiary" shall mean any Subsidiary which is not a
Restricted Subsidiary.
"Wholly-Owned" when used in connection with any Subsidiary shall mean
a Subsidiary of which all of the issued and outstanding shares of stock (except
shares required as directors' qualifying shares) shall be owned by the Company
and/or one or more of its Wholly-Owned Subsidiaries.
SECTION 1.02. Accounting Terms and Determinations. Except as
otherwise specified herein, all accounting terms used herein shall be
interpreted, all accounting determinations hereunder shall be made and all
financial statements required to be delivered hereunder shall be prepared in
accordance with GAAP, applied on a basis consistent (except for changes
approved by the Company's independent certified public accountants) with the
most recent audited consolidated financial statements of the Company and its
Consolidated Subsidiaries delivered to the Agent.
ARTICLE II
LOANS
SECTION 2.01. Commitments To Lend.
(a) During the Line of Credit Period, each Bank severally agrees,
on the terms and conditions set forth in this Agreement, to lend to the Company
from time to time (individually, a "Line of Credit Loan" and collectively, the
"Line of Credit Loans") amounts not to exceed, in the aggregate at any one time
outstanding, the amount of such Bank's Line of Credit Commitment. Each Line
of Credit Loan under this Section 2.01(a) shall be made from the several Banks
ratably in proportion to their respective Line of Credit Commitments. Each
Line of Credit Loan under this Section 2.01(a) shall be for an aggregate
principal amount of $2,500,000.00 or any larger multiple of $1,000,000.00.
Within the foregoing limits, the Company may borrow under this Section 2.01(a),
prepay under Section 2.08 and reborrow at any time during the Line of Credit
Period under this Section 2.01(a).
(b) During the Revolving Credit Period, each Bank severally
agrees, on the terms and conditions set forth in this Agreement, to lend to the
Company from time to time (individually, a "Revolving Credit Loan" and
collectively, the "Revolving Credit Loans") amounts not to exceed, in the
aggregate at any one time outstanding, the amount of such Bank's Revolving
Credit Commitment. Each Revolving Credit Loan under this Section 2.01(b) shall
be made from the several Banks ratably in proportion to their respective
Revolving Credit Loan Commitments. Each Revolving Credit Loan under this
Section 2.01(b) shall be for an aggregate principal amount of $2,500,000.00 or
any larger multiple of $1,000,000.00. Within the foregoing limits, the Company
may borrow under this Section 2.01(b), prepay under Section 2.08 and reborrow
at any time during the Revolving Credit Period under this Section 2.01(b).
(c) The Line of Credit Period shall mean the period commencing on
the Effective Date of this Agreement and ending June 2, 1994; provided,
however, that the Line of Credit Period may be extended successively as
provided in this Section 2.01(c). The Company may successively request within
each of the time periods hereinafter set forth a one hundred eighty-two (182)
day extension of the Line of Credit Period. The Company shall deliver any such
request (a "Line of Credit Extension Request") to the Agent between November 1
and November 15 of the applicable year or between May 1 and May 15 of the
applicable year, whichever time period is more than six (6) months but less
<PAGE> 22
than eight (8) months prior to the last day of the then current Line of Credit
Period, and the Agent shall promptly forward such request to each of the Banks.
Each Bank shall have the right, as to its Line of Credit Commitment, in its
sole and absolute discretion, to approve or disapprove the requested extension
of the Line of Credit Period. Each Bank shall, no earlier than the December 5
immediately following the date of the applicable Line of Credit Extension
Request (if the Line of Credit Extension Request was dated in November) or the
June 5 immediately following the date of the applicable Line of Credit
Extension Request (if the Line of Credit Extension Request was dated in May)
and no later than the December 15 immediately following the date of the
applicable Line of Credit Extension Request (if the Line of Credit Extension
Request was dated in November) or the June 15 immediately following the date of
the applicable Line of Credit Extension Request (if the Line of Credit
Extension Request was dated in May) (and any such notice which is sent or dated
more than one hundred eighty-two (182) days prior to the last day of the then
current Line of Credit Period shall not be effective for any purpose and shall
be null and void), notify the Agent in writing whether such Bank will extend
the Line of Credit Period with respect to its Line of Credit Commitment and any
Bank which fails to notify the Agent of its decision within such time period
will be deemed to have elected not to approve the Line of Credit Extension
Request. In the event that Banks holding less than 67% of the total Line of
Credit Commitments approve the Line of Credit Extension Request, the Line of
Credit Period as to all of the Banks (and the Line of Credit Commitments of
each of the Banks) shall terminate on the last day of the then current Line of
Credit Period. In the event Banks having at least 67% of the total Line of
Credit Commitments approve the Line of Credit Extension Request (such Banks so
approving the Line of Credit Extension Request referred to herein as the
"Approving Banks"), the Line of Credit Period and the obligation to make Line
of Credit Loans, solely as to the Approving Banks, shall, subject to all of the
terms and conditions of this Agreement, be extended to the date which is one
hundred eighty-two (182) days after the last day of the then current Line of
Credit Period. From and after the first day of any such extension of the Line
of Credit Period, any reference to "Line of Credit Commitments" shall refer
only to the Line of Credit Commitments of the Approving Banks. The Line of
Credit Commitment of any Bank which is not an Approving Bank shall terminate on
the last day of the then current Line of Credit Period (without giving effect
to any extension thereof not approved by such Bank) and all Line of Credit
Loans made by such Bank, together with all accrued and unpaid interest thereon
and all fees and other amounts owing by the Company to such Bank with respect
thereto, shall be due and payable on the last day of the current Line of Credit
Period (without giving effect to any extension thereof not approved by such
Bank). Any Bank which does not approve any such Line of Credit Extension
Request shall not be allowed to approve any concurrent or subsequent Line of
Credit Extension Request (including any subsequent Line of Credit Extension
Request made before the expiration of such Bank's Line of Credit Period) or
Revolving Credit Extension Request.
(d) The Revolving Credit Period shall mean the period commencing
on the Effective Date of this Agreement and ending June 4, 1996; provided,
however, that the Revolving Credit Period may be extended successively as
provided in this Section. The Company may successively request within each of
the time periods hereinafter set forth a one (1) year extension of the
Revolving Credit Period. The Company shall deliver any such request (a
"Revolving Credit Extension Request") to the Agent between May 1 and May 15 of
the applicable year, and the Agent shall promptly forward such request to each
of the Banks. Each Bank shall have the right, as to its Revolving Credit
Commitment, in its sole and absolute discretion, to approve or disapprove the
requested extension of the Revolving Credit Period. Each Bank shall, no
<PAGE> 23
earlier than the June 5 immediately following the date of the applicable
Revolving Credit Extension Request and no later than the June 15 immediately
following the date of the applicable Revolving Credit Extension Request, notify
the Agent in writing whether such Bank will extend the Revolving Credit Period
with respect to its Revolving Credit Commitment to the requested extended
Revolving Credit Period and any Bank which fails to notify the Agent of its
decision within such time period will be deemed to have elected not to approve
the Revolving Credit Extension Request. In the event that Banks holding less
than 67% of the total Revolving Credit Commitments approve the Revolving Credit
Extension Request, the Revolving Credit Period as to all of the Banks (and the
Revolving Credit Commitments of each of the Banks) shall terminate on the last
day of the then current Revolving Credit Period. In the event Banks having at
least 67% of the total Revolving Credit Commitments approve the Revolving
Credit Extension Request (such Banks so approving the Revolving Credit
Extension Request referred to herein as the "Approving Banks"), the Revolving
Credit Period and the obligation to make Revolving Credit Loans, solely as to
the Approving Banks, shall, subject to all of the terms and conditions of this
Agreement, be extended to the date which is one (1) year after the last day of
the then current Revolving Credit Period. From and after the first day of any
such extension of the Revolving Credit Period, any reference to "Revolving
Credit Commitments" shall refer only to the Revolving Credit Commitments of the
Approving Banks. The Revolving Credit Commitment of any Bank which is not an
Approving Bank shall terminate on the last day of the then current Revolving
Credit Period (without giving effect to any extension thereof not approved by
such Bank) and all Revolving Credit Loans made by such Bank, together with all
accrued and unpaid interest thereon and all fees and other amounts owing by the
Company to such Bank with respect thereto, shall be due and payable on the last
day of the current Revolving Credit Period (without giving effect to any
extension thereof not approved by such Bank). Any Bank which does not approve
any such Revolving Credit Extension Request shall not be allowed to approve any
concurrent or subsequent Revolving Credit Extension Request (including any
subsequent Revolving Credit Extension Request made before the expiration of
such Bank's Revolving Credit Period) or Line of Credit Extension Request.
(e) The failure of any Bank to make any Loan required under this
Agreement shall not release any other Bank from its obligation to make Loans as
provided herein.
SECTION 2.02. Method of Borrowing. (a) The Company shall give
notice (a "Notice of Borrowing") to the Agent by 10:00 a.m. (St. Louis time) on
the day of each Prime Loan or IBOR Loan, and at least one (1) Business Day
before each CD Loan, specifying:
(i) the date of such Loan, which shall be a Business Day,
(ii) the aggregate principal amount of such Loan,
(iii) whether such Loan is to be a Line of Credit Loan or a
Revolving Credit Loan,
(iv) whether such Loan is to be a Prime Loan, a CD Loan or
an IBOR Loan,
(v) in the case of a Fixed Rate Loan, the duration of the
initial Interest Period applicable thereto, subject to the provisions
of the definition of Interest Period,
<PAGE> 24
(vi) that on the date of, and after giving effect to, such
Loan, no Default or Event of Default under this Agreement has occurred
and is continuing, and
(vii) that on the date of, and after giving effect to, such
Loan, all of the representations and warranties of the Company
contained in this Agreement are true and correct in all material
respects as if made on the date of such Loan.
A Notice of Borrowing shall not be required in connection with a Prime Loan
pursuant to Section 8.01.
(b) Upon receipt of a Notice of Borrowing given to it, the Agent
shall notify each Bank by 1:00 p.m. (St. Louis time) on the date of receipt of
such Notice of Borrowing by the Agent (which must be a Business Day) of the
contents thereof and of such Bank's ratable share of such Loan. A Notice of
Borrowing shall not be revocable by the Company.
(c) Not later than 2:00 P.M. (St. Louis time) on the date of each
Loan, each Bank shall (except as provided in subsection (d) of this Section)
make available its ratable share of such Loan, in Federal or other funds
immediately available in St. Louis, Missouri, to the Agent at its address
specified in or pursuant to Section 9.01. Unless the Agent determines that any
applicable condition specified in Article III has not been satisfied, the Agent
will make the funds so received from the Banks available to the Company
immediately thereafter at the Agent's aforesaid address by crediting such funds
to a demand deposit account (or such other account mutually agreed upon in
writing between Agent and the Company) of the Company with the Agent.
(d) If any Bank makes a new Loan hereunder on a day on which the
Company is required to or has elected to repay all or any part of an
outstanding Loan from such Bank, such Bank shall apply the proceeds of its new
Loan to make such repayment and only an amount equal to the difference (if any)
between the amount being borrowed and the amount being repaid shall be made
available by such Bank to the Agent as provided in subsection (c) of this
Section, or remitted by the Company to the Agent as provided in Section 2.09,
as the case may be.
SECTION 2.03. Notes. (a) The Line of Credit Loans of each Bank to
the Company during the Line of Credit Period shall be evidenced by a Line of
Credit Note of the Company dated the date hereof and payable to the order of
such Bank in a principal amount equal to its Line of Credit Commitment in
substantially the form of Exhibit A attached hereto (with appropriate
insertions) (as the same may from time to time be amended, modified extended or
renewed, the "Line of Credit Notes").
(b) The Revolving Credit Loans of each Bank to the Company during the
Revolving Credit Period shall be evidenced by a Revolving Credit Note of the
Company dated the date hereof and payable to the order of such Bank in a
principal amount equal to its Revolving Credit Commitment in substantially the
form of Exhibit B attached hereto (with appropriate insertions) (as the same
may from time to time be amended, modified extended or renewed, the "Revolving
Credit Notes").
(c) Upon receipt of each Bank's Line of Credit Note pursuant to
Section 3.01(a), the Agent shall mail such Note by certified mail, return
receipt requested, to such Bank. Each Bank shall record, and prior to any
transfer of its Line of Credit Note shall endorse on the schedules forming a
<PAGE> 25
part thereof, appropriate notations to evidence the date and amount of each
Line of Credit Loan made by it during the Line of Credit Period and the date
and amount of each payment of principal made by the Company with respect
thereto. Each Bank is hereby irrevocably authorized by the Company so to
endorse its Line of Credit Note and to attach to and make a part of any such
Line of Credit Note a continuation of any such schedule as and when required;
provided, however that the obligation of the Company to repay each Line of
Credit Loan made hereunder shall be absolute and unconditional, notwithstanding
any failure of any Bank to endorse or any mistake by any Bank in connection
with endorsement on the schedules attached to their respective Line of Credit
Notes. The books and records of each Bank (including, without limitation, the
schedules attached to the Line of Credit Notes) showing the account between
such Bank and the Company shall be admissible in evidence in any action or
proceeding and shall constitute prima facie proof of the items therein set
forth.
(d) Upon receipt of each Bank's Revolving Credit Note pursuant to
Section 3.01(a), the Agent shall mail such Note by certified mail, return
receipt requested, to such Bank. Each Bank shall record, and prior to any
transfer of its Revolving Credit Note shall endorse on the schedules forming a
part thereof, appropriate notations to evidence the date and amount of each
Revolving Credit Loan made by it during the Revolving Credit Period and the
date and amount of each payment of principal made by the Company with respect
thereto. Each Bank is hereby irrevocably authorized by the Company so to
endorse its Revolving Credit Note and to attach to and make a part of any such
Revolving Credit Note a continuation of any such schedule as and when required;
provided, however that the obligation of the Company to repay each Revolving
Credit Loan made hereunder shall be absolute and unconditional, notwithstanding
any failure of any Bank to endorse or any mistake by any Bank in connection
with endorsement on the schedules attached to their respective Revolving Credit
Notes. The books and records of each Bank (including, without limitation, the
schedules attached to the Revolving Credit Notes) showing the account between
such Bank and the Company shall be admissible in evidence in any action or
proceeding and shall constitute prima facie proof of the items therein set
forth.
SECTION 2.04. Duration of Interest Periods and Selection of Interest
Rates. (a) The duration of the initial Interest Period for each Fixed Rate
Loan shall be as specified in the applicable Notice of Borrowing. The Company
shall elect the duration of each subsequent Interest Period applicable to such
Loan and the interest rate to be applicable during such subsequent Interest
Period (and the Company shall have the option (i) in the case of any Prime
Loan, to elect that such Loan become a Fixed Rate Loan and the Interest Period
to be applicable thereto, and (ii) in the case of any Fixed Rate Loan, to elect
that such Loan become a Prime Loan), by giving notice of such election to the
Agent by 10:00 a.m. (St. Louis time) on the day of, in the case of the election
of the Prime Rate or the IBOR Rate, and by 10:00 a.m. (St. Louis time) at least
one (1) Business Day before, in the case of the election of the CD Rate, the
end of the immediately preceding Interest Period applicable thereto, if any;
provided, however, that notwithstanding the foregoing, in addition to and
without limiting the rights and remedies of the Agent and the Banks under
Article VI hereof, so long as any Default or Event of Default under this
Agreement has occurred and is continuing, the Company shall not be permitted to
renew any Fixed Rate Loan as a Fixed Rate Loan or to convert any Prime Loan
into a Fixed Rate Loan.
(b) If the Agent does not receive a notice of election for a Loan
pursuant to subsection (a) above within the applicable time limits specified
<PAGE> 26
therein, the Company shall be deemed to have elected to pay such Loan in whole
pursuant to Section 2.08 on the last day of the current Interest Period with
respect thereto and to reborrow the principal amount of such Loan on such date
as a Prime Loan of the same type (i.e. a Line of Credit Loan or a Revolving
Credit Loan).
(c) Notwithstanding the foregoing, the duration of each Interest
Period shall be subject to the provisions of the definition of Interest Period.
SECTION 2.05. Interest Rates. (a) Each Prime Loan shall bear
interest on the outstanding principal amount thereof, for each day from the
date such Loan is made until it becomes due, at a rate per annum equal to the
Prime Rate. Such interest shall be payable monthly in arrears on the fourth
(4th) day of each month, commencing on the first such date after such Prime
Loan is made, and at maturity. Any overdue principal of and, to the extent
permitted by law, overdue interest on, any Prime Loan shall bear interest,
payable on demand, for each day until paid at a rate per annum equal to the sum
of Two Percent (2%) plus the otherwise applicable rate for such day.
(b) Each CD Loan shall bear interest on the outstanding principal
amount thereof, for each Interest Period applicable thereto, at a rate per
annum equal to the applicable CD Rate; provided that if any CD Loan or any
portion thereof shall, as a result of clause (b)(iii), (b)(iv), (b)(v) or
(b)(vi) of the definition of Interest Period, have an Interest Period of less
than thirty (30) days, such portion shall bear interest during such Interest
Period at the rate applicable to Prime Loans during such period. Such interest
shall be payable for each Interest Period on the last day thereof, unless the
duration of the applicable Interest Period exceeds ninety (90) days, in which
case such interest shall be payable on the ninetieth (90th) day of such
Interest Period and on the last day of such Interest Period. Any overdue
principal of and, to the extent permitted by law, overdue interest on, any CD
Loan shall bear interest, payable on demand, for each day until paid at a rate
per annum equal to the sum of Two Percent (2%) plus the higher of (i) the CD
Rate for the immediately preceding Interest Period applicable to such CD Loan
or (ii) the rate applicable to Prime Loans for such day.
(c) Each IBOR Loan shall bear interest on the outstanding
principal amount thereof for each Interest Period applicable thereto at a rate
per annum equal to the applicable IBOR Rate. Interest shall be payable for
each Interest Period on the last day thereof, unless the duration of the
applicable Interest Period exceeds three (3) months, in which case such
interest shall be payable at the end of the first three (3) months of such
Interest Period and on the last day of such Interest Period. Any overdue
principal of and, to the extent permitted by law, overdue interest on, any IBOR
Loan shall bear interest, payable on demand, for each day until paid, at a rate
per annum equal to the sum of Two Percent (2%) plus the higher of (i) the IBOR
Rate for the immediately preceding Interest Period applicable to such IBOR Loan
or (ii) the rate applicable to Prime Loans for such day.
(d) The Agent shall determine each interest rate applicable to the
Loans hereunder. The Agent shall give prompt notice to the Company and the
Banks by telecopy, telex or cable of each rate of interest so determined, and
its determination thereof shall be conclusive in the absence of manifest error.
(e) The Agent hereby acknowledges that the procedure for
determining the IBOR Base Rate is substantially equivalent to the procedure for
determining the rate known in the Eurodollar Market as the "LIBOR Base Rate"
except for the time and place of the rate quotation. In the case of the IBOR
<PAGE> 27
Base Rate the rate quotation is made in the United States, whereas in the case
of said LIBOR Base Rate the rate quotation is made at 11:00 a.m. in London.
The Agent does not, however, represent, warrant or guarantee that the IBOR Base
Rate will be the same as said "LIBOR Base Rate" on any given day.
SECTION 2.06. Fees. (a) From the Effective Date to but excluding the
last day of the Line of Credit Period of the applicable Bank(s), the Company
shall pay to the Agent for the account of each Bank a nonrefundable commitment
fee on the unused portion of the Line of Credit Commitment of such Bank at the
rate of:
(i) .025% per annum during such time as the Company's
commercial paper is rated P-1 by Moody's and A-1 by S&P,
(ii) .0625% per annum during such time as the Company's
commercial paper is rated at least P-2 by Moody's and at least A-2 by
S&P,
(iii) .0625% per annum during such time as the Company's
commercial paper is rated at least P-3 by Moody's and at least A-3 by
S&P, and
(iv) .0625% per annum during such time as the Company's
commercial paper is (A) rated NP by Moody's or B, C or D by S&P or
(B) not rated by either or both of Moody's and/or S&P,
and if clauses (i) and (ii) are both applicable or if clauses (i), (ii) and
(iii) are all applicable, the rate set forth in clause (i) shall be applicable,
and if both clauses (ii) and (iii) are applicable, the rate set forth in clause
(ii) shall be applicable. Such commitment fee shall be payable quarterly in
arrears on each January 1, April 1, July 1 and October 1 during the Line of
Credit Period of the applicable Bank(s) and on the last day of the Line of
Credit Period of the applicable Bank(s), and shall be calculated on an actual
day, 360-day year basis.
(b) From the Effective Date to but excluding the last day of the
Revolving Credit Period of the applicable Bank(s), the Company shall pay to the
Agent for the account of each Bank a nonrefundable commitment fee on the unused
portion of the Revolving Credit Commitment of such Bank at the rate of:
(i) .0625% per annum during such time as the Company's
commercial paper is rated P-1 by Moody's and A-1 by S&P,
(ii) .125% per annum during such time as the Company's
commercial paper is rated at least P-2 by Moody's and at least A-2 by
S&P,
(iii) .125% per annum during such time as the Company's
commercial paper is rated at least P-3 by Moody's and at least A-3 by
S&P, and
(iv) .125% per annum during such time as the Company's
commercial paper is (A) rated NP by Moody's or B, C or D by S&P or
(B) not rated by either or both of Moody's and/or S&P,
and if clauses (i) and (ii) are both applicable or if clauses (i), (ii) and
(iii) are all applicable, the rate set forth in clause (i) shall be applicable,
and if both clauses (ii) and (iii) are applicable, the rate set forth in clause
<PAGE> 28
(ii) shall be applicable. Such commitment fee shall be payable quarterly in
arrears on each January 1, April 1, July 1 and October 1 during the Revolving
Credit Period of the applicable Bank(s) and on the last day of the Revolving
Credit Period of the applicable Bank(s), and shall be calculated on an actual
day, 360-day year basis.
(c) From the Effective Date to but excluding the last day of the Line
of Credit Period of the applicable Bank(s), the Company shall pay to the Agent
for the account of each Bank a nonrefundable facility fee on the entire Line of
Credit Commitment of such Bank at the rate of:
(i) .125% per annum during such time as the Company's
commercial paper is rated P-1 by Moody's and A-1 by S&P,
(ii) .125% per annum during such time as the Company's
commercial paper is rated at least P-2 by Moody's and at least A-2 by
S&P,
(iii) .1875% per annum during such time as the Company's
commercial paper is rated at least P-3 by Moody's and at least A-3 by
S&P, and
(iv) .1875% per annum during such time as the Company's
commercial paper is (A) rated NP by Moody's or B, C or D by S&P or
(B) not rated by either or both of Moody's and/or S&P,
and if clauses (i) and (ii) are both applicable or if clauses (i), (ii) and
(iii) are all applicable, the rate set forth in clause (i) shall be applicable,
and if both clauses (ii) and (iii) are applicable, the rate set forth in clause
(ii) shall be applicable. Such facility fee shall be payable quarterly in
arrears on each January 1, April 1, July 1 and October 1 during the Line of
Credit Period of the applicable Bank(s) and on the last day of the Line of
Credit Period of the applicable Bank(s), and shall be calculated on an actual
day, 360-day year basis.
(d) From the Effective Date to but excluding the last day of the
Revolving Credit Period of the applicable Bank(s), the Company shall pay to the
Agent for the account of each Bank a nonrefundable facility fee on the entire
Revolving Credit Commitment of such Bank at the rate of:
(i) .125% per annum during such time as the Company's
commercial paper is rated P-1 by Moody's and A-1 by S&P,
(ii) .125% per annum during such time as the Company's
commercial paper is rated at least P-2 by Moody's and at least A-2 by
S&P,
(iii) .1875% per annum during such time as the Company's
commercial paper is rated at least P-3 by Moody's and at least A-3 by
S&P, and
(iv) .1875% per annum during such time as the Company's
commercial paper is (A) rated NP by Moody's or B, C or D by S&P or
(B) not rated by either or both of Moody's and/or S&P,
and if clauses (i) and (ii) are both applicable or if clauses (i), (ii) and
(iii) are all applicable, the rate set forth in clause (i) shall be applicable,
and if both clauses (ii) and (iii) are applicable, the rate set forth in clause
<PAGE> 29
(ii) shall be applicable. Such facility fee shall be payable quarterly in
arrears on each January 1, April 1, July 1 and October 1 during the Revolving
Credit Period of the applicable Bank(s) and on the last day of the Revolving
Credit Period of the applicable Bank(s), and shall be calculated on an actual
day, 360-day year basis.
(e) The Company shall also pay to the Agent for its own account a
nonrefundable agent's fee in the amounts set forth in a letter agreement dated
the date hereof by and between the Company and the Agent.
SECTION 2.07. Termination or Reduction of Commitments. (a) The
Company may, upon one (1) Business Day's prior written notice to the Agent,
terminate entirely at any time, or proportionately reduce from time to time on
a pro rata basis among the Banks based on their respective Line of Credit
Commitments by an aggregate amount of $5,000,000.00 or any larger multiple of
$5,000,000.00, the unused portions of the Line of Credit Commitments; provided,
however, that (i) at no time shall the Line of Credit Commitments be reduced to
a figure less than the total of the outstanding principal amount of all Line of
Credit Loans, (ii) at no time shall the Line of Credit Commitments be reduced
to a figure greater than zero but less than $25,000,000.00 and (iii) any such
termination or reduction shall be permanent and the Company shall have no right
to thereafter reinstate or increase, as the case may be, the Line of Credit
Commitment of any Bank.
(b) The Company may, upon one (1) Business Day's prior written notice
to the Agent, terminate entirely at any time, or proportionately reduce from
time to time on a pro rata basis among the Banks based on their respective
Revolving Credit Commitments by an aggregate amount of $5,000,000.00 or any
larger multiple of $5,000,000.00, the unused portions of the Revolving Credit
Commitments; provided, however, that (i) at no time shall the Revolving Credit
Commitments be reduced to a figure less than the total of the outstanding
principal amount of all Revolving Credit Loans, (ii) at no time shall the
Revolving Credit Commitments be reduced to a figure greater than zero but less
than $25,000,000.00 and (iii) any such termination or reduction shall be
permanent and the Company shall have no right to thereafter reinstate or
increase, as the case may be, the Revolving Credit Commitment of any Bank.
SECTION 2.08. Early Payments. (a) The Company may, upon notice to
the Agent specifying that it is paying its Prime Loans and specifying whether
it is paying its Line of Credit Loans and/or its Revolving Credit Loans, pay
without penalty or premium its Prime Loans in whole at any time, or from time
to time in part in amounts aggregating $2,500,000.00 or any larger multiple of
$1,000,000.00, by paying the principal amount to be paid together with all
accrued and unpaid interest thereon to and including the date of payment;
provided, however, that in no event may the Company make a partial payment of
Prime Loans which results in the total outstanding Prime Loans which are Line
of Credit Loans or the total outstanding Prime Loans which are Revolving Credit
Loans being greater than zero but less than $2,500,000.00. Each such optional
payment shall be applied to pay the Prime Loans of the several Banks in
proportion to their respective Line of Credit Commitments and/or Revolving
Credit Commitments, as the case may be depending upon which type of Loans are
being paid (i.e. Line of Credit Loans or Revolving Credit Loans).
(b) The Company may, upon at least one (1) Business Day's notice
to the Agent specifying whether it is paying CD Loans or IBOR Loans and
specifying whether it is paying its Line of Credit Loans and/or its Revolving
Credit Loans, pay without penalty or premium on the last day of any Interest
Period its Fixed Rate Loans to which such Interest Period applies, in whole, or
<PAGE> 30
in part in amounts aggregating $2,500,000.00 or any larger multiple of
$1,000,000.00, by paying the principal amount to be paid together with all
accrued and unpaid interest thereon to and including the date of payment;
provided, however, that in no event may the Company make a partial payment of
CD Loans or IBOR Loans which results in the total outstanding CD Loans which
are Line of Credit Loans with respect to which a given Interest Period applies,
the total outstanding CD Loans which are Revolving Credit Loans with respect to
which a given Interest Period applies, the total outstanding IBOR Loans which
are Line of Credit Loans with respect to which a given Interest Period applies
or the total outstanding IBOR Loans which are Revolving Credit Loans with
respect to which a given Interest Period applies being greater than zero but
less than $2,500,000.00. Each such optional payment shall, subject to Article
VIII, be applied to pay such Fixed Rate Loans of the several Banks in
proportion to their respective Line of Credit Commitments or Revolving Credit
Commitments, as the case may be depending upon which type of Loans are being
paid (i.e. Line of Credit Loans or Revolving Credit Loans).
(c) Upon receipt of a notice of payment pursuant to this Section,
the Agent shall promptly notify each Bank of the contents thereof and of such
Bank's ratable share of such payment and such notice shall not thereafter be
revocable by the Company.
SECTION 2.09. General Provisions as to Payments. The Company shall
make each payment of principal of, and interest on, the Loans and of fees and
all other amounts payable hereunder, not later than 12:00 P.M. (St. Louis time)
on the date when due, in Federal or other funds immediately available in
St. Louis, Missouri, to the Agent at its address referred to in Section 9.01.
The Agent will promptly distribute to each Bank in immediately available funds
its ratable share of each such payment received by the Agent for the account of
the Banks. Whenever any payment of principal of, or interest on, the Loans or
of fees shall be due on a day which is not a Business Day, the date for payment
thereof shall be extended to the next succeeding Business Day. If the date for
any payment of principal is extended by operation of law or otherwise, interest
thereon, at the then applicable rate, shall be payable for such extended time.
SECTION 2.10. Funding Losses. Notwithstanding any provision
contained herein to the contrary, if the Company makes any payment of principal
with respect to any Fixed Rate Loan (pursuant to Article II, VI or VIII or
otherwise, but excluding any such payment required by Section 8.02) on any day
other than the last day of an Interest Period applicable thereto, or if the
Company fails to borrow or pay any Fixed Rate Loan after notice has been given
to the Agent in accordance with Section 2.02, 2.04 or 2.08(b), the Company
shall reimburse each Bank on demand for any resulting losses and expenses
incurred by it, including, without limitation, any losses incurred in
obtaining, liquidating or employing deposits from third parties, but excluding
loss of margin for the period after any such payment, provided that such Bank
shall have delivered to the Company a certificate as to the amount of such
losses and expenses, which certificate shall be conclusive in the absence of
manifest error.
SECTION 2.11. Computation of Interest. Interest on Prime Loans
hereunder shall be computed on the basis of a year of 360 days and paid for the
actual number of days elapsed (including the first day but excluding the last
day). Interest on CD Loans and interest on IBOR Loans shall be computed on the
basis of a year of 360 days and paid for the actual number of days elapsed,
calculated as to each Interest Period from and including the first day thereof
to but excluding the last day thereof.
<PAGE> 31
SECTION 2.12 Maturity. (a) All Line of Credit Loans not paid prior
to the last day of the Line of Credit Period of the applicable Bank(s),
together with all accrued and unpaid interest thereon and all fees and other
amounts owing by the Company to such Bank(s) with respect thereto, shall be due
and payable on the last day of the Line of Credit Period of the applicable
Bank(s).
(b) All Revolving Credit Loans not paid prior to the last day of the
Revolving Credit Period of the applicable Bank(s), together with all accrued
and unpaid interest thereon and all fees and other amounts owing by the Company
to such Bank(s) with respect thereto, shall be due and payable on the last day
of the Revolving Credit Period of the applicable Bank(s).
ARTICLE III
PRECONDITIONS TO LOANS
SECTION 3.01. Initial Loan. Notwithstanding any provision contained
herein to the contrary, none of the Banks shall have any obligation to make the
initial Loan hereunder unless the Agent shall have first received:
(a) this Agreement, the Line of Credit Notes and the Revolving
Credit Notes, each executed by duly authorized officer(s) of the Company;
(b) a copy of resolutions of the Board of Directors of the Company
(or a duly authorized committee thereof), duly adopted, which authorize the
execution, delivery and performance of this Agreement, the Line of Credit
Notes, the Revolving Credit Notes and the other Transaction Documents,
certified by the Secretary of the Company;
(c) a copy of the Certificate of Incorporation of the Company,
including any amendments thereto, certified by the Secretary of State of the
State of Delaware;
(d) a copy of the By-Laws of the Company, including any amendments
thereto, certified by the Secretary of the Company;
(e) an incumbency certificate, executed by the Secretary of the
Company, which shall identify by name and title and bear the signatures of all
of the officers of the Company executing any of the Transaction Documents;
(f) certificates of corporate good standing of the Company issued
by the Secretaries of States of the States of Delaware and Missouri;
(g) an opinion of counsel of Alan Sachs, Executive Vice President,
General Counsel and Secretary of the Company, in the form of Exhibit C attached
hereto and incorporated herein by reference;
(h) the Notice of Borrowing required by Section 2.02; and
(i) such other agreements, documents, instruments and certificates
as the Agent or any Bank may reasonably request.
<PAGE> 32
SECTION 3.02. All Loans. Notwithstanding any provision contained
herein to the contrary, none of the Banks shall have any obligation to make any
Loan hereunder unless:
(a) the Agent shall have received a Notice of Borrowing
for such Loan if required by Section 2.02;
(b) on the date of and immediately after such Loan, no
Default or Event of Default under this Agreement shall have occurred and be
continuing;
(c) on the date of and immediately after such Loan, no
material adverse change in the business, financial condition or results of
operations of the Company and its Consolidated Subsidiaries, considered as a
whole, shall have occurred since the Effective Date of this Agreement and be
continuing; and
(d) all of the representations and warranties of the
Company contained in this Agreement shall be true and correct in all material
respects on and as of the date of such Loan as if made on the date of such
Loan.
Each request for a Loan by the Company hereunder shall be deemed to be
a representation and warranty by the Company on the date of such Loan as to the
facts specified in clauses (b), (c) and (d) of this Section 3.02.
ARTICLE IV
REPRESENTATIONS AND WARRANTIES
SECTION 4.01. Representations and Warranties. The Company hereby
represents and warrants to each of the Banks that:
(a) Corporate Existence and Power. The Company and each of its
Significant Subsidiaries: (i) is duly incorporated, validly existing and in
good standing under the laws of the jurisdiction of its incorporation; (ii) has
all requisite corporate powers and all material governmental and regulatory
licenses, authorizations, consents and approvals required to carry on its
business as now conducted; and (iii) is qualified to do business in all
jurisdictions in which the nature of the business conducted by it makes such
qualification necessary and where failure to so qualify would have a Material
Adverse Effect. The Company further represents and warrants to each of the
Banks that the failure of any one or more of its Subsidiaries other than the
Significant Subsidiaries: (i) to be duly incorporated, validly existing and in
good standing under the laws of the jurisdiction of its incorporation; (ii) to
have all requisite corporate powers and material governmental and regulatory
licenses, authorizations, consents and approvals required to carry on its
business as now conducted; and/or (iii) to be qualified to do business in all
jurisdictions in which the nature of the business conducted by it makes such
qualification necessary, does not and will not have a Material Adverse Effect.
(b) Corporate Authorization. The execution, delivery and
performance by the Company of this Agreement, the Notes and the other
Transaction Documents are within the corporate powers of the Company and have
been duly authorized by all necessary corporate action.
(c) Binding Effect. This Agreement, the Line of Credit Notes, the
Revolving Credit Notes and the other Transaction Documents have been duly
<PAGE> 33
executed and delivered by the Company and constitute the legal, valid and
binding obligations of the Company enforceable in accordance with their
respective terms.
(d) Financial Information.
(i) The consolidated balance sheet of the Company and its
Consolidated Subsidiaries as of January 30, 1993, and the related
consolidated statements of income, common stockholders' equity and
cash flows for the fiscal year then ended, with the report thereon of
Ernst & Young, copies of which have been provided to the Banks, fairly
present, in conformity with GAAP, the consolidated financial position
of the Company and its Consolidated Subsidiaries as of such date and
their consolidated results of operations and cash flows for such
fiscal year;
(ii) Since January 30, 1993, there has been no material
adverse change in the business, operations, Properties or condition,
financial or otherwise, of the Company and its Consolidated
Subsidiaries considered as a whole; and
(iii) Except as disclosed in Schedule 4.01(d) attached
hereto, neither the Company nor any of its Consolidated Subsidiaries
has any contingent liability in excess of $10,000,000.00 which is
required to be disclosed in accordance with GAAP and which is not
disclosed on said financial statements or the notes thereto.
(e) Litigation. Except as disclosed in Schedule 4.01(e) attached
hereto, there is no action, suit or proceeding pending or, to the knowledge of
the Company, threatened against or affecting, the Company or any of its
Subsidiaries before any court or arbitrator or any governmental, regulatory or
administrative body, agency or official in which the prayer or claim for relief
seeks recovery of an amount in excess of $10,000,000.00 (or, if no dollar
amount is specified in the prayer or claim for relief, in which there is a
reasonable likelihood of recovery of an amount in excess of $10,000,000.00), or
any form of equitable relief which if granted would have a Material Adverse
Effect.
(f) Pension and Welfare Plans. Each Pension Plan complies in all
material respects with all applicable statutes and governmental rules and
regulations; no Reportable Event has occurred and is continuing with respect to
any Pension Plan; neither the Company nor any ERISA Affiliate nor any
Subsidiary has withdrawn from any Multi-Employer Plan in a "complete
withdrawal" or a "partial withdrawal" as defined in Sections 4203 or 4205 of
ERISA, respectively; no steps have been instituted by the Company, any ERISA
Affiliate or any Subsidiary to terminate any Pension Plan; no condition exists
or event or transaction has occurred in connection with any Pension Plan or
Multi-Employer Plan which could result in the incurrence by the Company, any
ERISA Affiliate or any Subsidiary of any material liability, fine or penalty;
and neither the Company nor any ERISA Affiliate nor any Subsidiary is a
"contributing sponsor" as defined in Section 4001(a)(13) of ERISA of a
"single-employer plan" as defined in Section 4001(a)(15) of ERISA which has two
or more contributing sponsors at least two of whom are not under common
control. Except as disclosed on Schedule 4.01(f) attached hereto, neither the
Company nor any Subsidiary has any contingent liability with respect to any
"employee welfare benefit plan", as such term is defined in Section 3(a) of
ERISA, which covers retired employees and their beneficiaries.
<PAGE> 34
(g) Tax Returns and Payment. The Company and its Subsidiaries
have filed all tax returns which are required to be filed and have paid all
taxes which have become due pursuant to such returns and all other taxes,
assessments, fees and other governmental charges upon the Company and its
Subsidiaries and upon their respective Properties, assets, income and
franchises which have become due and payable by the Company or any of its
Subsidiaries, except those (i) wherein the amount, applicability or validity
are being contested by the Company or any such Subsidiary by appropriate
proceedings being diligently conducted in good faith and in respect of which
adequate reserves have been established or (ii) the nonpayment of which (a) by
the Company or any Subsidiary was not willful and (b) would not result in a
Material Adverse Effect. All material tax liabilities of the Company and its
Subsidiaries were adequately provided for as of January 30, 1993, and are now
so provided for on the books of the Company and its Subsidiaries.
(h) Compliance With Other Instruments; None Burdensome. Neither
the Company nor any Subsidiary is a party to any contract or agreement or
subject to any charter or other corporate restriction which could reasonably be
expected to have a Material Adverse Effect, and which is not disclosed on the
Company's financial statements heretofore submitted to the Banks; none of the
execution and delivery by the Company of the Transaction Documents, the
consummation of the transactions therein contemplated or the compliance with
the provisions thereof will violate any law, rule, regulation, order, writ,
judgment, injunction, decree or award binding on the Company, or any of the
provisions of the Company's Certificate of Incorporation or By-Laws or any of
the provisions of any indenture, agreement, document, instrument or undertaking
to which the Company is a party or subject or by which it or its Property is
bound, or conflict with or constitute a default thereunder or result in the
creation or imposition of any Lien pursuant to the terms of any such indenture,
agreement, document, instrument or undertaking. No order, consent, approval,
license, authorization or validation of, or filing, recording or registration
with, or exemption by, any governmental, regulatory, administrative or public
body or authority, or any subdivision thereof, or any other Person is required
to authorize, or is required as a pre-condition to, the execution, delivery or
performance of, or the legality, validity, binding effect or enforceability of,
any of the Transaction Documents.
(i) Existing Indebtedness. Schedule 4.01(i) attached hereto is a
true, correct and complete list of all Funded Debt and Capitalized Leases of
the Company with a principal balance of $1,000,000.00 or more and all Current
Debt, Funded Debt and Capitalized Leases of the Restricted Subsidiaries with a
principal balance of $1,000,000.00 or more outstanding as of April 30, 1993.
(j) Labor Matters. Except as disclosed on Schedule 4.01(j)
attached hereto, (a) neither the Company nor any Subsidiary is a party to any
union labor contract and (b) neither the Company nor any Subsidiary is a party
to any labor dispute.
(k) Title to Property. The Company and each Subsidiary is the
sole and absolute owner of, or has the legal right to use and occupy, all
Property it claims to own or which is necessary for the Company or such
Subsidiary to conduct its business. The Company and its Subsidiaries enjoy
peaceful and undisturbed possession in all material respects under all leases
under which they are operating as lessees (provided, however, that any failure
to enjoy such peaceful and undisturbed possession under any such lease shall
not constitute a breach of this representation and warranty if the effect of
such failure would not have a Material Adverse Effect), and all such leases are
valid and subsisting and in full force and effect, except for any default or
<PAGE> 35
defaults the effect of which, if taken individually or in the aggregate, would
not have a Material Adverse Effect. Neither the Company nor any Subsidiary has
signed any financing statements, security agreements or chattel mortgages with
respect to any of its Property, has granted or permitted any Liens securing
Indebtedness or other claims in an amount in excess of $500,000.00 with respect
to any of its Property or has any knowledge of any Liens securing Indebtedness
or other claims in an amount in excess of $500,000.00 with respect to any of
its Property, except as disclosed on Schedule 4.01(k) attached hereto.
(l) Regulation U. The Company is not engaged principally, or as
one of its important activities, in the business of extending credit for the
purpose of purchasing or carrying margin stock (within the meaning of
Regulation U of The Board of Governors of the Federal Reserve System, as
amended) and no part of the proceeds of any Loan will be used, whether directly
or indirectly, and whether immediately, incidentally or ultimately (i) to
purchase or carry margin stock or to extend credit to others for the purpose of
purchasing or carrying margin stock, or to refund or repay indebtedness
originally incurred for such purpose or (ii) for any purpose which entails a
violation of, or which is inconsistent with, the provisions of any of the
Regulations of The Board of Governors of the Federal Reserve System, including,
without limitation, Regulations G, U, T or X thereof, as amended. If requested
by Agent, the Company shall furnish to Agent a statement in conformity with the
requirements of Federal Reserve Form U-1 referred to in Regulation U.
(m) Multi-Employer Pension Plan Amendments Act of 1980. The
Company and each Subsidiary is in compliance with the Multi-Employer Pension
Plan Amendments Act of 1980, as amended ("MEPPAA"), and has no liability for
pension contributions pursuant to MEPPAA.
(n) Investment Company Act of 1940; Public Utility Holding Company
Act of 1935. The Company is not an "investment company" as that term is
defined in, and is not otherwise subject to regulation under, the Investment
Company Act of 1940, as amended. The Company is not a "holding company" as
that term is defined in, and is not otherwise subject to regulation under, the
Public Utility Holding Company Act of 1935, as amended.
(o) Patents, Licenses, Trademarks, Etc. Except as disclosed on
Schedule 4.01(o) attached hereto, the Company and its Subsidiaries possess all
necessary patents, licenses, trademarks, trademark rights, trade names, trade
name rights and copyrights to conduct their respective businesses in all
material respects as now conducted without known conflict with any patent,
license, trademark, trade name or copyright of any other Person.
(p) Environmental Safety and Health Matters. Except as disclosed
on Schedule 4.01(p) attached hereto, (i) the Company and its Subsidiaries are
in compliance with all applicable Environmental Laws and Occupational Safety
and Health Laws such that they will not incur or be subject to any liability,
penalty or Lien thereunder which could, individually or in the aggregate, have
a Material Adverse Effect, (ii) the Company and its Subsidiaries do not create,
manage, store, discharge, treat, dispose of or release any Hazardous Materials
in violation of any applicable Environmental Laws, (iii) there are no known
conditions or circumstances associated with any of the currently or previously
owned or leased Properties or operations of the Company or any of its
Subsidiaries or any tenants, if any, of the Company or any of its Subsidiaries
which may give rise to any liability, penalty or Lien under any applicable
Environmental Law or any applicable Occupational Safety and Health Law which
could have a Material Adverse Effect and (iv) neither the Company nor any of
its Subsidiaries has knowledge of any violation of, or has received or filed
<PAGE> 36
any notice pertaining to any violation or alleged violation of, any applicable
Environmental Law or any applicable Occupational Safety and Health Law.
(q) Handyman Guarantees. In the event the Company had to assume
payment under any or all of the Handyman Guarantees, such payment or payments
would not have a Material Adverse Effect.
(r) Subsidiaries. Schedule 4.01(r) attached hereto correctly sets
forth (i) the name and jurisdiction of incorporation of each Subsidiary as of
the date hereof and (ii) a statement of the ownership of each such Subsidiary's
stock. The shares of stock of the Subsidiaries listed on Schedule 4.01(r) as
being owned by the Company or any of its Subsidiaries are so owned as of the
date of this Agreement, free and clear of any and all liens, claims and
encumbrances of any kind or nature whatsoever, and all such shares of stock
have been duly issued and are fully paid and non-assessable.
(s) Disclosure. Neither this Agreement nor any of the Exhibits or
Schedules hereto nor any certificate or other data furnished to the Agent or
any of the Banks in writing by or on behalf of the Company in connection with
the transactions contemplated by this Agreement contains any untrue or
incorrect statement of a material fact or omits to state a material fact
necessary to make the statements contained herein or therein not misleading.
To the best knowledge of the Company, there is no fact peculiar to the Company
or any of its Subsidiaries which presently has a Material Adverse Effect or in
the future (so far as the Company can now reasonably foresee) will have a
Material Adverse Effect, which has not heretofore been disclosed by the Company
to the Agent.
ARTICLE V
COVENANTS
SECTION 5.01. Covenants of the Company. The Company agrees that, so
long as any Bank has any Line of Credit Commitment or Revolving Credit
Commitment hereunder or any amount payable under any Note remains unpaid,
unless the prior written consent of the Required Banks is obtained:
(a) Information. The Company will deliver to each Bank:
(i) as soon as available and in any event within ninety-
five (95) days after the end of each fiscal year of the Company, a
consolidated balance sheet of the Company and its Consolidated
Subsidiaries as of the end of such fiscal year and the related
consolidated statements of income, common stockholders' equity and
cash flows for such fiscal year, setting forth in each case in
comparative form the figures for the previous fiscal year, all
prepared in accordance with GAAP and reported on and accompanied by
the unqualified opinion (or, if the Required Banks, in their sole and
absolute discretion, determine that the reason or reasons for the
qualification of the accountant's opinion are not disadvantageous in
any material respect to the Company or any of the Banks, the qualified
opinion) of Ernst & Young or other independent certified public
accountants of nationally recognized standing selected by the Company,
together with a certificate from such accountants that, in conducting
the examination necessary for the signing of such annual audit report,
such accountants have not become aware of any Default or Event of
Default that has occurred and is continuing, or, if such accountants
have become aware of any such event, describing it and the steps being
<PAGE> 37
taken to cure it, but such accountants shall not be liable, directly
or indirectly, to anyone for failure to obtain knowledge of any such
Default or Event of Default;
(ii) as soon as available and in any event within fifty
(50) days after the end of each of the first three (3) quarters of
each fiscal year of the Company, a consolidated balance sheet of the
Company and its Consolidated Subsidiaries as of the end of such fiscal
quarter, the related consolidated statement of income for such fiscal
quarter and for the portion of the Company's fiscal year ended at the
end of such fiscal quarter and the related consolidated statement of
cash flows for the portion of the Company's fiscal year ended at the
end of such fiscal quarter, setting forth in each case in comparative
form the figures for the corresponding fiscal quarter and the
corresponding portion of the Company's previous fiscal year, all
certified (subject to normal year-end adjustments) as to fairness of
presentation, GAAP and consistency by the chief financial officer of
the Company;
(iii) simultaneously with the delivery of each set of
financial statements referred to in clauses (i) and (ii) above, a
certificate executed by the chief financial officer of the Company on
its behalf, in the form attached hereto and made a part hereof as
Exhibit D, accompanied by supporting financial work sheets where
appropriate, (A) evidencing the Company's compliance with the
financial covenants contained in Sections 5.01(b), 5.01(c), 5.01(d),
5.01(e)(vii), 5.01(e)(viii), 5.01(f), 5.01(h), 5.01(i) and 5.01(k) of
this Agreement, (B) stating whether there exists on the date of such
certificate any Default or Event of Default and, if any Default or
Event of Default then exists, setting forth the details thereof and
the action which the Company is taking or proposes to take with
respect thereto, (C) certifying that all of the representations and
warranties of the Company contained in this Agreement are true and
correct in all material respects on and as of the date of such
certificate as if made on the date of such certificate and (D) giving,
in the event of the formation or acquisition of a Subsidiary during
the preceding fiscal period, the name of such Subsidiary, its
jurisdiction of incorporation and a brief description of its business,
together with, in the case of such an acquisition, evidence showing
the Company's compliance with Section 5.01(g)(ii);
(iv) promptly upon the mailing thereof to the shareholders
of the Company generally, and in any event within ten (10) days after
any such mailing, copies of all financial statements, reports, proxy
statements and other material information so mailed;
(v) promptly upon any filing thereof, and in any event
within ten (10) days after the filing thereof, copies of all
registration statements (other than the exhibits thereto and any
registration statements on Form S-8 or its equivalent) and annual,
quarterly or monthly reports which the Company shall file with the
Securities and Exchange Commission or any successor agency;
(vi) if the Company submits a Revolving Credit Extension
Request to the Agent, simultaneously with the delivery of each such
Revolving Credit Extension Request, consolidated balance sheet, income
statement and cash flow projections for the Company and its
Consolidated Subsidiaries for the fiscal year of the Company during
<PAGE> 38
which such Revolving Credit Extension Request is submitted and the
succeeding two (2) year period, all in form and detail reasonably
acceptable to the Banks;
(vii) within one hundred twenty (120) days after the
beginning of each fiscal year of the Company, a general outline of the
projected financial outlook for the Company and its Consolidated
Subsidiaries for such fiscal year, which outline shall be delivered to
each of the Banks at a meeting to be held between the Company and the
Banks; and
(viii) from time to time, with reasonable promptness, such
further information regarding the business, affairs and financial
position of the Company and each Subsidiary as the Agent or any Bank
may reasonably request.
It is understood that the Company's fiscal year ends on the Saturday
nearest in time to January 31, the first quarter of the Company's fiscal year
ends on the 13th Saturday following the end of the fiscal year, the second
quarter ends on the 13th Saturday following the end of the first quarter, the
third quarter ends on the 13th Saturday following the end of the second quarter
and the fourth quarter ends at the fiscal year end.
The Company may from time to time change its accounting methods,
either at its option or in order to comply with GAAP, provided that (a) any
such change(s) are in accordance with GAAP and are approved by the Company's
independent certified public accountants and (b) if the Required Banks or the
Company, in their or its sole and absolute discretion, determine that any such
accounting change(s), individually or in the aggregate, have any significant
effect on any of the financial covenants contained in this Agreement (i) with
respect to those financial covenant(s) upon which the effect of such accounting
change(s) can be determined with mathematical certainty, such financial
covenant(s) shall be amended to reflect the effect of such accounting change(s)
(and the Company, the Agent and each of the Banks shall be obligated to
promptly execute an amendment to such effect) and (ii) with respect to those
financial covenant(s) upon which the effect of such accounting change(s) cannot
be determined with mathematical certainty, the Company and the Banks shall, in
good faith, negotiate and use their best efforts to agree upon new financial
covenant(s) reasonably acceptable to the Company and the Required Banks to
replace the affected financial covenant(s) (which new financial covenant(s)
shall, to the extent reasonably possible, approximate the effect of such
accounting change(s) on the existing financial covenant(s)), and if the Company
and the Required Banks cannot, in good faith, agree on said new financial
covenant(s), the existing financial covenant(s) shall remain in full force and
effect. Each such amendment shall be evidenced by an instrument in writing
signed by the Company, the Agent and each of the Banks and until such amendment
has been fully executed the existing financial covenant(s) shall remain in full
force and effect.
(b) Consolidated Net Worth. The Company will keep and maintain a
Consolidated Net Worth in an amount not less than (i) as of the last day of
each fiscal quarter of the fiscal year of the Company ending February 1, 1994,
$320,000,000.00, and (ii) as of the last day of each fiscal quarter of each
fiscal year of the Company thereafter, the sum of the Consolidated Net Worth
required to be maintained during the immediately preceding fiscal year of the
Company plus an amount equal to 33% of Consolidated Net Income for such
preceding fiscal year (but without deduction in the case of a deficit in
Consolidated Net Income).
<PAGE> 39
(c) Limitations on Current Debt and Funded Debt. (i) The Company will
not create, assume or incur or in any manner be or become liable in respect of
any Funded Debt, and will not cause or permit any Restricted Subsidiary to
create, assume or incur or in any manner be or become liable in respect of any
Current Debt or Funded Debt, except:
(A) Funded Debt evidenced by the Notes;
(B) Funded Debt of the Company and its Restricted
Subsidiaries outstanding as of the date of this Agreement and
reflected on Schedule 4.01(i) attached hereto;
(C) Additional Funded Debt of the Company and additional
Funded Debt and Current Debt of its Restricted Subsidiaries provided
that at the time of issuance thereof and after giving effect thereto
and to the application of the proceeds thereof: (1) in the case of the
issuance of any Funded Debt of the Company or any Restricted
Subsidiary, the sum of Consolidated Funded Debt plus Consolidated
Attributable Indebtedness does not exceed 50% of Consolidated Net
Tangible Assets; and (2) in the case of the issuance of any Funded
Debt of the Company secured by Liens permitted by Section
5.01(e)(viii) or the issuance of any Funded Debt or Current Debt of a
Restricted Subsidiary, the sum, without duplication, of (x)
Consolidated Attributable Indebtedness, (y) Consolidated Secured Debt
secured by Liens described in Section 5.01(e)(viii) and (z) the
aggregate amount of all Funded Debt and Current Debt of Restricted
Subsidiaries (other than Funded Debt and Current Debt owing to the
Company or to another Wholly-Owned Restricted Subsidiary), would not
exceed 15% of Consolidated Net Tangible Assets; and
(D) Current Debt or Funded Debt of a Restricted Subsidiary
to the Company or to a Wholly-Owned Restricted Subsidiary.
(ii) Current Debt and Funded Debt issued or incurred in accordance
with the limitations of Sections 5.01(c)(i)(B) or 5.01(c)(i)(C) may be renewed,
extended or refunded (without any increase in principal amount remaining unpaid
at the time of such renewal, extension or refunding) without regard to the
limitations of this Section 5.01(c).
(iii) Any corporation which becomes a Restricted Subsidiary after the
date hereof shall for all purposes of this Section 5.01(c) be deemed to have
created, assumed or incurred at the time it becomes a Restricted Subsidiary all
Current Debt and Funded Debt of such corporation existing immediately after it
becomes a Restricted Subsidiary.
(iv) Any Current Debt or Funded Debt of a Restricted Subsidiary to a
previously Wholly-Owned Restricted Subsidiary shall be deemed to have been
created, assumed or incurred immediately after such Wholly-Owned Restricted
Subsidiary is no longer WhollyOwned.
(d) Fixed Charges Coverage Ratio. The Company will keep and maintain
the ratio of Net Income Available for Fixed Charges to Fixed Charges for each
period of four (4) consecutive fiscal quarters at not less than 1.25 to 1.00.
(e) Limitation on Liens. The Company will not, and will not cause or
permit any Restricted Subsidiary to, create or incur, or suffer to be incurred
or to exist, any Lien on any of its or their Property or assets, whether now
<PAGE> 40
owned or hereafter acquired, or upon any income or profits therefrom, or
transfer any Property for the purpose of subjecting the same to the payment of
obligations in priority to the payment of its or their general creditors, or
acquire or agree to acquire, or permit any Restricted Subsidiary to acquire or
agree to acquire, any Property or assets upon conditional sales agreements or
other title retention devices, except:
(i) Liens for property taxes and assessments or governmental
charges or levies and Liens securing claims or demands of mechanics
and materialmen, provided payment thereof is not at the time required
by Section 5.01(o)(i);
(ii) Liens of or resulting from any judgment or award, the
time for the appeal or petition for rehearing of which shall not have
expired, or in respect of which the Company or a Restricted Subsidiary
shall (A) at any time in good faith be prosecuting an appeal or
proceeding for a review and in respect of which a stay of execution
pending such appeal or proceeding for review shall have been secured
and (B) have set aside on its books, reserves deemed by it to be
adequate with respect thereto;
(iii) Liens incidental to the conduct of business or the
ownership of Properties and assets (including Liens in connection with
worker's compensation, unemployment insurance and other like laws,
warehousemen's and attorneys' liens and statutory landlords' liens)
and Liens to secure the performance of bids, tenders or trade
contracts, or to secure statutory obligations, surety or appeal bonds
or other Liens of like general nature incurred in the ordinary course
of business and not in connection with the borrowing of money or the
acquisition of inventory; provided in each case the obligation secured
is not overdue or, if overdue, is being contested in good faith by
appropriate actions or proceedings;
(iv) minor survey exceptions or minor encumbrances, easements or
reservations, or rights of others for rights-of-way, utilities and
other similar purposes, or zoning or other restrictions as to the use
of real properties, which are necessary for the conduct of the
activities of the Company and its Restricted Subsidiaries or which
customarily exist on properties of corporations engaged in similar
activities and similarly situated and which do not in any event
materially impair the use of such real properties in the operation of
the business of the Company and its Restricted Subsidiaries;
(v) Liens securing Indebtedness of a Restricted Subsidiary to
the Company or to another Wholly-Owned Restricted Subsidiary;
(vi) Liens existing as of April 30, 1993, and reflected in
Schedule 4.01(k) attached hereto;
(vii) Liens incurred after the Effective Date given to secure
the payment of the purchase price incurred in connection with the
acquisition of fixed assets useful and intended to be used in carrying
on the business of the Company or a Restricted Subsidiary, including
Liens existing on such fixed assets at the time of acquisition thereof
or at the time of acquisition by the Company or a Restricted
Subsidiary of any business entity then owning such fixed assets,
whether or not such existing Liens were given to secure the payment of
the purchase price of the fixed assets to which they attach so long as
<PAGE> 41
they were not incurred, extended or renewed in contemplation of such
acquisition, provided that (A) the Lien shall attach solely to the
fixed assets acquired or purchased, (B) at the time of acquisition of
such fixed assets, the aggregate amount remaining unpaid on all
Indebtedness secured by Liens on such fixed assets whether or not
assumed by the Company or a Restricted Subsidiary shall not exceed an
amount equal to 100% of the lesser of the total purchase price or fair
market value at the time of acquisition of such fixed assets (as
determined in good faith by the Board of Directors of the Company),
(C) all such Indebtedness shall have been incurred within the
applicable limitations provided in Section 5.01(c)(i)(C), and (D) such
fixed assets shall not have been acquired out of the proceeds of a
Sale and Leaseback Transaction permitted under Section 5.01(f).
(viii) Liens incurred after the Effective Date by the Company or
any Restricted Subsidiary on property, plant or equipment given to
secure Funded Debt of the Company or any Restricted Subsidiary in
addition to the Liens permitted by the preceding clauses (i) through
(vii) hereof; provided that all Indebtedness secured by Liens incurred
pursuant to this Section 5.01(e)(viii) shall have been incurred within
the limitations provided in Sections 5.01(c)(i)(C); and
(ix) any extension, renewal or replacement of any Lien
permitted by the preceding clauses (vi), (vii) and (viii) hereof in
respect of the same Property theretofore subject to such Lien in
connection with the extension, renewal or refunding of the
Indebtedness secured thereby; provided that (1) such Lien shall attach
solely to the same such Property and (2) such extension, renewal or
refunding of such Indebtedness shall be without increase in the
principal remaining unpaid as of the date of such extension, renewal
or refunding.
Any Lien securing Indebtedness of a Restricted Subsidiary to a
previously Wholly-Owned Restricted Subsidiary shall be deemed to have been
created immediately after such Wholly-Owned Restricted Subsidiary is no longer
Wholly-Owned.
(f) Limitations on Sale and Leasebacks. The Company will not, and
will not cause or permit any Restricted Subsidiary to, enter into any
arrangement, directly or indirectly, whereby the Company or such Restricted
Subsidiary shall in one or more related transactions sell, transfer or
otherwise dispose of any Property owned by the Company or such Restricted
Subsidiary more than one hundred eighty (180) days after the later of the date
of initial acquisition of such Property or completion or occupancy thereof, as
the case may be, by the Company or such Restricted Subsidiary, and then rent or
lease, as lessee, such Property or any part thereof for a period or periods
which in the aggregate would exceed thirty-six (36) months from the date of
commencement of the lease term (a "Sale and Leaseback Transaction"), provided
that the foregoing restriction shall not apply to any Sale and Leaseback
Transaction if immediately after the consummation of such Sale and Leaseback
Transaction and after giving effect thereto, either of the following conditions
is satisfied:
(i) the sale of such Property is for cash consideration
which equals or exceeds the fair market value of the Property so sold
(as determined in good faith by the Board of Directors of the Company)
and the net proceeds from such sale are applied within ninety (90)
days after such sale to (A) the purchase or acquisition (and/or, in
<PAGE> 42
the case of real property, the construction) of tangible assets useful
and intended to be used by the Company or a Restricted Subsidiary in
the ordinary course of its business (provided that in any such event
the Company and its Restricted Subsidiaries shall not then or
thereafter cause or permit or agree or consent to cause or permit such
tangible assets to be subject to any Lien) or (B) the prepayment at
the applicable prepayment premium, if any, on a pro rata basis, of
Funded Debt of the Company and its Restricted Subsidiaries; or
(ii) after giving effect to the consummation of such Sale
and Leaseback Transaction and to the application of the proceeds
therefrom, the sum, without duplication, of (1) Consolidated
Attributable Indebtedness (including the Consolidated Attributable
Indebtedness to be incurred in connection with such Sale and Leaseback
Transaction), (2) Consolidated Secured Debt secured by Liens permitted
and incurred within the limitations of Section 5.01(e)(viii) and (3)
Current Debt and Funded Debt of Restricted Subsidiaries shall not
exceed 15% of Consolidated Net Tangible Assets.
(g) Merger or Consolidation. The Company will not, and, except as
permitted in Section 5.01(h), it will not cause or permit any Restricted
Subsidiary to, merge or consolidate into or with any other Person; provided,
however, that:
(i) any Restricted Subsidiary may merge or consolidate into or
with the Company or any Wholly-Owned Subsidiary so long as in any
merger or consolidation involving the Company, the Company shall be
the surviving or continuing corporation; and
(ii) the Company or any Restricted Subsidiary may acquire by
merger or other method all of the capital stock or assets of any
Person so long as (A) the Company or such Restricted Subsidiary, as
the case may be, is the surviving or continuing corporation, (B) both
prior to and after giving effect to said transaction, the Company is
in compliance with all of the terms, representations, warranties,
covenants and agreements contained in this Agreement and no Default or
Event of Default under this Agreement has occurred and is continuing
and (C) after giving effect to such consolidation or merger the
surviving or continuing corporation would be permitted to incur at
least $1.00 of additional Funded Debt under the provisions of Section
5.01(c)(i)(C).
(h) Certain Restrictions Relating to Subsidiaries. (i) Except as
permitted by Section 5.01(g), the Company will not cause or permit any
Restricted Subsidiary to merge or consolidate into or with any Person (other
than the Company or a Wholly-Owned Subsidiary) if such other Person will be the
surviving or continuing corporation unless, (A) immediately after giving effect
to such merger or consolidation, (1) the portion of Consolidated Net Tangible
Assets attributable to the Restricted Subsidiary being merged or consolidated
shall not exceed 12.5% of the total Consolidated Net Tangible Assets as of the
end of the fiscal quarter of the Company immediately preceding the date of such
merger or consolidation and (2) the portion of Consolidated Net Sales
attributable to the Restricted Subsidiary being merged or consolidated shall
not exceed 12.5% of the total Consolidated Net Sales as of the end of the
fiscal year of the Company immediately preceding the date of such merger or
consolidation, (B) the ratio of Net Income Available for Fixed Charges to Fixed
Charges for the period of four (4) consecutive fiscal quarters ending
immediately preceding the date of such merger or consolidation (determined on a
<PAGE> 43
pro forma basis and excluding any amounts attributable to the Restricted
Subsidiary being merged or consolidated) shall not be less than 1.25 to 1.00,
(C) immediately after giving effect to such merger or consolidation, no Default
or Event of Default shall have occurred and be continuing and (D) immediately
after giving effect to such merger or consolidation, all of the representations
and warranties of the Company contained in this Agreement shall be true and
correct in all material respects as if made on the date of such merger or
consolidation.
(ii) The Company will not, and it will not cause or permit any
Restricted Subsidiary to, sell, assign, transfer or otherwise dispose of any
capital stock of any Restricted Subsidiary to any Person (other than the
Company or a Wholly-Owned Subsidiary) unless, (A) immediately after giving
effect to such sale, assignment, transfer or other disposition, (1) the portion
of Consolidated Net Tangible Assets attributable to that portion of the
Restricted Subsidiary being sold, assigned, transfered or otherwise disposed of
(meaning the same proportion as the fair market value (as determined by the
Company in good faith) of the capital stock being sold bears to the total fair
market value (as determined by the Company in good faith) of all of the
outstanding capital stock of such Restricted Subsidiary) shall not exceed 12.5%
of the total Consolidated Net Tangible Assets as of the end of the fiscal
quarter of the Company immediately preceding the date of such sale, assignment,
transfer or other disposition and (2) the portion of Consolidated Net Sales
attributable to that portion of the Restricted Subsidiary being sold, assigned,
transfered or otherwise disposed of (meaning the same proportion as the fair
market value (as determined by the Company in good faith) of the capital stock
being sold bears to the total fair market value (as determined by the Company
in good faith) of all of the outstanding capital stock of such Restricted
Subsidiary) shall not exceed 12.5% of the total Consolidated Net Sales as of
the end of the fiscal year of the Company immediately preceding the date of
such sale, assignment, transfer or other disposition, (B) the ratio of Net
Income Available for Fixed Charges to Fixed Charges for the period of four (4)
consecutive fiscal quarters ending immediately preceding the date of such sale,
assignment, transfer or other disposition (determined on a pro forma basis and
excluding any amounts attributable to that portion of the Restricted Subsidiary
being sold, assigned, transfered or otherwise disposed of (meaning the same
proportion as the fair market value (as determined by the Company in good
faith) of the capital stock being sold bears to the total fair market value (as
determined by the Company in good faith) of all of the outstanding capital
stock the Restricted Subsidiary)) shall not be less than 1.25 to 1.00,
(C) immediately after giving effect to such sale, assignment, transfer or other
disposition, no Default or Event of Default shall have occurred and be
continuing and (D) immediately after giving effect to such sale, assignment,
transfer or other disposition, all of the representations and warranties of the
Company contained in this Agreement shall be true and correct in all material
respects as if made on the date of such transfer or other disposition.
(iii) The Company will not cause or permit any Restricted Subsidiary
to issue any shares of its capital stock to any Person (other than the Company
or a Wholly-Owned Subsidiary) unless, (A) immediately after giving effect to
such issuance, (1) the portion of Consolidated Net Tangible Assets attributable
to that portion of the Restricted Subsidiary being issued to another Person
(meaning the same proportion as the fair market value (as determined by the
Company in good faith) of the capital stock being issued bears to the total
fair market value (as determined by the Company in good faith) of all of the
outstanding capital stock of such Restricted Subsidiary (including the capital
stock being issued)) shall not exceed 12.5% of the total Consolidated Net
Tangible Assets as of the end of the fiscal quarter of the Company immediately
<PAGE> 44
preceding the date of such issuance and (2) the portion of Consolidated Net
Sales attributable to that portion of the Restricted Subsidiary being issued to
another Person (meaning the same proportion as the fair market value (as
determined by the Company in good faith) of the capital stock being issued
bears to the total fair market value (as determined by the Company in good
faith) of all of the outstanding capital stock of such Restricted Subsidiary
(including the capital stock being issued)) shall not exceed 12.5% of the total
Consolidated Net Sales as of the end of the fiscal year of the Company
immediately preceding the date of such issuance, (B) the ratio of Net Income
Available for Fixed Charges to Fixed Charges for the period of four (4)
consecutive fiscal quarters ending immediately preceding the date of such
issuance (determined on a pro forma basis and excluding any amounts
attributable to that portion of the Restricted Subsidiary being issued to
another Person (meaning the same proportion as the fair market value (as
determined by the Company in good faith) of the capital stock being issued
bears to the total fair market value (as determined by the Company in good
faith) of all of the outstanding capital stock of the Restricted Subsidiary
(including the capital stock being issued))) shall not be less than 1.25 to
1.00, (C) immediately after giving effect to such issuance, no Default or Event
of Default shall have occurred and be continuing, and (D) immediately after
giving effect to such issuance, all of the representations and warranties of
the Company contained in this Agreement shall be true and correct in all
material respects as if made on the date of such issuance.
(iv) The Company will not cause or permit any Restricted Subsidiary
to, sell, assign, transfer or otherwise dispose of (other than in the ordinary
course of business) any of such Restricted Subsidiary's Property or assets to
any Person (other than the Company or any Wholly-Owned Subsidiary) unless, (A)
immediately after giving effect to such sale, assignment, transfer or other
disposition, (1) the portion of Consolidated Net Tangible Assets attributable
to that portion of the Restricted Subsidiary being sold, assigned, transfered
or otherwise disposed of (meaning the same proportion as the fair market value
(as determined by the Company in good faith) of the Properties and assets being
sold bears to the total fair market value (as determined by the Company in good
faith) of all of Properties and assets of the Restricted Subsidiary) shall not
exceed 12.5% of the total Consolidated Net Tangible Assets as of the end of the
fiscal quarter of the Company immediately preceding the date of such sale,
assignment, transfer or other disposition and (2) the portion of Consolidated
Net Sales attributable to that portion of the Restricted Subsidiary being sold,
assigned, transfered or otherwise disposed of (meaning the same proportion as
the fair market value (as determined by the Company in good faith) of the
Properties and assets being sold bears to the total fair market value (as
determined by the Company in good faith) of all of Properties and assets of the
Restricted Subsidiary) shall not exceed 12.5% of the total Consolidated Net
Sales as of the end of the fiscal year of the Company immediately preceding the
date of such sale, assignment, transfer or other disposition, (B) the ratio of
Net Income Available for Fixed Charges to Fixed Charges for the period of four
(4) consecutive fiscal quarters ending immediately preceding the date of such
sale, assignment, transfer or other disposition (determined on a pro forma
basis and excluding any amounts attributable to that portion of the Restricted
Subsidiary being sold, assigned, transfered or otherwise disposed of (meaning
the same proportion as the fair market value (as determined by the Company in
good faith) of the Properties and assets being sold bears to the total fair
market value (as determined by the Company in good faith) of all of Properties
and assets of the Restricted Subsidiary)) shall not be less than 1.25 to 1.00,
(C) immediately after giving effect to such sale, assignment, transfer or other
disposition, no Default or Event of Default shall have occurred and be
continuing and (D) immediately after giving effect to such sale, assignment,
<PAGE> 45
transfer or other disposition, all of the representations and warranties of the
Company contained in this Agreement shall be true and correct in all material
respects as if made on the date of such sale, assignment, transfer or other
disposition.
(i) Consolidated Current Ratio. The Company will at all times
maintain a Consolidated Current Ratio of at least 1.25 to 1.00.
(j) Transactions with Affiliates. The Company will not, and will
not cause or permit any Subsidiary to, enter into or be a party to any
transaction or arrangement with any Affiliate (including, without limitation,
the purchase from, sale to or exchange of Property with, or the rendering of
any service by or for, any Affiliate), except in the ordinary course of
business and pursuant to the reasonable requirements of the Company's or such
Subsidiary's business and upon fair and reasonable terms no less favorable to
the Company or such Subsidiary than would be obtained in a comparable arm's-
length transaction with a Person not an Affiliate.
(k) Restricted Investments. The Company will not, and will not
cause or permit any Subsidiary to, directly or indirectly, make any Restricted
Investments, unless, immediately after giving effect thereto, the aggregate
amount of all Restricted Investments owned by the Company and/or any one or
more of its Subsidiaries (valued in accordance with GAAP) does not exceed the
sum of $10,000,000.00.
(l) Payment of Indebtedness. The Company and each Subsidiary will
(i) pay any and all Indebtedness for borrowed money with an outstanding
principal balance of $1,000,000.00 or more payable or guaranteed by the Company
or such Subsidiary, as the case may be, and any interest or premium thereon,
when due (whether by scheduled maturity, required prepayment, acceleration,
demand or otherwise) in accordance with the agreement or instrument relating to
such Indebtedness or such guarantee and (ii) faithfully perform, observe and
discharge all covenants, conditions and obligations which are imposed upon the
Company or such Subsidiary, as the case may be, by any and all agreements,
documents, instruments and indentures evidencing, securing or otherwise
relating to such Indebtedness or guarantee.
(m) Payment of Liabilities. Except as otherwise specifically
provided in Section 5.01(o)(i), the Company and each Subsidiary will pay each
liability and/or obligation of an outstanding amount of $1,000,000.00 or more
which is payable or guaranteed by the Company or such Subsidiary, as the case
may be, when due in accordance with the agreement or instrument relating to
such liability and/or obligation or such guarantee; provided, however, that
neither the Company nor any Subsidiary shall be required to pay any such
liability or obligation which is being contested in good faith by appropriate
proceedings being diligently conducted and for which reserves in form and
amount deemed adequate by the Company in its reasonable judgment have been
provided (segregated to the extent required by GAAP), except that the Company
and its Subsidiaries shall pay or cause to be paid all such liabilities and
obligations forthwith upon the commencement of proceedings to foreclose any
Lien which is attached as security therefor, unless such foreclosure is stayed
by the filing of an appropriate bond.
(n) Consultations and Inspections. Solely for the purpose of
permitting the Banks to determine compliance by the Company with this
Agreement, the Company will permit, and will cause each Subsidiary to permit,
any Bank (and any Person appointed by any Bank to whom the Company does not
reasonably object) to discuss the affairs, finances and accounts of the Company
<PAGE> 46
and its Subsidiaries with the officers of the Company and each of its
Subsidiaries, all at such reasonable times and as often as may from time to
time be reasonably requested. The Company will also permit, and will cause
each Subsidiary to permit, inspection of its Properties, books and records by
any Bank during normal business hours and at other reasonable times. If such
consultation and/or inspection reveals that no Default or Event of Default
under this Agreement has occurred and is continuing, the Bank causing such
consultation and/or inspection shall bear the expense of such consultation
and/or inspection; provided, however, that such expense shall not include
compensation of the Company or any Subsidiary or any of their respective
employees, agents or other representatives for their involvement in such
consultation and/or inspection. If such consultation and/or inspection reveals
that any Default or Event of Default under this Agreement has occurred and is
continuing, the Company shall bear the expense of such consultation and/or
inspection.
(o) Payment of Taxes and Claims; Corporate Existence; Maintenance
of Properties; Insurance. The Company will, and will cause each Subsidiary to:
(i) pay and discharge promptly all taxes, assessments and
other governmental charges or levies imposed upon it or any of its
income, profits or Property before the same shall become past due or
in default, as well as all lawful claims and liabilities of any kind
(including claims and liabilities for labor, materials and supplies)
which, if unpaid, might by law become a Lien upon any of its Property
or assets; provided, however, that (A) neither the Company nor any
Subsidiary shall be required to pay any such tax, assessment, charge,
levy or claim the payment of which is being contested in good faith
and by appropriate proceedings being diligently conducted and for
which adequate reserves in form and amount deemed adequate by the
Company and its independent certified public accountants have been
provided (segregated to the extent required by GAAP), except that the
Company and its Subsidiaries will pay or cause to be paid all such
taxes, assessments, charges, levies and claims forthwith upon the
commencement of proceedings to foreclose any Lien which is attached as
security therefor, unless such foreclosure is stayed by the filing of
an appropriate bond and (B) any failure to pay any such tax,
assessment, charge, levy or claim shall not constitute an Event of
Default if such failure (1) was not willful and (2) does not and will
not result in any Material Adverse Effect;
(ii) do all things necessary to preserve and keep in full
force and effect its corporate existence and franchises; provided,
however, that nothing in this Section 5.01(o)(ii) shall prevent
(1) the abandonment or termination of the corporate existence and
franchises of any Subsidiary if, in the opinion of the Company, such
abandonment or termination is in the interest of the Company and not
disadvantageous in any material respect to any of the Banks or (2) a
consolidation or merger permitted by Section 5.01(g);
(iii) on a basis consistent with the past practices of the
Company and its Subsidiaries, maintain and keep its Properties used or
useful in the conduct of its business in good condition, repair and
working order and supplied with all necessary equipment and make all
necessary repairs, renewals, replacements, betterments and
improvements thereof, all as may be necessary so that the business
carried on in connection therewith may be properly and advantageously
conducted at all times; and
<PAGE> 47
(iv) cause its Properties of an insurable nature to be
self-insured or insured (subject to reasonable deductible amounts) by
reputable and solvent insurance companies against loss or damages
(including public liability) in amounts and subject to terms deemed
adequate and prudent by the Company. For purposes of this Section
5.01(o)(iv), a "reputable and solvent" insurance company shall mean
any insurance company accorded a rating by A.M. Best Company, Inc. of
A:XII or higher at the time of issuance of any policy; provided,
however, that if during the term of any insurance policy, the rating
accorded the insurer shall be less than A:XII, the Company or the
Subsidiary, as the case may be, on the date of renewal of any such
policy (or, if such change in rating shall occur within ninety (90)
days prior to such renewal date, within ninety (90) days of the date
of such change in rating), will obtain such insurance policy from an
insurer accorded such a rating.
(p) Maintenance of Books and Records. The Company and its
Subsidiaries will, on a consolidated basis, maintain their books and records in
accordance with GAAP consistently applied (except for changes disclosed in the
financial statements furnished to the Banks pursuant to Section 5.01(a) and
concurred in by the independent certified public accountants of the Company).
(q) Changes in Nature of Business. The Company will not, and will
not cause or permit any Subsidiary to, engage in any business if, as a result,
the general nature of the business which would then be engaged in by the
Company and its Subsidiaries, considered as a whole, would be substantially
changed from the general nature of the business engaged in by the Company and
its Subsidiaries as of the Effective Date of this Agreement.
(r) Compliance with Law. The Company will, and will cause each
Subsidiary to, comply with any and all laws, ordinances and governmental and
regulatory rules and regulations to which it is subject and obtain any and all
licenses, permits, franchises and other governmental and regulatory
authorizations necessary to the ownership of its Properties or to the conduct
of its business, which failure to comply or failure to obtain could reasonably
be expected to have a Material Adverse Effect.
(s) Accountant. The Company shall give the Banks prompt notice of
any change of the Company's independent certified public accountants and a
statement of the reasons for such change. The Company shall at all times
utilize independent certified public accountants of nationally recognized
standing.
(t) ERISA Compliance. If the Company or any Subsidiary shall have
any Pension Plan, the Company and such Subsidiary or Subsidiaries shall comply
in all material respects with all requirements of ERISA relating to such plan.
Without limiting the generality of the foregoing, neither the Company nor any
Subsidiary shall:
(i) permit any Pension Plan maintained by it to engage in
any nonexempt "prohibited transaction," as such term is defined in
Section 4975 of the Code;
(ii) permit any Pension Plan maintained by it to incur any
"accumulated funding deficiency", as such term is defined in Section
302 of ERISA, 29 U.S.C. Section 1082, whether or not waived;
<PAGE> 48
(iii) terminate any such Pension Plan in a manner which could
result in the imposition of a Lien on any Property of the Company or
any Subsidiary pursuant to Section 4068 of ERISA, 29 U.S.C. Section
1368; or
(iv) take any action which would constitute a complete or
partial withdrawal from a Multi-Employer Plan within the meaning of
Sections 4203 and 4205 of Title IV of ERISA.
Notwithstanding any provision contained in this Section 5.01(t) to the
contrary, an act by the Company or any Subsidiary shall not be deemed to
constitute a violation of subparagraphs (i) through (iv) hereof unless the
Required Banks determine in good faith that said action, individually or
cumulatively with other acts of the Company and its Subsidiaries, does have or
is likely to cause a Material Adverse Effect.
The Company shall have the affirmative obligation hereunder to report
to the Banks any of those acts identified in subparagraphs (i) through (iv)
hereof, regardless of whether said act does have or is likely to cause a
Material Adverse Effect, and failure by the Company to report such act promptly
upon the Company's becoming aware of the existence thereof shall constitute an
Event of Default hereunder.
(u) Further Assurances. The Company will execute any and all
further agreements, documents and instruments, and take any and all further
actions which may be required under applicable law, or which any Bank may from
time to time reasonably request, in order to effectuate the transactions
contemplated by this Agreement, the Notes and the other Transaction Documents.
(v) Notices. The Company will notify the Agent in writing of any
of the following immediately upon learning of the occurrence thereof,
describing the same and, if applicable, the steps being taken by the Company
and/or its Subsidiaries with respect thereto:
(i) Default. The occurrence of (A) any Default or Event of
Default under this Agreement or (B) any default or event of default by
the Company or any Subsidiary under any note, indenture, loan
agreement, mortgage, deed of trust, security agreement, lease or other
similar agreement, document or instrument to which the Company or any
Subsidiary, as the case may be, is a party or by which it is bound or
to which it is subject, a default under which could have a Material
Adverse Effect;
(ii) Litigation. The institution of any litigation,
arbitration proceeding or governmental, regulatory or administrative
proceeding affecting the Company or any Subsidiary, whether or not
considered to be covered by insurance, in which the prayer or claim
for relief seeks recovery of an amount in excess of $10,000,000.00
(or, if no dollar amount is specified in the prayer or claim for
relief, in which there is a reasonable likelihood of recovery of an
amount in excess of $10,000,000.00) or any form of equitable relief
which if granted could have a Material Adverse Effect;
(iii) Judgment. The entry of any judgment or decree in an
amount in excess of $1,000,000.00 against the Company or any
Subsidiary;
<PAGE> 49
(iv) Pension Plans. The occurrence of a Reportable Event
with respect to any Pension Plan; the filing of a notice of intent to
terminate a Pension Plan by the Company, any ERISA Affiliate or any
Subsidiary; the institution of proceedings to terminate a Pension Plan
by the PBGC or any other Person; the withdrawal in a "complete
withdrawal" or a "partial withdrawal" as defined in Sections 4203 and
4205, respectively, of ERISA by the Company, any ERISA Affiliate or
any Subsidiary from any Multi-Employer Plan; or the incurrence of any
material increase in the contingent liability of the Company or any
Subsidiary with respect to any "employee welfare benefit plan" as
defined in Section 3(1) of ERISA which covers retired employees and
their beneficiaries;
(v) Environmental and Safety and Health Matters. The receipt
by the Company or any Subsidiary of any notice or allegation by any
governmental or regulatory agency, entity, authority or official that:
(i) the operations of the Company or any Subsidiary are not in full
compliance with the requirements of any applicable Environmental Law
or Occupational Safety and Health Law; (ii) the Company or any
Subsidiary or any of their respective Properties or facilities are
subject to any Federal, state or local investigation concerning
(A) any actual, threatened or suspected violation of any Environmental
Law or Occupational Safety and Health Law and/or any spillage,
disposal or other release into the environment of any Hazardous
Materials or (B) any unsafe or unhealthful condition; or (iii) any
Properties, facilities or assets of the Company or any Subsidiary are
or may become subject to any Environmental Lien;
(vi) Material Adverse Change. The occurrence of any material
adverse change in the business, operations or condition, financial or
otherwise, of the Company and its Subsidiaries, considered as a whole;
and
(vii) Change in Management. Any resignation, removal or
replacement of the Chairman of the Board, President or Chief Financial
Officer of the Company.
(w) Pension Plans. Neither the Company nor any Subsidiary shall
(a) permit any condition to exist in connection with any Pension Plan which
might constitute grounds for the PBGC to institute proceedings to have such
Pension Plan terminated or a trustee appointed to administer such Pension Plan
or (b) engage in, or permit to exist or occur, any other condition, event or
transaction with respect to any Pension Plan which could result in the
incurrence by the Company or any Subsidiary of any material liability, fine or
penalty.
(x) Acquisitions. The Company will not, nor will it cause or
permit any Subsidiary to, make or suffer to exist any Acquisition of any
Person, except Acceptable Acquisitions.
(y) Guaranties. The Company will not, and will not cause or
permit any Restricted Subsidiary to, become liable in respect of any Guaranty
except Guaranties which are limited in amount to a maximum stated dollar
exposure or which constitute Guaranties of obligations incurred by any
Restricted Subsidiary in compliance with Section 5.01(c) and the other
provisions of this Agreement.
<PAGE> 50
SECTION 5.02. Use of Proceeds. The Company agrees that (i) the
proceeds of the Loans made under this Agreement will be used solely for its
general corporate purposes and (ii) none of such proceeds will be used in
violation of any applicable law or regulation.
ARTICLE VI
DEFAULTS
SECTION 6.01. Events of Default. If any of the following (each of
the following herein sometimes called an "Event of Default") shall occur and be
continuing:
(a) the Company shall fail to pay any principal of or
interest on any of the Notes or any other amount or amounts payable by
the Company under this Agreement as and when the same shall become due
and payable;
(b) the Company shall violate or fail to perform or
observe any of the covenants or agreements contained in Section 5.01
or Section 5.02 of this Agreement;
(c) the Company shall violate or fail to perform or
observe any other term, covenant or agreement contained in this
Agreement (other than those specified in clauses (a) or (b) above) and
any such violation or failure shall remain unremedied for thirty (30)
days after the earlier of (i) written notice of default is given to
the Company by the Agent at the request of any Bank or (ii) a
responsible officer of the Company obtaining knowledge of such
default;
(d) any representation or warranty of the Company made in
this Agreement, in any other Transaction Document or in any
certificate, agreement, instrument or statement furnished or made or
delivered pursuant hereto or thereto or in connection herewith or
therewith, shall prove to have been untrue, incorrect or materially
misleading when made or effected;
(e) this Agreement or any of the other Transaction
Documents shall at any time for any reason cease to be in full force
and effect or shall be declared to be null and void by a court of
competent jurisdiction, or if the validity or enforceability thereof
shall be contested or denied by the Company, or if the transactions
completed hereunder or thereunder shall be contested by the Company or
if the Company shall deny that it has any or further liability or
obligation hereunder or thereunder;
(f) the Company or any Subsidiary shall (i) voluntarily
commence any proceeding or file any petition seeking relief under
Title 11 of the United States Code or any other Federal, state or
foreign bankruptcy, insolvency, receivership, liquidation or similar
law, (ii) consent to the institution of, or fail to contravene in a
timely and appropriate manner, any such proceeding or the filing of
any such petition, (iii) apply for or consent to the appointment of a
receiver, trustee, custodian, sequestrator or similar official of
itself or of a substantial part of its Property or assets, (iv) file
an answer admitting the material allegations of a petition filed
against itself in any such proceeding, (v) make a general assignment
<PAGE> 51
for the benefit of creditors, (vi) become unable, admit in writing its
inability or fail generally to pay its debts as they become due or
(vii) take any corporate or other action for the purpose of effecting
any of the foregoing;
(g) An involuntary proceeding shall be commenced or an
involuntary petition shall be filed in a court of competent
jurisdiction seeking (i) relief in respect of the Company or any
Subsidiary, or of a substantial part of the Property or assets of the
Company or any Subsidiary, under Title 11 of the United States Code or
any other Federal, state or foreign bankruptcy, insolvency,
receivership, liquidation or similar law, (ii) the appointment of a
receiver, trustee, custodian, sequestrator or similar official of the
Company or any Subsidiary or of a substantial part of the Property or
assets of the Company or any Subsidiary or (iii) the winding-up or
liquidation of the Company or any Subsidiary; and such proceeding or
petition shall continue undismissed for thirty (30) consecutive days
or an order or decree approving or ordering any of the foregoing shall
continue unstayed and in effect for thirty (30) consecutive days;
(h) The Company or any Subsidiary shall be declared by any
of the Banks to be in default on, or pursuant to the terms of, (1) any
other present or future obligation to any of such Bank(s), including,
without limitation, any other loan, line of credit, revolving credit,
guaranty or letter of credit reimbursement obligation, or (2) any
other present or future agreement purporting to convey to any of such
Bank(s) a Lien upon any Property or assets of the Company or such
Subsidiary, as the case may be, and, if such default relates to a
commercial letter of credit reimbursement obligation, such default
shall remain unremedied for two (2) Business Days after written notice
thereof shall have been given to the Company or such Subsidiary, as
the case may be, by such Bank(s);
(i) The Company or any Subsidiary shall fail (and such
failure shall not have been cured or waived) to perform or observe any
term, provision or condition of, or any other default or event of
default shall occur under, any agreement, document or instrument
evidencing, securing or otherwise relating to any outstanding
Indebtedness of the Company or such Subsidiary, as the case may be,
for borrowed money (other than the Notes), in a principal amount in
excess of Two Million Dollars ($2,000,000.00), if the effect of such
failure or default is to cause or permit such Indebtedness to be
declared to be due and payable or otherwise accelerated, or to be
required to be prepaid (other than by a regularly scheduled required
prepayment) prior to the stated maturity thereof;
(j) The Company or any Subsidiary shall have a judgment in
excess of One Million Dollars ($1,000,000.00) entered against it by a
court having jurisdiction in the premises and such judgment shall not
be appealed in good faith or satisfied by the Company or such
Subsidiary (or an insurer on behalf of the Company or such
Subsidiary), as the case may be, within the time permitted by
applicable law for an appeal of such judgment;
(k) The occurrence of a Reportable Event with respect to
any Pension Plan; the filing of a notice of intent to terminate a
Pension Plan by the Company, any ERISA Affiliate or any Subsidiary;
the institution of proceedings to terminate a Pension Plan by the PBGC
<PAGE> 52
or any other Person; the withdrawal in a "complete withdrawal" or a
"partial withdrawal" as defined in Sections 4203 and 4205,
respectively, of ERISA by the Company, any ERISA Affiliate or any
Subsidiary from any Multi-Employer Plan; or the incurrence of any
material increase in the contingent liability of the Company or any
Subsidiary with respect to any "employee welfare benefit plan" as
defined in Section 3(1) of ERISA which covers retired employees and
their beneficiaries;
(l) The institution by the Company, any ERISA Affiliate or
any Subsidiary of steps to terminate any Pension Plan if, in order to
effectuate such termination, the Company, such ERISA Affiliate or such
Subsidiary, as the case may be, would be required to make a
contribution to such Pension Plan, or would incur a liability or
obligation to such Pension Plan, in excess of Ten Million Dollars
($10,000,000.00); or the institution by the PBGC of steps to terminate
any Pension Plan;
(m) a Change of Control shall occur;
(n) any "Event of Default" (as defined therein) shall
occur under or within the meaning of any one or more of those certain
Note Agreements dated March 23, 1993, by and between the Company and
each of Principal Mutual Life Insurance Company, CIGNA Property and
Casualty Insurance Company, Connecticut General Life Insurance
Company, Connecticut General Life Insurance Company on behalf of one
or more separate accounts, Life Insurance Company of North America,
Allstate Life Insurance Company, Farmland Life Insurance Company,
Financial Horizons Life Insurance Company, Nationwide Life Insurance
Company, West Coast Life Insurance Company, Woodmen of the World Life
Insurance Society, General American Life Insurance Company, Century
Life of America, CUNA Mutual Insurance Society, National Life
Insurance Company, Provident Mutual Life Insurance Company of
Philadelphia, Provident Mutual Life and Annuity Company of America,
Provident Mutual Life Insurance Company - CALIC, Modern Woodmen of
America, Guarantee Mutual Life Company and Woodmen Accident and Life
Company (collectively, as the same may from time to time be amended,
modified, extended or renewed, the "Note Agreements");
THEN, and in each such event (other than an event described in the
foregoing clauses (f) or (g)), the Agent shall, if requested in writing by the
Required Banks, and may, in its sole and absolute discretion, upon the oral
request of the Required Banks, by notice in writing to the Company declare that
the obligations of the Banks to make Loans under this Agreement have
terminated, whereupon such obligations of the Banks shall be immediately and
forthwith terminated, and the Agent shall, if requested in writing by the
Required Banks, and may, in its sole and absolute discretion, upon the oral
request of the Required Banks, by notice in writing to the Company declare the
entire outstanding principal balance of and all accrued and unpaid interest on
the Notes issued under this Agreement and all other amounts payable by the
Company hereunder to be forthwith due and payable, whereupon all of the unpaid
principal balance, accrued and unpaid interest and all such other amounts shall
become and be immediately due and payable, without presentment, demand, protest
or further notice of any kind, all of which are hereby expressly waived by the
Company; provided, however, that upon the occurrence of any event described in
the foregoing clauses (f) or (g), the obligation of the Banks to make Loans
under this Agreement shall automatically terminate and the entire outstanding
principal balance of and all accrued and unpaid interest on the Notes issued
<PAGE> 53
under this Agreement and all other amounts payable by the Company hereunder
shall automatically become immediately due and payable, without presentment,
demand, protest or further notice of any kind, all of which are hereby
expressly waived by the Company.
SECTION 6.02. Notice of Default. The Agent shall give notice of a
Default to the Company promptly upon being requested to do so by any Bank and
shall thereupon notify all of the Banks thereof.
ARTICLE VII
THE AGENT
SECTION 7.01. Appointment and Authorization. Each Bank irrevocably
appoints and authorizes the Agent to take such action as agent on its behalf
and to exercise such powers under this Agreement, the Notes and the other
Transaction Documents as are delegated to the Agent by the terms hereof or
thereof, together with all such powers as may be reasonably incidental thereto.
SECTION 7.02. Agent and Affiliates. The Agent shall have the same
rights and powers under this Agreement as any other Bank and may exercise or
refrain from exercising the same as though it were not the Agent, and the Agent
and its affiliates may accept deposits from, lend money to and generally engage
in any kind of business with the Company or any of its Subsidiaries or
Affiliates as if it were not the Agent hereunder.
SECTION 7.03. Action by Agent. The obligations of the Agent
hereunder are only those expressly set forth herein. Without limiting the
generality of the foregoing, the Agent shall not be required to take any action
with respect to any Default or Event of Default, except as expressly provided
in Article VI.
SECTION 7.04. Consultation with Experts. The Agent may consult with
legal counsel, independent certified public accountants and other experts
selected by it and shall not be liable for any action taken or omitted to be
taken by it in good faith in accordance with the advice of such counsel,
accountants or other experts.
SECTION 7.05. Liability of Agent. Neither the Agent nor any of its
directors, officers, employees, agents or advisors shall be liable for any
action taken or not taken by it in connection herewith (i) with the consent or
at the request of the requisite percentage in interest of the Banks set forth
herein or (ii) in the absence of its own gross negligence or willful misconduct
as determined by a court of competent jurisdiction. Neither the Agent nor any
of its directors, officers, employees, agents or advisors shall be responsible
for or have any duty to ascertain, inquire into or verify (i) any statement,
warranty or representation made in connection with this Agreement or any Loan
hereunder; (ii) the performance or observance of any of the covenants or
agreements of the Company; (iii) the satisfaction of any condition specified in
Article III, except receipt of items required to be delivered to the Agent; or
(iv) the validity, effectiveness or genuineness of this Agreement, the Notes or
any of the other Transaction Documents. The Agent shall not incur any
liability by acting in reliance upon any notice, consent, certificate,
statement or other writing (which may be a bank wire, telex, telecopy or
similar writing) believed by it to be genuine or to be signed by the proper
party or parties.
<PAGE> 54
SECTION 7.06. Indemnification. Notwithstanding any other provision
contained in this Agreement to the contrary, to the extent the Company fails to
reimburse the Agent pursuant to Section 9.03 (excluding clause (i) thereof),
Section 9.04 or Section 9.05, or if any Default or Event of Default shall occur
under this Agreement, the Banks shall ratably in accordance with their
respective Pro Rata Shares of the aggregate amount of Loans then outstanding,
or if no Loans are then outstanding, their respective Pro Rata Shares of the
total Loan Commitments of all of the Banks, indemnify the Agent and hold it
harmless from and against any and all liabilities, losses (except losses
occasioned solely by failure of the Company to make any payments or to perform
any obligations required by this Agreement (excepting those described in
Sections 9.03, 9.04 and 9.05), the Notes or any of the other Transaction
Documents), costs and/or expenses, including, without limitation, any
liabilities, losses, costs and/or expenses arising from the failure of any Bank
to perform its obligations hereunder or in respect of this Agreement, and also
including, without limitation, reasonable attorneys' fees and expenses, which
the Agent may incur, directly or indirectly, in connection with this Agreement,
the Notes or any of the other Transaction Documents, or any action or
transaction related hereto or thereto; provided only that the Agent shall not
be entitled to such indemnification for any losses, liabilities, costs and/or
expenses directly and solely resulting from its own gross negligence or willful
misconduct as determined by a court of competent jurisdiction. This indemnity
shall be a continuing indemnity, contemplates all liabilities, losses, costs
and expenses related to the execution, delivery and performance of this
Agreement, the Notes and the other Transaction Documents, and shall survive the
satisfaction and payment of the Loans and the termination of this Agreement.
SECTION 7.07. Credit Decision. Each Bank acknowledges that it has,
independently and without reliance upon the Agent or any other Bank, and based
on such documents and information as it has deemed appropriate, made its own
credit analysis and decision to enter into this Agreement. Each Bank also
acknowledges that it will, independently and without reliance upon the Agent or
any other Bank, and based on such documents and information as it shall deem
appropriate at the time, continue to make its own credit decisions in taking or
not taking any action under this Agreement.
SECTION 7.08. Resignation of Agent. The Agent may resign at any time
by giving written notice thereof to the Banks and the Company. Upon any such
resignation, the Company, with the consent of the Required Banks, shall have
the right to appoint a successor Agent. If no successor Agent shall have been
so appointed by the Company, and shall have accepted such appointment, within
thirty (30) days after the retiring Agent's giving of notice of resignation,
then the Required Banks shall, on behalf of all of the Banks, appoint a
successor Agent, which shall be a commercial bank organized under the laws of
the United States of America or of any State thereof and having a combined
capital and surplus of at least $100,000,000.00. Upon the acceptance of any
appointment as Agent hereunder by a successor Agent, such successor Agent shall
thereupon succeed to and become vested with all of the rights, powers,
privileges and duties of the retiring Agent, and the retiring Agent shall be
discharged from all of its duties and obligations under this Agreement. After
any retiring Agent's resignation as Agent, the provisions of this Article VII
shall inure to its benefit as to any actions taken or omitted to be taken by it
while it was Agent under this Agreement.
<PAGE> 55
ARTICLE VIII
CHANGE IN CIRCUMSTANCES
AFFECTING FIXED RATE LOANS
SECTION 8.01. Basis for Determining Interest Rate Inadequate or
Unfair. If with respect to any Interest Period:
(i) the Agent is advised by Mercantile that deposits in
dollars (in the applicable amounts) are not being offered to
Mercantile in the relevant market for such Interest Period, or
(ii) Banks holding Notes evidencing 40% or more in
aggregate principal amount of the affected Fixed Rate Loans (or having
40% or more of the aggregate amount of the total Loan Commitments of
all of the Banks, if no such Fixed Rate Loans are then outstanding)
advise the Agent that the CD Rate or the IBOR Rate, as the case may
be, as determined by the Agent will not adequately and fairly reflect
the cost to such Banks of maintaining or funding their IBOR Loans
and/or CD Loans for such Interest Period,
the Agent shall forthwith give notice thereof to the Company and the Banks,
whereupon until the Agent notifies the Company that the circumstances giving
rise to such suspension no longer exist, (a) the obligations of the Banks to
make CD Loans or IBOR Loans, as the case may be, shall be suspended, and (b)
the Company shall repay in full the then outstanding principal amount of each
of its CD Loans or IBOR Loans, as the case may be, together with all accrued
and unpaid interest thereon, on the last day of the then current Interest
Period applicable to such Loan. Concurrently with repaying each such Fixed
Rate Loan of each Bank pursuant to this Section, the Company may borrow a Prime
Loan of the same type (i.e., a Line of Credit Loan or a Revolving Credit Loan)
in an equal principal amount from such Bank, and, if the Company so elects,
such Bank shall make such a Prime Loan of the same type (i.e., a Line of Credit
Loan or a Revolving Credit Loan) to the Company.
SECTION 8.02. Illegality. If, after the date of this Agreement, 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
or regulatory authority, central bank or comparable agency charged with the
interpretation or administration thereof, or compliance by any Bank with any
request or directive (whether or not having the force of law) of any such
governmental or regulatory authority, central bank or comparable agency shall
make it unlawful or impossible for any Bank to make, maintain or fund its IBOR
Loans to the Company and such Bank shall so notify the Agent, the Agent shall
forthwith give notice thereof to the other Banks and the Company. Upon receipt
of such notice, the Company shall repay in full the then outstanding principal
amount of each of its IBOR Loans from such Bank, together with all accrued and
unpaid interest thereon, on either (a) the last day of the then current
Interest Period applicable to such IBOR Loan if such Bank may lawfully continue
to maintain and fund such IBOR Loan to such day or (b) immediately if such Bank
may not lawfully continue to fund and maintain such IBOR Loan to such day.
Concurrently with repaying each IBOR Loan of such Bank, the Company may borrow
a Prime Loan of the same type (i.e., a Line of Credit Loan or a Revolving
Credit Loan) in an equal principal amount from such Bank, and, if the Company
so elects, such Bank shall make such a Prime Loan of the same type (i.e., a
Line of Credit Loan or a Revolving Credit Loan) to the Company.
<PAGE> 56
SECTION 8.03. Increased or Decreased Cost. (a) If (i) Regulation D
or (ii) 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 or regulatory authority, central
bank or comparable agency charged with the interpretation or administration
thereof, or compliance by any Bank with any request or directive (whether or
not having the force of law) of any such governmental or regulatory authority,
central bank or comparable agency (a "Regulatory Change"):
(A) shall subject any Bank to any tax, duty or other
charge with respect to its Fixed Rate Loans, its Notes or its
obligation to make Fixed Rate Loans, or shall change the basis of
taxation of payments to any Bank of the principal of or interest on
its Fixed Rate Loans or any other amounts due under this Agreement in
respect of its Fixed Rate Loans or its obligation to make Fixed Rate
Loans (except for taxes on or changes in the rate of tax on the
overall net income of such Bank); or
(B) shall impose, modify or deem applicable or
inapplicable any reserve (including, without limitation, any reserve
imposed by the Board of Governors of the Federal Reserve System),
special deposit, capital or similar requirement against assets of,
deposits with or for the account of, or credit extended or committed
to be extended by, any Bank or shall, with respect to any Bank or the
United States market for certificates of deposit or the Interbank
Eurodollar market, impose, modify or deem applicable or inapplicable
any other condition affecting its Fixed Rate Loans, its Notes or its
obligation to make Fixed Rate Loans;
and the result of any of the foregoing is to increase or decrease the cost to
(or in the case of Regulation D, to impose a cost on or increase or decrease
the cost to) such Bank of making or maintaining any Fixed Rate Loan, or to
reduce or increase the amount of any sum received or receivable by such Bank
under this Agreement or under its Notes with respect thereto, by an amount
deemed by such Bank, in its reasonable good faith judgment, to be material, and
if such Bank or the Company, as the case may be, is not otherwise fully
compensated for such change in cost or reduction or increase in amount received
or receivable by virtue of the inclusion of the reference to "CD Reserve
Percentage" in the calculation of the interest rate applicable to CD Loans or
to "IBOR Reserve Percentage" in the calculation of the interest rate applicable
to IBOR Loans, as the case may be, then, within fifteen (15) days after notice
by such Bank to the Company together with a copy of the official notice of the
applicable change in law (if applicable) and a work sheet showing how the
change in cost or reduction or increase in amount received or receivable was
calculated (with a copy to the Agent and all of the other Banks), (i) in the
case of an increase in cost to such Bank or a reduction in amounts received or
receivable by such Bank the Company shall pay for the account of such Bank as
additional interest, such additional amount or amounts as will compensate such
Bank for such increased cost or reduction and (ii) in the case of a decrease in
cost to such Bank or an increase in amounts received or receivable by such
Bank, the Company's interest payments to such Bank under this Agreement shall
be reduced by such amount or amounts as will compensate the Company for such
decreased cost or increased amount received or receivable by such Bank. Each
Bank will promptly notify the Company, the Agent and all of the other Banks of
any event of which it has knowledge, occurring after the date hereof, which
will entitle such Bank or the Company to compensation pursuant to this Section.
The determination by any Bank under this Section of the additional amount or
amounts to be paid to it or to the Company hereunder shall be conclusive in the
<PAGE> 57
absence of manifest error. In determining such amount or amounts, such Bank
may use any reasonable averaging and attribution methods.
(b) If any Bank demands compensation under this Section, the
Company may at any time, upon at least two (2) Business Days' prior notice to
such Bank and the Agent, repay in full its then outstanding CD Loans or IBOR
Loans, as the case may be, of such Bank, together with all accrued and unpaid
interest thereon to the date of prepayment and any funding losses and other
amounts due under Section 2.10. Concurrently with repaying such Fixed Rate
Loans of such Bank, the Company may borrow from such Bank a Prime Loan of the
same type (i.e., a Line of Credit Loan or a Revolving Credit Loan) in an amount
equal to the aggregate principal amount of such Fixed Rate Loans, and, if the
Company so elects, such Bank shall make such a Prime Loan of the same type
(i.e., a Line of Credit Loan or a Revolving Credit Loan) to the Company.
SECTION 8.04. Prime Loans Substituted for Affected Fixed Rate Loans.
If notice has been given by a Bank pursuant to Section 8.02 or by the Company
pursuant to Section 8.03 requiring Fixed Rate Loans of any Bank to be repaid,
then, unless and until such Bank notifies the Company that the circumstances
giving rise to such repayment no longer apply, all Loans which would otherwise
be made by such Bank to the Company as CD Loans or IBOR Loans, as the case may
be, shall be made instead as Prime Loans. Such Bank shall notify the Company
if and when the circumstances giving rise to such repayment no longer apply.
SECTION 8.05. Capital Adequacy. If, after the date of this
Agreement, any Bank shall have determined that the adoption of any applicable
law, rule, regulation or guideline regarding capital adequacy, or any change
therein, or any change in the interpretation or administration thereof by any
governmental or regulatory authority, central bank or comparable agency charged
with the interpretation or administration thereof, or compliance by such Bank
with any request or directive regarding capital adequacy (whether or not having
the force of law) of any such authority, central bank or comparable agency, has
or will have the effect of reducing the rate of return on such Bank's capital
in respect of its obligations hereunder to a level below that which such Bank
could have achieved but for such adoption, change or compliance (taking into
consideration such Bank's policies with respect to capital adequacy), then from
time to time the Company shall pay to such Bank upon demand such additional
amount or amounts as will compensate such Bank for such reduction. All
determinations made by such Bank of the additional amount or amounts required
to compensate such Bank in respect of the foregoing shall be conclusive in the
absence of manifest error. In determining such amount or amounts, such Bank
may use any reasonable averaging and attribution methods.
ARTICLE IX
MISCELLANEOUS
SECTION 9.01. Notices. All notices, requests and other
communications to any party hereunder shall be in writing (including bank wire,
telex, telecopy or similar writing) and shall be given to such party at its
address or telex number set forth on the signature pages hereof or such other
address or telex number as such party may hereafter specify for the purpose by
notice to the Agent and the Company. Each such notice, request or other
communication shall be effective (i) if given by telex, when such telex is
transmitted to the telex number specified in this Section and the appropriate
answer-back is received upon completion of transmission, (ii) if given by mail,
on the third (3rd) Business Day after such communication is deposited in the
mails with appropriate first class, certified or registered postage prepaid,
<PAGE> 58
addressed as aforesaid, or (iii) if given by any other means, when delivered at
the address specified in this Section; provided that notices to the Agent under
Sections 2.02, 2.04, 2.07 or 2.08 or Article VIII shall not be effective until
actually received by the Agent.
SECTION 9.02. No Waivers. No failure or delay by the Company, the
Agent or any Bank in exercising any right, power or privilege hereunder, under
any Note or under any of the other Transaction Documents shall operate as a
waiver thereof nor shall any single or partial exercise thereof preclude any
other or further exercise thereof or the exercise of any other right, power or
privilege. The rights and remedies provided in this Agreement and in the other
Transaction Documents shall be cumulative and not exclusive of any rights or
remedies provided by law.
SECTION 9.03. Expenses; Documentary Taxes. The Company agrees to pay
(i) all reasonable out-of-pocket costs and expenses of the Agent in connection
with the preparation, documentation, negotiation and execution of this
Agreement and the other Transaction Documents, including, without limitation,
reasonable fees and disbursements of Thompson and Mitchell, counsel for the
Agent, within thirty (30) days of receipt of a statement therefor, (ii) all
reasonable out-of-pocket costs and expenses of the Agent in connection with the
preparation of any waiver or consent hereunder or any amendment, modification,
extension or renewal hereof or any default or alleged default by the Company
hereunder, including, without limitation, reasonable fees and disbursements of
counsel for Agent, within thirty (30) days of receipt of a statement therefor
and (iii) if a Default or an Event of Default occurs hereunder, all reasonable
out-of-pocket costs and expenses incurred by the Agent or any Bank, including,
without limitation, reasonable fees and disbursements of counsel (including
attorneys who are employees of the Agent or such Bank or of any affiliate of
the Agent or such Bank, as the case may be), in connection with such Default or
Event of Default and collection and other enforcement proceedings resulting
therefrom within thirty (30) days of receipt of a statement therefor. The
Company shall indemnify each Bank against any transfer taxes, documentary taxes
and/or similar assessments or charges made by any governmental authority by
reason of the execution and delivery of this Agreement, the Notes or any of the
other Transaction Documents. The obligations of the Company under this Section
9.03 are continuing and shall survive the satisfaction and payment of the Loans
and the termination of this Agreement.
SECTION 9.04. General Indemnity. In addition to the payment of
expenses pursuant to Section 9.03, whether or not the transactions contemplated
hereby shall be consummated, the Company hereby agrees to indemnify, pay and
hold the Agent, each of the Banks and any holder(s) of the Notes, and the
officers, directors, employees, agents and affiliates of the Agent, each of the
Banks and such holder(s) (collectively, the "Indemnitees") harmless from and
against any and all other liabilities, obligations, losses, damages, penalties,
actions, judgments, suits, claims, costs, expenses and disbursements of any
kind or nature whatsoever (including, without limitation, the reasonable fees
and disbursements of counsel for such Indemnitees in connection with any
investigative, administrative or judicial proceeding commenced or threatened,
whether or not such Indemnitees shall be designated a party thereto), that may
be imposed on, incurred by or asserted against the Indemnitees, in any manner
relating to or arising out of this Agreement, any of the other Transaction
Documents or any other agreement, document or instrument executed and delivered
by the Company in connection herewith or therewith, the statements contained in
any commitment letters delivered by the Agent or any of the Banks, any Bank's
agreement to make the Loans hereunder or the use or intended use of the
proceeds of any Loan hereunder (collectively, the "indemnified liabilities");
<PAGE> 59
provided that the Company shall have no obligation to an Indemnitee hereunder
with respect to indemnified liabilities directly resulting from (i) the gross
negligence or willful misconduct of that Indemnitee as determined by a court of
competent jurisdiction in a final nonappealable order or (ii) any failure of
the Agent to properly remit funds to the Banks as required under Section 2.09
or any other provision of this Agreement. To the extent that the undertaking
to indemnify, pay and hold harmless set forth in the preceding sentence may be
unenforceable because it is violative of any law or public policy, the Company
shall contribute the maximum portion that it is permitted to pay and satisfy
under applicable law to the payment and satisfaction of all indemnified
liabilities incurred by the Indemnitees or any of them. The provisions of the
undertakings and indemnification set out in this Section 9.04 are continuing
and shall survive the satisfaction and payment of the Loans and the termination
of this Agreement.
SECTION 9.05. Environmental Indemnity. The Company hereby agrees to
indemnify and hold harmless the Agent and each of the Banks and their
respective shareholders, officers, directors, employees, agents, successors and
assigns, from and against all claims and orders (including, without limitation,
all private and/or governmental claims or orders under common law and/or any
Environmental Law), causes of action, liabilities, damages (including natural
resource damages), costs and expenses (including, without limitation,
investigative and cleanup costs and attorneys' fees and expenses),
notwithstanding any negligence on the part of the Agent or any Bank and/or any
of their respective officers, directors, employees, agents, successors and
assigns, arising out of or relating in any way to (i) the release, threat of
release or presence or threat of any Hazardous Materials on, in, under or about
any Property or facility owned and/or operated by the Company or any Subsidiary
or emanating or disposed of therefrom (regardless of cause or source), (ii) any
act or omission or liability of the Company or any of its Subsidiaries or any
of their respective officers, partners, employees, directors, agents,
shareholders, successors or assigns, concerning any Hazardous Materials;
(iii) the enforcement or exercise of any right in this Agreement pertaining to
environmental matters, including, without limitation, the enforcement of this
indemnity provision; and/or (iv) any unsafe or unhealthful condition at any
Property or facility owned or operated by the Company or any Subsidiary or any
violation of any Occupation Safety and Health Law. The foregoing indemnity
shall be in addition to all other indemnity provisions contained in this
Agreement and any other agreements between the parties hereto or executed in
connection with the transactions contemplated hereby, and all such indemnities
shall be given effect, notwithstanding any overlap in coverage. This indemnity
shall survive the repayment of the Loans and the termination of this Agreement.
Should it be finally determined by a court of competent jurisdiction that the
scope or reach of this indemnity exceeds that allowed by applicable law, this
indemnity shall be construed to extend and shall be given effect to, but not in
excess of, the maximum scope and reach allowed by applicable law.
SECTION 9.06. Sharing of Setoffs. Each Bank agrees that if it shall,
by exercising any right of set-off or counterclaim or otherwise, receive
payment of a proportion of the aggregate amount of principal and interest due
with respect to any Note held by it which is greater than the proportion
received by any other Bank (based on the Pro Rata Shares of the Banks) in
respect of the aggregate amount of principal and interest due with respect to
any Note held by such other Bank, the Bank receiving such proportionately
greater payment shall purchase such participations in the Notes held by the
other Banks (to which purchase the Company hereby consents), and such other
adjustments shall be made, as may be required so that all such payments of
principal and interest with respect to the Notes held by the Banks shall be
<PAGE> 60
shared by the Banks on the basis of their Pro Rata Shares; provided, however,
that nothing in this Section shall impair the right of any Bank to exercise any
right of set-off or counterclaim it may have and to apply the amount subject to
such exercise to the payment of indebtedness of the Company other than its
indebtedness under the Notes. The Company agrees, to the fullest extent it may
effectively do so under applicable law, that any holder of a participation in a
Note, whether or not acquired pursuant to the foregoing arrangements, may
exercise rights of set-off or counterclaim and other rights with respect to
such participation as fully as if such holder of a participation were a direct
creditor of the Company in the amount of such participation.
SECTION 9.07. Amendments and Waivers. Any provision of this
Agreement, the Notes or any of the other Transaction Documents may be amended
or waived if, but only if, such amendment or waiver is in writing and is signed
by the Company and the Required Banks (and, if the rights or duties of the
Agent in its capacity as Agent are affected thereby, by the Agent); provided
that no such amendment or waiver shall, unless signed by all of the Banks,
(i) increase the Line of Credit Commitment or Revolving Credit Commitment of
any Bank, (ii) reduce the principal amount of or rate of interest on any Loan
or any fees hereunder, (iii) postpone the date fixed for any payment of
principal of or interest on any Loan or any fees hereunder, (iv) change the
percentage of the Line of Credit Commitments or Revolving Credit Commitments or
of the aggregate unpaid principal amount of the Notes or the number of Banks
which shall be required for the Banks or any of them to take any action or
obligations under this Section or any other provision of this Agreement.
SECTION 9.08. Successors and Assigns. (a) The provisions of this
Agreement shall be binding upon and inure to the benefit of the parties hereto
and their respective successors and assigns, except that (i) the Company may
not assign or otherwise transfer any of its rights or delegate any of its
obligations under this Agreement and (ii) without the prior written consent of
the Company, no Bank may sell, assign or otherwise transfer its Notes or its
rights under this Agreement (other than by way of participation to the extent
permitted below) in whole or in part to any Person other than another existing
Bank; provided, however, that, notwithstanding the foregoing, (i) any Bank may
assign, as collateral or otherwise, any of its rights (but not any of its
obligations) under this Agreement or its Notes (including, without limitation,
rights to payment of principal and/or interest on its Notes) to any Federal
Reserve Bank without notice to or consent of the Company or the Agent, (ii) any
Bank may sell participations in its Notes or its rights under this Agreement in
whole or in part to any commercial bank organized under the laws of the United
States or any state thereof that is a member of both the Federal Deposit
Insurance Corporation and the Federal Reserve System without the consent of the
Company so long as each agreement pursuant to which any such participation is
granted provides that such selling Bank shall retain the sole right to approve
or disapprove (A) any amendment, modification or waiver of any provision of
this Agreement or any of the other Transaction Documents, (B) any Line of
Credit Extension Request and (C) any Revolving Credit Extension Request and
(iii) from and after (A) the occurrence of any Event of Default under this
Agreement, (B) the termination of the obligations of the Banks to make Loans
under this Agreement and (C) the acceleration of the entire outstanding
principal balance of and all accrued and unpaid interest on the Notes issued
under this Agreement, each Bank may sell, assign, grant a participation in or
otherwise transfer its Notes and its rights under this Agreement in whole or in
part to any Person without the consent of the Company.
(b) Any Bank which, in accordance with Section 9.08(a), grants a
participation in, or sells, assigns or otherwise transfers any interest in, any
<PAGE> 61
of its rights under this Agreement or its Notes shall give prompt notice
thereof to the Agent and the Company.
(c) Unless otherwise agreed to by the Company in writing, no Bank
shall, as between the Company and that Bank, be relieved of any of its
obligations under this Agreement as a result of such Bank's granting of a
participation in all or any part of such Bank's Notes or all or any part of
such Bank's rights under this Agreement.
SECTION 9.09. Severability. In the event any one or more of the
provisions contained in this Agreement should be invalid, illegal or
unenforceable in any respect, the validity, legality and enforceability of the
remaining provisions contained herein shall not in any way be affected or
impaired thereby.
SECTION 9.10. Missouri Law. This Agreement, the Notes and all of the
other Transaction Documents shall be governed by and construed in accordance
with the internal laws of the State of Missouri.
SECTION 9.11. Counterparts; Effectiveness. This Agreement may be
signed in any number of counterparts, each of which shall be an original, with
the same effect as if the signatures thereto and hereto were upon the same
instrument. This Agreement shall become effective on the later of (i) June 4,
1993, or (ii) the date when the Agent shall have received counterparts hereof
signed by all of the parties hereto, or telexes confirming signatures to such
counterparts.
SECTION 9.12. Authority to Act. The Agent shall be entitled to act
on any notices and instructions (telephonic or written) reasonably believed by
the Agent to have been delivered by any person authorized to act on behalf of
the Company pursuant hereto, regardless of whether such notice or instruction
was in fact delivered by a person authorized to act on behalf of the Company,
and the Company hereby agrees to indemnify the Agent and hold the Agent
harmless from and against any and all losses and expenses, if any, ensuing from
any such action.
SECTION 9.13. CONSENT TO JURISDICTION. THE COMPANY HEREBY
IRREVOCABLY SUBMITS TO THE NON-EXCLUSIVE JURISDICTION OF ANY MISSOURI STATE
COURT OR ANY UNITED STATES OF AMERICA COURT SITTING IN THE EASTERN DISTRICT OF
MISSOURI, AS THE AGENT OR ANY BANK MAY ELECT, IN ANY SUIT, ACTION OR PROCEEDING
ARISING OUT OF OR RELATING TO THIS AGREEMENT OR ANY OTHER TRANSACTION DOCUMENT.
THE COMPANY HEREBY IRREVOCABLY AGREES THAT ALL CLAIMS IN RESPECT TO SUCH SUIT,
ACTION OR PROCEEDING MAY BE HELD AND DETERMINED IN ANY OF SUCH COURTS. THE
COMPANY IRREVOCABLY WAIVES, TO THE FULLEST EXTENT PERMITTED BY LAW, ANY
OBJECTION WHICH THE COMPANY MAY NOW OR HEREAFTER HAVE TO THE LAYING OF VENUE OF
ANY SUCH SUIT, ACTION OR PROCEEDING BROUGHT IN ANY SUCH COURT, AND THE COMPANY
FURTHER IRREVOCABLY WAIVES ANY CLAIM THAT SUCH SUIT, ACTION OR PROCEEDING
BROUGHT IN ANY SUCH COURT HAS BEEN BROUGHT IN AN INCONVENIENT FORUM. THE
COMPANY HEREBY EXPRESSLY WAIVES ALL RIGHTS OF ANY OTHER JURISDICTION WHICH THE
COMPANY MAY NOW OR HEREAFTER HAVE BY REASON OF ITS PRESENT OR SUBSEQUENT
DOMICILES. THE COMPANY AUTHORIZES THE SERVICE OF PROCESS UPON THE COMPANY BY
REGISTERED MAIL SENT TO THE COMPANY AT ITS ADDRESS SET FORTH IN SECTION 9.01.
SECTION 9.14. References; Headings for Convenience. Unless otherwise
specified herein, all references herein to Section numbers refer to Section
numbers of this Agreement, all references herein to Exhibits "A", "B", "C" and
"D" refer to annexed Exhibits "A", "B", "C" and "D" which are hereby
incorporated herein by reference and all references herein to
<PAGE> 62
Schedules 4.01(d), 4.01(e), 4.01(f), 4.01(i), 4.01(j), 4.01(k), 4.01(o),
4.01(p) and 4.01(r) refer to annexed Schedules 4.01(d), 4.01(e), 4.01(f),
4.01(i), 4.01(j), 4.01(k), 4.01(o), 4.01(p) and 4.01(r) which are hereby
incorporated herein by reference. The Section headings are furnished for the
convenience of the parties and are not to be considered in the construction or
interpretation of this Agreement.
SECTION 9.15. NO ORAL AGREEMENTS; ENTIRE AGREEMENT. ORAL AGREEMENTS
OR COMMITMENTS TO LOAN MONEY, EXTEND CREDIT OR TO FORBEAR FROM ENFORCING
REPAYMENT OF A DEBT, INCLUDING PROMISES TO EXTEND OR RENEW SUCH DEBT, ARE NOT
ENFORCEABLE. TO PROTECT THE COMPANY, THE AGENT AND THE BANKS FROM
MISUNDERSTANDING OR DISAPPOINTMENT, ANY AGREEMENTS REACHED BY THE COMPANY, THE
AGENT AND THE BANKS COVERING SUCH MATTERS ARE CONTAINED IN THIS AGREEMENT AND
THE OTHER TRANSACTION DOCUMENTS, WHICH AGREEMENT AND OTHER TRANSACTION
DOCUMENTS ARE A COMPLETE AND EXCLUSIVE STATEMENT OF THE AGREEMENTS BETWEEN THE
COMPANY, THE AGENT AND THE BANKS, EXCEPT AS THE COMPANY, THE AGENT AND THE
BANKS MAY LATER AGREE IN WRITING TO MODIFY THEM. THIS AGREEMENT EMBODIES THE
ENTIRE AGREEMENT AND UNDERSTANDING BETWEEN THE PARTIES HERETO AND SUPERSEDES
ALL PRIOR AGREEMENTS AND UNDERSTANDINGS (ORAL OR WRITTEN) RELATING TO THE
SUBJECT MATTER HEREOF.
SECTION 9.16. Resurrection of Loans. To the extent that any Bank
receives any payment on account of any of the Loans, and any such payment(s) or
any part thereof are subsequently invalidated, declared to be fraudulent or
preferential, set aside, subordinated and/or required to be repaid to a
trustee, receiver or any other Person under any bankruptcy act, state or
Federal law, common law or equitable cause, then, to the extent of such
payment(s) received, the Loans or part thereof intended to be satisfied shall
be revived and continue in full force and effect, as if such payment(s) had not
been received by such Bank and applied on account of such Loan(s).
IN WITNESS WHEREOF, the parties hereto have caused this Credit
Agreement to be duly executed by their respective authorized officers effective
as of the day and year first above written.
EDISON BROTHERS STORES, INC.
By _____________________________________
Title: _____________________________________
501 North Broadway
St. Louis, Missouri 63102
Telex number: 797979
Telecopy number (314) 331-6554
MERCANTILE BANK OF ST. LOUIS
NATIONAL ASSOCIATION
By _____________________________________
Title: _____________________________________
721 Locust Street
St. Louis, Missouri 63101
Telex number: 442300
Telecopy number: (314) 425-2162
<PAGE> 63
THE BOATMEN'S NATIONAL BANK OF ST. LOUIS
By _____________________________________
Title: _____________________________________
One Boatmen's Plaza
St. Louis, Missouri 63101
Telex number: 447389
Telecopy number: (314) 466-7783
CITIBANK, N.A.
By _____________________________________
Title: _____________________________________
399 Park Avenue
12th Floor, Zone 21
New York, New York 10043
Telex number: ______
Telecopy number: _____ ________
NBD BANK, N.A.
By _____________________________________
Title: _____________________________________
611 Woodward Avenue
Detroit, Michigan 48226
Telex number: None
Telecopy number: (313) 225-2649
THE BANK OF NOVA SCOTIA
By _____________________________________
Title: _____________________________________
Suite 650
55 Park Place
Atlanta, Georgia 30303
Telex number: 00542319
Telecopy number: (404) 581-0807
THE FIRST NATIONAL BANK OF CHICAGO
By _____________________________________
Title: _____________________________________
One First National Plaza
Mail Suite 0088; 1-14
Chicago, Illinois 60670
Telex number: 4430253
Telecopy number: (312) 732-6222
BANK OF AMERICA NATIONAL TRUST
AND SAVINGS ASSOCIATION
By _____________________________________
Title: _____________________________________
200 West Adams, Suite 2800
Chicago, Illinois 60606
Telex number: 6972650
Telecopy number: (312) 641-2350
<PAGE> 64
MERCANTILE BANK OF ST. LOUIS
NATIONAL ASSOCIATION, as Agent
By _____________________________________
Title: _____________________________________
721 Locust Street
St. Louis, Missouri 63101
Telex number: 442300
Telecopy number: (314) 425-2162
<PAGE> 65
EXHIBIT A
LINE OF CREDIT NOTE
$ St. Louis, Missouri
June 4, 1993
FOR VALUE RECEIVED, on the last day of the Line of Credit Period, the
undersigned, EDISON BROTHERS STORES, INC., a Delaware corporation (the
"Company"), hereby promises to pay to the order of __________ ("Bank"), the
principal sum of __________ Dollars ($__________), or such lesser sum as may
then constitute the aggregate unpaid principal amount of all Line of Credit
Loans made by Bank to the Company pursuant to the Credit Agreement referred to
below. The aggregate principal amount which Bank shall be committed to have
outstanding hereunder at any time shall not exceed __________ Dollars
($__________), which amount may be borrowed, paid, reborrowed and repaid, in
whole or in part, subject to the terms and conditions hereof and of the Credit
Agreement referred to below. The Company further promises to pay to the order
of Bank interest on the aggregate unpaid principal amount of such Line of
Credit Loans on the dates and at the rate or rates provided for in the Credit
Agreement. All such payments of principal and interest shall be made in lawful
currency of the United States in Federal or other immediately available funds
at the office of Mercantile Bank of St. Louis National Association, 721 Locust
Street, St. Louis, Missouri 63101.
All Line of Credit Loans made by Bank and all repayments of the
principal thereof shall be recorded by Bank and, prior to any transfer hereof,
endorsed by Bank on the schedule attached hereto, or on a continuation of such
schedule attached to and made a part hereof; provided, however, that the
obligation of the Company to repay each Line of Credit Loan made hereunder
shall be absolute and unconditional, notwithstanding any failure of Bank to
record or endorse or any mistake by Bank in connection with recordation or
endorsement on the schedules attached to this Note. Bank's books and records
(including, without limitation, the schedules attached to this Note) showing
the account between Bank and the Company shall be admissible in evidence in any
action or proceeding and shall constitute prima facie proof of the items
therein set forth.
This Note is one of the Line of Credit Notes referred to in the Credit
Agreement dated the date hereof by and among the Company, the banks listed on
the signature pages thereof and Mercantile Bank of St. Louis National
Association, as agent (as the same may from time to time be amended, modified,
extended or renewed, the "Credit Agreement"). The Credit Agreement, among
other things, contains provisions for acceleration of the maturity hereof upon
the occurrence of certain stated events and also for prepayments on account of
principal hereof and interest hereon prior to the maturity hereof upon the
terms and conditions specified therein. Upon the occurrence of any Event of
Default under the Credit Agreement, the entire outstanding principal balance of
this Note and all accrued and unpaid interest thereon may be declared to be
immediately due and payable in the manner and with the effect as provided in
the Credit Agreement. All capitalized terms used and not otherwise defined in
this Note shall have the respective meanings ascribed to them in the Credit
Agreement.
<PAGE> 66
In the event that any payment due hereunder shall not be paid when
due, whether by reason of acceleration or otherwise, and this Note shall be
placed in the hands of an attorney or attorneys for collection, or if this Note
shall be placed in the hands of an attorney or attorneys for representation of
Bank in connection with bankruptcy or insolvency proceedings relating hereto,
the Company hereby agrees to pay to the order of Bank, in addition to all other
amounts otherwise due hereon, the reasonable costs and expenses of such
collection and representation, including, without limitation, reasonable
attorneys' fees and expenses (whether or not litigation shall be commenced in
aid thereof). The Company hereby waives presentment for payment, demand,
protest, notice of protest and notice of dishonor.
This Note shall be governed by and construed in accordance with the
internal laws of the State of Missouri.
EDISON BROTHERS STORES, INC.
By _____________________________________
Title: _____________________________________
<PAGE> 67
Line of Credit Note (cont'd)
LOANS AND PAYMENTS OF PRINCIPAL
Amount Amount of Unpaid
Prime, CD of Principal Principal Notation
Date or IBOR Loan Loan Repaid Balance Made By
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<PAGE> 68
EXHIBIT B
REVOLVING CREDIT NOTE
$____________________ St. Louis, Missouri
June 4, 1993
FOR VALUE RECEIVED, on the last day of the Revolving Credit Period,
the undersigned, EDISON BROTHERS STORES, INC., a Delaware corporation (the
"Company"), hereby promises to pay to the order of __________ ("Bank"), the
principal sum of __________ ($__________), or such lesser sum as may then
constitute the aggregate unpaid principal amount of all Revolving Credit Loans
made by Bank to the Company pursuant to the Credit Agreement referred to below.
The aggregate principal amount which Bank shall be committed to have
outstanding hereunder at any time shall not exceed __________ Dollars
($__________), which amount may be borrowed, paid, reborrowed and repaid, in
whole or in part, subject to the terms and conditions hereof and of the Credit
Agreement referred to below. The Company further promises to pay to the order
of Bank interest on the aggregate unpaid principal amount of such Revolving
Credit Loans on the dates and at the rate or rates provided for in the Credit
Agreement. All such payments of principal and interest shall be made in lawful
currency of the United States in Federal or other immediately available funds
at the office of Mercantile Bank of St. Louis National Association, 721 Locust
Street, St. Louis, Missouri 63101.
All Revolving Credit Loans made by Bank and all repayments of the
principal thereof shall be recorded by Bank and, prior to any transfer hereof,
endorsed by Bank on the schedule attached hereto, or on a continuation of such
schedule attached to and made a part hereof; provided, however, that the
obligation of the Company to repay each Revolving Credit Loan made hereunder
shall be absolute and unconditional, notwithstanding any failure of Bank to
record or endorse or any mistake by Bank in connection with recordation or
endorsement on the schedules attached to this Note. Bank's books and records
(including, without limitation, the schedules attached to this Note) showing
the account between Bank and the Company shall be admissible in evidence in any
action or proceeding and shall constitute prima facie proof of the items
therein set forth.
This Note is one of the Revolving Credit Notes referred to in the
Credit Agreement dated the date hereof by and among the Company, the banks
listed on the signature pages thereof and Mercantile Bank of St. Louis National
Association, as agent (as the same may from time to time be amended, modified,
extended or renewed, the "Credit Agreement"). The Credit Agreement, among
other things, contains provisions for acceleration of the maturity hereof upon
the occurrence of certain stated events and also for prepayments on account of
principal hereof and interest hereon prior to the maturity hereof upon the
terms and conditions specified therein. Upon the occurrence of any Event of
Default under the Credit Agreement, the entire outstanding principal balance of
this Note and all accrued and unpaid interest thereon may be declared to be
immediately due and payable in the manner and with the effect as provided in
the Credit Agreement. All capitalized terms used and not otherwise defined in
this Note shall have the respective meanings ascribed to them in the Credit
Agreement.
<PAGE> 69
In the event that any payment due hereunder shall not be paid when
due, whether by reason of acceleration or otherwise, and this Note shall be
placed in the hands of an attorney or attorneys for collection, or if this Note
shall be placed in the hands of an attorney or attorneys for representation of
Bank in connection with bankruptcy or insolvency proceedings relating hereto,
the Company hereby agrees to pay to the order of Bank, in addition to all other
amounts otherwise due hereon, the reasonable costs and expenses of such
collection and representation, including, without limitation, reasonable
attorneys' fees and expenses (whether or not litigation shall be commenced in
aid thereof). The Company hereby waives presentment for payment, demand,
protest, notice of protest and notice of dishonor.
This Note shall be governed by and construed in accordance with the
internal laws of the State of Missouri.
EDISON BROTHERS STORES, INC.
By _____________________________________
Title: _____________________________________
<PAGE> 70
Revolving Credit Note (cont'd)
LOANS AND PAYMENTS OF PRINCIPAL
Amount Amount of Unpaid
Prime, CD of Principal Principal Notation
Date or IBOR Loan Loan Repaid Balance Made By
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<PAGE> 71
EXHIBIT C
[Opinion of General Counsel of Edison Brothers Stores, Inc.]
June 4, 1993
To the Banks and the
Agent Referred to Below
c/o Mercantile Bank of St. Louis
National Association
721 Locust Street
St. Louis, Missouri 63101
Credit Agreement dated effective as of June 4,
1993, by and among Edison Brothers Stores, Inc.,
the Banks listed therein and Mercantile Bank of
St. Louis National Association, as Agent
------------------------------------------------
Gentlemen:
I am Executive Vice President, General Counsel and Secretary of Edison
Brothers Stores, Inc., a Delaware corporation (the "Company") and have acted as
counsel to the Company in connection with its execution and delivery of the
Credit Agreement referred to above (the "Agreement"). This opinion is given
pursuant to Section 3.01(g) of the Agreement. All capitalized terms used and
not otherwise defined herein shall have the respective meanings ascribed to
them in the Agreement.
In rendering this opinion, I have examined originals or copies
(certified or otherwise identified to my satisfaction) of the Certificate of
Incorporation and By-Laws of the Company, the Agreement, the Line of Credit
Notes, the Revolving Credit Notes, records of proceedings of the Board of
Directors and of the Executive Committee of the Board of Directors of the
Company and such other documents, corporate records and certificates of public
officials as I have considered appropriate. I have assumed the genuineness of
all signatures on all documents examined by me, the authenticity of all such
documents delivered to me as originals and the conformity to the originals of
all such documents delivered to me as copies.
In rendering the opinion expressed in the first sentence of paragraph
number 1 below, as to any of the Subsidiaries of the Company listed on
Exhibit A to this opinion (the "Significant Subsidiaries") which are
incorporated in a State other than Missouri or Delaware, I have, with your
concurrence, relied without investigation solely on the certificates rendered
by the Secretaries of State of such States.
Based on the foregoing, I am of the opinion that:
1. The Company and each of its Significant Subsidiaries is (a) a
corporation duly organized, validly existing and in good standing under the
<PAGE> 72
laws of the jurisdiction of its incorporation and (b) duly qualified to do
business in all jurisdictions in which the nature of the business conducted by
it makes such qualification necessary and where failure so to qualify could
reasonably be expected to have a material adverse effect on the business,
operations, Properties or condition, financial or otherwise, of the Company and
its Subsidiaries considered as a whole.
2. The Company has the corporate power and authority to enter
into and perform the Agreement and to execute and deliver the Line of Credit
Notes and the Revolving Credit Notes to you. The execution, delivery and
performance of the Agreement, including the execution and delivery of the Line
of Credit Notes and the Revolving Credit Notes, have been duly authorized by
all requisite corporate action on the part of the Company, and the Agreement,
the Line of Credit Notes and the Revolving Credit Notes have been duly executed
and delivered by the Company.
3. The Agreement, Line of Credit Notes and the Revolving Credit
Notes are legal, valid and binding obligations of the Company, enforceable
against the Company in accordance with their respective terms, except as such
enforceability may be limited by bankruptcy, insolvency or other similar laws
affecting the enforcement of creditors' rights generally and by general
principles of equity.
4. The execution and delivery of the Agreement, the Line of
Credit Notes and the Revolving Credit Notes, and the performance by the Company
of their respective terms, do not conflict with or result in a violation of or
default under the Certificate of Incorporation or By-Laws of the Company, any
of the Note Agreements or, to the best knowledge of the undersigned, any other
agreement, instrument, order, writ, judgment or decree to which the Company is
a party or is subject.
6. To the best knowledge of the undersigned, there are no legal
or arbitral proceedings by or before any governmental or regulatory authority
or agency, now pending or threatened against the Company or any of its
Subsidiaries, which could reasonably be expected to have a material adverse
effect on the business, operations, Properties or condition, financial or
otherwise, of the Company and its Subsidiaries considered as a whole. To the
best knowledge of the undersigned, neither the Company nor any of its
Subsidiaries is in default under or in violation of any order, writ or decree
of any governmental or regulatory authority, which default or violation could
reasonably be expected to have a material adverse effect on the business,
operations, Properties or condition, financial or otherwise, of the Company and
its Subsidiaries considered as a whole.
7. No approval, authorization or other action by, or prior filing
with, any governmental or regulatory authority is required by current law in
connection with the execution and delivery by the Company of the Agreement, the
Line of Credit Notes or the Revolving Credit Notes.
This opinion is furnished solely for your benefit and may not be
distributed to or relied upon by any other person.
Very truly yours,
Alan A. Sachs
Executive Vice President, General Counsel and
Secretary
<PAGE> 73
Exhibit D
C E R T I F I C A T E
---------------------
This Certificate is issued pursuant to Section 5.01(a)(iii) of that
certain Credit Agreement dated effective as of June 4, 1993, by and among
Edison Brothers Stores, Inc., Mercantile Bank of St. Louis National
Association, as Agent, and the Banks listed therein (as the same may from time
to time be amended, modified, extended or renewed, the "Credit Agreement").
All capitalized terms used and not otherwise defined herein shall have the
respective meanings ascribed to them in the Credit Agreement.
Pursuant to Section 5.01(a)(iii) of the Credit Agreement, the Company
hereby certifies, represents and warrants to the Agent and the Banks as
follows:
(i) As of the date hereof, no Default or Event of Default has
occurred under the Credit Agreement and is continuing;
(ii) All of the representations and warranties of the Company
contained in the Agreement are true and correct in all material respects on and
as of the date hereof as if made on the date hereof;
(iii) As of __________, 19__, the calculations contained in Schedule 1
attached hereto are true, accurate and complete; and
(iv) [Description of New Subsidiaries].
Executed this __________ day of __________, 19__.
EDISON BROTHERS STORES, INC.
By: _____________________________________
Title: _____________________________________
<PAGE> 74
SCHEDULE 1
EDISON BROTHERS STORES, INC.
SCHEDULE OF FINANCIAL RATIOS AND RESTRICTIONS
AS OF: __________, 19__
<PAGE> 75
SCHEDULE 4.01(d)
Contingent Liabilities
See Schedule 4.01(e).
<PAGE> 76
SCHEDULE 4.01(e)
Litigation
LaDonna Harrison v. Edison Brothers Apparel Stores, Inc. ("EBAS") (United
States District Court, Middle District of North Carolina). Plaintiff alleges
that while employed in EBAS' Jean West store in the Hanes Mall in Winston-
Salem, she was sexually harassed by the store manager. Plaintiff sued both
EBAS and the store manager, asserting causes of action for intentional
infliction of emotional distress, battery, negligent retention and wrongful
discharge, and seeking $5 million compensatory damages and an unstated amount
of punitive damages on each cause of action. At the end of discovery,
plaintiff voluntarily dismissed all of her claims against the store manager
with prejudice. EBAS thereupon moved for judgment dismissing all claims
against EBAS. The motion was granted as to all counts except the negligent
retention claim. Plaintiff appealed the dismissal of her other claims to the
U.S. Court of Appeals, which affirmed the dismissal of the claims for battery
and intentional infliction of emotional distress, but reversed and reinstated
the claim for wrongful discharge.
The case was tried before the United States District Court in November 1992,
and resulted in a verdict in EBAS' favor on the wrongful discharge claim and a
verdict for the plaintiff on the negligent retention claim. The jury awarded
the plaintiff $225,000 in actual damages but denied her any punitive damages.
Post-trial motions were filed by EBAS to overturn the verdict on the negligent
retention claim. These motions were granted by the judge, the verdict was
vacated, and judgment was entered for EBAS on February 19, 1993.
Plaintiff has filed a notice of appeal. Although EBAS is hopeful that the U.S.
Court of Appeals will uphold the District Court's ruling, the possibility
exists that the Court of Appeals may reverse that ruling and either return the
case for a new trial or reinstate the earlier verdict for the plaintiff. If
the matter is returned for a new trial, the possibility then exists that a new
jury could determine that the plaintiff is entitled to greater damages than
that awarded by the first jury. However, it is EBAS' belief that, even if
those events resulted, plaintiff's actual recovery would be considerably less
than $10 million.
<PAGE> 77
SCHEDULE 4.01(f)
Pension Plan Matters
NONE
<PAGE> 78
SCHEDULE 4.01(i)
Existing Indebtedness
INDEBTEDNESS AMOUNT
- ------------ -----------
NOTES: (As of 5/1/93 unless otherwise noted.)
Notes sold to a group of institutional investors:
7.09% Series A Senior Notes Due March 1, 2000 $45,000,000
7.52% Series B Senior Notes Due March 1, 2003 60,000,000
8.04% Series C Senior Notes Due March 1, 2008 45,000,000
Metropolitan Life Insurance Company:
8.93% Senior Notes Due November 15, 1993 45,000,000
9.19% Senior Notes Due November 15, 1994 15,000,000
The Prudential Insurance Corporation of America and
Prudential Property and Casualty Insurance Corporation:
8.90% Senior Notes Due December 15, 1993 30,000,000
Nationwide Life Insurance Company:
8.44% Senior Notes Due June 15, 1994 20,000,000
Webster 8% Note Payable 11,325
Shawmut Bank (State Street Property) (secured) 187,090
OTHER INDEBTEDNESS
- ------------------
Industrial Revenue Bonds, Washington, Missouri 8,600,000
Distribution Center
BANK BORROWING (B) AND COMMERCIAL PAPER (CP)
- --------------------------------------------
(as of 4/30/93)
Shearson (CP) 6,779,256
Shearson (CP) 13,960,940
Goldman Sachs (CP) 1,695,089
Citibank (B) 10,000,895
Bank of Nova Scotia (B) 3,000,000
Bank of Nova Scotia (B) 3,500,000
-----------
38,936.180
TOTAL $307,734,595
<PAGE> 79
SCHEDULE 4.01(j)
Labor Matters
NONE
<PAGE> 80
SCHEDULE 4.01(k)
Liens
The Company or one or more of its Subsidiaries have signed financing
statements, security agreements or chattel mortgages, or have granted or
permitted Liens securing Indebtedness in an amount in excess of $500,000.00
with respect to their Property as follows:
1. City of Washington Mercantile Trust $3,100,000
Franklin County principal balance
Missouri Industrial
Revenue Bonds,
Series of 1977
2. City of Washington Mercantile Trust $5,500,000
Franklin County principal balance
Missouri Industrial
Revenue Bonds
Series of 1985
3. Leased computer equipment Property value > $500,000
including leases of point of (approximately $3,389,839
sale terminals, mainframe in annual rental payments)
processors, peripheral
hardware and software and
copiers:
<PAGE> 81
SCHEDULE 4.01(o)
Patents, Trademarks and other Intellectual Property
NONE
<PAGE> 82
SCHEDULE 4.01(p)
Environmental and Safety and Health Matters
NONE
<PAGE> 83
SCHEDULE 4.01(r)
Subsidiaries
1. RESTRICTED SUBSIDIARIES:
PERCENTAGE OF VOTING
STOCK OWNED BY
JURISDICTION OF COMPANY AND EACH
NAME OF SUBSIDIARY INCORPORATION OTHER SUBSIDIARY
- ---------------------------------------- --------------- --------------------
Edison Brothers Apparel Stores, Inc. Missouri 100%
Edison Brothers Entertainment, Inc. Missouri 100%
Edison Brothers Redevelopment
Corporation Missouri 100%
Edison Brothers Stores
International, Inc. Missouri 100%
EBSS-West, Inc. California 100%
Edison Alabama Stores, Inc. Alabama 100%
Edison Arkansas Stores, Inc. Arkansas 100%
Edison Colorado Stores, Inc. Colorado 100%
Edison Hawaii Stores, Inc. Delaware 100%
Edison Illinois Stores, Inc. Illinois 100%
Edison Kansas Stores, Inc. Kansas 100%
Edison Kentucky Stores, Inc. Kentucky 100%
Edison Louisiana Stores, Inc. Louisiana 100%
Edison Maryland Stores, Inc. Maryland 100%
Edison Massachusetts Stores, Inc. Massachusetts 100%
Edison Michigan Stores, Inc. Michigan 100%
Edison Minnesota Stores, Inc. Minnesota 100%
Edison Mississippi Stores, Inc. Mississippi 100%
Edison Nebraska Stores, Inc. Nebraska 100%
Edison New Jersey Stores, Inc. New Jersey 100%
Edison New Mexico Stores, Inc. New Mexico 100%
Edison New York Stores, Inc. New York 100%
<PAGE> 84
PERCENTAGE OF VOTING
STOCK OWNED BY
JURISDICTION OF COMPANY AND EACH
NAME OF SUBSIDIARY INCORPORATION OTHER SUBSIDIARY
- ---------------------------------------- --------------- --------------------
Edison Ohio Stores, Inc. Ohio 100%
Edison Oklahoma Stores, Inc. Oklahoma 100%
Edison Oregon Stores, Inc. Oregon 100%
Edison Pennsylvania Stores, Inc. Pennsylvania 100%
Edison Puerto Rico Stores, Inc. Puerto Rico 100%
Edison Tennessee Stores, Inc. Tennessee 100%
Edison Texas Stores, Inc. Texas 100%
Edison Utah Stores, Inc. Utah 100%
EBSS-East, Inc. New York 100%
EBSS-Indiana, Inc. Indiana 100%
EBSS-Iowa, Inc. Iowa 100%
EBSS-Kansas, Inc. Kansas 100%
EBSS-Michigan, Inc. Michigan 100%
EBSS-Mideast, Inc. Maryland 100%
EBSS-Missouri, Inc. Missouri 100%
EBSS-Montana, Inc. Montana 100%
EBSS-North Central, Inc. Illinois 100%
EBSS-Northeast, Inc. Delaware 100%
EBSS-Ohio, Inc. Ohio 100%
EBSS-Pennsylvania, Inc. Pennsylvania 100%
EBSS-South, Inc. Florida 100%
EBSS-Texas, Inc. Texas 100%
EBSS-Wisconsin, Inc. Wisconsin 100%
Edbro Arizona Realty Company, Inc. Arizona 100%
Edbro Arizona USG #2, Inc. Arizona 100%
Edbro California USG #1, Inc. California 100%
<PAGE> 85
PERCENTAGE OF VOTING
STOCK OWNED BY
JURISDICTION OF COMPANY AND EACH
NAME OF SUBSIDIARY INCORPORATION OTHER SUBSIDIARY
- ---------------------------------------- --------------- --------------------
Edbro California USG #2, Inc. California 100%
Edbro Missouri Realty, Inc. Missouri 100%
Edbro Missouri USG #2, Inc. Missouri 100%
Edbro Nebraska USG #2, Inc. Nebraska 100%
Edbro Ohio Realty, Inc. Ohio 100%
Edison Brothers Company Georgia 100%
Edison Brothers Mall Entertainment
Inc. Missouri 100%
Edison Brothers Shoe Stores, Inc. Missouri 100%
Edison Brothers Stores
International, Inc. Taiwan 100%
Edison Paymaster, Inc. Missouri 100%
Edison Whittier Warehouse, Inc. California 100%
EBE Realty, Inc. Missouri 100%
EBSCAT, Inc. Missouri 100%
Edibas de Mexico, S.A. de C.V. Mexico 100%
Dave & Busters, Inc. Delaware 80%
Dave & Busters of Georgia, Inc. Georgia 100% owned by
Dave & Busters, Inc.
Dave & Busters of Texas, Inc. Texas 100% owned by
Dave & Busters, Inc.
Horizon Entertainment, Inc. Missouri 100%
Industrial Design, Inc. Missouri 100%
Kasmen Limited Hong Kong 100%
Mandels of California California 100%
EBS Holdings Corp. Delaware 100%
Sacha Shoes, Ltd. California 100%
Time Out Family Amusement
Centers, Inc. New York 100%
<PAGE> 86
PERCENTAGE OF VOTING
STOCK OWNED BY
JURISDICTION OF COMPANY AND EACH
NAME OF SUBSIDIARY INCORPORATION OTHER SUBSIDIARY
- ---------------------------------------- --------------- --------------------
TOFAC of Puerto Rico, Inc. Virginia 100%
Webster Clothes, Inc. Delaware 100%
Webster-Rossville, Inc. Maryland 100%
Z&Z Fashions, Ltd. California 100%
2. SUBSIDIARIES (OTHER THAN RESTRICTED SUBSIDIARIES):
None
<PAGE> 1
EXHIBIT 10.9
FIRST AMENDMENT TO CREDIT AGREEMENT
-----------------------------------
THIS FIRST AMENDMENT TO CREDIT AGREEMENT (this "Amendment") is made
and entered into this 24th day of January, 1994, by and among EDISON BROTHERS
STORES, INC., a Delaware corporation (the "Company"), the banks listed on the
signature pages hereof (collectively, the "Banks") and MERCANTILE BANK OF
ST. LOUIS NATIONAL ASSOCIATION, a national banking association, as agent for
the Banks (in such capacity, the "Agent").
W I T N E S S E T H
-------------------
WHEREAS, the Company, the Banks and the Agent have heretofore entered
into that certain Credit Agreement dated effective as of June 4, 1993 (the
"Credit Agreement"; all capitalized terms used and not otherwise defined herein
shall have the respective meanings ascribed to them in the Credit Agreement);
and
WHEREAS, the Company desires to amend the Credit Agreement in the
manner hereinafter set forth and the Banks and the Agent are willing to agree
thereto on the terms and conditions hereinafter set forth;
NOW, THEREFORE, in consideration of the premises and for other good
and valuable consideration, the receipt and sufficiency of which are hereby
acknowledged, the Company, the Banks and the Agent hereby agree as follows:
1. Notwithstanding any provision contained in Section 2.06(a) of the
Credit Agreement to the contrary, during the period commencing January 24th,
1994, and ending on the earlier of (i) the last day of the Line of Credit
Period of the applicable Bank(s) and (ii) February 3, 1996, the nonrefundable
commitment fee payable by the Company under Section 2.06(a) of the Credit
Agreement shall be computed on the entire Line of Credit Commitment of each
Bank as opposed to the unused portion of the Line of Credit Commitment of each
Bank.
2. Notwithstanding any provision contained in Section 2.06(b) of the
Credit Agreement to the contrary, during the period commencing January 24th,
1994, and ending on the earlier of (i) the last day of the Revolving Credit
Period of the applicable Bank(s) and (ii) February 3, 1996, the nonrefundable
commitment fee payable by the Company under Section 2.06(b) of the Credit
Agreement shall be computed on the entire Revolving Credit Commitment of each
Bank as opposed to the unused portion of the Revolving Credit Commitment of
each Bank.
3. Section 5.01(d) of the Credit Agreement is hereby deleted in its
entirety and the following substituted in lieu thereof:
"(d) Fixed Charges Coverage Ratio. The Company will keep and
maintain the ratio of Net Income Available for Fixed Charges to Fixed
Charges for:
(i) each period of four (4) consecutive fiscal quarters up to
and including the quarter ending October 30, 1993, at not less
than 1.25 to 1.00;
<PAGE> 2
(ii) the fiscal quarter ending January 29, 1994, at not
less than 1.25 to 1.00;
(iii) each of the first three (3) quarters during the fiscal
years of 1994 and 1995, at not less than 1.00 to 1.00, except
that:
(A) if Consolidated Net Income during any one of the first
three quarters of fiscal years 1994 and 1995 is a net loss,
the Company will keep and maintain a ratio of Net Income
Available for Fixed Charges to Fixed Charges for the period of
four (4) consecutive fiscal quarters ending with the quarter
in which the loss occurs at not less than 1.10 to 1.00, if the
loss occurs during any of the first three fiscal quarters of
1994, or at not less than 1.175 to 1.00, if the loss occurs
during any of the first three fiscal quarters of 1995;
provided, however, that the exception set forth in this clause
(A) shall not be applicable if Consolidated Net Income for
each of any two consecutive quarters during the first three
quarters of fiscal years 1994 or 1995 is a net loss; and
(B) if Consolidated Net Income for each of any two
consecutive quarters during the first three quarters of fiscal
years 1994 or 1995 is a net loss and the net loss reported for
the second such consecutive quarter is smaller than the net
loss reported for the first such quarter, the Company will
keep and maintain a ratio of Net Income Available for Fixed
Charges to Fixed Charges for the period of four (4)
consecutive fiscal quarters ending with the second such
consecutive quarter at not less than 1.10 to 1.00, if the
consecutive quarterly losses occur during the first three
fiscal quarters of 1994, or at not less than 1.175 to 1.00, if
the consecutive quarterly losses occur during the first three
fiscal quarters of 1995;
(iv) the fourth quarter of fiscal years 1994 and 1995, at
not less than 1.25 to 1.00; and
(v) each period of four (4) consecutive fiscal quarters
beginning with the period ending with the first quarter of fiscal
year 1996, and thereafter, at not less than 1.25 to 1.00.
If consolidated Net Income for each of any two consecutive
quarters during the first three quarters of fiscal years 1994 or 1995
is a net loss and the loss reported for the second such consecutive
quarter is greater than the loss reported for the first such quarter,
such event shall constitute an Event of Default under this Agreement."
4. This Amendment shall not be effective unless and until the Agent
shall have received:
(a) evidence satisfactory to the Agent that the minimum fixed
charge coverage covenant contained in Section 5.8 of each of the "Note
Agreements" (as defined in Section 6.01(n) of the Credit Agreement)
has been amended to read the same in all material respects as Section
5.01(d) of the Credit Agreement as amended by this Amendment (with the
exception of the proviso added at the end of clause (A) of paragraph
<PAGE> 3
(iii) of Section 5.01(d) of the Credit Agreement as amended by this
Amendment; and
(b) payment by the Company of a nonrefundable amendment fee for
the ratable benefit of the Banks in the amount of Sixty-Two Thousand
Five Hundred Dollars ($62,500.00).
5. The Company hereby agrees to reimburse the Agent upon demand for
all out-of-pocket costs and expenses, including, without limitation, reasonable
attorneys' fees and expenses, incurred by the Agent in the preparation,
negotiation and execution of this Amendment. All of the obligations of the
Company under this Paragraph 5 shall survive termination of the Credit
Agreement.
6. All references in the Credit Agreement to this "Agreement" and any
other references of similar import shall henceforth mean the Credit Agreement
as amended by this Amendment.
7. Except to the extent specifically amended by this Amendment, all
of the terms, provisions, conditions, covenants, representations and warranties
contained in the Credit Agreement shall be and remain in full force and effect
and the same are hereby ratified and confirmed.
8. This Amendment shall be binding upon and inure to the benefit of
the Company, the Banks, the Agent and their respective successors and assigns,
except that Company may not assign, transfer or delegate any of its rights or
obligations hereunder.
9. The Company hereby represents and warrants to the Banks and the
Agent that:
(a) the execution, delivery and performance by the Company of this
Amendment are within the corporate powers of the Company, have been duly
authorized by all necessary corporate action and require no action by or in
respect of, or filing with, any governmental or regulatory body, agency or
official or any other third party. The execution, delivery and performance by
the Company of this Amendment do not conflict with, or result in a breach of
the terms, conditions or provisions of, or constitute a default under or result
in any violation of, the terms of the Certificate of Incorporation or By-Laws
of the Company, any applicable law, rule, regulation, order, writ, judgment or
decree of any court or governmental or regulatory agency or instrumentality or
any agreement, document or instrument to which the Company is a party or by
which it is bound or to which it is subject;
(b) this Amendment has been duly executed and delivered by the
Company and constitutes the legal, valid and binding obligation of the Company
enforceable in accordance with its terms; and
(c) as of the date hereof, all of the representations, warranties
and covenants of the Company set forth in the Credit Agreement are true and
correct and no Default or Event of Default under or within the meaning of the
Credit Agreement has occurred and is continuing.
10. In the event of any inconsistency or conflict between this
Amendment and the Credit Agreement, the terms, provisions and conditions of
this Amendment shall govern and control.
<PAGE> 4
11. This Amendment shall be governed by and construed in accordance
with the substantive laws of the State of Missouri (without reference to
conflict of law principles).
12. ORAL AGREEMENTS OR COMMITMENTS TO LOAN MONEY, EXTEND CREDIT OR TO
FORBEAR FROM ENFORCING REPAYMENT OF A DEBT, INCLUDING PROMISES TO EXTEND OR
RENEW SUCH DEBT, ARE NOT ENFORCEABLE. TO PROTECT THE COMPANY, THE BANKS AND
THE AGENT FROM MISUNDERSTANDING OR DISAPPOINTMENT, ANY AGREEMENTS REACHED BY
THE COMPANY, THE BANKS AND THE AGENT COVERING SUCH MATTERS ARE CONTAINED IN THE
CREDIT AGREEMENT AS AMENDED BY THIS AMENDMENT, WHICH CREDIT AGREEMENT AS
AMENDED BY THIS AMENDMENT IS A COMPLETE AND EXCLUSIVE STATEMENT OF THE
AGREEMENTS BETWEEN THE COMPANY, THE BANKS AND THE AGENT, EXCEPT AS THE COMPANY,
THE BANKS AND THE AGENT MAY LATER AGREE IN WRITING TO MODIFY THEM.
13. This Amendment may be signed in any number of counterparts, each
of which shall be an original, with the same effect as if the signatures
thereto and hereto were upon the same instrument. Subject to the provisions of
Paragraph 4 of this Amendment, this Amendment shall become effective on the
date when the Agent shall have received counterparts hereof signed by the
Company and each of the Banks, or telexes confirming signatures to such
counterparts.
IN WITNESS WHEREOF, the Company, the Banks and the Agent have executed
this First Amendment to Credit Agreement this 24th day of January, 1994.
EDISON BROTHERS STORES, INC.
By /s/ Ken Vaught
Title: Assistant Vice President and
Cash Management Officer
MERCANTILE BANK OF ST. LOUIS
NATIONAL ASSOCIATION
By /s/ Sally Dion
Title: Vice President
THE BOATMEN'S NATIONAL BANK OF ST. LOUIS
By /s/ C. Susan Taylor
Title: Vice President
CITIBANK, N.A.
By /s/ Theodore J. Beck
Title: Vice President
NBD BANK, N.A.
By /S/ Thomas G. Susser
Title: Second Vice President
<PAGE> 5
THE BANK OF NOVA SCOTIA
By /s/ F.C.H. Ashby
Title: Senior Manager
Loan Operations
THE FIRST NATIONAL BANK OF CHICAGO
By /s/ Sharon A. Huebner
Title: Vice President
BANK OF AMERICA NATIONAL TRUST
AND SAVINGS ASSOCIATION
By
Title:
MERCANTILE BANK OF ST. LOUIS
NATIONAL ASSOCIATION, as Agent
By /S/ Sally Dion
Title: Vice President
<PAGE> 1
EXHIBIT 10.10
SECOND AMENDMENT TO CREDIT AGREEMENT
------------------------------------
THIS SECOND AMENDMENT TO CREDIT AGREEMENT (this "Amendment") is made
and entered into this 17th day of February, 1994, by and among EDISON BROTHERS
STORES, INC., a Delaware corporation (the "Company"), the banks listed on the
signature pages hereof (collectively, the "Banks") and MERCANTILE BANK OF
ST. LOUIS NATIONAL ASSOCIATION, a national banking association, as agent for
the Banks (in such capacity, the "Agent").
W I T N E S S E T H:
--------------------
WHEREAS, the Company, the Banks and the Agent have heretofore entered
into that certain Credit Agreement dated effective as of June 4, 1993, as
amended by that certain First Amendment to Credit Agreement dated January 24th,
1994 (as so amended, the "Credit Agreement"; all capitalized terms used and not
otherwise defined herein shall have the respective meanings ascribed to them in
the Credit Agreement); and
WHEREAS, the Company desires to amend the Credit Agreement in the
manner hereinafter set forth and the Banks and the Agent are willing to agree
thereto on the terms and conditions hereinafter set forth;
NOW, THEREFORE, in consideration of the premises and for other good
and valuable consideration, the receipt and sufficiency of which are hereby
acknowledged, the Company, the Banks and the Agent hereby agree as follows:
1. Section 5.01(d) of the Credit Agreement is hereby deleted in its
entirety and the following substituted in lieu thereof:
"(d) Fixed Charges Coverage Ratio. The Company will keep and
maintain the ratio of Net Income Available for Fixed Charges to Fixed
Charges for:
(i) each period of four (4) consecutive fiscal quarters up to
and including the quarter ending October 30, 1993, at not less
than 1.25 to 1.00;
(ii) the fiscal quarter ending January 29, 1994, at not
less than 1.25 to 1.00;
(iii) each period of four (4) consecutive fiscal quarters
beginning with the period that ends with the first fiscal quarter
of fiscal year 1994 to and including the period that ends with the
fourth fiscal quarter of fiscal year 1994, at not less than 1.10
to 1.00;
(iv) each period of four (4) consecutive fiscal quarters
beginning with the period that ends with the first fiscal quarter
of fiscal year 1995 to and including the period that ends with the
fourth fiscal quarter of fiscal year 1995, at not less than 1.175
to 1.00;
(v) the fourth fiscal quarters of fiscal years 1994 and 1995,
at not less than 1.25 to 1.00; and
<PAGE> 2
(vi) each period of four (4) consecutive fiscal quarters
beginning with the period that ends with the first fiscal quarter
of fiscal year 1996, and thereafter, at not less than 1.25 to
1.00."
2. The word "or" is hereby added immediately following clause (n) of
Section 6.01 of the Credit Agreement and the following new clause (o) is hereby
added to Section 6.01 of the Credit Agreement as an additional Event of Default
under the Credit Agreement:
"(o) If Consolidated Net Income for each of any two consecutive
fiscal quarters during fiscal years 1994 or 1995 is a net loss and the
loss reported for the second such consecutive quarter is greater than
the loss reported for the first such fiscal quarter;"
3. This Amendment shall not be effective unless and until the Agent
shall have received evidence satisfactory to the Agent that the minimum fixed
charge coverage covenant contained in Section 5.8 of each of the "Note
Agreements" (as defined in Section 6.01(n) of the Credit Agreement) has been
amended to read the same in all material respects as Section 5.01(d) of the
Credit Agreement as amended by this Amendment.
4. The Company hereby agrees to reimburse the Agent upon demand for
all out-of-pocket costs and expenses, including, without limitation, reasonable
attorneys' fees and expenses, incurred by the Agent in the preparation,
negotiation and execution of this Amendment. All of the obligations of the
Company under this Paragraph 4 shall survive termination of the Credit
Agreement.
5. All references in the Credit Agreement to this "Agreement" and
any, other references of similar import shall henceforth mean the Credit
Agreement as amended by this Amendment.
6. Except to the extent specifically amended by this Amendment, all
of the terms, provisions, conditions, covenants, representations and warranties
contained in the Credit Agreement shall be and remain in full force and effect
and the same are hereby ratified and confirmed.
7. This Amendment shall be binding upon and inure to the benefit of
the Company, the Banks, the Agent and their respective successors and assigns,
except that Company may not assign, transfer or delegate any of its rights or
obligations hereunder.
8. The Company hereby represents and warrants to the Banks and the
Agent that:
(a) the execution, delivery and performance by the Company of this
Amendment are within the corporate powers of the Company, have been duly
authorized by all necessary corporate action and require no action by or in
respect of, or filing with, any governmental or regulatory body, agency or
official or any other third party. The execution, delivery and performance by
the Company of this Amendment do not conflict with, or result in a breach of
the terms, conditions or provisions of, or constitute a default under or result
in any violation of, the terms of the Certificate of Incorporation or By-Laws
of the Company, any applicable law, rule, regulation, order, writ, judgment or
decree of any court or governmental or regulatory agency or instrumentality, or
any agreement, document or instrument to which the Company is a party or by
which it is bound or to which it is subject;
<PAGE> 3
(b) this Amendment has been duly executed and delivered by the
Company and constitutes the legal, valid and binding obligation of the Company
enforceable in accordance with its terms; and
(c) as of the date hereof, all of the representations, warranties
and covenants of the Company set forth in the Credit Agreement are true and
correct and no Default or Event of Default under or within the meaning of the
Credit Agreement has occurred and is continuing.
9. In the event of any inconsistency or conflict between this
Amendment and the Credit Agreement, the terms, provisions and conditions of
this Amendment shall govern and control.
10. This Amendment shall be governed by and construed in accordance
with the substantive laws of the State of Missouri (without reference to
conflict of law principles).
11. ORAL AGREEMENTS OR COMMITMENTS TO LOAN MONEY, EXTEND CREDIT OR TO
FORBEAR FROM ENFORCING REPAYMENT OF A DEBIT INCLUDING PROMISES TO EXTEND OR
RENEW SUCH DEBT, ARE NOT ENFORCEABLE. TO PROTECT THE COMPANY, THE BANKS AND
THE AGENT FROM MISUNDERSTANDING OR DISAPPOINTMENT, ANY AGREEMENTS REACHED BY
THE COMPANY, THE BANKS AND THE AGENT COVERING SUCH MATTERS ARE CONTAINED IN THE
CREDIT AGREEMENT AS AMENDED BY THIS AMENDMENT, WHICH CREDIT AGREEMENT AS
AMENDED BY THIS AMENDMENT IS A COMPLETE AND EXCLUSIVE STATEMENT OF THE
AGREEMENTS BETWEEN THE COMPANY, THE BANKS AND THE AGENT, EXCEPT AS THE COMPANY,
THE BANKS AND THE AGENT MAY LATER AGREE IN WRITING TO MODIFY THEM.
12. This Amendment may be signed in any number of counterparts, each
of which shall be an original, with the same effect as if the signatures
thereto and hereto were upon the same instrument. Subject to the provisions of
Paragraph 3 of this Amendment, this Amendment shall become effective on the
date when the Agent shall have received counterparts hereof signed by the
Company and each of the Banks.
IN WITNESS WHEREOF, the Company, the Banks and the Agent have executed
this Second Amendment to Credit Agreement this 17th day of February, 1994.
EDISON BROTHERS STORES, INC.
By Lee G. Weeks
Title:
MERCANTILE BANK OF ST. LOUIS
NATIONAL ASSOCIATION
By /S/ Sally Dion
Title: Vice President
THE BOATMEN'S NATIONAL BANK OF ST. LOUIS
By /S/ C. Susan Taylor
Title: Vice President
<PAGE> 4
CITIBANK, N.A.
By /S/ Theodore J. Beck
Title: Vice President
NBD BANK, N.A.
By /S/ J. J. Csernits
Title: First Vice President
THE BANK OF NOVA SCOTIA
By /S/ A. S. Norsworthy
Title: Assistant Agent
THE FIRST NATIONAL BANK OF CHICAGO
By /s/ Sharon A. Huebner
Title: Vice President
BANK OF AMERICA NATIONAL TRUST AND
SAVINGS ASSOCIATION
By /S/ Lymen Sanger
Title: Vice President
MERCANTILE BANK OF ST. LOUIS
NATIONAL ASSOCIATION, as Agent
By /S/ Sally Dion
Title: Vice President
<PAGE> 1
EXHIBIT 10.11
THIRD AMENDMENT TO CREDIT AGREEMENT
-----------------------------------
THIS THIRD AMENDMENT TO CREDIT AGREEMENT (this "Amendment") is made
and entered into effective as of the 29th day of March, 1995, by and among
EDISON BROTHERS STORES, INC., a Delaware corporation (the "Company"), the banks
listed on the signature pages hereof (collectively, the "Banks") and MERCANTILE
BANK OF ST. LOUIS NATIONAL ASSOCIATION, a national banking association, as
agent for the Banks (in such capacity, the "Agent").
W I T N E S S E T H:
--------------------
WHEREAS, the Company, the Banks and the Agent have heretofore entered
into that certain Credit Agreement dated effective as of June 4, 1993, as
amended by that certain First Amendment to Credit Agreement dated January 24,
1994, and that certain Second Amendment to Credit Agreement dated February 17,
1994 (as so amended, the "Credit Agreement"; all capitalized terms used and not
otherwise defined herein shall have the respective meanings ascribed to them in
the Credit Agreement); and
WHEREAS, the Company desires to amend the Credit Agreement in the
manner hereinafter set forth and the Banks and the Agent are willing to agree
thereto on the terms and conditions hereinafter set forth;
NOW, THEREFORE, in consideration of the premises and for other good
and valuable consideration, the receipt and sufficiency of which are hereby
acknowledged, the Company, the Banks and the Agent hereby agree as follows:
1. The definition of "IBOR Margin" set forth in Section 1.01 of
the Credit Agreement is hereby deleted in its entirety and the following
substituted in lieu thereof:
""IBOR Margin" shall mean: (a) with respect to each Line of
Credit Loan,
(i) during the period commencing June 4, 1993, and ending
March 28, 1995,
(A) .375% per annum during such time as the Company's
commercial paper is rated P-1 by Moody's and A-1 by S&P,
(B) .50% per annum during such time as the Company's
commercial paper is rated at least P-2 by Moody's and at least
A-2 by S&P,
(C) .6875% per annum during such time as the Company's
commercial paper is rated at least P-3 by Moody's and at least
A-3 by S&P, and
(D) .9375% per annum during such time as the Company's
commercial paper is (1) rated NP by Moody's or B, C or D by
S&P or (2) not rated by either or both of Moody's and/or S&P,
<PAGE> 2
and if clauses (A) and (B) are both applicable or if clauses (A), (B)
and (C) are all applicable, the IBOR Margin set forth in clause (A)
shall be applicable, and if both clauses (B) and (C) are applicable,
the IBOR Margin set forth in clause (B) shall be applicable; and
(ii) .625% per annum during the period commencing March 29,
1995, and ending on the earlier of (1) the first date when the Company
has issued at least $100,000,000.00 in aggregate principal amount of
Long-Term Indebtedness on or after March 29, 1995, or (2) May 31,
1995; provided, however, that if (A) the Company issues Long-Term
Indebtedness on or after March 29, 1995, and before June 1, 1995, and
(B) such Long-Term Indebtedness is rated less than Baa-3 by Moody's or
less than BBB- by S&P, then such IBOR Margin shall be adjusted
retroactively to March 29, 1995, to the IBOR Margin which would be
applicable under clause (iii) below given the applicable Long-Term
Indebtedness ratings, and
(iii) from and after the earlier of (1) the date one day after
the first date when the Company has issued at least $100,000,000.00 in
aggregate principal amount of Long-Term Indebtedness on or after
March 29, 1995, or (2) June 1, 1995,
(A) .50% per annum during such time as the Company's
Long-Term Indebtedness (if any) is rated at least Baa-2 by
Moody's and at least BBB by S&P,
(B) .625% per annum during such time as the Company's
Long-Term Indebtedness (if any) is rated at least Baa-3 by
Moody's and at least BBB- by S&P,
(C) .825% per annum during such time as the Company's
Long-Term Indebtedness (if any) is rated at least Ba-1 by
Moody's and at least BB+ by S&P, and
(D) 1.125% per annum during such time as (1) the
Company's Long-Term Indebtedness (if any) is (a) rated Ba-2 or
lower by Moody's or BB or lower by S&P or (b) not rated by
either or both of Moody's and/or S&P or (2) the Company has no
Long-Term Indebtedness outstanding,
and if clauses (A) and (B) are both applicable or if clauses (A), (B)
and (C) are all applicable, the IBOR Margin set forth in clause (A)
shall be applicable, and if both clauses (B) and (C) are applicable,
the IBOR Margin set forth in clause (B) shall be applicable; and
(b) with respect to each Revolving Credit Loan,
(i) during the period commencing June 4, 1993, and ending
March 28, 1995,
(A) .375% per annum during such time as the Company's
commercial paper is rated P-1 by Moody's and A-1 by S&P,
(B) .50% per annum during such time as the Company's
commercial paper is rated at least P-2 by Moody's and at least
A-2 by S&P,
<PAGE> 3
(C) .6875% per annum during such time as the Company's
commercial paper is rated at least P-3 by Moody's and at least
A-3 by S&P, and
(D) .9375% per annum during such time as the Company's
commercial paper is (1) rated NP by Moody's or B, C or D by
S&P or (2) not rated by either or both of Moody's and/or S&P,
and if clauses (A) and (B) are both applicable or if clauses (A), (B)
and (C) are all applicable, the IBOR Margin set forth in clause (A)
shall be applicable, and if both clauses (B) and (C) are applicable,
the IBOR Margin set forth in clause (B) shall be applicable; and
(ii) .625% per annum during the period commencing March 29,
1995, and ending on the earlier of (1) the first date when the Company
has issued at least $100,000,000.00 in aggregate principal amount of
Long-Term Indebtedness on or after March 29, 1995, or (2) May 31,
1995; provided, however, that if (A) the Company issues Long-Term
Indebtedness on or after March 29, 1995, and before June 1, 1995, and
(B) such Long-Term Indebtedness is rated less than Baa-3 by Moody's or
less than BBB- by S&P, then such IBOR Margin shall be adjusted
retroactively to March 29, 1995, to the IBOR Margin which would be
applicable under clause (iii) below given the applicable Long-Term
Indebtedness ratings, and
(iii) from and after the earlier of (1) the date one day after
the first date when the Company has issued at least $100,000,000.00 in
aggregate principal amount of Long-Term Indebtedness on or after March
29, 1995, or (2) June 1, 1995,
(A) .50% per annum during such time as the Company's
Long-Term Indebtedness (if any) is rated at least Baa-2 by
Moody's and at least BBB by S&P,
(B) .625% per annum during such time as the Company's
Long-Term Indebtedness (if any) is rated at least Baa-3 by
Moody's and at least BBB- by S&P,
(C) .825% per annum during such time as the Company's
Long-Term Indebtedness (if any) is rated at least Ba-1 by
Moody's and at least BB+ by S&P, and
(D) 1.125% per annum during such time as (1) the
Company's Long-Term Indebtedness (if any) is (a) rated Ba-2 or
lower by Moody's or BB or lower by S&P or (b) not rated by
either or both of Moody's and/or S&P or (2) the Company has no
Long-Term Indebtedness outstanding,
and if clauses (A) and (B) are both applicable or if clauses (A), (B)
and (C) are all applicable, the IBOR Margin set forth in clause (A)
shall be applicable, and if both clauses (B) and (C) are applicable,
the IBOR Margin set forth in clause (B) shall be applicable.
The IBOR Rate shall be adjusted automatically on and as of the
effective date of any change in the IBOR Margin."
<PAGE> 4
2. The following new definition of "Long-Term Indebtedness" is
hereby added to Section 1.01 of the Credit Agreement:
""Long-Term Indebtedness" shall mean senior unsecured long-
term debt of the Company which has a maturity date of three (3) years
or more from the date of original issuance thereof."
3. Section 2.06 of the Credit Agreement is hereby deleted in its
entirety and the following substituted in lieu thereof:
"SECTION 2.06. Fees. (a) From the Effective Date to but
excluding March 29, 1995, the Company shall pay to the Agent for the
account of each Bank a nonrefundable commitment fee on (i) from the
Effective Date to but excluding January 23, 1994, the unused portion
of the Line of Credit Commitment of such Bank and (ii) from January
24, 1994, to but excluding March 29, 1995, the entire Line of Credit
Commitment of such Bank, at the rate of:
(i) .025% per annum during such time as the Company's
commercial paper is rated P-1 by Moody's and A-1 by S&P,
(ii) .0625% per annum during such time as the
Company's commercial paper is rated at least P-2 by Moody's
and at least A-2 by S&P,
(iii) .0625% per annum during such time as the
Company's commercial paper is rated at least P-3 by Moody's
and at least A-3 by S&P, and
(iv) .0625% per annum during such time as the
Company's commercial paper is (A) rated NP by Moody's or B, C
or D by S&P or (B) not rated by either or both of Moody's
and/or S&P,
and if clauses (i) and (ii) are both applicable or if clauses (i),
(ii) and (iii) are all applicable, the rate set forth in clause (i)
shall be applicable, and if both clauses (ii) and (iii) are
applicable, the rate set forth in clause (ii) shall be applicable.
Such commitment fee shall be payable quarterly in arrears on each
January 1, April 1, July 1 and October 1 during the Line of Credit
Period of the applicable Bank(s) and on the last day of the Line of
Credit Period of the applicable Bank(s), and shall be calculated on an
actual day, 360-day year basis.
(b) From the Effective Date to but excluding March 29, 1995,
the Company shall pay to the Agent for the account of each Bank a
nonrefundable commitment fee on (i) from the Effective Date to but
excluding January 23, 1994, the unused portion of the Revolving Credit
Commitment of such Bank and (ii) from January 24, 1994, to but
excluding March 29, 1995, the entire Revolving Credit Commitment of
such Bank, at the rate of:
(i) .0625% per annum during such time as the Company's
commercial paper is rated P-1 by Moody's and A-1 by S&P,
(ii) .125% per annum during such time as the Company's
commercial paper is rated at least P-2 by Moody's and at least
A-2 by S&P,
<PAGE> 5
(iii) .125% per annum during such time as the
Company's commercial paper is rated at least P-3 by Moody's
and at least A-3 by S&P, and
(iv) .125% per annum during such time as the Company's
commercial paper is (A) rated NP by Moody's or B, C or D by
S&P or (B) not rated by either or both of Moody's and/or S&P,
and if clauses (i) and (ii) are both applicable or if clauses (i),
(ii) and (iii) are all applicable, the rate set forth in clause (i)
shall be applicable, and if both clauses (ii) and (iii) are
applicable, the rate set forth in clause (ii) shall be applicable.
Such commitment fee shall be payable quarterly in arrears on each
January 1, April 1, July 1 and October 1 during the Revolving Credit
Period of the applicable Bank(s) and on the last day of the Revolving
Credit Period of the applicable Bank(s), and shall be calculated on an
actual day, 360-day year basis.
(c) From the Effective Date to but excluding March 29, 1995,
the Company shall pay to the Agent for the account of each Bank a
nonrefundable facility fee on the entire Line of Credit Commitment of
such Bank at the rate of:
(i) .125% per annum during such time as the Company's
commercial paper is rated P-1 by Moody's and A-1 by S&P,
(ii) .125% per annum during such time as the Company's
commercial paper is rated at least P-2 by Moody's and at least
A-2 by S&P,
(iii) .1875% per annum during such time as the
Company's commercial paper is rated at least P-3 by Moody's
and at least A-3 by S&P, and
(iv) .1875% per annum during such time as the
Company's commercial paper is (A) rated NP by Moody's or B, C
or D by S&P or (B) not rated by either or both of Moody's
and/or S&P,
and if clauses (i) and (ii) are both applicable or if clauses (i),
(ii) and (iii) are all applicable, the rate set forth in clause (i)
shall be applicable, and if both clauses (ii) and (iii) are
applicable, the rate set forth in clause (ii) shall be applicable.
Such facility fee shall be payable quarterly in arrears on each
January 1, April 1, July 1 and October 1 during the Line of Credit
Period of the applicable Bank(s) and on the last day of the Line of
Credit Period of the applicable Bank(s), and shall be calculated on an
actual day, 360-day year basis.
(d) From the Effective Date to but excluding March 29, 1995,
the Company shall pay to the Agent for the account of each Bank a
nonrefundable facility fee on the entire Revolving Credit Commitment
of such Bank at the rate of:
(i) .125% per annum during such time as the Company's
commercial paper is rated P-1 by Moody's and A-1 by S&P,
<PAGE> 6
(ii) .125% per annum during such time as the Company's
commercial paper is rated at least P-2 by Moody's and at least
A-2 by S&P,
(iii) .1875% per annum during such time as the
Company's commercial paper is rated at least P-3 by Moody's
and at least A-3 by S&P, and
(iv) .1875% per annum during such time as the
Company's commercial paper is (A) rated NP by Moody's or B, C
or D by S&P or (B) not rated by either or both of Moody's
and/or S&P,
and if clauses (i) and (ii) are both applicable or if clauses (i),
(ii) and (iii) are all applicable, the rate set forth in clause (i)
shall be applicable, and if both clauses (ii) and (iii) are
applicable, the rate set forth in clause (ii) shall be applicable.
Such facility fee shall be payable quarterly in arrears on each
January 1, April 1, July 1 and October 1 during the Revolving Credit
Period of the applicable Bank(s) and on the last day of the Revolving
Credit Period of the applicable Bank(s), and shall be calculated on an
actual day, 360-day year basis.
(e) From March 29, 1995, to and including the earlier of
(1) the first date when the Company has issued at least
$100,000,000.00 in aggregate principal amount of Long-Term
Indebtedness on or after March 29, 1995, or (2) May 31, 1995, the
Company shall pay to the Agent for the account of each Bank a
nonrefundable facility fee on the entire Line of Credit Commitment of
such Bank at the rate of .20% per annum; provided, however, that if
(A) the Company issues Long-Term Indebtedness on or after March 29,
1995, and before June 1, 1995, and (B) such Long-Term Indebtedness is
rated less than Baa-3 by Moody's or less than BBB- by S&P, then the
amount of such facility fee shall be adjusted retroactively to March
29, 1995, to the facility fee which would be applicable under clause
(g) below given the applicable Long-Term Indebtedness ratings. Such
facility fee shall be payable in arrears on July 1, 1995, and shall be
calculated on an actual day, 360-day year basis.
(f) From March 29, 1995, to and including the earlier of
(1) the first date when the Company has issued at least
$100,000,000.00 in aggregate principal amount of Long-Term
Indebtedness on or after March 29, 1995, or (2) May 31, 1995, the
Company shall pay to the Agent for the account of each Bank a
nonrefundable facility fee on the entire Revolving Credit Commitment
of such Bank at the rate of .20% per annum; provided, however, that if
(A) the Company issues Long-Term Indebtedness on or after March 29,
1995, and before June 1, 1995, and (B) such Long-Term Indebtedness is
rated less than Baa-3 by Moody's or less than BBB- by S&P, then the
amount of such facility fee shall be adjusted retroactively to March
29, 1995, to the facility fee which would be applicable under clause
(h) below given the applicable Long-Term Indebtedness ratings. Such
facility fee shall be payable in arrears on July 1, 1995, and shall be
calculated on an actual day, 360-day year basis.
<PAGE> 7
(g) From the earlier of (1) the date one day after the
first date when the Company has issued at least $100,000,000.00 in
aggregate principal amount of Long-Term Indebtedness on or after
March 29, 1995, or (2) June 1, 1995, to but excluding the last day of
the Line of Credit Period of the applicable Bank(s), the Company shall
pay to the Agent for the account of each Bank a nonrefundable facility
fee on the entire Line of Credit Commitment of such Bank at the rate
of:
(i) .15% per annum during such time as the Company's
Long-Term Indebtedness (if any) is rated at least Baa-2 by
Moody's and at least BBB by S&P,
(ii) .20% per annum during such time as the Company's
Long-Term Indebtedness (if any) is rated at least Baa-3 by
Moody's and at least BBB- by S&P,
(iii) .325% per annum during such time as the
Company's Long-Term Indebtedness (if any) is rated at least
Ba-1 by Moody's and at least BB+ by S&P, and
(iv) .375% per annum during such time as (A) the
Company's Long-Term Indebtedness (if any) is (1) rated Ba-2 or
lower by Moody's or BB or lower by S&P or (2) not rated by
either or both of Moody's and/or S&P or (B) the Company has no
Long-Term Indebtedness outstanding,
and if clauses (i) and (ii) are both applicable or if clauses (i),
(ii) and (iii) are all applicable, the rate set forth in clause (i)
shall be applicable, and if both clauses (ii) and (iii) are
applicable, the rate set forth in clause (ii) shall be applicable.
Such facility fee shall be payable quarterly in arrears on each
January 1, April 1, July 1 and October 1 during the Line of Credit
Period of the applicable Bank(s) and on the last day of the Line of
Credit Period of the applicable Bank(s), and shall be calculated on an
actual day, 360-day year basis.
(h) From the earlier of (1) the date one day after the
first date when the Company has issued at least $100,000,000.00 in
aggregate principal amount of Long-Term Indebtedness on or after March
29, 1995, or (2) June 1, 1995, to but excluding the last day of the
Revolving Credit Period of the applicable Bank(s), the Company shall
pay to the Agent for the account of each Bank a nonrefundable facility
fee on the entire Revolving Credit Commitment of such Bank at the rate
of:
(i) .15% per annum during such time as the Company's
Long-Term Indebtedness (if any) is rated at least Baa-2 by
Moody's and at least BBB by S&P,
(ii) .20% per annum during such time as the Company's
Long-Term Indebtedness (if any) is rated at least Baa-3 by
Moody's and at least BBB- by S&P,
(iii) .325% per annum during such time as the
Company's Long-Term Indebtedness (if any) is rated at least
Ba-1 by Moody's and at least BB+ by S&P, and
<PAGE> 8
(iv) .375% per annum during such time as (A) the
Company's Long-Term Indebtedness (if any) is (1) rated Ba-2 or
lower by Moody's or BB or lower by S&P or (2) not rated by
either or both of Moody's and/or S&P or (B) the Company has no
Long-Term Indebtedness outstanding,
and if clauses (i) and (ii) are both applicable or if clauses (i),
(ii) and (iii) are all applicable, the rate set forth in clause (i)
shall be applicable, and if both clauses (ii) and (iii) are
applicable, the rate set forth in clause (ii) shall be applicable.
Such facility fee shall be payable quarterly in arrears on each
January 1, April 1, July 1 and October 1 during the Revolving Credit
Period of the applicable Bank(s) and on the last day of the Revolving
Credit Period of the applicable Bank(s), and shall be calculated on an
actual day, 360-day year basis.
(i) For each day during the period commencing March 29,
1995, and ending on the earlier of (1) the first date when the Company
has issued at least $100,000,000.00 in aggregate principal amount of
Long-Term Indebtedness on or after March 29, 1995, or (2) May 31,
1995, on which the unused portion of the Line of Credit Commitment of
a Bank is less than Fifty Percent (50%) of the entire Line of Credit
Commitment of such Bank, the Company shall pay to the Agent for the
account of such Bank a nonrefundable utilization fee on the entire
Line of Credit Commitment of such Bank at the rate of .20% per annum;
provided, however, that if (A) the Company issues Long-Term
Indebtedness on or after March 29, 1995, and before June 1, 1995, and
(B) such Long-Term Indebtedness is rated less than Baa-3 by Moody's or
less than BBB- by S&P, then the amount of such utilization fee shall
be adjusted retroactively to March 29, 1995, to the utilization fee
which would be applicable under clause (k) below given the applicable
Long-Term Indebtedness ratings. Such utilization fee shall be payable
in arrears on July 1, 1995, and shall be calculated on an actual day,
360-day year basis.
(j) For each day during the period commencing March 29,
1995, and ending on the earlier of (1) the first date when the Company
has issued at least $100,000,000.00 in aggregate principal amount of
Long-Term Indebtedness on or after March 29, 1995, or (2) May 31,
1995, on which the unused portion of the Revolving Credit Commitment
of a Bank is less than Fifty Percent (50%) of the entire Revolving
Credit Commitment of such Bank, the Company shall pay to the Agent for
the account of such Bank a nonrefundable utilization fee on the entire
Revolving Credit Commitment of such Bank at the rate of .20% per
annum; provided, however, that if (A) the Company issues Long-Term
Indebtedness on or after March 29, 1995, and before June 1, 1995, and
(B) such Long-Term Indebtedness is rated less than Baa-3 by Moody's or
less than BBB- by S&P, then the amount of such utilization fee shall
be adjusted retroactively to March 29, 1995, to the utilization fee
which would be applicable under clause (l) below given the applicable
Long-Term Indebtedness ratings. Such utilization fee shall be payable
in arrears on July 1, 1995, and shall be calculated on an actual day,
360-day year basis.
(k) For each day during the period commencing on the
earlier of (1) the date one day after the first date when the Company
has issued at least $100,000,000.00 in aggregate principal amount of
Long-Term Indebtedness on or after March 29, 1995, or (2) June 1,
<PAGE> 9
1995, and ending on the last day of the Line of Credit Period of the
applicable Bank on which the unused portion of the Line of Credit
Commitment of a Bank is less than Fifty Percent (50%) of the entire
Line of Credit Commitment of such Bank, the Company shall pay to the
Agent for the account of such Bank a nonrefundable utilization fee on
the entire Line of Credit Commitment of such Bank at the rate of:
(i) .10% per annum during such time as the Company's
Long-Term Indebtedness (if any) is rated at least Baa-2 by
Moody's and at least BBB by S&P,
(ii) .20% per annum during such time as the Company's
Long-Term Indebtedness (if any) is rated at least Baa-3 by
Moody's and at least BBB- by S&P,
(iii) .20% per annum during such time as the Company's
Long-Term Indebtedness (if any) is rated at least Ba-1 by
Moody's and at least BB+ by S&P, and
(iv) .25% per annum during such time as (A) the
Company's Long-Term Indebtedness (if any) is (1) rated Ba-2 or
lower by Moody's or BB or lower by S&P or (2) not rated by
either or both of Moody's and/or S&P or (B) the Company has no
Long-Term Indebtedness outstanding,
and if clauses (i) and (ii) are both applicable or if clauses (i),
(ii) and (iii) are all applicable, the rate set forth in clause (i)
shall be applicable, and if both clauses (ii) and (iii) are
applicable, the rate set forth in clause (ii) shall be applicable.
Such utilization fee shall be payable quarterly in arrears on each
January 1, April 1, July 1 and October 1 during the Line of Credit
Period of the applicable Bank(s) and on the last day of the Line of
Credit Period of the applicable Bank(s), and shall be calculated on an
actual day, 360-day year basis.
(l) For each day during the period commencing on the
earlier of (1) the date one day after the first date when the Company
has issued at least $100,000,000.00 in aggregate principal amount of
Long-Term Indebtedness on or after March 29, 1995, or (2) June 1,
1995, and ending on the last day of the Revolving Credit Period of the
applicable Bank on which the unused portion of the Revolving Credit
Commitment of a Bank is less than Fifty Percent (50%) of the entire
Revolving Credit Commitment of such Bank, the Company shall pay to the
Agent for the account of such Bank a nonrefundable utilization fee on
the entire Revolving Credit Commitment of such Bank at the rate of:
(i) .10% per annum during such time as the Company's
Long-Term Indebtedness (if any) is rated at least Baa-2 by
Moody's and at least BBB by S&P,
(ii) .20% per annum during such time as the Company's
Long-Term Indebtedness (if any) is rated at least Baa-3 by
Moody's and at least BBB- by S&P,
(iii) .20% per annum during such time as the Company's
Long-Term Indebtedness (if any) is rated at least Ba-1 by
Moody's and at least BB+ by S&P, and
<PAGE> 10
(iv) .25% per annum during such time as (A) the
Company's Long-Term Indebtedness (if any) is (1) rated Ba-2 or
lower by Moody's or BB or lower by S&P or (2) not rated by
either or both of Moody's and/or S&P or (B) the Company has no
Long-Term Indebtedness outstanding,
and if clauses (i) and (ii) are both applicable or if clauses (i),
(ii) and (iii) are all applicable, the rate set forth in clause (i)
shall be applicable, and if both clauses (ii) and (iii) are
applicable, the rate set forth in clause (ii) shall be applicable.
Such facility fee shall be payable quarterly in arrears on each
January 1, April 1, July 1 and October 1 during the Revolving Credit
Period of the applicable Bank(s) and on the last day of the Revolving
Credit Period of the applicable Bank(s), and shall be calculated on an
actual day, 360-day year basis.
(m) The Company shall also pay to the Agent for its own
account a nonrefundable agent's fee in the amounts set forth in a
letter agreement dated June 4, 1993, by and between the Company and
the Agent."
4. Section 5.01(d) of the Credit Agreement is hereby deleted in
its entirety and the following substituted in lieu thereof:
"(d) Fixed Charges Coverage Ratio. The Company will keep and
maintain the ratio of Net Income Available for Fixed Charges to Fixed
Charges for:
(i) each period of four (4) consecutive fiscal
quarters up to and including the fiscal quarter ending October
30, 1993, at not less than 1.25 to 1.00;
(ii) the fiscal quarter ending January 29, 1994, at
not less than 1.25 to 1.00;
(iii) each period of four (4) consecutive fiscal
quarters beginning with the period that ends with the first
fiscal quarter of fiscal year 1994 to and including the period
that ends with the fourth fiscal quarter of fiscal year 1994,
at not less than 1.10 to 1.00;
(iv) the fourth fiscal quarter of fiscal year
1994, at not less than 1.25 to 1.00;
(v) each period of four (4) consecutive fiscal
quarters beginning with the period that ends with the fiscal
quarter ending April 29, 1995, to and including the period
that ends with the fiscal quarter ending October 28, 1995, at
not less than 1.05 to 1.00;
(vi) each period of four (4) consecutive fiscal
quarters beginning with the period that ends with the fiscal
quarter ending February 3, 1996, to and including the period
that ends with the fiscal quarter ending November 2, 1996, at
not less than 1.10 to 1.00;
<PAGE> 11
(vii) the fourth fiscal quarter of each fiscal year
commencing with fiscal year 1995, at not less than 1.25 to
1.00; and
(viii) each period of four (4) consecutive fiscal
quarters beginning with the period that ends with the fiscal
quarter ending February 1, 1997, and thereafter, at not less
than 1.175 to 1.00."
5. Section 5.01(h) of the Credit Agreement is hereby deleted in
its entirety and the following substituted in lieu thereof:
"(h) Certain Restrictions Relating to Subsidiaries.
(i) Except as permitted by Section 5.01(g), the Company will not cause
or permit any Restricted Subsidiary to merge or consolidate into or
with any Person (other than the Company or a Wholly-Owned Subsidiary)
if such other Person will be the surviving or continuing corporation
unless, (A) immediately after giving effect to such merger or
consolidation, (1) the portion of Consolidated Net Tangible Assets
attributable to the Restricted Subsidiary being merged or consolidated
shall not exceed 12.5% of the total Consolidated Net Tangible Assets
as of the end of the fiscal quarter of the Company immediately
preceding the date of such merger or consolidation and (2) the portion
of Consolidated Net Sales attributable to the Restricted Subsidiary
being merged or consolidated shall not exceed 12.5% of the total
Consolidated Net Sales as of the end of the fiscal year of the Company
immediately preceding the date of such merger or consolidation, (B)
the ratio of Net Income Available for Fixed Charges to Fixed Charges
for the period of four (4) consecutive fiscal quarters ended
immediately preceding the date of such merger or consolidation and for
the most recent fourth fiscal quarter of the Company ended immediately
preceding the date of such merger or consolidation (each determined on
a pro forma basis and excluding any amounts attributable to the
Restricted Subsidiary being merged or consolidated) shall not be less
than the respective minimum amounts required by Section 5.01(d),
(C) immediately after giving effect to such merger or consolidation,
no Default or Event of Default shall have occurred and be continuing
and (D) immediately after giving effect to such merger or
consolidation, all of the representations and warranties of the
Company contained in this Agreement shall be true and correct in all
material respects as if made on and as of the date of such merger or
consolidation.
(ii) The Company will not, and it will not cause or permit
any Restricted Subsidiary to, sell, assign, transfer or otherwise
dispose of any capital stock of any Restricted Subsidiary to any
Person (other than the Company or a Wholly-Owned Subsidiary) unless,
(A) immediately after giving effect to such sale, assignment, transfer
or other disposition, (1) the portion of Consolidated Net Tangible
Assets attributable to that portion of the Restricted Subsidiary being
sold, assigned, transferred or otherwise disposed of (meaning the same
proportion as the fair market value (as determined by the Company in
good faith) of the capital stock being sold bears to the total fair
market value (as determined by the Company in good faith) of all of
the outstanding capital stock of such Restricted Subsidiary) shall not
exceed 12.5% of the total Consolidated Net Tangible Assets as of the
end of the fiscal quarter of the Company immediately preceding the
date of such sale, assignment, transfer or other disposition and
<PAGE> 12
(2) the portion of Consolidated Net Sales attributable to that portion
of the Restricted Subsidiary being sold, assigned, transferred or
otherwise disposed of (meaning the same proportion as the fair market
value (as determined by the Company in good faith) of the capital
stock being sold bears to the total fair market value (as determined
by the Company in good faith) of all of the outstanding capital stock
of such Restricted Subsidiary) shall not exceed 12.5% of the total
Consolidated Net Sales as of the end of the fiscal year of the Company
immediately preceding the date of such sale, assignment, transfer or
other disposition, (B) the ratio of Net Income Available for Fixed
Charges to Fixed Charges for the period of four (4) consecutive fiscal
quarters ended immediately preceding the date of such sale,
assignment, transfer or other disposition and for the most recent
fourth fiscal quarter of the Company ended immediately preceding the
date of such sale, assignment, transfer or other disposition (each
determined on a pro forma basis and excluding any amounts attributable
to that portion of the Restricted Subsidiary being sold, assigned,
transferred or otherwise disposed of (meaning the same proportion as
the fair market value (as determined by the Company in good faith) of
the capital stock being sold bears to the total fair market value (as
determined by the Company in good faith) of all of the outstanding
capital stock the Restricted Subsidiary)) shall not be less than the
respective minimum amounts required by Section 5.01(d),
(C) immediately after giving effect to such sale, assignment, transfer
or other disposition, no Default or Event of Default shall have
occurred and be continuing and (D) immediately after giving effect to
such sale, assignment, transfer or other disposition, all of the
representations and warranties of the Company contained in this
Agreement shall be true and correct in all material respects as if
made on and as of the date of such transfer or other disposition.
(iii) The Company will not cause or permit any Restricted
Subsidiary to issue any shares of its capital stock to any Person
(other than the Company or a Wholly-Owned Subsidiary) unless, (A)
immediately after giving effect to such issuance, (1) the portion of
Consolidated Net Tangible Assets attributable to that portion of the
Restricted Subsidiary being issued to another Person (meaning the same
proportion as the fair market value (as determined by the Company in
good faith) of the capital stock being issued bears to the total fair
market value (as determined by the Company in good faith) of all of
the outstanding capital stock of such Restricted Subsidiary (including
the capital stock being issued)) shall not exceed 12.5% of the total
Consolidated Net Tangible Assets as of the end of the fiscal quarter
of the Company immediately preceding the date of such issuance and
(2) the portion of Consolidated Net Sales attributable to that portion
of the Restricted Subsidiary being issued to another Person (meaning
the same proportion as the fair market value (as determined by the
Company in good faith) of the capital stock being issued bears to the
total fair market value (as determined by the Company in good faith)
of all of the outstanding capital stock of such Restricted Subsidiary
(including the capital stock being issued)) shall not exceed 12.5% of
the total Consolidated Net Sales as of the end of the fiscal year of
the Company immediately preceding the date of such issuance, (B) the
ratio of Net Income Available for Fixed Charges to Fixed Charges for
the period of four (4) consecutive fiscal quarters ended immediately
preceding the date of such issuance and for the most recent fourth
fiscal quarter of the Company ended immediately preceding the date of
such issuance (each determined on a pro forma basis and excluding any
<PAGE> 13
amounts attributable to that portion of the Restricted Subsidiary
being issued to another Person (meaning the same proportion as the
fair market value (as determined by the Company in good faith) of the
capital stock being issued bears to the total fair market value (as
determined by the Company in good faith) of all of the outstanding
capital stock of the Restricted Subsidiary (including the capital
stock being issued))) shall not be less than the respective minimum
amounts required by Section 5.01(d), (C) immediately after giving
effect to such issuance, no Default or Event of Default shall have
occurred and be continuing, and (D) immediately after giving effect to
such issuance, all of the representations and warranties of the
Company contained in this Agreement shall be true and correct in all
material respects as if made on and as of the date of such issuance.
(iv) The Company will not cause or permit any Restricted
Subsidiary to, sell, assign, transfer or otherwise dispose of (other
than in the ordinary course of business) any of such Restricted
Subsidiary's Property or assets to any Person (other than the Company
or any Wholly-Owned Subsidiary) unless, (A) immediately after giving
effect to such sale, assignment, transfer or other disposition,
(1) the portion of Consolidated Net Tangible Assets attributable to
that portion of the Restricted Subsidiary being sold, assigned,
transferred or otherwise disposed of (meaning the same proportion as
the fair market value (as determined by the Company in good faith) of
the Properties and assets being sold bears to the total fair market
value (as determined by the Company in good faith) of all of
Properties and assets of the Restricted Subsidiary) shall not exceed
12.5% of the total Consolidated Net Tangible Assets as of the end of
the fiscal quarter of the Company immediately preceding the date of
such sale, assignment, transfer or other disposition and (2) the
portion of Consolidated Net Sales attributable to that portion of the
Restricted Subsidiary being sold, assigned, transferred or otherwise
disposed of (meaning the same proportion as the fair market value (as
determined by the Company in good faith) of the Properties and assets
being sold bears to the total fair market value (as determined by the
Company in good faith) of all of Properties and assets of the
Restricted Subsidiary) shall not exceed 12.5% of the total
Consolidated Net Sales as of the end of the fiscal year of the Company
immediately preceding the date of such sale, assignment, transfer or
other disposition, (B) the ratio of Net Income Available for Fixed
Charges to Fixed Charges for the period of four (4) consecutive fiscal
quarters ended immediately preceding the date of such sale,
assignment, transfer or other disposition and for the most recent
fourth fiscal quarter of the Company ended immediately preceding the
date of such sale, assignment, transfer or other disposition (each
determined on a pro forma basis and excluding any amounts attributable
to that portion of the Restricted Subsidiary being sold, assigned,
transferred or otherwise disposed of (meaning the same proportion as
the fair market value (as determined by the Company in good faith) of
the Properties and assets being sold bears to the total fair market
value (as determined by the Company in good faith) of all of
Properties and assets of the Restricted Subsidiary)) shall not be less
than the respective minimum amounts required by Section 5.01(d),
(C) immediately after giving effect to such sale, assignment, transfer
or other disposition, no Default or Event of Default shall have
occurred and be continuing and (D) immediately after giving effect to
such sale, assignment, transfer or other disposition, all of the
representations and warranties of the Company contained in this
<PAGE> 14
Agreement shall be true and correct in all material respects as if
made on and as of the date of such sale, assignment, transfer or other
disposition."
6. The following new Sections 5.01(z) and 5.01(aa) are hereby
added to the Credit Agreement:
"(z) Use of Proceeds of Long-Term Indebtedness. The Company
will use all of the net proceeds of each issuance of Long-Term
Indebtedness issued by the Company on or after March 29, 1995, first
to pay or prepay (i) any Current Debt of the Company under any
uncommitted lines of credit of the Company and (ii) any Loans of the
Company under this Agreement on a pro-rata basis among the Banks. Any
remaining proceeds may then be used by the Company for its general
corporate purposes to the extent not inconsistent with any of the
other terms or provisions of this Agreement.
(aa) No Prepayment of Funded Debt. The Company will not make
any optional prepayment on any Funded Debt of the Company (other than
the Loans under this Agreement) except with the proceeds of Long-Term
Indebtedness issued by the Company on or after January 1, 1996."
7. Clause (o) of Section 6.01 of the Credit Agreement is hereby
deleted in its entirety and the following substituted in lieu thereof:
"(o) If Consolidated Net Income for each of any two
consecutive fiscal quarters is a net loss and the loss reported for
the second such consecutive quarter is greater than the loss reported
for the first such fiscal quarter;"
8. Notwithstanding any provision contained in the Credit
Agreement to the contrary, from and after March 29, 1995, the Company shall
have no right to request or obtain a CD Loan under the Credit Agreement and all
references in the Credit Agreement to CD Loans (and any related terms) shall
henceforth be disregarded in their entirety.
9. This Amendment shall not be effective unless and until the
Agent shall have received:
(a) evidence satisfactory to the Agent that the minimum
fixed charge coverage covenant contained in Section 5.8 of each of the
"Note Agreements" (as defined in Section 6.01(n) of the Credit
Agreement) has been amended to read the same in all material respects
as Section 5.01(d) of the Credit Agreement as amended by this
Amendment;
(b) a copy of resolutions of the Board of Directors of the
Company (or a duly authorized committee thereof), duly adopted, which
authorize the execution, delivery and performance of this Amendment,
certified by the Secretary of the Company; and
(c) payment by the Company of a nonrefundable amendment
fee for the ratable benefit of the Banks in the amount of One Hundred
Fifty-Six Thousand Two Hundred Fifty Dollars ($156,250.00).
10. The Company hereby agrees to reimburse the Agent upon demand
for all out-of-pocket costs and expenses, including, without limitation,
reasonable attorneys' fees and expenses, incurred by the Agent in the
<PAGE> 15
preparation, negotiation and execution of this Amendment. All of the
obligations of the Company under this Paragraph 10 shall survive the
termination of the Credit Agreement.
11. All references in the Credit Agreement and in the Notes to the
Credit Agreement and any other references of similar import shall henceforth
mean the Credit Agreement as amended by this Amendment.
12. Except to the extent specifically amended by this Amendment,
all of the terms, provisions, conditions, covenants, representations and
warranties contained in the Credit Agreement shall be and remain in full force
and effect and the same are hereby ratified and confirmed.
13. This Amendment shall be binding upon and inure to the benefit
of the Company, the Banks, the Agent and their respective successors and
assigns, except that Company may not assign, transfer or delegate any of its
rights or obligations hereunder.
14. The Company hereby represents and warrants to the Banks and
the Agent that:
(a) the execution, delivery and performance by the Company
of this Amendment are within the corporate powers of the Company, have been
duly authorized by all necessary corporate action and require no action by or
in respect of, or filing with, any governmental or regulatory body, agency or
official or any other third party. The execution, delivery and performance by
the Company of this Amendment do not conflict with, or result in a breach of
the terms, conditions or provisions of, or constitute a default under or result
in any violation of, the terms of the Certificate of Incorporation or By-Laws
of the Company, any applicable law, rule, regulation, order, writ, judgment or
decree of any court or governmental or regulatory agency or instrumentality or
any agreement, document or instrument to which the Company is a party or by
which it is bound or to which it is subject;
(b) this Amendment has been duly executed and delivered by
the Company and constitutes the legal, valid and binding obligation of the
Company enforceable in accordance with its terms; and
(c) as of the date hereof, all of the representations,
warranties and covenants of the Company set forth in the Credit Agreement are
true and correct and no Default or Event of Default under or within the meaning
of the Credit Agreement has occurred and is continuing.
15. In the event of any inconsistency or conflict between this
Amendment and the Credit Agreement, the terms, provisions and conditions of
this Amendment shall govern and control.
16. This Amendment shall be governed by and construed in
accordance with the substantive laws of the State of Missouri (without
reference to conflict of law principles).
17. ORAL AGREEMENTS OR COMMITMENTS TO LOAN MONEY, EXTEND CREDIT OR
TO FORBEAR FROM ENFORCING REPAYMENT OF A DEBT, INCLUDING PROMISES TO EXTEND OR
RENEW SUCH DEBT, ARE NOT ENFORCEABLE. TO PROTECT THE COMPANY, THE BANKS AND
THE AGENT FROM MISUNDERSTANDING OR DISAPPOINTMENT, ANY AGREEMENTS REACHED BY
THE COMPANY, THE BANKS AND THE AGENT COVERING SUCH MATTERS ARE CONTAINED IN THE
CREDIT AGREEMENT AS AMENDED BY THIS AMENDMENT, WHICH CREDIT AGREEMENT AS
AMENDED BY THIS AMENDMENT IS A COMPLETE AND EXCLUSIVE STATEMENT OF THE
<PAGE> 16
AGREEMENTS BETWEEN THE COMPANY, THE BANKS AND THE AGENT, EXCEPT AS THE COMPANY,
THE BANKS AND THE AGENT MAY LATER AGREE IN WRITING TO MODIFY THEM.
18. This Amendment may be signed in any number of counterparts,
each of which shall be an original, with the same effect as if the signatures
thereto and hereto were upon the same instrument. Subject to the provisions of
Paragraph 9 of this Amendment, this Amendment shall become effective on the
date when the Agent shall have received original or telecopied counterparts
hereof signed by the Company and each of the Banks.
IN WITNESS WHEREOF, the Company, the Banks and the Agent have executed
this Third Amendment to Credit Agreement this 11th day of April, 1995,
effective as of March 29, 1995.
EDISON BROTHERS STORES, INC.
By /S/ David B. Cooper, Jr.
------------------------------------------
Title: Executive Vice President and
Chief Financial Officer
MERCANTILE BANK OF ST. LOUIS
NATIONAL ASSOCIATION
By /S/ Carl Dunajcik
------------------------------------------
Title:_______________________________________
THE BOATMEN'S NATIONAL BANK OF ST. LOUIS
By /S/ John Rouse
------------------------------------------
Title:_______________________________________
CITIBANK, N.A.
By /S/ Theodore J. Beck
------------------------------------------
Title:_______________________________________
NBD BANK (formerly known as NBD Bank, N.A.)
By Thomas A. LeVasseur
------------------------------------------
Title:_______________________________________
THE BANK OF NOVA SCOTIA
By /S/ S. C. B. Ashby
------------------------------------------
Title:_______________________________________
<PAGE> 17
THE FIRST NATIONAL BANK OF CHICAGO
By /S/ Jeneatte Ganousis
------------------------------------------
Title:_______________________________________
BANK OF AMERICA NATIONAL TRUST
AND SAVINGS ASSOCIATION
By /S/ Adam N. Bolbach
------------------------------------------
Title:_______________________________________
MERCANTILE BANK OF ST. LOUIS
NATIONAL ASSOCIATION, as Agent
By /S/ Carl Dunajcik
------------------------------------------
Title:_______________________________________
<PAGE> 1
EXHIBIT 10.12
Draft of 3/8/95
===============================================================================
EDISON BROTHERS STORES, INC.
TO
FLEET BANK OF MASSACHUSETTS
Trustee
______________
Indenture
Dated as of ..............., 1995
______________
===============================================================================
<PAGE> 2
EDISON BROTHERS STORES, INC.
Certain Sections of this Indenture relating to Sections 310 through 318,
inclusive, of the Trust Indenture Act of 1939:
Trust Indenture
Act Section Indenture Section
Section 310 (a)(1) . . . . . . . . . . . . . . . . . . . 609
(a)(2) . . . . . . . . . . . . . . . . . . . 609
(a)(3) . . . . . . . . . . . . . . . . . . . Not Applicable
(a)(4) . . . . . . . . . . . . . . . . . . . Not Applicable
(b). . . . . . . . . . . . . . . . . . . . . 608
610
Section 311 (a). . . . . . . . . . . . . . . . . . . . . 613
(b). . . . . . . . . . . . . . . . . . . . . 613
Section 312 (a). . . . . . . . . . . . . . . . . . . . . 701
702
(b). . . . . . . . . . . . . . . . . . . . . 702
(c). . . . . . . . . . . . . . . . . . . . . 702
Section 313 (a). . . . . . . . . . . . . . . . . . . . . 703
(b). . . . . . . . . . . . . . . . . . . . . 703
(c). . . . . . . . . . . . . . . . . . . . . 703
(d). . . . . . . . . . . . . . . . . . . . . 703
Section 314 (a). . . . . . . . . . . . . . . . . . . . . 704
(a)(4) . . . . . . . . . . . . . . . . . . . 101
1004
(b). . . . . . . . . . . . . . . . . . . . . Not Applicable
(c)(1) . . . . . . . . . . . . . . . . . . . 102
(c)(2) . . . . . . . . . . . . . . . . . . . 102
(c)(3) . . . . . . . . . . . . . . . . . . . Not Applicable
(d). . . . . . . . . . . . . . . . . . . . . Not Applicable
(e). . . . . . . . . . . . . . . . . . . . . 102
Section 315 (a). . . . . . . . . . . . . . . . . . . . . 601
(b). . . . . . . . . . . . . . . . . . . . . 602
(c). . . . . . . . . . . . . . . . . . . . . 601
(d). . . . . . . . . . . . . . . . . . . . . 601
(e). . . . . . . . . . . . . . . . . . . . . 514
Section 316 (a). . . . . . . . . . . . . . . . . . . . . 101
(a)(1)(A). . . . . . . . . . . . . . . . . . 502
512
(a)(1)(B). . . . . . . . . . . . . . . . . . 513
(a)(2) . . . . . . . . . . . . . . . . . . . Not Applicable
(b). . . . . . . . . . . . . . . . . . . . . 508
(c). . . . . . . . . . . . . . . . . . . . . 104
Section 317 (a)(1) . . . . . . . . . . . . . . . . . . . 503
(a)(2) . . . . . . . . . . . . . . . . . . . 504
(b). . . . . . . . . . . . . . . . . . . . . 1003
Section 318 (a). . . . . . . . . . . . . . . . . . . . . 107
- ---------------
NOTE: This reconciliation and tie shall not, for any purpose, be deemed to be
a part of the Indenture.
<PAGE> 3
TABLE OF CONTENTS
__________
PAGE
----
PARTIES . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8
RECITALS OF THE COMPANY. . . . . . . . . . . . . . . . . . . . . . . . . 8
ARTICLE ONE
DEFINITIONS AND OTHER PROVISIONS OF GENERAL APPLICATION
SECTION 101. Definitions:
Act. . . . . . . . . . . . . . . . . . . . . . . . . . . 8
Affiliate; control . . . . . . . . . . . . . . . . . . . 9
Attributable Debt. . . . . . . . . . . . . . . . . . . . 9
Authenticating Agent . . . . . . . . . . . . . . . . . . 9
Board of Directors . . . . . . . . . . . . . . . . . . . 9
Board Resolution . . . . . . . . . . . . . . . . . . . . 9
Business Day . . . . . . . . . . . . . . . . . . . . . . 9
Commission . . . . . . . . . . . . . . . . . . . . . . . 9
Company. . . . . . . . . . . . . . . . . . . . . . . . . 10
Company Request; Company Order . . . . . . . . . . . . . 10
Consolidated Net Tangible Assets . . . . . . . . . . . . 10
Corporate Trust Office . . . . . . . . . . . . . . . . . 10
corporation. . . . . . . . . . . . . . . . . . . . . . . 10
Covenant Defeasance. . . . . . . . . . . . . . . . . . . 10
Defaulted Interest . . . . . . . . . . . . . . . . . . . 10
Defeasance . . . . . . . . . . . . . . . . . . . . . . . 10
Depositary . . . . . . . . . . . . . . . . . . . . . . . 10
Event of Default . . . . . . . . . . . . . . . . . . . . 10
Exchange Act . . . . . . . . . . . . . . . . . . . . . . 10
Expiration Date. . . . . . . . . . . . . . . . . . . . . 10
Global Security. . . . . . . . . . . . . . . . . . . . . 10
Holder . . . . . . . . . . . . . . . . . . . . . . . . . 10
Indenture. . . . . . . . . . . . . . . . . . . . . . . . 10
interest . . . . . . . . . . . . . . . . . . . . . . . . 11
Interest Payment Date. . . . . . . . . . . . . . . . . . 11
Investment Company Act . . . . . . . . . . . . . . . . . 11
Maturity . . . . . . . . . . . . . . . . . . . . . . . . 11
Nonrecourse Obligation . . . . . . . . . . . . . . . . . 11
Notice of Default. . . . . . . . . . . . . . . . . . . . 11
Officers' Certificate. . . . . . . . . . . . . . . . . . 11
Opinion of Counsel . . . . . . . . . . . . . . . . . . . 11
Original Issue Discount Security . . . . . . . . . . . . 11
Outstanding. . . . . . . . . . . . . . . . . . . . . . . 11
Paying Agent . . . . . . . . . . . . . . . . . . . . . . 12
Person . . . . . . . . . . . . . . . . . . . . . . . . . 12
Place of Payment . . . . . . . . . . . . . . . . . . . . 12
Predecessor Security . . . . . . . . . . . . . . . . . . 13
Principal Property . . . . . . . . . . . . . . . . . . . 13
Redemption Date. . . . . . . . . . . . . . . . . . . . . 13
Redemption Price . . . . . . . . . . . . . . . . . . . . 13
Regular Record Date. . . . . . . . . . . . . . . . . . . 13
Responsible Officer. . . . . . . . . . . . . . . . . . . 13
Restricted Subsidiary. . . . . . . . . . . . . . . . . . 13
<PAGE> 4
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Sale and Lease-Back Transaction. . . . . . . . . . . . . 13
Securities . . . . . . . . . . . . . . . . . . . . . . . 13
Securities Act . . . . . . . . . . . . . . . . . . . . . 14
Security Register and Security Registrar . . . . . . . . 14
Special Record Date. . . . . . . . . . . . . . . . . . . 14
Stated Maturity. . . . . . . . . . . . . . . . . . . . . 14
Subsidiary . . . . . . . . . . . . . . . . . . . . . . . 14
Trust Indenture Act. . . . . . . . . . . . . . . . . . . 14
Trustee. . . . . . . . . . . . . . . . . . . . . . . . . 14
U.S. Government Obligation . . . . . . . . . . . . . . . 14
Vice President . . . . . . . . . . . . . . . . . . . . . 14
SECTION 102. Compliance Certificates and Opinions . . . . . . . . . . 14
SECTION 103. Form of Documents Delivered to Trustee . . . . . . . . . 15
SECTION 104. Acts of Holders; Record Dates. . . . . . . . . . . . . . 15
SECTION 105. Notices, Etc., to Trustee and Company. . . . . . . . . . 17
SECTION 106. Notice to Holders; Waiver. . . . . . . . . . . . . . . . 18
SECTION 107. Conflict with Trust Indenture Act. . . . . . . . . . . . 18
SECTION 108. Effect of Headings and Table of Contents . . . . . . . . 18
SECTION 109. Successors and Assigns . . . . . . . . . . . . . . . . . 18
SECTION 110. Separability Clause. . . . . . . . . . . . . . . . . . . 19
SECTION 111. Benefits of Indenture. . . . . . . . . . . . . . . . . . 19
SECTION 112. Governing Law. . . . . . . . . . . . . . . . . . . . . . 19
SECTION 113. Legal Holidays . . . . . . . . . . . . . . . . . . . . . 19
ARTICLE TWO
SECURITY FORMS
SECTION 201. Forms Generally. . . . . . . . . . . . . . . . . . . . . 19
SECTION 202. Form of Face of Security . . . . . . . . . . . . . . . . 20
SECTION 203. Form of Reverse of Security. . . . . . . . . . . . . . . 21
SECTION 204. Form of Legend for Global Securities . . . . . . . . . . 25
SECTION 205. Form of Trustee's Certificate of Authentication. . . . . 25
ARTICLE THREE
THE SECURITIES
SECTION 301. Amount Unlimited; Issuable in Series . . . . . . . . . . 25
SECTION 302. Denominations. . . . . . . . . . . . . . . . . . . . . . 28
SECTION 303. Execution, Authentication, Delivery and Dating . . . . . 28
SECTION 304. Temporary Securities . . . . . . . . . . . . . . . . . . 29
SECTION 305. Registration, Registration of Transfer and Exchange. . . 30
SECTION 306. Mutilated, Destroyed, Lost and Stolen Securities . . . . 31
SECTION 307. Payment of Interest; Interest Rights Preserved . . . . . 32
SECTION 308. Persons Deemed Owners. . . . . . . . . . . . . . . . . . 33
SECTION 309. Cancellation . . . . . . . . . . . . . . . . . . . . . . 33
SECTION 310. Computation of Interest. . . . . . . . . . . . . . . . . 34
<PAGE> 5
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ARTICLE FOUR
SATISFACTION AND DISCHARGE
SECTION 401. Satisfaction and Discharge of Indenture. . . . . . . . . 34
SECTION 402. Application of Trust Money . . . . . . . . . . . . . . . 35
ARTICLE FIVE
REMEDIES
SECTION 501. Events of Default. . . . . . . . . . . . . . . . . . . . 35
SECTION 502. Acceleration of Maturity; Rescission and Annulment . . . 37
SECTION 503. Collection of Indebtedness and Suits for
Enforcement by Trustee . . . . . . . . . . . . . . . 38
SECTION 504. Trustee May File Proofs of Claim . . . . . . . . . . . . 38
SECTION 505. Trustee May Enforce Claims Without Possession
of Securities. . . . . . . . . . . . . . . . . . . . 39
SECTION 506. Application of Money Collected . . . . . . . . . . . . . 39
SECTION 507. Limitation on Suits. . . . . . . . . . . . . . . . . . . 39
SECTION 508. Unconditional Right of Holders to Receive Principal,
Premium and Interest . . . . . . . . . . . . . . . . 40
SECTION 509. Restoration of Rights and Remedies . . . . . . . . . . . 40
SECTION 510. Rights and Remedies Cumulative . . . . . . . . . . . . . 40
SECTION 511. Delay or Omission Not Waiver . . . . . . . . . . . . . . 41
SECTION 512. Control by Holders . . . . . . . . . . . . . . . . . . . 41
SECTION 513. Waiver of Past Defaults. . . . . . . . . . . . . . . . . 41
SECTION 514. Undertaking for Costs. . . . . . . . . . . . . . . . . . 41
SECTION 515. Waiver of Usury, Stay or Extension Laws. . . . . . . . . 42
ARTICLE SIX
THE TRUSTEE
SECTION 601. Certain Duties and Responsibilities. . . . . . . . . . . 42
SECTION 602. Notice of Defaults . . . . . . . . . . . . . . . . . . . 42
SECTION 603. Certain Rights of Trustee. . . . . . . . . . . . . . . . 42
SECTION 604. Not Responsible for Recitals or Issuance of Securities . 43
SECTION 605. May Hold Securities. . . . . . . . . . . . . . . . . . . 43
SECTION 606. Money Held in Trust. . . . . . . . . . . . . . . . . . . 44
SECTION 607. Compensation and Reimbursement . . . . . . . . . . . . . 44
SECTION 608. Conflicting Interests. . . . . . . . . . . . . . . . . . 44
SECTION 609. Corporate Trustee Required; Eligibility. . . . . . . . . 44
SECTION 610. Resignation and Removal; Appointment of Successor. . . . 45
SECTION 611. Acceptance of Appointment by Successor . . . . . . . . . 46
SECTION 612. Merger, Conversion, Consolidation or Succession
to Business. . . . . . . . . . . . . . . . . . . . . 47
SECTION 613. Preferential Collection of Claims Against Company. . . . 47
SECTION 614. Appointment of Authenticating Agent. . . . . . . . . . . 47
<PAGE> 6
PAGE
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ARTICLE SEVEN
HOLDERS' LISTS AND REPORTS BY TRUSTEE AND COMPANY
SECTION 701. Company to Furnish Trustee Names and Addresses
of Holders . . . . . . . . . . . . . . . . . . . . . 49
SECTION 702. Preservation of Information; Communications
to Holders . . . . . . . . . . . . . . . . . . . . . 49
SECTION 703. Reports by Trustee . . . . . . . . . . . . . . . . . . . 50
SECTION 704. Reports by Company . . . . . . . . . . . . . . . . . . . 50
ARTICLE EIGHT
CONSOLIDATION, MERGER, CONVEYANCE, TRANSFER OR LEASE
SECTION 801. Company May Consolidate, Etc., Only on
Certain Terms. . . . . . . . . . . . . . . . . . . . 50
SECTION 802. Successor Substituted. . . . . . . . . . . . . . . . . . 51
ARTICLE NINE
SUPPLEMENTAL INDENTURES
SECTION 901. Supplemental Indentures Without Consent of Holders . . . 51
SECTION 902. Supplemental Indentures with Consent of Holders. . . . . 52
SECTION 903. Execution of Supplemental Indentures . . . . . . . . . . 53
SECTION 904. Effect of Supplemental Indentures. . . . . . . . . . . . 53
SECTION 905. Conformity with Trust Indenture Act. . . . . . . . . . . 54
SECTION 906. Reference in Securities to Supplemental Indentures . . . 54
ARTICLE TEN
COVENANTS
SECTION 1001. Payment of Principal, Premium and Interest . . . . . . . 54
SECTION 1002. Maintenance of Office or Agency. . . . . . . . . . . . . 54
SECTION 1003. Money for Securities Payments to Be Held in Trust. . . . 55
SECTION 1004. Statement by Officers as to Default. . . . . . . . . . . 56
SECTION 1005. Existence. . . . . . . . . . . . . . . . . . . . . . . . 56
SECTION 1006. Maintenance of Properties. . . . . . . . . . . . . . . . 56
SECTION 1007. Payment of Taxes and Other Claims. . . . . . . . . . . . 56
SECTION 1008. Limitation on Liens. . . . . . . . . . . . . . . . . . . 57
SECTION 1009. Limitation on Sale and Lease-Back Transactions . . . . . 58
SECTION 1010. Waiver of Certain Covenants. . . . . . . . . . . . . . . 58
ARTICLE ELEVEN
REDEMPTION OF SECURITIES
SECTION 1101. Applicability of Article . . . . . . . . . . . . . . . . 59
SECTION 1102. Election to Redeem; Notice to Trustee. . . . . . . . . . 59
<PAGE> 7
PAGE
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SECTION 1103. Selection by Trustee of Securities to Be Redeemed. . . . 59
SECTION 1104. Notice of Redemption . . . . . . . . . . . . . . . . . . 60
SECTION 1105. Deposit of Redemption Price. . . . . . . . . . . . . . . 60
SECTION 1106. Securities Payable on Redemption Date. . . . . . . . . . 61
SECTION 1107. Securities Redeemed in Part. . . . . . . . . . . . . . . 61
ARTICLE TWELVE
SINKING FUNDS
SECTION 1201. Applicability of Article . . . . . . . . . . . . . . . . 61
SECTION 1202. Satisfaction of Sinking Fund Payments with Securities. . 62
SECTION 1203. Redemption of Securities for Sinking Fund. . . . . . . . 62
ARTICLE THIRTEEN
DEFEASANCE AND COVENANT DEFEASANCE
SECTION 1301. Company's Option to Effect Defeasance or
Covenant Defeasance. . . . . . . . . . . . . . . . . 62
SECTION 1302. Defeasance and Discharge . . . . . . . . . . . . . . . . 63
SECTION 1303. Covenant Defeasance. . . . . . . . . . . . . . . . . . . 63
SECTION 1304. Conditions to Defeasance or Covenant Defeasance. . . . . 63
SECTION 1305. Deposited Money and U.S. Government Obligations
to Be Held in Trust; Miscellaneous Provisions. . . . 65
SECTION 1306. Reinstatement. . . . . . . . . . . . . . . . . . . . . . 66
TESTIMONIUM . . . . . . . . . . . . . . . . . . . . . . . . . . . . 66
SIGNATURES AND SEALS . . . . . . . . . . . . . . . . . . . . . . . . . . 66
ACKNOWLEDGEMENTS . . . . . . . . . . . . . . . . . . . . . . . . . . . . 67
<PAGE> 8
INDENTURE, dated as of ............, 1995 between EDISON BROTHERS
STORES, INC., a corporation duly organized and existing under the laws of the
State of Delaware (herein called the "Company"), having its principal office at
501 North Broadway, St. Louis, Missouri 63102, and Fleet Bank of Massachusetts,
N.A., a National Banking Association duly organized and existing under the laws
of the United States of America, as Trustee (herein called the "Trustee").
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
debentures, notes or other evidences of indebtedness (herein called the
"Securities"), to be issued in one or more series as in this Indenture
provided.
All things necessary to make this Indenture a valid agreement of the
Company, in accordance with its terms, have been done.
NOW, THEREFORE, THIS INDENTURE WITNESSETH:
For and in consideration of the premises and the purchase of the
Securities by the Holders thereof, it is mutually agreed, for the equal and
proportionate benefit of all Holders of the Securities or of series thereof, as
follows:
ARTICLE ONE
DEFINITIONS AND OTHER PROVISIONS
OF GENERAL APPLICATION
SECTION 101. 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, and, except as otherwise herein expressly provided, the term
"generally accepted accounting principles" with respect to any computation
required or permitted hereunder shall mean such accounting principles as
are generally accepted at the date of such computation;
(4) unless the context otherwise requires, any reference to an
"Article" or a "Section" refers to an Article or a Section, as the case may
be, of this Indenture; and
<PAGE> 9
(5) 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.
"Act", when used with respect to any Holder, has the meaning specified
in Section 104.
"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" when used with respect to any specified Person means the power to
direct the management and policies of such Person, directly or indirectly,
whether through the ownership of voting securities, by contract or otherwise;
and the terms "controlling" and "controlled" have meanings correlative to the
foregoing.
"Attributable Debt" when used in connection with a Sale and Lease-Back
Transaction involving a Principal Property means, at the time of determination,
the lesser of: (a) the fair value of such property (as determined in good faith
by the Board of Directors of the Company); or (b) the present value of the
total net amount of rent required to be paid under such lease during the
remaining term thereof (including any renewal term or period for which such
lease has been extended), discounted at the rate of interest set forth or
implicit in the terms of such lease or, if not practicable to determine such
rate, the weighted average interest rate per annum (in the case of Original
Issue Discount Securities, the imputed interest rate) borne by the Securities
of each series outstanding pursuant to the Indenture compounded semi-annually.
For purposes of the foregoing definition, rent shall not include amounts
required to be paid by the lessee, whether or not designated as rent or
additional rent, on account of or contingent upon maintenance and repairs,
insurance, taxes, assessments, water rates and similar charges. In the case of
any lease which is terminable by the lessee upon the payment of a penalty, such
net amount shall be the lesser of the net amount determined assuming
termination upon the first date such lease may be terminated (in which case the
net amount shall also include the amount of the penalty, but no rent shall be
considered as required to be paid under such lease subsequent to the first date
upon which it may be so terminated) or the net amount determined assuming no
such termination.
"Authenticating Agent" means any Person authorized by the Trustee
pursuant to Section 614 to act on behalf of the Trustee to authenticate
Securities of one or more series.
"Board of Directors" means either the board of directors of the
Company or any duly authorized committee of that board.
"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.
"Business Day", when used with respect to any Place of Payment, means
each Monday, Tuesday, Wednesday, Thursday and Friday which is not a day on
which banking institutions or trust companies in Massachusetts or in that Place
of Payment are authorized or obligated by law or executive order to close.
"Commission" means the Securities and Exchange Commission, from time
to time constituted, created under the Exchange Act, or, if at any time after
<PAGE> 10
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 at such time.
"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" or "Company Order" means a written request or order
signed in the name of the Company by its Chairman of the Board, its Vice
Chairman of the Board, its President or a Vice President, and by its Treasurer,
an Assistant Treasurer, its Secretary or an Assistant Secretary, and delivered
to the Trustee.
"Consolidated Net Tangible Assets" means, as of any particular time,
total assets (excluding applicable reserves and other properly deductible
items) less: (a) total current liabilities, except for (1) notes and loans
payable, (2) current maturities of long-term debt, and (3) current maturities
of obligations under capital leases; and (b) goodwill, patents and trademarks,
to the extend included in total assets; all as set forth on the most recent
consolidated balance sheet of the Company and its Consolidated Subsidiaries and
computed in accordance with generally accepted accounting principles.
"Corporate Trust Office" means the principal office of the Trustee in
Boston, Massachusetts at which at any particular time its corporate trust
business shall be administered.
A "corporation" means a corporation, association, company, joint-stock
company or business trust.
"Covenant Defeasance" has the meaning specified in Section 1303.
"Defaulted Interest" has the meaning specified in Section 307.
"Defeasance" has the meaning specified in Section 1302.
"Depositary" means, with respect to Securities of any series issuable
in whole or in part in the form of one or more Global Securities, a clearing
agency registered under the Exchange Act that is designated to act as
Depositary for such Securities as contemplated by Section 301.
"Event of Default" has the meaning specified in Section 501.
"Exchange Act" means the Securities Exchange Act of 1934 and any
statute successor thereto, in each case as amended from time to time.
"Expiration Date" has the meaning specified in Section 104.
"Global Security" means a Security that evidences all or part of the
Securities of any series and bears the legend set forth in Section 204 (or such
legend as may be specified as contemplated by Section 301 for such Securities).
"Holder" means a Person in whose name a Security is registered in the
Security Register.
"Indenture" means this instrument as originally executed and as it may
from time to time be supplemented or amended by one or more indentures
<PAGE> 11
supplemental hereto entered into pursuant to the applicable provisions hereof,
including, for all purposes of this instrument and any such supplemental
indenture, the provisions of the Trust Indenture Act that are deemed to be a
part of and govern this instrument and any such supplemental indenture,
respectively. The term "Indenture" shall also include the terms of particular
series of Securities established as contemplated by Section 301.
The term "interest", when used with respect to an Original Issue
Discount Security which by its terms bears interest only after Maturity, means
interest payable after Maturity.
"Interest Payment Date", when used with respect to any Security, means
the Stated Maturity of an instalment of interest on such Security.
"Investment Company Act" means the Investment Company Act of 1940 and
any statute successor thereto, in each case as amended from time to time.
"Maturity", when used with respect to any Security, means the date on
which the principal of such Security or an instalment of principal becomes due
and payable as therein or herein provided, whether at the Stated Maturity or by
declaration of acceleration, call for redemption or otherwise.
"Nonrecourse Obligation" means indebtedness or other obligations
substantially related to (i) the acquisition of assets not previously owned by
the Company or any Restricted Subsidiary or (ii) the financing of a project
involving the development or expansion of properties of the Company or any
Restricted Subsidiary, as to which the obligee with respect to such
indebtedness or obligation has no recourse to the Company or any Restricted
Subsidiary or any assets of the Company or any Restricted Subsidiary other than
the assets which were acquired with the proceeds of such transaction or the
project financed with the proceeds of such transaction (and the proceeds
thereof).
"Notice of Default" means a written notice of the kind specified in
Section 501(4) or 501(5).
"Officers' Certificate" means a certificate signed by the Chairman of
the Board, a Vice Chairman of the Board, the President or a Vice President, and
by the Treasurer, an Assistant Treasurer, the Secretary or an Assistant
Secretary, of the Company, and delivered to the Trustee. One of the officers
signing an Officers' Certificate given pursuant to Section 1004 shall be the
principal executive, financial or accounting officer of the Company.
"Opinion of Counsel" means a written opinion of counsel, who may be
counsel for the Company, and who shall be acceptable to the Trustee.
"Original Issue Discount Security" means any Security which provides
for an amount less than the principal amount thereof to be due and payable upon
a declaration of acceleration of the Maturity thereof pursuant to Section 502.
"Outstanding", when used with respect to Securities, means, as of the
date of determination, all Securities theretofore authenticated and delivered
under this Indenture, except:
(1) Securities theretofore cancelled by the Trustee or delivered
to the Trustee for cancellation;
<PAGE> 12
(2) Securities for whose payment or 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 Securities; provided that, if such Securities are
to be redeemed, notice of such redemption has been duly given pursuant to
this Indenture or provision therefor satisfactory to the Trustee has been
made;
(3) Securities as to which Defeasance has been effected pursuant
to Section 1302; and
(4) Securities which have been paid pursuant to Section 306 or in
exchange for or in lieu of which other Securities have been authenticated
and delivered pursuant to this Indenture, other than any such Securities in
respect of which there shall have been presented to the Trustee proof
satisfactory to it that such Securities are held by a bona fide purchaser
in whose hands such Securities are valid obligations of the Company;
provided, however, that in determining whether the Holders of the requisite
principal amount of the Outstanding Securities have given, made or taken any
request, demand, authorization, direction, notice, consent, waiver or other
action hereunder as of any date, (A) the principal amount of an Original Issue
Discount Security which shall be deemed to be Outstanding shall be the amount
of the principal thereof which would be due and payable as of such date upon
acceleration of the Maturity thereof to such date pursuant to Section 502,
(B) if, as of such date, the principal amount payable at the Stated Maturity of
a Security is not determinable, the principal amount of such Security which
shall be deemed to be Outstanding shall be the amount as specified or
determined as contemplated by Section 301, (C) the principal amount of a
Security denominated in one or more foreign currencies or currency units which
shall be deemed to be Outstanding shall be the U.S. dollar equivalent,
determined as of such date in the manner provided as contemplated by
Section 301, of the principal amount of such Security (or, in the case of a
Security described in Clause (A) or (B) above, of the amount determined as
provided in such Clause), and (D) Securities owned by the Company or any other
obligor upon the Securities or any Affiliate of the Company or of such other
obligor shall be disregarded and deemed not to be Outstanding, except that, in
determining whether the Trustee shall be protected in relying upon any such
request, demand, authorization, direction, notice, consent, waiver or other
action, only Securities which the Trustee knows to be so owned shall be so
disregarded. 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 so to act with respect to such Securities and that
the pledgee is not the Company or any other obligor upon the Securities or any
Affiliate of the Company or of such other obligor.
"Paying Agent" means any Person authorized by the Company to pay the
principal of or any premium or interest on any Securities on behalf of the
Company.
"Person" means any individual, corporation, partnership, joint
venture, trust, unincorporated organization or government or any agency or
political subdivision thereof.
"Place of Payment", when used with respect to the Securities of any
series, means the place or places where the principal of and any premium and
<PAGE> 13
interest on the Securities of that series are payable as specified as
contemplated by Section 301.
"Predecessor Security" of any particular Security means every previous
Security evidencing all or a portion of the same debt as that evidenced by such
particular Security; and, for the purposes of this definition, any Security
authenticated and delivered under Section 306 in exchange for or in lieu of a
mutilated, destroyed, lost or stolen Security shall be deemed to evidence the
same debt as the mutilated, destroyed, lost or stolen Security.
"Principal Property" means the land, land improvements, buildings and
fixtures (to the extent they constitute real property interests) (including any
leasehold interest therein) constituting the principal corporate office or any
distribution center (whether now owned or hereafter acquired) which: (a) is
owned by the Company or any Subsidiary; (b) is located within any of the
present 50 states of the United States (or the District of Columbia); (c) has
not been determined in good faith by the Board of Directors of the Company not
to be materially important to the total business conducted by the Company and
its Subsidiaries taken as a whole; and (d) has a market value on the date as of
which the determination is being made in excess of 1.0% of Consolidated Net
Tangible Assets of the Company as most recently determined on or prior to such
date.
"Redemption Date", when used with respect to any Security to be
redeemed, means the date fixed for such redemption by or pursuant to this
Indenture.
"Redemption Price", when used with respect to any Security to be
redeemed, means the price at which it is to be redeemed pursuant to this
Indenture.
"Regular Record Date" for the interest payable on any Interest Payment
Date on the Securities of any series means the date specified for that purpose
as contemplated by Section 301.
"Responsible Officer", when used with respect to the Trustee, means
the chairman or any vice-chairman of the board of directors, the chairman or
any vice-chairman of the executive committee of the board of directors, the
chairman of the trust committee, the president, any vice president, the
secretary, any assistant secretary, the treasurer, any assistant treasurer, the
cashier, any assistant cashier, any trust officer or assistant trust officer,
the controller or any assistant controller 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.
"Restricted Subsidiary" means any Subsidiary which owns any Principal
Property.
"Sale and Lease-Back Transaction" means any arrangement with any
person providing for the leasing by the Company or any Restricted Subsidiary of
any Principal Property which property has been or is to be sold or transferred
by the Company or such Restricted Subsidiary to such person.
"Securities" has the meaning stated in the first recital of this
Indenture and more particularly means any Securities authenticated and
delivered under this Indenture.
<PAGE> 14
"Securities Act" means the Securities Act of 1933 and any statute
successor thereto, in each case as amended from time to time.
"Security Register" and "Security Registrar" have the respective
meanings specified in Section 305.
"Special Record Date" for the payment of any Defaulted Interest means
a date fixed by the Trustee pursuant to Section 307.
"Stated Maturity", when used with respect to any Security or any
instalment of principal thereof or interest thereon, means the date specified
in such Security as the fixed date on which the principal of such Security or
such instalment of principal or interest is due and payable.
"Subsidiary" means any corporation of which at least a majority of the
outstanding voting stock having the power to elect a majority of the board of
directors of such corporation is at the time owned, directly or indirectly, by
the Company or by one or more other Subsidiaries, or by the Company and one or
more other Subsidiaries. For the purposes of this definition, "voting stock"
means stock which ordinarily has voting power for the election of directors,
whether at all times or only so long as no senior class of stock has such
voting power by reason of any contingency.
"Trust Indenture Act" means the Trust Indenture Act of 1939 as in
force at the date as of which this instrument was executed; provided, however,
that in the event the Trust Indenture Act of 1939 is amended after such date,
"Trust Indenture Act" means, to the extent required by any such amendment, the
Trust Indenture Act of 1939, as so amended.
"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 Securities of any series shall mean the Trustee with respect to
Securities of that series.
"U.S. Government Obligation" has the meaning specified in
Section 1304.
"Vice President", when used with respect to the Company or the
Trustee, means any vice president, whether or not designated by a number or a
word or words added before or after the title "vice president".
SECTION 102. 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 such certificates and opinions as may be required under the Trust
Indenture Act or this Indenture. Each such certificate or opinion shall be
given in the form of an Officers' Certificate, if to be given by an officer of
the Company, or an Opinion of Counsel, if to be given by counsel, and shall
comply with the requirements of the Trust Indenture Act and any other
requirements set forth in this Indenture.
<PAGE> 15
Every certificate or opinion with respect to compliance with a
condition or covenant provided for in this Indenture (except for certificates
provided for in Section 1004) 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;
(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 103. 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
representations 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 104. Acts of Holders; Record Dates.
Any request, demand, authorization, direction, notice, consent, waiver
or other action provided or permitted by this Indenture to be given, made 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 agent duly
appointed in writing; and, except as herein otherwise expressly provided, such
action shall become effective when such instrument or instruments are delivered
<PAGE> 16
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. Proof of execution of any such instrument or of
a writing appointing any such agent shall be sufficient for any purpose of this
Indenture and (subject to Section 601) conclusive in favor of the Trustee and
the Company, if made in the manner provided in this Section.
The fact and date of the execution by any Person of any such
instrument or writing may be proved by the affidavit of a witness of such
execution or by a certificate of a notary public or other officer authorized by
law to take acknowledgments of deeds, certifying that the individual signing
such instrument or writing acknowledged to him the execution thereof. Where
such execution is by a signer acting in a capacity other than his individual
capacity, such certificate or affidavit shall also constitute sufficient proof
of his authority. The fact and date of the execution of any such instrument or
writing, or the authority of the Person executing the same, may also be proved
in any other manner which the Trustee deems sufficient.
The ownership of Securities shall be proved by the Security Register.
Any request, demand, authorization, direction, notice, consent, waiver
or other Act of the Holder of any Security shall bind every future Holder of
the same Security and the Holder of every Security issued upon the registration
of transfer thereof or in exchange therefor or in lieu thereof in respect of
anything done, omitted or suffered to be done by the Trustee or the Company in
reliance thereon, whether or not notation of such action is made upon such
Security.
The Company may set any day as a record date for the purpose of
determining the Holders of Outstanding Securities of any series entitled to
give, make or take any request, demand, authorization, direction, notice,
consent, waiver or other action provided or permitted by this Indenture to be
given, made or taken by Holders of Securities of such series, provided that the
Company may not set a record date for, and the provisions of this paragraph
shall not apply with respect to, the giving or making of any notice,
declaration, request or direction referred to in the next paragraph. If any
record date is set pursuant to this paragraph, the Holders of Outstanding
Securities of the relevant series on such record date, and no other Holders,
shall be entitled to take the relevant action, whether or not such Holders
remain Holders after such record date; provided that no such action shall be
effective hereunder unless taken on or prior to the applicable Expiration Date
by Holders of the requisite principal amount of Outstanding Securities of such
series on such record date. Nothing in this paragraph shall be construed to
prevent the Company from setting a new record date for any action for which a
record date has previously been set pursuant to this paragraph (whereupon the
record date previously set shall automatically and with no action by any Person
be cancelled and of no effect), and nothing in this paragraph shall be
construed to render ineffective any action taken by Holders of the requisite
principal amount of Outstanding Securities of the relevant series on the date
such action is taken. Promptly after any record date is set pursuant to this
paragraph, the Company, at its own expense, shall cause notice of such record
date, the proposed action by Holders and the applicable Expiration Date to be
given to the Trustee in writing and to each Holder of Securities of the
relevant series in the manner set forth in Section 106.
The Trustee may set any day as a record date for the purpose of
determining the Holders of Outstanding Securities of any series entitled to
<PAGE> 17
join in the giving or making of (i) any Notice of Default, (ii) any declaration
of acceleration referred to in Section 502, (iii) any request to institute
proceedings referred to in Section 507(2) or (iv) any direction referred to in
Section 512, in each case with respect to Securities of such series. If any
record date is set pursuant to this paragraph, the Holders of Outstanding
Securities of such series on such record date, and no other Holders, shall be
entitled to join in such notice, declaration, request or direction, whether or
not such Holders remain Holders after such record date; provided that no such
action shall be effective hereunder unless taken on or prior to the applicable
Expiration Date by Holders of the requisite principal amount of Outstanding
Securities of such series on such record date. Nothing in this paragraph shall
be construed to prevent the Trustee from setting a new record date for any
action for which a record date has previously been set pursuant to this
paragraph (whereupon the record date previously set shall automatically and
with no action by any Person be cancelled and of no effect), and nothing in
this paragraph shall be construed to render ineffective any action taken by
Holders of the requisite principal amount of Outstanding Securities of the
relevant series on the date such action is taken. Promptly after any record
date is set pursuant to this paragraph, the Trustee, at the Company's expense,
shall cause notice of such record date, the proposed action by Holders and the
applicable Expiration Date to be given to the Company in writing and to each
Holder of Securities of the relevant series in the manner set forth in
Section 106.
With respect to any record date set pursuant to this Section, the
party hereto which sets such record dates may designate any day as the
"Expiration Date" and from time to time may change the Expiration Date to any
earlier or later day; provided that no such change shall be effective unless
notice of the proposed new Expiration Date is given to the other party hereto
in writing, and to each Holder of Securities of the relevant series in the
manner set forth in Section 106, on or prior to the existing Expiration Date.
If an Expiration Date is not designated with respect to any record date set
pursuant to this Section, the party hereto which set such record date shall be
deemed to have initially designated the 180th day after such record date as the
Expiration Date with respect thereto, subject to its right to change the
Expiration Date as provided in this paragraph. Notwithstanding the foregoing,
no Expiration Date shall be later than the 180th day after the applicable
record date.
Without limiting the foregoing, a Holder entitled hereunder to take
any action hereunder with regard to any particular Security may do so with
regard to all or any part of the principal amount of such Security or by one or
more duly appointed agents each of which may do so pursuant to such appointment
with regard to all or any part of such principal amount.
SECTION 105. Notices, Etc., to Trustee and Company.
Any request, demand, authorization, direction, notice, consent, waiver
or 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 if made, given, furnished or filed
in writing to or with the Trustee at its Corporate Trust Office, Attention:
................., or
<PAGE> 18
(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, to the
Company addressed to it at the address of its principal office specified in
the first paragraph of this instrument or at any other address previously
furnished in writing to the Trustee by the Company.
SECTION 106. Notice to Holders; Waiver.
Where this Indenture provides for notice to Holders of any event, such
notice shall be sufficiently given (unless otherwise herein expressly provided)
if in writing and when mailed, first-class postage prepaid, to each Holder
affected by such event, at his address as it appears in the Security Register,
not later than the latest date (if any), and not earlier than the earliest date
(if any), prescribed for the giving of such notice. 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. 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 upon such
waiver.
In case by reason of the suspension of regular mail service or by
reason of any other cause it shall be impracticable to give such notice by
mail, then such notification as shall be made with the approval of the Trustee
shall constitute a sufficient notification for every purpose hereunder.
SECTION 107. Conflict with Trust Indenture Act.
If any provision hereof limits, qualifies or conflicts with a
provision of the Trust Indenture Act which is required under such Act to be a
part of and govern this Indenture, the latter provision shall control. If any
provision of this Indenture modifies or excludes any provision of the Trust
Indenture Act which may be so modified or excluded, the latter provision shall
be deemed to apply to this Indenture as so modified or to be excluded, as the
case may be.
SECTION 108. Effect of Headings and Table of Contents.
The Article and Section headings herein and the Table of Contents are
for convenience only and shall not affect the construction hereof.
SECTION 109. Successors and Assigns.
All covenants and agreements in this Indenture by the Company shall
bind its successors and assigns, whether so expressed or not.
<PAGE> 19
SECTION 110. Separability Clause.
In case any provision in this Indenture or in the 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 111. Benefits of Indenture.
Nothing in this Indenture or in the Securities, express or implied,
shall give to any Person, other than the parties hereto and their successors
hereunder and the Holders, any benefit or any legal or equitable right, remedy
or claim under this Indenture.
SECTION 112. Governing Law.
This Indenture and the Securities shall be governed by and construed
in accordance with the law of the State of New York.
SECTION 113. Legal Holidays.
In any case where any Interest Payment Date, Redemption Date or Stated
Maturity of any Security shall not be a Business Day at any Place of Payment,
then (notwithstanding any other provision of this Indenture or of the
Securities (other than a provision of any Security which specifically states
that such provision shall apply in lieu of this Section)) payment of interest
or principal (and premium, if any) 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
or Redemption Date, or at the Stated Maturity.
ARTICLE TWO
SECURITY FORMS
SECTION 201. Forms Generally.
The Securities of each series shall be in substantially the form set
forth in this Article, or in such other form as shall be established by or
pursuant to a Board Resolution or in one or more indentures supplemental
hereto, in each case with 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 and such legends or
endorsements placed thereon as may be required to comply with the rules of any
securities exchange or Depositary therefor or as may, consistently herewith, be
determined by the officers executing such Securities, as evidenced by their
execution thereof. If the form of Securities of any series is established by
action taken pursuant to a Board Resolution, a copy of an appropriate record of
such action 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
Company Order contemplated by Section 303 for the authentication and delivery
of such Securities.
<PAGE> 20
The definitive Securities shall be printed, lithographed or engraved
on steel engraved borders or may be produced in any other manner, all as
determined by the officers executing such Securities, as evidenced by their
execution of such Securities.
SECTION 202. Form of Face of Security.
[Insert any legend required by the Internal Revenue Code and the
regulations thereunder.]
EDISON BROTHERS STORES, INC.
..........................................................................
No. ......... $ ........
EDISON BROTHERS STORES, INC., a corporation duly organized and
existing under the laws of Delaware (herein called the "Company", which term
includes any successor Person under the Indenture hereinafter referred to), for
value received, hereby promises to pay to
..............................................., or registered assigns, the
principal sum of ...................................... Dollars on
........................................................ [if the Security is to
bear interest prior to Maturity, insert -- , and to pay interest thereon from
............. or from the most recent Interest Payment Date to which interest
has been paid or duly provided for, semi-annually on ............ and
............ in each year, commencing ........., at the rate of ....% per
annum, until the principal hereof is paid or made available for payment [if
applicable, insert -- , provided that any principal and premium, and any such
instalment of interest, which is overdue shall bear interest at the rate of
...% per annum (to the extent that the payment of such interest shall be
legally enforceable), from the dates such amounts are due until they are paid
or made available for payment, and such interest shall be payable on demand].
The interest so payable, and punctually paid or duly provided for, on any
Interest Payment Date will, as provided in such Indenture, be paid to the
Person in whose name this Security (or one or more Predecessor Securities) is
registered at the close of business on the Regular Record Date for such
interest, which shall be the ....... or ....... (whether or not a Business
Day), as the case may be, next preceding such Interest Payment Date. Any such
interest not so punctually paid or duly provided for will forthwith cease to be
payable to the Holder on such Regular Record Date and may either be paid to the
Person in whose name this Security (or one or more Predecessor Securities) is
registered at the close of business on a Special Record Date for the payment of
such Defaulted Interest to be fixed by the Trustee, notice whereof shall be
given to Holders of Securities of this series not less than 10 days prior to
such Special Record Date, or be paid at any time in any other lawful manner not
inconsistent with the requirements of any securities exchange on which the
Securities of this series may be listed, and upon such notice as may be
required by such exchange, all as more fully provided in said Indenture].
[If the Security is not to bear interest prior to Maturity, insert -- The
principal of this Security shall not bear interest except in the case of a
default in payment of principal upon acceleration, upon redemption or at Stated
Maturity and in such case the overdue principal and any overdue premium shall
bear interest at the rate of ....% per annum (to the extent that the payment of
such interest shall be legally enforceable), from the dates such amounts are
due until they are paid or made available for payment. Interest on any overdue
<PAGE> 21
principal or premium shall be payable on demand. [Any such interest on overdue
principal or premium which is not paid on demand shall bear interest at the
rate of ......% per annum (to the extent that the payment of such interest on
interest shall be legally enforceable), from the date of such demand until the
amount so demanded is paid or made available for payment. Interest on any
overdue interest shall be payable on demand.]]
Payment of the principal of (and premium, if any) and [if applicable,
insert -- any such] interest on this Security will be made at the office or
agency of the Company maintained for that purpose in ............, in such coin
or currency of the United States of America as at the time of payment is legal
tender for payment of public and private debts [if applicable, insert -- ;
provided, however, that at the option of the Company payment of interest may be
made by check mailed to the address of the Person entitled thereto as such
address shall appear in the Security Register].
Reference is hereby made to the further provisions of this Security
set forth on the reverse hereof, which further provisions shall for all
purposes have the same effect as if set forth at this place.
Unless the certificate of authentication hereon has been executed by
the Trustee referred to on the reverse hereof by manual signature, this
Security shall not be entitled to any benefit under the Indenture or be valid
or obligatory for any purpose.
IN WITNESS WHEREOF, the Company has caused this instrument to be duly
executed under its corporate seal.
Dated:
EDISON BROTHERS STORES, INC.
By...........................................
Attest:
.........................................
SECTION 203. Form of Reverse of Security.
This Security is one of a duly authorized issue of securities of the
Company (herein called the "Securities"), issued and to be issued in one or
more series under an Indenture, dated as of ..........., 1995 (herein called
the "Indenture", which term shall have the meaning assigned to it in such
instrument), between the Company and ..................., as Trustee (herein
called the "Trustee", which term includes any successor trustee under the
Indenture), and reference is hereby made to the Indenture for a statement of
the respective rights, limitations of rights, duties and immunities thereunder
of the Company, the Trustee, and the Holders of the Securities and of the terms
upon which the Securities are, and are to be, authenticated and delivered. This
Security is one of the series designated on the face hereof [if applicable,
insert -- , limited in aggregate principal amount to $...........].
[If applicable, insert -- The Securities of this series are subject to
redemption upon not less than 30 days' notice by mail, [if applicable, insert
- -- (1) on ........... in any year commencing with the year ...... and ending
<PAGE> 22
with the year ...... through operation of the sinking fund for this series at a
Redemption Price equal to 100% of the principal amount, and (2)] at any time
[if applicable, insert -- on or after .........., ....], as a whole or in part,
at the election of the Company, at the following Redemption Prices (expressed
as percentages of the principal amount): If redeemed [if applicable, insert --
on or before ..............., ...%, and if redeemed] during the 12-month period
beginning ............. of the years indicated,
<TABLE>
<CAPTION>
Redemption Redemption
Year Price Year Price
- ------------------ ------------------ ------------------- ------------------
<C> <C> <C> <C>
</TABLE>
and thereafter at a Redemption Price equal to .....% of the principal amount,
together in the case of any such redemption [if applicable, insert -- (whether
through operation of the sinking fund or otherwise)] with accrued interest to
the Redemption Date, but interest instalments whose Stated Maturity is on or
prior to such Redemption Date will be payable to the Holders of such
Securities, or one or more Predecessor Securities, of record at the close of
business on the relevant Record Dates referred to on the face hereof, all as
provided in the Indenture.]
[If applicable, insert -- The Securities of this series are subject to
redemption upon not less than 30 days' notice by mail, (1) on ............ in
any year commencing with the year .... and ending with the year .... through
operation of the sinking fund for this series at the Redemption Prices for
redemption through operation of the sinking fund (expressed as percentages of
the principal amount) set forth in the table below, and (2) at any time [if
applicable, insert -- on or after ............], as a whole or in part, at the
election of the Company, at the Redemption Prices for redemption otherwise than
through operation of the sinking fund (expressed as percentages of the
principal amount) set forth in the table below: If redeemed during the 12-month
period beginning ............ of the years indicated,
<TABLE>
<CAPTION>
Redemption Price
For Redemption Redemption Price for
Through Operation Redemption Otherwise
of the Than Through Operation
Year Sinking Fund of the Sinking Fund
- ------------------------- ------------------------- -------------------------
<C> <C> <C>
</TABLE>
<PAGE> 23
and thereafter at a Redemption Price equal to .....% of the principal amount,
together in the case of any such redemption (whether through operation of the
sinking fund or otherwise) with accrued interest to the Redemption Date, but
interest instalments whose Stated Maturity is on or prior to such Redemption
Date will be payable to the Holders of such Securities, or one or more
Predecessor Securities, of record at the close of business on the relevant
Record Dates referred to on the face hereof, all as provided in the Indenture.]
[If applicable, insert -- Notwithstanding the foregoing, the Company
may not, prior to ............., redeem any Securities of this series as
contemplated by [if applicable, insert -- Clause (2) of] the preceding
paragraph as a part of, or in anticipation of, any refunding operation by the
application, directly or indirectly, of moneys borrowed having an interest cost
to the Company (calculated in accordance with generally accepted financial
practice) of less than .....% per annum.]
[If applicable, insert -- The sinking fund for this series provides
for the redemption on ............ in each year beginning with the year .......
and ending with the year ...... of [if applicable, insert -- not less than
$.......... ("mandatory sinking fund") and not more than] $......... aggregate
principal amount of Securities of this series. Securities of this series
acquired or redeemed by the Company otherwise than through [if applicable,
insert -- mandatory] sinking fund payments may be credited against subsequent
[if applicable, insert -- mandatory] sinking fund payments otherwise required
to be made [if applicable, insert -- , in the inverse order in which they
become due].]
[If the Security is subject to redemption of any kind, insert -- In
the event of redemption of this Security in part only, a new Security or
Securities of this series and of like tenor for the unredeemed portion hereof
will be issued in the name of the Holder hereof upon the cancellation hereof.]
[If applicable, insert -- The Indenture contains provisions for
defeasance at any time of [the entire indebtedness of this Security] [or]
[certain restrictive covenants and Events of Default with respect to this
Security] [, in each case] upon compliance with certain conditions set forth in
the Indenture.]
[If the Security is not an Original Issue Discount Security, insert --
If an Event of Default with respect to Securities of this series shall occur
and be continuing, the principal of the Securities of this series may be
declared due and payable in the manner and with the effect provided in the
Indenture.]
[If the Security is an Original Issue Discount Security, insert -- If
an Event of Default with respect to Securities of this series shall occur and
be continuing, an amount of principal of the Securities of this series may be
declared due and payable in the manner and with the effect provided in the
Indenture. Such amount shall be equal to -- insert formula for determining the
amount. Upon payment (i) of the amount of principal so declared due and payable
and (ii) of interest on any overdue principal, premium and interest (in each
case to the extent that the payment of such interest shall be legally
enforceable), all of the Company's obligations in respect of the payment of the
principal of and premium and interest, if any, on the Securities of this series
shall terminate.]
The Indenture permits, with certain exceptions as therein provided,
the amendment thereof and the modification of the rights and obligations of the
<PAGE> 24
Company and the rights of the Holders of the Securities of each series to be
affected under the Indenture at any time by the Company and the Trustee with
the consent of the Holders of not less than a majority in principal amount of
the Securities at the time Outstanding of each series to be affected. The
Indenture also contains provisions permitting the Holders of specified
percentages in principal amount of the Securities of each series at the time
Outstanding, on behalf of the Holders of all Securities of such series, to
waive compliance by the Company with certain provisions of the Indenture and
certain past defaults under the Indenture and their consequences. Any such
consent or waiver by the Holder of this Security shall be conclusive and
binding upon such Holder and upon all future Holders of this Security and of
any Security issued upon the registration of transfer hereof or in exchange
herefor or in lieu hereof, whether or not notation of such consent or waiver is
made upon this Security.
As provided in and subject to the provisions of the Indenture, the
Holder of this Security shall not have the right to institute any proceeding
with respect to the Indenture or for the appointment of a receiver or trustee
or for any other remedy thereunder, unless such Holder shall have previously
given the Trustee written notice of a continuing Event of Default with respect
to the Securities of this series, the Holders of not less than 25% in principal
amount of the Securities of this series at the time Outstanding shall have made
written request to the Trustee to institute proceedings in respect of such
Event of Default as Trustee and offered the Trustee reasonable indemnity, and
the Trustee shall not have received from the Holders of a majority in principal
amount of Securities of this series at the time Outstanding a direction
inconsistent with such request, and shall have failed to institute any such
proceeding, for 60 days after receipt of such notice, request and offer of
indemnity. The foregoing shall not apply to any suit instituted by the Holder
of this Security for the enforcement of any payment of principal hereof or any
premium or interest hereon on or after the respective due dates expressed
herein.
No reference herein to the Indenture and no provision of this Security
or of the Indenture shall alter or impair the obligation of the Company, which
is absolute and unconditional, to pay the principal of and any premium and
interest on this Security at the times, place and rate, and in the coin or
currency, herein prescribed.
As provided in the Indenture and subject to certain limitations
therein set forth, the transfer of this Security is registrable in the Security
Register, upon surrender of this Security for registration of transfer at the
office or agency of the Company in any place where the principal of and any
premium and interest on this Security are payable, duly endorsed by, or
accompanied by a written instrument of transfer in form satisfactory to the
Company and the Security Registrar duly executed by, the Holder hereof or his
attorney duly authorized in writing, and thereupon one or more new Securities
of this series and of like tenor, of authorized denominations and for the same
aggregate principal amount, will be issued to the designated transferee or
transferees.
The Securities of this series are issuable only in registered form
without coupons in denominations of $....... and any integral multiple thereof.
As provided in the Indenture and subject to certain limitations therein set
forth, Securities of this series are exchangeable for a like aggregate
principal amount of Securities of this series and of like tenor of a different
authorized denomination, as requested by the Holder surrendering the same.
<PAGE> 25
No service charge shall be made for any such registration of transfer
or exchange, but the Company may require payment of a sum sufficient to cover
any tax or other governmental charge payable in connection therewith.
Prior to due presentment of this Security for registration of
transfer, the Company, the Trustee and any agent of the Company or the Trustee
may treat the Person in whose name this Security is registered as the owner
hereof for all purposes, whether or not this Security be overdue, and neither
the Company, the Trustee nor any such agent shall be affected by notice to the
contrary.
All terms used in this Security which are defined in the Indenture
shall have the meanings assigned to them in the Indenture.
SECTION 204. Form of Legend for Global Securities.
Unless otherwise specified as contemplated by Section 301 for the
Securities evidenced thereby, every Global Security authenticated and delivered
hereunder shall bear a legend in substantially the following form:
THIS SECURITY IS A GLOBAL SECURITY WITHIN THE MEANING OF THE INDENTURE
HEREINAFTER REFERRED TO AND IS REGISTERED IN THE NAME OF A DEPOSITARY OR A
NOMINEE THEREOF. THIS SECURITY MAY NOT BE EXCHANGED IN WHOLE OR IN PART FOR A
SECURITY REGISTERED, AND NO TRANSFER OF THIS SECURITY IN WHOLE OR IN PART MAY
BE REGISTERED, IN THE NAME OF ANY PERSON OTHER THAN SUCH DEPOSITARY OR A
NOMINEE THEREOF, EXCEPT IN THE LIMITED CIRCUMSTANCES DESCRIBED IN THE
INDENTURE.
SECTION 205. Form of Trustee's Certificate of Authentication.
The Trustee's certificates of authentication shall be in substantially
the following form:
This is one of the Securities of the series designated therein
referred to in the within-mentioned Indenture.
..........................................,
As Trustee
By.........................................
Authorized Officer
ARTICLE THREE
THE SECURITIES
SECTION 301. Amount Unlimited; Issuable in Series.
The aggregate principal amount of Securities which may be
authenticated and delivered under this Indenture is unlimited.
<PAGE> 26
The Securities may be issued in one or more series. There shall be
established in or pursuant to a Board Resolution and, subject to Section 303,
set forth, or determined in the manner provided, in an Officers' Certificate,
or established in one or more indentures supplemental hereto, prior to the
issuance of Securities of any series,
(1) the title of the Securities of the series (which shall
distinguish the Securities of the series from Securities of any other
series);
(2) any limit upon the aggregate principal amount of the
Securities of the series which may be authenticated and delivered under
this Indenture (except for Securities authenticated and delivered upon
registration of transfer of, or in exchange for, or in lieu of, other
Securities of the series pursuant to Section 304, 305, 306, 906 or 1107 and
except for any Securities which, pursuant to Section 303, are deemed never
to have been authenticated and delivered hereunder);
(3) the Person to whom any interest on a Security of the series
shall be payable, if other than the Person in whose name that Security (or
one or more Predecessor Securities) is registered at the close of business
on the Regular Record Date for such interest;
(4) the date or dates on which the principal of any Securities of
the series is payable;
(5) the rate or rates (which may be fixed or variable) at which
any Securities of the series shall bear interest, if any, the date or dates
from which any such interest shall accrue, the Interest Payment Dates on
which any such interest shall be payable and the Regular Record Date for
any such interest payable on any Interest Payment Date;
(6) the place or places where the principal of and any premium and
interest on any Securities of the series shall be payable;
(7) the period or periods within which, the price or prices at
which and the terms and conditions upon which any Securities of the series
may be redeemed, in whole or in part, at the option of the Company and, if
other than by a Board Resolution, the manner in which any election by the
Company to redeem the Securities shall be evidenced;
(8) the obligation, if any, of the Company to redeem or purchase
any Securities of the series pursuant to any sinking fund or analogous
provisions or at the option of the Holder thereof and the period or periods
within which, the price or prices at which and the terms and conditions
upon which any Securities of the series shall be redeemed or purchased, in
whole or in part, pursuant to such obligation;
(9) if other than denominations of $1,000 and any integral
multiple thereof, the denominations in which any Securities of the series
shall be issuable;
(10) if the amount of principal of or any premium or interest on
any Securities of the series may be determined with reference to an index
or pursuant to a formula, the manner in which such amounts shall be
determined;
<PAGE> 27
(11) if other than the currency of the United States of America,
the currency, currencies or currency units in which the principal of or any
premium or interest on any Securities of the series shall be payable and
the manner of determining the equivalent thereof in the currency of the
United States of America for any purpose, including for purposes of the
definition of "Outstanding" in Section 101;
(12) if the principal of or any premium or interest on any
Securities of the series is to be payable, at the election of the Company
or the Holder thereof, in one or more currencies or currency units other
than that or those in which such Securities are stated to be payable, the
currency, currencies or currency units in which the principal of or any
premium or interest on such Securities as to which such election is made
shall be payable, the periods within which and the terms and conditions
upon which such election is to be made and the amount so payable (or the
manner in which such amount shall be determined);
(13) if other than the entire principal amount thereof, the portion
of the principal amount of any Securities of the series which shall be
payable upon declaration of acceleration of the Maturity thereof pursuant
to Section 502;
(14) if the principal amount payable at the Stated Maturity of any
Securities of the series will not be determinable as of any one or more
dates prior to the Stated Maturity, the amount which shall be deemed to be
the principal amount of such Securities as of any such date for any purpose
thereunder or hereunder, including the principal amount thereof which shall
be due and payable upon any Maturity other than the Stated Maturity or
which shall be deemed to be Outstanding as of any date prior to the Stated
Maturity (or, in any such case, the manner in which such amount deemed to
be the principal amount shall be determined);
(15) if applicable, that the Securities of the series, in whole or
any specified part, shall be defeasible pursuant to Section 1302 or
Section 1303 or both such Sections and, if other than by a Board
Resolution, the manner in which any election by the Company to defease such
Securities shall be evidenced;
(16) if applicable, that any Securities of the series shall be
issuable in whole or in part in the form of one or more Global Securities
and, in such case, the respective Depositaries for such Global Securities,
the form of any legend or legends which shall be borne by any such Global
Security in addition to or in lieu of that set forth in Section 204 and any
circumstances in addition to or in lieu of those set forth in Clause (2) of
the last paragraph of Section 305 in which any such Global Security may be
exchanged in whole or in part for Securities registered, and any transfer
of such Global Security in whole or in part may be registered, in the name
or names of Persons other than the Depositary for such Global Security or a
nominee thereof;
(17) any addition to or change in the Events of Default which
applies to any Securities of the series and any change in the right of the
Trustee or the requisite Holders of such Securities to declare the
principal amount thereof due and payable pursuant to Section 502;
(18) any addition to or change in the covenants set forth in
Article Ten which applies to Securities of the series;
<PAGE> 28
(19) any other terms of the series (which terms shall not be
inconsistent with the provisions of this Indenture, except as permitted by
Section 901(5)); and
(20) designation of a paying agent.
All Securities of any one series shall be substantially identical
except as to denomination and except as may otherwise be provided in or
pursuant to the Board Resolution referred to above and (subject to Section 303)
set forth, or determined in the manner provided, in the Officers' Certificate
referred to above or in any such indenture supplemental hereto.
If any of the terms of the series are established by action taken
pursuant to a Board Resolution, a copy of an appropriate record of such action
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 302. Denominations.
The Securities of each series shall be issuable only in registered
form without coupons and only in such denominations as shall be specified as
contemplated by Section 301. In the absence of any such specified denomination
with respect to the Securities of any series, the Securities of such series
shall be issuable in denominations of $1,000 and any integral multiple thereof.
SECTION 303. Execution, Authentication, Delivery and Dating.
The Securities shall be executed on behalf of the Company by its
Chairman of the Board, its Vice Chairman of the Board, its President or one of
its Vice Presidents, under its corporate seal reproduced thereon attested by
its Secretary or one of its Assistant Secretaries. The signature of any of
these officers on the Securities may be manual or facsimile.
Securities 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 such individuals or any of them have ceased to hold such
offices prior to the authentication and delivery of such Securities or did not
hold such offices at the date of such Securities.
At any time and from time to time after the execution and delivery of
this Indenture, the Company may deliver Securities of any series executed by
the Company to the Trustee for authentication, together with a Company Order
for the authentication and delivery of such Securities, and the Trustee in
accordance with the Company Order shall authenticate and deliver such
Securities. If the form or terms of the Securities of the series have been
established by or pursuant to one or more Board Resolutions as permitted by
Sections 201 and 301, in authenticating such Securities, and accepting the
additional responsibilities under this Indenture in relation to such
Securities, the Trustee shall be entitled to receive, and (subject to
Section 601) shall be fully protected in relying upon, an Opinion of Counsel
stating,
(1) if the form of such Securities has been established by or
pursuant to Board Resolution as permitted by Section 201, that such form
has been established in conformity with the provisions of this Indenture;
<PAGE> 29
(2) if the terms of such Securities have been established by or
pursuant to Board Resolution as permitted by Section 301, that such terms
have been established in conformity with the provisions of this Indenture;
and
(3) that such Securities, when authenticated and delivered by the
Trustee and issued by the Company in the manner and subject to any
conditions specified in such Opinion of Counsel, will constitute valid and
legally binding obligations of the Company enforceable in accordance with
their terms, subject to bankruptcy, insolvency, fraudulent transfer,
reorganization, moratorium and similar laws of general applicability
relating to or affecting creditors' rights and to general equity
principles.
If such form or terms have been so established, the Trustee shall not be
required to authenticate such Securities if the issue of such Securities
pursuant to this Indenture will affect the Trustee's own rights, duties or
immunities under the Securities and this Indenture or otherwise in a manner
which is not reasonably acceptable to the Trustee.
Notwithstanding the provisions of Section 301 and of the preceding
paragraph, if all Securities of a series are not to be originally issued at one
time, it shall not be necessary to deliver the Officers' Certificate otherwise
required pursuant to Section 301 or the Company Order and Opinion of Counsel
otherwise required pursuant to such preceding paragraph at or prior to the
authentication of each Security of such series if such documents are delivered
at or prior to the authentication upon original issuance of the first Security
of such series to be issued.
Each Security shall be dated the date of its authentication.
No Security shall be entitled to any benefit under this Indenture or
be valid or obligatory for any purpose unless there appears on such Security a
certificate of authentication substantially in the form provided for herein
executed by the Trustee by manual signature, and such certificate upon any
Security shall be conclusive evidence, and the only evidence, that such
Security has been duly authenticated and delivered hereunder. Notwithstanding
the foregoing, if any Security shall have been authenticated and delivered
hereunder but never issued and sold by the Company, and the Company shall
deliver such Security to the Trustee for cancellation as provided in
Section 309, for all purposes of this Indenture such Security shall be deemed
never to have been authenticated and delivered hereunder and shall never be
entitled to the benefits of this Indenture.
SECTION 304. Temporary Securities.
Pending the preparation of definitive Securities of any series, the
Company may execute, and upon Company Order the Trustee shall authenticate and
deliver, temporary Securities which are printed, lithographed, typewritten,
mimeographed or otherwise produced, in any authorized denomination,
substantially of the tenor of the definitive Securities in lieu of which they
are issued and with such appropriate insertions, omissions, substitutions and
other variations as the officers executing such Securities may determine, as
evidenced by their execution of such Securities.
If temporary Securities of any series are issued, the Company will
cause definitive Securities of that series to be prepared without unreasonable
<PAGE> 30
delay. After the preparation of definitive Securities of such series, the
temporary Securities of such series shall be exchangeable for definitive
Securities of such series upon surrender of the temporary Securities of such
series at the office or agency of the Company in a Place of Payment for that
series, without charge to the Holder. Upon surrender for cancellation of any
one or more temporary Securities of any series, the Company shall execute and
the Trustee shall authenticate and deliver in exchange therefor one or more
definitive Securities of the same series, of any authorized denominations and
of like tenor and aggregate principal amount. Until so exchanged, the temporary
Securities of any series shall in all respects be entitled to the same benefits
under this Indenture as definitive Securities of such series and tenor.
SECTION 305. Registration, Registration of Transfer and Exchange.
The Company shall cause to be kept at the Corporate Trust Office of
the Trustee a register (the register 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 Securities and of transfers of Securities. The
Trustee is hereby appointed "Security Registrar" for the purpose of registering
Securities and transfers of Securities as herein provided.
Upon surrender for registration of transfer of any Security of a
series at the office or agency of the Company in a Place of Payment for that
series, the Company shall execute, and the Trustee shall authenticate and
deliver, in the name of the designated transferee or transferees, one or more
new Securities of the same series, of any authorized denominations and of like
tenor and aggregate principal amount.
At the option of the Holder, Securities of any series may be exchanged
for other Securities of the same series, of any authorized denominations and of
like tenor and aggregate principal amount, upon surrender of the Securities to
be exchanged at such office or agency. Whenever any Securities are so sur-
rendered for exchange, the Company shall execute, and the Trustee shall
authenticate and deliver, the Securities which the Holder making the exchange
is entitled to receive.
All Securities issued upon any registration of transfer or exchange of
Securities shall be the valid obligations of the Company, evidencing the same
debt, and entitled to the same benefits under this Indenture, as the Securities
surrendered upon such registration of transfer or exchange.
Every Security presented or surrendered for registration of transfer
or for 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.
No service charge shall be made for any registration of transfer or
exchange of Securities, but 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 of transfer or exchange of Securities, other than
exchanges pursuant to Section 304, 906 or 1107 not involving any transfer.
If the Securities of any series (or of any series and specified tenor)
are to be redeemed in part, the Company shall not be required (A) to issue,
<PAGE> 31
register the transfer of or exchange any Securities of that series (or of that
series and specified tenor, as the case may be) during a period beginning at
the opening of business 15 days before the day of the mailing of a notice of
redemption of any such Securities selected for redemption under Section 1103
and ending at the close of business on the day of such mailing, or (B) to
register the transfer of or exchange any Security so selected for redemption in
whole or in part, except the unredeemed portion of any Security being redeemed
in part.
The provisions of Clauses (1), (2), (3) and (4) below shall apply only
to Global Securities:
(1) Each Global Security authenticated under this Indenture shall
be registered in the name of the Depositary designated for such Global
Security or a nominee thereof and delivered to such Depositary or a nominee
thereof or custodian therefor, and each such Global Security shall
constitute a single Security for all purposes of this Indenture.
(2) Notwithstanding any other provision in this Indenture, no
Global Security may be exchanged in whole or in part for Securities
registered, and no transfer of a Global Security in whole or in part may be
registered, in the name of any Person other than the Depositary for such
Global Security or a nominee thereof unless (A) such Depositary (i) has
notified the Company that it is unwilling or unable to continue as
Depositary for such Global Security or (ii) has ceased to be a clearing
agency registered under the Exchange Act, (B) there shall have occurred and
be continuing an Event of Default with respect to such Global Security or
(C) there shall exist such circumstances, if any, in addition to or in lieu
of the foregoing as have been specified for this purpose as contemplated by
Section 301.
(3) Subject to Clause (2) above, any exchange of a Global Security
for other Securities may be made in whole or in part, and all Securities
issued in exchange for a Global Security or any portion thereof shall be
registered in such names as the Depositary for such Global Security shall
direct.
(4) Every Security authenticated and delivered upon registration
of transfer of, or in exchange for or in lieu of, a Global Security or any
portion thereof, whether pursuant to this Section, Section 304, 306, 906 or
1107 or otherwise, shall be authenticated and delivered in the form of, and
shall be, a Global Security, unless such Security is registered in the name
of a Person other than the Depositary for such Global Security or a nominee
thereof.
SECTION 306. Mutilated, Destroyed, Lost and Stolen Securities.
If any mutilated Security is surrendered to the Trustee, the Company
shall execute and the Trustee shall authenticate and deliver in exchange
therefor a new Security of the same series and of like tenor and principal
amount and bearing a number not contemporaneously outstanding.
If there shall be delivered to the Company and the Trustee
(i) evidence to their satisfaction of the destruction, loss or theft of any
Security and (ii) such security or indemnity as may be required by them to save
each of them and any agent of either of them harmless, then, in the absence of
notice to the Company or the Trustee that such Security has been acquired by a
<PAGE> 32
bona fide purchaser, the Company shall execute and the Trustee shall
authenticate and deliver, in lieu of any such destroyed, lost or stolen
Security, a new Security of the same series and of like tenor and principal
amount and bearing a number not contemporaneously outstanding.
In case any such mutilated, destroyed, lost or stolen Security has
become or is about to become due and payable, the Company in its discretion
may, instead of issuing a new Security, pay such Security.
Upon the issuance of any new 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 relation thereto and any other
expenses (including the fees and expenses of the Trustee) connected therewith.
Every new Security of any series issued pursuant to this Section in
lieu of any destroyed, lost or stolen Security shall constitute an original
additional contractual obligation of the Company, whether or not the destroyed,
lost or stolen Security 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 Securities of that series duly issued hereunder.
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 Securities.
SECTION 307. Payment of Interest; Interest Rights Preserved.
Except as otherwise provided as contemplated by Section 301 with
respect to any series of Securities, interest on any Security which is payable,
and is punctually paid or duly provided for, on any Interest Payment Date shall
be paid to the Person in whose name that Security (or one or more Predecessor
Securities) is registered at the close of business on the Regular Record Date
for such interest.
Any interest on any Security of any series which is payable, but is
not punctually paid or duly provided for, on any Interest Payment Date (herein
called "Defaulted Interest") shall forthwith cease to be payable to the Holder
on the relevant Regular Record Date by virtue of having been such Holder, and
such Defaulted Interest may be paid by the Company, at its election in each
case, as provided in Clause (1) or (2) below:
(1) The Company may elect to make payment of any Defaulted
Interest to the Persons in whose names the Securities of such series
(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 Security of such series and the
date of the proposed payment, and at the same time the Company shall
deposit with the Trustee an amount of money equal to the aggregate
amount proposed to be paid in respect of such Defaulted Interest or
shall make arrangements satisfactory to the Trustee for such deposit
prior to the date of the proposed payment, such money when deposited
to be held in trust for the benefit of the Persons entitled to such
Defaulted Interest as in this Clause provided. Thereupon the Trustee
shall fix a Special Record Date for the payment of such Defaulted
Interest which shall be not more than 15 days and not less than
<PAGE> 33
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 given to each Holder of
Securities of such series in the manner set forth in Section 106, not
less than 10 days prior to such Special Record Date. Notice of the
proposed payment of such Defaulted Interest and the Special Record
Date therefor having been so mailed, such Defaulted Interest shall be
paid to the Persons in whose names the Securities of such series (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 the
Securities of any series in any other lawful manner not inconsistent
with the requirements of any securities exchange on which such
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.
Subject to the foregoing provisions of this Section, each Security
delivered under this Indenture upon registration of transfer of or in exchange
for or in lieu of any other Security shall carry the rights to interest accrued
and unpaid, and to accrue, which were carried by such other Security.
SECTION 308. Persons Deemed Owners.
Prior to due presentment of a Security for registration of transfer,
the Company, the Trustee and any agent of the Company or the Trustee may treat
the Person in whose name such Security is registered as the owner of such
Security for the purpose of receiving payment of principal of and any premium
and (subject to Section 307) any interest on such Security and for all other
purposes whatsoever, whether or not such 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.
SECTION 309. Cancellation.
All Securities surrendered for payment, redemption, registration of
transfer or exchange or for credit against any sinking fund payment shall, if
surrendered to any Person other than the Trustee, be delivered to the Trustee
and shall be promptly cancelled by it. The Company may at any time deliver to
the Trustee for cancellation any Securities previously authenticated and
delivered hereunder which the Company may have acquired in any manner whatso-
ever, and may deliver to the Trustee (or to any other Person for delivery to
the Trustee) for cancellation any Securities previously authenticated hereunder
which the Company has not issued and sold, and all Securities so delivered
shall be promptly cancelled by the Trustee. No Securities shall be
authenticated in lieu of or in exchange for any Securities cancelled as
provided in this Section, except as expressly permitted by this Indenture. All
cancelled Securities held by the Trustee shall be disposed of as directed by a
Company Order.
<PAGE> 34
SECTION 310. Computation of Interest.
Except as otherwise specified as contemplated by Section 301 for
Securities of any series, interest on the Securities of each series shall be
computed on the basis of a 360-day year of twelve 30-day months.
ARTICLE FOUR
SATISFACTION AND DISCHARGE
SECTION 401. Satisfaction and Discharge of Indenture.
This Indenture shall upon Company Request cease to be of further
effect (except as to any surviving rights of registration of transfer or
exchange of Securities herein expressly provided for), 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 Securities theretofore authenticated and delivered (other
than (i) Securities which have been destroyed, lost or stolen and
which have been replaced or paid as provided in Section 306 and
(ii) Securities 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 1003) have been delivered to the Trustee for cancellation; or
(B) all such Securities 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
of redemption by the Trustee in the name, and at the expense, of
the Company,
and the Company, in the case of (i), (ii) or (iii) above, has
deposited or caused to be deposited with the Trustee as trust funds in
trust for the purpose money in an amount sufficient to pay and dis-
charge the entire indebtedness on such Securities not theretofore
delivered to the Trustee for cancellation, for principal and any
premium and interest to the date of such deposit (in the case of
Securities which have become due and payable) or to the Stated
Maturity or Redemption Date, as the case may be;
(2) the Company has paid or caused to be paid all other sums payable
hereunder by the Company; and
(3) the Company has delivered to the Trustee an Officers' Certificate
and an Opinion of Counsel, each stating that all conditions precedent
<PAGE> 35
herein provided for relating to the satisfaction and discharge of this
Indenture have been complied with.
Notwithstanding the satisfaction and discharge of this Indenture, the
obligations of the Company to the Trustee under Section 607, the obligations of
the Trustee to any Authenticating Agent under Section 614 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 402 and the last
paragraph of Section 1003 shall survive.
SECTION 402. Application of Trust Money.
Subject to the provisions of the last paragraph of Section 1003, all
money deposited with the Trustee pursuant to Section 401 shall be held in trust
and applied by it, in accordance with the provisions of the 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 Persons entitled thereto, of the principal and any premium
and interest for whose payment such money has been deposited with the Trustee.
ARTICLE FIVE
REMEDIES
SECTION 501. Events of Default.
"Event of Default", wherever used herein with respect to 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 or 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 Security of that
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 or any premium on any
Security of that series at its Maturity; or
(3) default in the deposit of any sinking fund payment, when and as
due by the terms of a Security of that 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 has expressly been included
in this Indenture solely for the benefit of any series of Securities other
than that series), and continuance of such default or breach for a period
of 60 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 25% in principal amount of the Outstanding Securities of that
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
<PAGE> 36
(5) a default under any bond, debenture, note or other evidence of
indebtedness for money borrowed by the Company (including a default with
respect to Securities of any series other than that series) or any
Restricted Subsidiary having an aggregate principal amount outstanding at
the time of such default of at least $10 million, or under any mortgage,
indenture or instrument (including this Indenture) under which there may be
issued or by which there may be secured or evidenced any indebtedness for
money borrowed by the Company or any Restricted Subsidiary having an
aggregate principal amount outstanding at the time of such default of at
least $10 million, whether such indebtedness now exists or shall hereafter
be created, which default (A) shall constitute a failure to pay any portion
of the principal of such indebtedness when due and payable after the
expiration of any applicable grace period with respect thereto or (B) shall
have resulted in such indebtedness becoming or being declared due and
payable prior to the date on which it would otherwise have become due and
payable, without, in the case of Clause (A), such indebtedness having been
discharged or without, in the case of Clause (B), such indebtedness having
been discharged or such acceleration having been rescinded or annulled, in
each such case within a period of 10 days after there shall have 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 25% in principal
amount of the Outstanding Securities of that series a written notice
specifying such default and requiring the Company to cause such
indebtedness to be discharged or cause such acceleration to be rescinded or
annulled, as the case may be, and stating that such notice is a "Notice of
Default" hereunder; provided, however, that, subject to the provisions of
Sections 601 and 602, the Trustee shall not be deemed to have knowledge of
such default unless either (A) a Responsible Officer of the Trustee shall
have actual knowledge of such default or (B) the Trustee shall have
received written notice thereof from the Company, from any Holder, from the
holder of any such indebtedness or from the trustee under any such
mortgage, indenture or other instrument; or
(6) the entry by a court having jurisdiction in the premises of (A) a
decree or order for relief in respect of the Company in an involuntary case
or proceeding under any applicable Federal or State bankruptcy, insolvency,
reorganization or other similar law or (B) 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 custodian, receiver, liquidator, assignee, 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 for relief or any
such other decree or order unstayed and in effect for a period of 60
consecutive days; or
(7) the commencement by the Company of a voluntary case or proceeding
under any applicable Federal or State bankruptcy, insolvency,
reorganization or other similar law or of any other case or proceeding to
be adjudicated a bankrupt or insolvent, or the consent by it to the entry
of a decree or order for relief in respect of the Company in an involuntary
case or proceeding under any applicable Federal or State bankruptcy,
insolvency, reorganization or other similar law or to the commencement of
any bankruptcy or insolvency case or proceeding against it, or the filing
by it of a petition or answer or consent seeking reorganization or relief
under any applicable Federal or State law, or the consent by it to the
filing of such petition or to the appointment of or taking possession by a
<PAGE> 37
custodian, receiver, liquidator, assignee, 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 creditors, or the
admission by it in writing of its inability to pay its debts generally as
they become due, or the taking of corporate action by the Company in
furtherance of any such action; or
(8) any other Event of Default provided with respect to Securities of
that series.
SECTION 502. Acceleration of Maturity; Rescission and Annulment.
If an Event of Default (other than an Event of Default specified in
Section 501(6) or 501(7)) with respect to 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
Securities of that series may declare the principal amount of all the
Securities of that series (or, if any Securities of that series are Original
Issue Discount Securities, such portion of the principal amount of such
Securities as may be specified by the terms thereof) 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) shall become immediately due and payable. If an Event of Default
specified in Section 501(6) or 501 (7) with respect to Securities of any series
at the time Outstanding occurs, the principal amount of all the Securities of
that series (or, if any Securities of that series are Original Issue Discount
Securities, such portion of the principal amount of such Securities as may be
specified by the terms thereof) shall automatically, and without any
declaration or other action on the part of the Trustee or any Holder, become
immediately due and payable.
At any time after such a declaration of acceleration with respect to
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 Securities of that 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
sufficient to pay
(A) all overdue interest on all Securities of that series,
(B) the principal of (and premium, if any, on) any Securities of
that series which have become due otherwise than by such declaration
of acceleration and any interest thereon at the rate or rates
prescribed therefor in such Securities,
(C) to the extent that payment of such interest is lawful,
interest upon overdue interest at the rate or rates prescribed
therefor in such Securities, 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;
and
<PAGE> 38
(2) all Events of Default with respect to Securities of that series,
other than the non-payment of the principal of Securities of that series
which have become due solely by such declaration of acceleration, have been
cured or waived as provided in Section 513.
No such rescission shall affect any subsequent default or impair any right
consequent thereon.
SECTION 503. Collection of Indebtedness and Suits for Enforcement by Trustee.
The Company covenants that if
(1) default is made in the payment of any interest on any Security
when such interest becomes due and payable and such default continues for a
period of 30 days, or
(2) default is made in the payment of the principal of (or premium,
if any, on) any Security at the Maturity thereof,
the Company will, upon demand of the Trustee, pay to it, for the benefit of the
Holders of such Securities, the total outstanding amount of the Securities
and, to the extent that payment of such interest shall be legally enforceable,
interest on any overdue principal and premium and on any overdue interest, at
the rate or rates prescribed therefor in such Securities, 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 an Event of Default with respect to 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 Securities 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.
SECTION 504. Trustee May File Proofs of Claim.
In case of any judicial proceeding relative to the Company (or any
other obligor upon the Securities), its property or its creditors, the Trustee
shall be entitled and empowered, by intervention in such proceeding or
otherwise, to take any and all actions authorized under the Trust Indenture Act
in order to have claims of the Holders and the Trustee allowed in any such
proceeding. In particular, the Trustee shall be authorized to collect and
receive any moneys or other property payable or deliverable on any such claims
and to distribute the same; and any custodian, receiver, assignee, trustee,
liquidator, sequestrator or other similar official in any such judicial
proceeding is hereby authorized by each 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 the Holders, to pay to the Trustee any amount due it for
the reasonable compensation, all actual expenses, and disbursements of the
Trustee, its agents and counsel, and any other amounts due the Trustee
under Section 607.
<PAGE> 39
No provision of this Indenture 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 Securities 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; provided,
however, that the Trustee may, on behalf of the Holders, vote for the election
of a trustee in bankruptcy or similar official and be a member of a creditors'
or other similar committee.
SECTION 505. Trustee May Enforce Claims Without Possession of Securities.
All rights of action and claims under this Indenture or the Securities
may be prosecuted and enforced by the Trustee without the possession of any of
the Securities 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, disburse-
ments and advances of the Trustee, its agents and counsel, be for the ratable
benefit of the Holders of the Securities in respect of which such judgment has
been recovered.
SECTION 506. 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 or any
premium or interest, upon presentation of the Securities 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 607; and
SECOND: To the payment of the amounts then due and unpaid for
principal of and any premium and interest on the Securities 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 Securities for principal and any premium and interest,
respectively.
SECTION 507. Limitation on Suits.
No Holder of any Security 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 the Securities of that
series;
(2) the Holders of not less than 25% in principal amount of the
Outstanding Securities of that 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;
<PAGE> 40
(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 Securities of that 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 of
such Holders, 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.
SECTION 508. Unconditional Right of Holders to Receive Principal,
Premium and Interest.
Notwithstanding any other provision in this Indenture, the Holder of
any Security shall have the right, which is absolute and unconditional, to
receive payment of the principal of and any premium and (subject to
Section 307) interest on such Security on the respective Stated Maturities
expressed in such Security (or, in the case of redemption, on the Redemption
Date) and to institute suit for the enforcement of any such payment, and such
rights shall not be impaired without the consent of such Holder.
SECTION 509. 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, subject to any
determination in such proceeding, the Company, the Trustee and the Holders
shall 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 510. Rights and Remedies Cumulative.
Except as otherwise provided with respect to the replacement or
payment of mutilated, destroyed, lost or stolen Securities in the last
paragraph of Section 306, 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.
<PAGE> 41
SECTION 511. Delay or Omission Not Waiver.
No delay or omission of the Trustee or of any Holder of any Securities
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
an acquiescence therein. Every right and remedy given by this Article 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 512. Control by Holders.
The Holders of a majority in principal amount of the Outstanding
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
Securities of such series, provided that
(1) such direction shall not be in conflict with any rule of law or
with this Indenture, and
(2) the Trustee may take any other action deemed proper by the Trustee
which is not inconsistent with such direction.
SECTION 513. Waiver of Past Defaults.
The Holders of not less than a majority in principal amount of the
Outstanding Securities of any series may on behalf of the Holders of all the
Securities of 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 any premium or interest on
any Security of such series, or
(2) in respect of a covenant or provision hereof which under Article
Nine cannot be modified or amended without the consent of the Holder of
each Outstanding 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 this Indenture; but no such waiver shall extend to any subsequent or
other default or impair any right consequent thereon.
SECTION 514. Undertaking for Costs.
In any suit for the enforcement of any right or remedy under this
Indenture, or in any suit against the Trustee for any action taken, suffered or
omitted by it as Trustee, a court may require any party litigant in such suit
to file an undertaking to pay the costs of such suit, and may assess costs
against any such party litigant, in the manner and to the extent provided in
the Trust Indenture Act; provided that neither this Section nor the Trust
Indenture Act shall be deemed to authorize any court to require such an
undertaking or to make such an assessment in any suit instituted by the
Company.
<PAGE> 42
SECTION 515. Waiver of Usury, 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 usury, 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 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 601. Certain Duties and Responsibilities.
The duties and responsibilities of the Trustee shall be as provided by
the Trust Indenture Act. Notwithstanding the foregoing, no provision of this
Indenture shall require the Trustee to expend or risk its own funds or
otherwise incur any financial liability in the performance of any of its duties
hereunder, or 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.
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 602. Notice of Defaults.
If a default occurs hereunder with respect to Securities of any
series, the Trustee shall give the Holders of Securities of such series notice
of such default as and to the extent provided by the Trust Indenture Act;
provided, however, that in the case of any default of the character specified
in Section 501(4) with respect to 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 Securities of such series.
SECTION 603. Certain Rights of Trustee.
Subject to the provisions of Section 601:
(1) 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 and, to the extent not otherwise required
by the Trust Indenture Act, shall have no obligation to independently
verify the accuracy of any statement or conclusions in such paper or
document;
<PAGE> 43
(2) 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;
(3) 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;
(4) the Trustee may consult with counsel and the written 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;
(5) 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 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;
(6) 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
(7) 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 or attorney appointed with due care by
it hereunder.
SECTION 604. Not Responsible for Recitals or Issuance of Securities.
The recitals contained herein and in the Securities, except the
Trustee's certificates of authentication, shall be taken as the statements of
the Company, and neither the Trustee nor any Authenticating Agent assumes any
responsibility for their correctness. The Trustee makes no representations as
to the validity or sufficiency of this Indenture or of the Securities. Neither
the Trustee nor any Authenticating Agent shall be accountable for the use or
application by the Company of Securities or the proceeds thereof.
SECTION 605. May Hold Securities.
The Trustee, any Authenticating Agent, any Paying Agent, any Security
Registrar or any other agent of the Company, in its individual or any other
capacity, may become the owner or pledgee of Securities and, subject to
Sections 608 and 613, may otherwise deal with the Company with the same rights
<PAGE> 44
it would have if it were not Trustee, Authenticating Agent, Paying Agent,
Security Registrar or such other agent.
SECTION 606. Money Held in Trust.
Money held by the Trustee in trust hereunder need not be segregated
from other funds except to the extent required by law. The Trustee shall be
under no liability for interest on any money received by it hereunder except as
otherwise agreed with the Company.
SECTION 607. Compensation and Reimbursement.
The Company agrees
(1) to pay to the Trustee from time to time reasonable compensation
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 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 the Trustee for, and to hold it harmless against, any
loss, liability or expense including reasonable attorney fees incurred
without negligence or bad faith on its part, arising out of or in
connection with the acceptance or administration of the trust or trusts
hereunder or the exercise 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.
SECTION 608. Conflicting Interests.
If the Trustee has or shall acquire a conflicting interest within the
meaning of the Trust Indenture Act, the Trustee shall either eliminate such
conflict of interest or resign, to the extent and in the manner provided by,
and subject to the provisions of, the Trust Indenture Act and this Indenture.
To the extent permitted by such Act, the Trustee shall not be deemed to have a
conflicting interest by virtue of being a trustee under this Indenture with
respect to Securities of more than one series.
SECTION 609. Corporate Trustee Required; Eligibility.
There shall at all times be one (and only one) Trustee hereunder with
respect to the Securities of each series, which may be Trustee hereunder for
Securities of one or more other series. Each Trustee shall be a Person that is
eligible pursuant to the Trust Indenture Act to act as such, has a combined
capital and surplus of at least $50,000,000 and has its Corporate Trust Office
in Boston, Massachusetts. If any such Person publishes reports of condition at
<PAGE> 45
least annually, pursuant to law or to the requirements of its supervising or
examining authority, then for the purposes of this Section and to the extent
permitted by the Trust Indenture Act, the combined capital and surplus of such
Person 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 the Trustee
with respect to the Securities of any series shall cease to be eligible in
accordance with the provisions of this Section, it shall resign immediately in
the manner and with the effect hereinafter specified in this Article.
SECTION 610. Resignation and Removal; Appointment of Successor.
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 in accordance with the
applicable requirements of Section 611.
The Trustee may resign at any time with respect to the Securities of
one or more series by giving written notice thereof to the Company. If the
instrument of acceptance by a successor Trustee required by Section 611 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 Securities of such series.
The Trustee may be removed at any time with respect to the Securities
of any series by Act of the Holders of a majority in principal amount of the
Outstanding Securities of such series, delivered to the Trustee and to the
Company.
If at any time:
(1) the Trustee shall fail to comply with Section 608 after written
request therefor by the Company or by any Holder who has been a bona fide
Holder of a Security for at least six months, or
(2) the Trustee shall cease to be eligible under Section 609 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, (A) the Company by a Board Resolution may remove the
Trustee with respect to all Securities, or (B) subject to Section 514, any
Holder who has been a bona fide Holder of a Security 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 with respect to all
Securities and the appointment of a successor Trustee or Trustees.
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 Securities of one or more series, the Company, by a Board
Resolution, shall promptly appoint a successor Trustee or Trustees with respect
to the Securities of that or those series (it being understood that any such
<PAGE> 46
successor Trustee may be appointed with respect to the 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 Securities of any particular series) and shall comply with
the applicable requirements of Section 611. If, within one year after such
resignation, removal or incapability, or the occurrence of such vacancy, a
successor Trustee with respect to the Securities of any series shall be
appointed by Act of the Holders of a majority in principal amount of the
Outstanding 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 in accordance with the applicable requirements
of Section 611, become the successor Trustee with respect to the Securities of
such series and to that extent supersede the successor Trustee appointed by the
Company. If no successor Trustee with respect to the Securities of any series
shall have been so appointed by the Company or the Holders and accepted
appointment in the manner required by Section 611, any Holder who has been a
bona fide Holder of a Security of such series for at least six months may, 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 Securities of such series.
The Company shall give notice of each resignation and each removal of
the Trustee with respect to the Securities of any series and each appointment
of a successor Trustee with respect to the Securities of any series to all
Holders of Securities of such series in the manner provided in Section 106.
Each notice shall include the name of the successor Trustee with respect to the
Securities of such series and the address of its Corporate Trust Office.
SECTION 611. Acceptance of Appointment by Successor.
In case of the appointment hereunder of a successor Trustee with
respect to all Securities, every 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 the 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.
In case of the appointment hereunder of a successor Trustee with
respect to the Securities of one or more (but not all) series, the Company, the
retiring Trustee and each successor Trustee with respect to the 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
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 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 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 provisions of this
<PAGE> 47
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 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 trust or trusts hereunder
administered by any other such Trustee; and upon the execution and delivery of
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 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 Securities of that or those series to which the
appointment of such successor Trustee relates.
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 the
first or second preceding paragraph, as the case may be.
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 612. 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 the corporate trust
business of the Trustee, shall be the successor of the Trustee hereunder,
provided 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 Securities shall have been
authenticated, but not delivered, by the Trustee then in office, any successor
by merger, conversion or consolidation to such authenticating Trustee may adopt
such authentication and deliver the Securities so authenticated with the same
effect as if such successor Trustee had itself authenticated such Securities.
SECTION 613. Preferential Collection of Claims Against Company.
If and when the Trustee shall be or become a creditor of the Company
(or any other obligor upon the Securities), the Trustee shall be subject to the
provisions of the Trust Indenture Act regarding the collection of claims
against the Company (or any such other obligor).
SECTION 614. Appointment of Authenticating Agent.
The Trustee may appoint an Authenticating Agent or Agents with respect
to one or more series of Securities which shall be authorized to act on behalf
of the Trustee to authenticate Securities of such series issued upon original
issue and upon exchange, registration of transfer or partial redemption thereof
or pursuant to Section 306, and Securities so authenticated shall be entitled
<PAGE> 48
to the benefits of this Indenture and shall be valid and obligatory for all
purposes as if authenticated by the Trustee hereunder. Wherever reference is
made in this Indenture to the authentication and delivery of Securities by the
Trustee or the Trustee's certificate of authentication, such reference shall be
deemed to include authentication and delivery on behalf of the Trustee by an
Authenticating Agent and a certificate of authentication executed on behalf of
the Trustee by an Authenticating Agent. Each Authenticating Agent shall be
acceptable to the Company and shall at all times 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 act as
Authenticating Agent, having a combined capital and surplus of not less than
$50,000,000 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 the 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 an 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 such Authenticating Agent
shall be a party, or any corporation succeeding to the corporate agency or
corporate trust business of an Authenticating Agent, shall continue to be an
Authenticating Agent, provided such corporation shall be otherwise eligible
under this Section, without the execution or filing of any paper or any further
act on the part of the Trustee or the Authenticating Agent.
An Authenticating Agent may resign at any time by giving written
notice thereof to the Trustee and to the Company. The Trustee may at any time
terminate the agency of an Authenticating Agent by giving written notice
thereof to such Authenticating Agent and to the Company. Upon receiving such a
notice of resignation or upon such a termination, or in case at any time such
Authenticating Agent shall cease to be eligible in accordance with the
provisions of this Section, the Trustee may appoint a successor Authenticating
Agent which shall be acceptable to the Company and shall give notice of such
appointment in the manner provided in Section 106 to all Holders of Securities
of the series with respect to which such Authenticating Agent will serve. Any
successor Authenticating Agent upon acceptance of its appointment hereunder
shall become vested with all the rights, powers and duties of its predecessor
hereunder, with like effect as if originally named as an Authenticating Agent.
No successor Authenticating Agent shall be appointed unless eligible under the
provisions of this Section.
The Trustee agrees to pay to each Authenticating Agent from time to
time reasonable compensation for its services under this Section, and the
Trustee shall be entitled to be reimbursed for such payments, subject to the
provisions of Section 607.
If an appointment with respect to one or more series is made pursuant
to this Section, the 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:
<PAGE> 49
This is one of the Securities of the series designated therein
referred to in the within-mentioned Indenture.
FLEET BANK OF MASSACHUSETTS, N.A.,
As Trustee
By......................................,
As Authenticating Agent
By.......................................
Authorized Officer
ARTICLE SEVEN
HOLDERS' LISTS AND REPORTS BY TRUSTEE AND COMPANY
SECTION 701. Company to Furnish Trustee Names and Addresses of Holders.
The Company will furnish or cause to be furnished to the Trustee
(1) semi-annually, not later than ............... and
................... in each year, a list, in such form as the Trustee
may reasonably require, of the names and addresses of the Holders of
Securities of each series as of the preceding .............. or
.............., as the case may be, and
(2) 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;
excluding from any such list names and addresses received by the Trustee in its
capacity as Security Registrar.
SECTION 702. Preservation of Information; Communications to Holders.
The Trustee shall preserve, in as current a form as is reasonably
practicable, the names and addresses of Holders contained in the most recent
list furnished to the Trustee as provided in Section 701 and the names and
addresses of Holders received by the Trustee in its capacity as Security
Registrar. The Trustee may destroy any list furnished to it as provided in
Section 701 upon receipt of a new list so furnished.
The rights of Holders to communicate with other Holders with respect
to their rights under this Indenture or under the Securities, and the
corresponding rights and privileges of the Trustee, shall be as provided by the
Trust Indenture Act.
<PAGE> 50
Every Holder of Securities, by receiving and holding the same, agrees
with the Company and the Trustee that neither the Company nor the Trustee nor
any agent of either of them shall be held accountable by reason of any
disclosure of information as to names and addresses of Holders made pursuant to
the Trust Indenture Act.
SECTION 703. Reports by Trustee.
The Trustee shall transmit to Holders such reports concerning the
Trustee and its actions under this Indenture as may be required pursuant to the
Trust Indenture Act at the times and in the manner provided pursuant thereto.
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
Securities are listed, with the Commission and with the Company. The Company
will notify the Trustee when any Securities are listed on any stock exchange.
SECTION 704. Reports by Company.
The Company shall file with the Trustee and the Commission, and
transmit to Holders, such information, documents and other reports, and such
summaries thereof, as may be required pursuant to the Trust Indenture Act at
the times and in the manner provided pursuant to such Act; provided that any
such information, documents or reports required to be filed with the Commission
pursuant to Section 13 or 15(d) of the Exchange Act shall be filed with the
Trustee within 15 days after the same is so required to be filed with the
Commission.
ARTICLE EIGHT
CONSOLIDATION, MERGER, CONVEYANCE, TRANSFER OR LEASE
SECTION 801. Company May Consolidate, Etc., Only on Certain Terms.
The Company shall not consolidate with or merge into any other Person
or convey, transfer or lease its properties and assets substantially as an
entirety to any Person, and the Company shall not permit any Person to
consolidate with or merge into the Company or convey, transfer or lease its
properties and assets substantially as an entirety to the Company, unless:
(1) in case the Company shall consolidate with or merge into another
Person or convey, transfer or lease its properties and assets substantially
as an entirety to any Person, the Person 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 shall be a corporation, partnership or trust,
shall be organized and validly existing under the laws of the United States
of America, any State 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 any premium and interest on all
the Securities and the performance or observance of every covenant of this
Indenture on the part of the Company to be performed or observed;
<PAGE> 51
(2) immediately after giving effect to such transaction and treating
any indebtedness which becomes an obligation of the Company or any
Subsidiary as a result of such transaction as having been incurred by the
Company or such Subsidiary at the time of 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) if, as a result of any such consolidation or merger or such
conveyance, transfer or lease, properties or assets of the Company would
become subject to a mortgage, pledge, lien, security interest or other
encumbrance which would not be permitted by this Indenture, the Company or
such successor Person, as the case may be, shall take such steps as shall
be necessary effectively to secure the Securities equally and ratably with
(or prior to) all indebtedness secured thereby; and
(4) 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, if a supplemental indenture is required
in connection with such transaction, such supplemental indenture comply
with this Article and that all conditions precedent herein provided for
relating to such transaction have been complied with.
SECTION 802. Successor Substituted.
Upon any consolidation of the Company with, or merger of the Company
into, any other Person or any conveyance, transfer or lease of the properties
and assets of the Company substantially as an entirety in accordance with
Section 801, the successor Person 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 Person had been named as the Company herein, and thereafter, except
in the case of a lease, the predecessor Person shall be relieved of all
obligations and covenants under this Indenture and the Securities.
ARTICLE NINE
SUPPLEMENTAL INDENTURES
SECTION 901. 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 and content
satisfactory to the Trustee, for any of the following purposes:
(1) to evidence the succession of another Person to the Company and
the assumption by any such successor of the covenants of the Company herein
and in the Securities; or
(2) to add to the covenants of the Company for the benefit of the
Holders of all or any series of Securities (and if such covenants are to be
for the benefit of less than all series of Securities, stating that such
covenants are expressly being included solely for the benefit of such
<PAGE> 52
series) or to surrender any right or power herein conferred upon the
Company; or
(3) to add any additional Events of Default for the benefit of the
Holders of all or any series of Securities (and if such additional Events
of Default are to be for the benefit of less than all series of Securities,
stating that such additional Events of Default are expressly being included
solely for the benefit of such series); or
(4) to add to or change any of the provisions of this Indenture to
such extent as shall be necessary to permit or facilitate the issuance of
Securities in bearer form, registrable or not registrable as to principal,
and with or without interest coupons, or to permit or facilitate the
issuance of Securities in uncertificated form; or
(5) to add to, change or eliminate any of the provisions of this
Indenture in respect of one or more series of Securities, provided that any
such addition, change or elimination (A) shall neither (i) apply to any
Security of any series created prior to the execution of such supplemental
indenture and entitled to the benefit of such provision nor (ii) modify the
rights of the Holder of any such Security with respect to such provision or
(B) shall become effective only when there is no such Security Outstanding;
or
(6) to secure the Securities pursuant to the requirements of
Section 1008 or otherwise; or
(7) to establish the form or terms of Securities of any series as
permitted by Sections 201 and 301; or
(8) to evidence and provide for the acceptance of appointment
hereunder by a successor Trustee with respect to the Securities of one or
more series 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 611; or
(9) to cure any ambiguity, to correct or supplement any provision
herein which may be defective or inconsistent with any other provision
herein, or to make any other provisions with respect to matters or
questions arising under this Indenture, provided that such action pursuant
to this Clause (9) shall not adversely affect the interests of the Holders
of Securities of any series in any material respect.
SECTION 902. Supplemental Indentures With Consent of Holders.
With the consent of the Holders of not less than a majority in
principal amount of the Outstanding Securities of each series affected by such
supplemental indenture, 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 of Securities of such series under this Indenture; provided, however,
that no such supplemental indenture shall, without the consent of the Holder of
each Outstanding Security affected thereby,
<PAGE> 53
(1) change the Stated Maturity of the principal of, or any instalment
of principal of or interest on, any Security, or reduce the principal
amount thereof or the rate of interest thereon or any premium payable upon
the redemption thereof, or reduce the amount of the principal of an
Original Issue Discount Security or any other Security which would be due
and payable upon a declaration of acceleration of the Maturity thereof
pursuant to Section 502, or change the time at which any Security may or
shall be redeemed, or change any Place of Payment where, or the coin or
currency in which, any Security or any premium or interest thereon is
payable, or impair the right to institute suit for the enforcement of any
such payment on or after the Stated Maturity thereof (or, in the case of
redemption, on or after the Redemption Date), or
(2) reduce the percentage in principal amount of the Outstanding
Securities of any series, the consent of whose Holders is required for any
such 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
(3) modify any of the provisions of this Section, Section 513 or
Section 1010, 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 Security 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 1010, or the
deletion of this proviso, in accordance with the requirements of
Sections 611 and 901(8).
A supplemental indenture which changes or eliminates any covenant or other
provision of this Indenture which has expressly been included solely for the
benefit of one or more particular series of Securities, or which modifies the
rights of the Holders of Securities 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 Securities of any other series.
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.
SECTION 903. 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 601) 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 affects the
Trustee's own rights, duties or immunities under this Indenture or otherwise.
SECTION 904. 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
<PAGE> 54
indenture shall form a part of this Indenture for all purposes; and every
Holder of Securities theretofore or thereafter authenticated and delivered
hereunder shall be bound thereby.
SECTION 905. Conformity with Trust Indenture Act.
Every supplemental indenture executed pursuant to this Article shall
conform to the requirements of the Trust Indenture Act.
SECTION 906. Reference in Securities to Supplemental Indentures.
Securities 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 Securities of any series so modified as to conform, in the
opinion of the Trustee and the Company, to any such supplemental indenture may
be prepared and executed by the Company and authenticated and delivered by the
Trustee in exchange for Outstanding Securities of such series.
ARTICLE TEN
COVENANTS
SECTION 1001. Payment of Principal, Premium and Interest.
The Company covenants and agrees for the benefit of each series of
Securities that it will duly and punctually pay the principal of and any
premium and interest on the Securities of that series in accordance with the
terms of the Securities and this Indenture.
SECTION 1002. Maintenance of Office or Agency.
The Company will maintain in each Place of Payment for any series of
Securities an office or agency where Securities of that series may be presented
or surrendered for payment, where Securities of that series may be surrendered
for registration of transfer or exchange and where notices and demands to or
upon the Company in respect of the 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, and the Company hereby appoints the
Trustee as its agent to receive all such presentations, surrenders, notices and
demands.
The Company may also from time to time designate one or more other
offices or agencies where the Securities of one or more series may be presented
or surrendered for any or all such purposes and may from time to time rescind
such designations; provided, however, that no such designation or rescission
shall in any manner relieve the Company of its obligation to maintain an office
or agency in each Place of Payment for Securities of any series for such
<PAGE> 55
purposes. The Company will give prompt written notice to the Trustee of any
such designation or rescission and of any change in the location of any such
other office or agency.
SECTION 1003. Money for 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 Securities, it will, on or before each due date of the
principal of or any premium or interest on any of the Securities of that
series, segregate and hold in trust for the benefit of the Persons entitled
thereto a sum sufficient to pay the principal and any premium and 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 for any
series of Securities, it will, prior to each due date of the principal of or
any premium or interest on any Securities of that series, deposit with a Paying
Agent a sum sufficient to pay such amount, such sum to be held as provided by
the Trust Indenture Act, and (unless 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 for any series of 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) comply with the provisions of
the Trust Indenture Act applicable to it as a Paying Agent and (2) during the
continuance of any default by the Company (or any other obligor upon the
Securities of that series) in the making of any payment in respect of the
Securities of that series, upon the written request of the Trustee, forthwith
pay to the Trustee all sums held in trust by such Paying Agent for payment in
respect of the Securities of that series.
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 or any premium or
interest on any Security of any series and remaining unclaimed for two years
after such principal, premium or interest has become due and payable shall be
paid to the Company on Company Request, or (if then held by the Company) shall
be discharged from such trust; and the Holder of such Security 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 published once, in a newspaper published in
the English language, customarily published on each Business Day and of general
circulation in The City of New York, New York, notice that such money remains
unclaimed and that, after a date specified therein, which shall not be less
<PAGE> 56
than 30 days from the date of such publication, any unclaimed balance of such
money then remaining will be repaid to the Company.
SECTION 1004. Statement by Officers as to Default.
The Company will deliver to the Trustee, within 120 days after the end
of each fiscal year of the Company ending after the date hereof, an Officers'
Certificate, stating whether or not to the best knowledge of the signers
thereof the Company is in default in the performance and observance of any of
the terms, provisions and conditions of this Indenture (without regard to any
period of grace or requirement of notice provided hereunder) and, if the
Company shall be in default, specifying all such defaults and the nature and
status thereof of which they may have knowledge.
SECTION 1005. Existence.
Subject to Article Eight, the Company will do or cause to be done all
things necessary to preserve and keep in full force and effect its 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
Board of Directors shall determine that the preservation thereof is no longer
desirable in the conduct of the business of the Company and that the loss
thereof is not disadvantageous in any material respect to the Holders.
SECTION 1006. Maintenance of Properties.
The Company will cause all properties used or useful in the conduct of
its business or the business of any Subsidiary to be maintained and kept in
good condition, repair and working order and supplied with all necessary
equipment and will cause to be made all necessary repairs, renewals,
replacements, betterments and improvements thereof, all as in the judgment of
the Company may be necessary so that the business carried on in connection
therewith may be properly and advantageously conducted at all times; provided,
however, that nothing in this Section shall prevent the Company from
discontinuing the operation or maintenance of any of such properties if such
discontinuance is, in the judgment of the Company, desirable in the conduct of
its business or the business of any Subsidiary and not disadvantageous in any
material respect to the Holders.
SECTION 1007. Payment of Taxes and Other Claims.
The Company will pay or discharge or cause to be paid or discharged,
before the same shall become delinquent, (1) all taxes, assessments and
governmental charges levied or imposed upon the Company or any Subsidiary or
upon the income, profits or property of the Company or any Subsidiary, and
(2) all lawful claims for labor, materials and supplies which, if unpaid, might
by law become a lien upon the property of the Company or any Subsidiary;
provided, however, that the Company shall not be required to pay or discharge
or cause to be paid or discharged any such tax, assessment, charge or claim
whose amount, applicability or validity is being contested in good faith by
appropriate proceedings.
<PAGE> 57
SECTION 1008. Limitation on Liens.
(a) The Company covenants that it will not issue, incur, create,
assume or guarantee, and will not permit any Restricted Subsidiary to issue,
incur, create, assume or guarantee, any debt for borrowed money secured by a
mortgage, security interest, pledge, lien, charge or other encumbrance
("mortgages") upon any Principal Property of the Company or any Restricted
Subsidiary or upon any shares of stock or indebtedness of any Restricted
Subsidiary (whether such Principal Property, shares or indebtedness are now
existing or owned or hereafter created or acquired) without in any such case
effectively providing concurrently with the issuance, incurrence, creation,
assumption or guarantee of any such secured debt, or the grant of a mortgage
with respect to any such indebtedness, that the Securities (together with, if
the Company shall so determine, any other indebtedness of or guarantee by the
Company or such Restricted Subsidiary ranking equally with the Securities)
shall be secured equally and ratably with (or, at the option of the Company,
prior to) such secured debt. The foregoing restriction, however, will not apply
to:
(i) mortgages on property existing at the time of acquisition
thereof by the Company or any Subsidiary, provided that such mortgages were
in existence prior to the contemplation of such acquisition;
(ii) mortgages on property, shares of stock or indebtedness or
other assets of any corporation existing at the time such corporation
becomes a Restricted Subsidiary, provided that such mortgages are not
incurred in anticipation of such corporation becoming a Restricted
Subsidiary;
(iii) mortgages on property, shares of stock or indebtedness
existing at the time of acquisition thereof by the Company or a Restricted
Subsidiary or mortgages thereon to secure the payment of all or any part of
the purchase price thereof, or mortgages on property, shares of stock or
indebtedness to secure any indebtedness for borrowed money incurred prior
to, at the time of or within 270 days after, the latest of the acquisition
thereof, or, in the case of property, the completion of construction, the
completion of improvements, or the commencement of substantial commercial
operation of such property for the purpose of financing all or any part of
the purchase price thereof, such construction, or the making of such
improvements;
(iv) mortgages to secure indebtedness owing to the Company or to a
Restricted Subsidiary;
(v) mortgages existing at the date of this Indenture;
(vi) mortgages on property of a corporation existing at the time
such corporation is merged into or consolidated with the Company or a
Restricted Subsidiary or at the time of a sale, lease or other disposition
of the properties of a corporation as an entirety or substantially as an
entirety to the Company or a Restricted Subsidiary, provided that such
mortgage was not incurred in anticipation of such merger or consolidation
or sale, lease or other disposition;
(vii) mortgages in favor of the United States or any State,
territory or possession thereof (or the District of Columbia), or any
department, agency, instrumentality or political subdivision of the United
States or any State, territory or possession thereof (or the District of
<PAGE> 58
Columbia), to secure partial, progress, advance or other payments pursuant
to any contract or statute or to secure any indebtedness incurred for the
purpose of financing all or any part of the purchase price or the cost of
constructing or improving the property subject to such mortgages;
(viii) mortgages created in connection with the acquisition of
assets or a project financed with, and created to secure, a Nonrecourse
Obligation; and
(ix) extensions, renewals, refinancings or replacements of any
mortgage referred to in the foregoing clauses (i), (ii), (iii), (v), (vi),
(vii), and (viii); provided, however, that any mortgages permitted by any
of the foregoing clauses (i), (ii), (iii), (v), (vi), (vii), and (viii)
shall not extend to or cover any property of the Company or such Restricted
Subsidiary, as the case may be, other than the property, if any, specified
in such clauses and improvements thereto, and provided further that any
refinancing or replacement of any mortgages permitted by the foregoing
clauses (vii) and (viii) shall be of the type referred to in such clauses
(vii) or (viii), as the case may be.
(b) Notwithstanding the restrictions set forth in Section 1008(a), the
Company or any Restricted Subsidiary will be permitted to issue, incur, create,
assume or guarantee debt secured by a mortgage which would otherwise be subject
to such restrictions, without equally and ratably securing the Securities,
provided that after giving effect thereto, the aggregate amount of all debt so
secured by mortgages (not including mortgages permitted under clauses (i)
through (ix) of Section 1008(a)) does not exceed 10% of the Consolidated Net
Tangible Assets of the Company.
SECTION 1009. Limitation on Sale and Lease-Back Transactions.
The Company covenants that it will not, nor will it permit any
Restricted Subsidiary to, enter into any Sale and Lease-Back Transaction with
respect to any Principal Property, other than any such transaction involving a
lease for a term of not more than three years or any such transaction between
the Company and a Restricted Subsidiary or between Restricted Subsidiaries,
unless: (a) the Company or such Restricted Subsidiary would be entitled to
incur indebtedness secured by a mortgage on the Principal Property involved in
such transaction at least equal in amount to the Attributable Debt with respect
to such Sale and Lease-Back Transaction, without equally and ratably securing
the Securities, pursuant to Section 1008; or (b) the Company shall apply an
amount equal to the greater of the net proceeds of such sale or the
Attributable Debt with respect to such Sale and Lease-Back Transaction within
180 days of such sale to either (or a combination of) the retirement (other
than any mandatory retirement, mandatory prepayment or sinking fund payment or
by payment at maturity) of debt for borrowed money of the Company or a
Restricted Subsidiary that matures more than 12 months after the creation of
such indebtedness or the purchase, construction or development of other
comparable property.
SECTION 1010. Waiver of Certain Covenants.
Except as otherwise specified as contemplated by Section 301 for
Securities of such series, the Company may, with respect to the Securities of
any series, omit in any particular instance to comply with any term, provision
or condition set forth in any covenant provided pursuant to Section 301(18),
901(2) or 901(7) for the benefit of the Holders of such series or in any of
Sections 1006 to 1009, inclusive, if before the time for such compliance the
<PAGE> 59
Holders of at least a majority in principal amount of the Outstanding
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 so expressly 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 ELEVEN
REDEMPTION OF SECURITIES
SECTION 1101. Applicability of Article.
Securities of any series which are redeemable before their Stated
Maturity shall be redeemable in accordance with their terms and (except as
otherwise specified as contemplated by Section 301 for such Securities) in
accordance with this Article.
SECTION 1102. Election to Redeem; Notice to Trustee.
The election of the Company to redeem any Securities shall be
evidenced by a Board Resolution or in another manner specified as contemplated
by Section 301 for such Securities. In case of any redemption at the election
of the Company of less than all the Securities of any series (including any
such redemption affecting only a single Security), the Company shall, at least
60 days prior to the Redemption Date fixed by the Company (unless a shorter
notice shall be satisfactory to the Trustee), notify the Trustee of such
Redemption Date, of the principal amount of Securities of such series to be
redeemed and, if applicable, of the tenor of the Securities to be redeemed. In
the case of any redemption of Securities prior to the expiration of any
restriction on such redemption provided in the terms of such Securities or
elsewhere in this Indenture, the Company shall furnish the Trustee with an
Officers' Certificate evidencing compliance with such restriction.
SECTION 1103. Selection by Trustee of Securities to Be Redeemed.
If less than all the Securities of any series are to be redeemed
(unless all the Securities of such series and of a specified tenor are to be
redeemed or unless such redemption affects only a single Security), the
particular Securities to be redeemed shall be selected not more than 60 days
prior to the Redemption Date by the Trustee, from the Outstanding Securities of
such series not previously called for redemption, by such method as the Trustee
shall deem fair and appropriate (which may be by lot) and which may provide for
the selection for redemption of a portion of the principal amount of any
Security of such series, provided that the unredeemed portion of the principal
amount of any Security shall be in an authorized denomination (which shall not
be less than the minimum authorized denomination) for such Security. If less
than all the Securities of such series and of a specified tenor are to be
redeemed (unless such redemption affects only a single Security), the
particular Securities to be redeemed shall be selected not more than 60 days
prior to the Redemption Date by the Trustee, from the Outstanding Securities of
such series and specified tenor not previously called for redemption in
accordance with the preceding sentence.
<PAGE> 60
The Trustee shall promptly notify the Company in writing of the
Securities selected for redemption as aforesaid and, in case of any Securities
selected for partial redemption as aforesaid, the principal amount thereof to
be redeemed.
The provisions of the two preceding paragraphs shall not apply with
respect to any redemption affecting only a single Security, whether such
Security is to be redeemed in whole or in part. In the case of any such
redemption in part, the unredeemed portion of the principal amount of the
Security shall be in an authorized denomination (which shall not be less than
the minimum authorized denomination) for such Security.
For all purposes of this Indenture, unless the context otherwise
requires, all provisions relating to the redemption of Securities shall relate,
in the case of any Securities redeemed or to be redeemed only in part, to the
portion of the principal amount of such Securities which has been or is to be
redeemed.
SECTION 1104. Notice of Redemption.
Notice of redemption shall be given by first-class mail, postage
prepaid, mailed not less than 30 nor more than 60 days prior to the Redemption
Date, to each Holder of Securities to be redeemed, at his address appearing in
the Security Register.
All notices of redemption shall state:
(1) the Redemption Date,
(2) the Redemption Price,
(3) if less than all the Outstanding Securities of any series
consisting of more than a single Security are to be redeemed, the
identification (and, in the case of partial redemption of any such
Securities, the principal amounts) of the particular Securities to be
redeemed and, if less than all the Outstanding Securities of any series
consisting of a single Security are to be redeemed, the principal amount of
the particular Security to be redeemed,
(4) that on the Redemption Date the Redemption Price will become due
and payable upon each such Security to be redeemed and, if applicable, that
interest thereon will cease to accrue on and after said date,
(5) the place or places where each such Security is to be surrendered
for payment of the Redemption Price, and
(6) that the redemption is for a sinking fund, if such is the case.
Notice of redemption of Securities to be redeemed at the election of
the Company 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 and shall be irrevocable.
SECTION 1105. Deposit of Redemption Price.
Prior to any Redemption Date, the Company shall deposit with the
Trustee or with a Paying Agent (or, if the Company is acting as its own Paying
<PAGE> 61
Agent, segregate and hold in trust as provided in Section 1003) an amount of
money sufficient to pay the Redemption Price of, and (except if the Redemption
Date shall be an Interest Payment Date) accrued interest on, all the Securities
which are to be redeemed on that date.
SECTION 1106. Securities Payable on Redemption Date.
Notice of redemption having been given as aforesaid, the Securities so
to be redeemed shall, on the Redemption Date, become due and payable at the
Redemption Price therein specified, and from and after such date (unless the
Company shall default in the payment of the Redemption Price and accrued
interest) such Securities shall cease to bear interest. Upon surrender of any
such Security for redemption in accordance with said notice, such Security
shall be paid by the Company at the Redemption Price, together with accrued
interest to the Redemption Date; provided, however, that, unless otherwise
specified as contemplated by Section 301, instalments of interest whose Stated
Maturity is on or prior to the Redemption Date will be payable to the Holders
of such Securities, or one or more Predecessor Securities, registered as such
at the close of business on the relevant Record Dates according to their terms
and the provisions of Section 307.
If any Security called for redemption shall not be so paid upon
surrender thereof for redemption, the principal and any premium shall, until
paid, bear interest from the Redemption Date at the rate prescribed therefor in
the Security.
SECTION 1107. Securities Redeemed in Part.
Any Security which is to be redeemed only in part shall be surrendered
at a Place of Payment therefor (with, if the Company or the Trustee so
requires, due endorsement by, or a written instrument of transfer in form
satisfactory to the Company 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
Security without service charge, a new Security or Securities of the same
series and of like tenor, 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 Security so surrendered.
ARTICLE TWELVE
SINKING FUNDS
SECTION 1201. Applicability of Article.
The provisions of this Article shall be applicable to any sinking fund
for the retirement of Securities of any series except as otherwise specified as
contemplated by Section 301 for such Securities.
The minimum amount of any sinking fund payment provided for by the
terms of any Securities 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 such Securities is herein referred to as an "optional sinking fund
payment". If provided for by the terms of any Securities, the cash amount of
<PAGE> 62
any sinking fund payment may be subject to reduction as provided in
Section 1202. Each sinking fund payment shall be applied to the redemption of
Securities as provided for by the terms of such Securities.
SECTION 1202. Satisfaction of Sinking Fund Payments with Securities.
The Company (1) may deliver Outstanding Securities of a series (other
than any previously called for redemption) and (2) may apply as a credit
Securities of a series which have been redeemed either at the election of the
Company pursuant to the terms of such Securities or through the application of
permitted optional sinking fund payments pursuant to the terms of such
Securities, in each case in satisfaction of all or any part of any sinking fund
payment with respect to any Securities of such series required to be made
pursuant to the terms of such Securities as and to the extent provided for by
the terms of such Securities; provided that the Securities to be so credited
have not been previously so credited. The Securities to be so credited shall be
received and credited for such purpose by the Trustee at the Redemption Price,
as specified in the Securities so to be redeemed, for redemption through
operation of the sinking fund and the amount of such sinking fund payment shall
be reduced accordingly.
SECTION 1203. Redemption of Securities for Sinking Fund.
Not less than 45 days prior to each sinking fund payment date for any
Securities, the Company will deliver to the Trustee an Officers' Certificate
specifying the amount of the next ensuing sinking fund payment for such
Securities pursuant to the terms of such Securities, the portion thereof, if
any, which is to be satisfied by payment of cash and the portion thereof, if
any, which is to be satisfied by delivering and crediting Securities pursuant
to Section 1202 and will also deliver to the Trustee any Securities to be so
delivered. Not less than 30 days prior to each such sinking fund payment date,
the Trustee shall select the Securities to be redeemed upon such sinking fund
payment date in the manner specified in Section 1103 and cause notice of the
redemption thereof to be given in the name of and at the expense of the Company
in the manner provided in Section 1104. Such notice having been duly given, the
redemption of such Securities shall be made upon the terms and in the manner
stated in Sections 1106 and 1107.
ARTICLE THIRTEEN
DEFEASANCE AND COVENANT DEFEASANCE
SECTION 1301. Company's Option to Effect Defeasance or Covenant Defeasance.
The Company may elect, at its option at any time, to have Section 1302
or Section 1303 applied to any Securities or any series of Securities, as the
case may be, designated pursuant to Section 301 as being defeasible pursuant to
such Section 1302 or 1303, in accordance with any applicable requirements
provided pursuant to Section 301 and upon compliance with the conditions set
forth below in this Article. Any such election shall be evidenced by a Board
Resolution or in another manner specified as contemplated by Section 301 for
such Securities.
<PAGE> 63
SECTION 1302. Defeasance and Discharge.
Upon the Company's exercise of its option (if any) to have this
Section applied to any Securities or any series of Securities, as the case may
be, the Company shall be deemed to have been discharged from its obligations
with respect to such Securities as provided in this Section on and after the
date the conditions set forth in Section 1304 are satisfied (hereinafter called
"Defeasance"). For this purpose, such Defeasance means that the Company shall
be deemed to have paid and discharged the entire indebtedness represented by
such Securities and to have satisfied all its other obligations under such
Securities and this Indenture insofar as such Securities are concerned (and the
Trustee, at the expense of the Company, shall execute proper instruments
acknowledging the same), subject to the following which shall survive until
otherwise terminated or discharged hereunder: (1) the rights of Holders of such
Securities to receive, solely from the trust fund described in Section 1304 and
as more fully set forth in such Section, payments in respect of the principal
of and any premium and interest on such Securities when payments are due,
(2) the Company's obligations with respect to such Securities under
Sections 304, 305, 306, 1002 and 1003, (3) the rights, powers, trusts, duties
and immunities of the Trustee hereunder and (4) this Article. Subject to
compliance with this Article, the Company may exercise its option (if any) to
have this Section applied to any Securities notwithstanding the prior exercise
of its option (if any) to have Section 1303 applied to such Securities.
SECTION 1303. Covenant Defeasance.
Upon the Company's exercise of its option (if any) to have this
Section applied to any Securities or any series of Securities, as the case may
be, (1) the Company shall be released from its obligations under
Section 801(3), Sections 1006 through 1009, inclusive, and any covenants
provided pursuant to Section 301(18), 901(2) or 901(7) for the benefit of the
Holders of such Securities and (2) the occurrence of any event specified in
Sections 501(4) (with respect to any of Section 801(3), Sections 1006 through
1009, inclusive, and any such covenants provided pursuant to Section 301(18),
901(2) or 901(7)), 501(5) and 501(8) shall be deemed not to be or result in an
Event of Default, in each case with respect to such Securities as provided in
this Section on and after the date the conditions set forth in Section 1304 are
satisfied (hereinafter called "Covenant Defeasance"). For this purpose, such
Covenant Defeasance means that, with respect to such 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 specified Section (to the extent
so specified in the case of Section 501(4)) whether directly or indirectly by
reason of any reference elsewhere herein to any such Section or by reason of
any reference in any such Section to any other provision herein or in any other
document, but the remainder of this Indenture and such Securities shall be
unaffected thereby.
SECTION 1304. Conditions to Defeasance or Covenant Defeasance.
The following shall be the conditions to the application of
Section 1302 or Section 1303 to any Securities or any series of Securities, as
the case may be:
(1) The Company shall irrevocably have deposited or caused to be
deposited with the Trustee (or another trustee which satisfies the
requirements contemplated by Section 609 and agrees to comply with the
<PAGE> 64
provisions of this Article 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 benefits of the Holders of such
Securities, (A) money in an amount, or (B) U.S. Government Obligations
which through the scheduled payment of principal and interest 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 (C) a
combination thereof, in each case sufficient, in the opinion of a
nationally recognized firm of independent public accountants expressed in a
written certification thereof delivered to the Trustee, to pay and
discharge, and which shall be applied by the Trustee (or any such other
qualifying trustee) to pay and discharge, the principal of and any premium
and interest on such Securities on the respective Stated Maturities, in
accordance with the terms of this Indenture and such Securities. As used
herein, "U.S. Government Obligation" means (x) any security which is (i) a
direct obligation of the United States of America for the payment of which
the full faith and credit of the United States of America is pledged or
(ii) an obligation of a Person controlled or supervised by and acting as an
agency or instrumentality of the United States of America the payment of
which is unconditionally guaranteed as a full faith and credit obligation
by the United States of America, which, in either case (i) or (ii), is not
callable or redeemable at the option of the issuer thereof, and (y) any
depositary receipt issued by a bank (as defined in Section 3(a)(2) of the
Securities Act) as custodian with respect to any U.S. Government Obligation
which is specified in Clause (x) above and held by such bank for the
account of the holder of such depositary receipt, or with respect to any
specific payment of principal of or interest on any U.S. Government
Obligation which is so specified and held, 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 depositary receipt from any
amount received by the custodian in respect of the U.S. Government
Obligation or the specific payment of principal or interest evidenced by
such depositary receipt.
(2) In the event of an election to have Section 1302 apply to any
Securities or any series of Securities, as the case may be, the Company
shall have delivered to the Trustee an Opinion of Counsel stating that
(A) the Company has received from, or there has been published by, the
Internal Revenue Service a ruling or (B) since the date of this instrument,
there has been a change in the applicable Federal income tax law, in either
case (A) or (B) to the effect that, and based thereon such opinion shall
confirm that, the Holders of such Securities will not recognize gain or
loss for Federal income tax purposes as a result of the deposit, Defeasance
and discharge to be effected with respect to such Securities and will be
subject to Federal income tax on the same amount, in the same manner and at
the same times as would be the case if such deposit, Defeasance and
discharge were not to occur.
(3) In the event of an election to have Section 1303 apply to any
Securities or any series of Securities, as the case may be, the Company
shall have delivered to the Trustee an Opinion of Counsel to the effect
that the Holders of such Securities will not recognize gain or loss for
Federal income tax purposes as a result of the deposit and Covenant
Defeasance to be effected with respect to such Securities and will be
subject to Federal income tax on the same amount, in the same manner and at
the same times as would be the case if such deposit and Covenant Defeasance
were not to occur.
<PAGE> 65
(4) The Company shall have delivered to the Trustee an Officer's
Certificate to the effect that neither such Securities nor any other
Securities of the same series, if then listed on any securities exchange,
will be delisted as a result of such deposit.
(5) No event which is, or after notice or lapse of time or both would
become, an Event of Default with respect to such Securities or any other
Securities shall have occurred and be continuing at the time of such
deposit or, with regard to any such event specified in Sections 501(6) and
(7), at any time on or prior to the 90th day after the date of such deposit
(it being understood that this condition shall not be deemed satisfied
until after such 90th day).
(6) Such Defeasance or Covenant Defeasance shall not cause the Trustee
to have a conflicting interest within the meaning of the Trust Indenture
Act (assuming all Securities are in default within the meaning of such
Act).
(7) Such Defeasance or Covenant Defeasance shall not result in a
breach or violation of, or constitute a default under, any other agreement
or instrument to which the Company is a party or by which it is bound.
(8) Such Defeasance or Covenant Defeasance shall not result in the
trust arising from such deposit constituting an investment company within
the meaning of the Investment Company Act unless such trust shall be
registered under such Act or exempt from registration thereunder.
(9) The Company shall have delivered to the Trustee an Officer's
Certificate and an Opinion of Counsel, each stating that all conditions
precedent with respect to such Defeasance or Covenant Defeasance have been
complied with.
SECTION 1305. Deposited Money and U.S. Government Obligations to Be
Held in Trust; Miscellaneous Provisions.
Subject to the provisions of the last paragraph of Section 1003, all
money and U.S. Government Obligations (including the proceeds thereof)
deposited with the Trustee or other qualifying trustee (solely for purposes of
this Section and Section 1306, the Trustee and any such other trustee are
referred to collectively as the "Trustee") pursuant to Section 1304 in respect
of any Securities shall be held in trust and applied by the Trustee, in
accordance with the provisions of such Securities and this Indenture, to the
payment, either directly or through any such Paying Agent (including the
Company acting as its own Paying Agent) as the Trustee may determine, to the
Holders of such Securities, of all sums due and to become due thereon in
respect of principal and any premium and interest, but money so held in trust
need not be segregated from other funds except to the extent required by law.
The Company shall pay and indemnify the Trustee against any tax, fee
or other charge imposed on or assessed against the U.S. Government Obligations
deposited pursuant to Section 1304 or the principal and interest received in
respect thereof other than any such tax, fee or other charge which by law is
for the account of the Holders of Outstanding Securities.
Anything in this Article to the contrary notwithstanding, the Trustee
shall deliver or pay to the Company from time to time upon Company Request any
money or U.S. Government Obligations held by it as provided in Section 1304
<PAGE> 66
with respect to any Securities which, in the opinion of a nationally recognized
firm of independent public accountants expressed in a written certification
thereof delivered to the Trustee, are in excess of the amount thereof which
would then be required to be deposited to effect the Defeasance or Covenant
Defeasance, as the case may be, with respect to such Securities.
SECTION 1306. Reinstatement.
If the Trustee or the Paying Agent is unable to apply any money in
accordance with this Article with respect to any Securities by reason of any
order or judgment of any court or governmental authority enjoining, restraining
or otherwise prohibiting such application, then the obligations under this
Indenture and such Securities from which the Company has been discharged or
released pursuant to Section 1302 or 1303 shall be revived and reinstated as
though no deposit had occurred pursuant to this Article with respect to such
Securities, until such time as the Trustee or Paying Agent is permitted to
apply all money held in trust pursuant to Section 1305 with respect to such
Securities in accordance with this Article; provided, however, that if the
Company makes any payment of principal of or any premium or interest on any
such Security following such reinstatement of its obligations, the Company
shall be subrogated to the rights (if any) of the Holders of such Securities to
receive such payment from the money so held in trust.
_____________________________
This instrument may be executed in any number of counterparts, each of
which so executed shall be deemed to be an original, but all such counterparts
shall together constitute but one and the same instrument.
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.
EDISON BROTHERS STORES, INC.
By...........................................
Attest:
......................................
.............................................
By...........................................
Attest:
......................................
<PAGE> 67
STATE OF NEW YORK )
) SS.:
COUNTY OF NEW YORK )
On the .... day of ..........., 1995, before me personally came
..........................., to me known, who, being by me duly sworn, did
depose and say that he is .................... of EDISON BROTHERS STORES, 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.
...............................................
STATE OF NEW YORK )
) SS.:
COUNTY OF NEW YORK )
On the .... day of ..........., 1995, before me personally came
..........................., to me known, who, being by me duly sworn, did
depose and say 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.
...............................................
<PAGE> 1
EXHIBIT 5
BRYAN CAVE
ONE METROPOLITAN SQUARE
211 NORTH BROADWAY, SUITE 3600
ST. LOUIS, MISSOURI 63102-2750
(314) 259-2000
FACSIMILE: (314) 259-2020
Washington, D.C. Irvine, California
Los Angeles, California Santa Monica, California
New York, New York Overland Park, Kansas
Phoenix, Arizona London, England
Kansas City, Missouri Riyadh, Saudi Arabia
Frankfurt Am Main, Germany
April 13, 1995
Board of Directors
Edison Brothers Stores, Inc.
501 North Broadway
St. Louis, Missouri 63102
Gentlemen:
We have acted as special counsel to Edison Brothers Stores,
Inc. (the "Company"), a Delaware corporation, in connection with the
Registration Statement on Form S-3, and Preliminary Prospectus, which the
Company proposes to file with the Securities and Exchange Commission under the
Securities Act of 1933, as amended, relating to $250,000,000 in aggregate
initial offering price, or the equivalent thereof in one or more foreign
currencies, foreign currency units, or composite currencies, including European
Currency Units, of (i) unsecured debentures, notes, and other forms of
indebtedness issuable in series under an Indenture substantially in the form
included in the Registration Statement (the "Debt Securities"), (ii) warrants
to purchase Debt Securities ("Debt Warrants"), (iii) shares of preferred stock
of one or more series ("Preferred Stock"), (iv) warrants to purchase shares of
Preferred Stock ("Preferred Stock Warrants"), (v) depositary shares
representing entitlement to all rights and preferences of a fraction of a share
of Preferred Stock of a specified series ("Depositary Shares"), (vi) shares of
common stock, par value $1.00 per share ("Common Stock"), or (vii) warrants to
purchase shares of Common Stock ("Common Stock Warrants"). The Debt
Securities, Preferred Stock, Depositary Shares, Common Stock, Common Stock
Warrants, Debt Warrants and Preferred Stock Warrants are referred to herein
collectively as the "Offered Securities." Terms not defined herein shall have
the meaning thereof contained in the Preliminary Prospectus.
In connection herewith, we have examined and relied without
independent investigation as to matters of fact upon such certificates of
public officials, such statements and certificates of officers of the Company
and such other corporate records, documents, certificates and instruments as we
have deemed necessary in order to enable us to render the opinions expressed
herein. In our examination of the foregoing, we have assumed the genuineness
of all signatures, the legal competence and capacity of each person executing
documents, the authenticity of all documents submitted to us as originals, and
the conformity to original documents of all documents submitted to us as copies
or drafts of documents to be executed and the due authorization, execution and
delivery of all agreements where due authorization, execution and delivery are
a prerequisite to the effectiveness thereof.
<PAGE> 2
Edison Brothers Stores, Inc.
April 13, 1995
Page 2
Subject to (i) the effectiveness of the Registration Statement
under the Securities Act of 1933, as amended, (ii) the due authorization,
approval and filings by the Company and its shareholders of an amendment to the
Company Certificate of Incorporation authorizing the issuance of the Preferred
Stock, and (iv) the due authorization, approval and filings by you of the
Certificate of Designation(s) setting forth the terms of the Preferred Stock,
we are of the opinion that:
1. The Company is a corporation duly organized and
existing under the laws of the State of Delaware and is in good standing in
that state;
2. Each series of the Debt Securities, when duly
established by or pursuant to a resolution of the Board of Directors of the
Company or in a supplemental Indenture, in each case so as not to violate any
applicable law or any agreement or instrument to which the Company is a party
or by which it is bound, and duly executed, authenticated and issued as
provided in the Indenture and delivered against payment, will constitute valid
and legally binding obligations of the Company and enforceable in accordance
with its terms entitled to the benefits of the Indenture;
3. The shares of Preferred Stock, when both (A) the Board
of Directors and shareholders of the Company have taken all necessary corporate
action to approve the issuance and terms of the shares of Preferred Stock, the
terms of the offering thereof, and related matters, in each case so as not to
violate any applicable law or any agreement or instrument to which the Company
is a party or by which it is bound, including the adoption of a Certificate of
Designation relating to such Preferred Stock (a "Certificate") and the filing
of the Certificate with the Secretary of State of the State of Delaware, and
(B) certificates representing the shares of Preferred Stock have been duly
executed, countersigned, registered and delivered either (i) in accordance with
the applicable definitive purchase, underwriting or similar agreement approved
by the Board of Directors of the Company and upon payment of the consideration
therefor (not less than the par value of the Preferred Stock) provided for
therein, or (ii) upon conversion or exercise of any other Offered Security, in
accordance with the terms of such Offered Security or the instrument governing
such Offered Security providing for such conversion or exercise as approved by
the Board of Directors of the Company, for the consideration approved by the
Board of Directors of the Company (not less than the par value of the Preferred
Stock), will be validly issued, fully paid and non-assessable;
4. The Depositary Shares, when (A) the Board of Directors
and shareholders of the Company have taken all necessary corporate action to
approve the issuance and terms of the Depositary Shares, the terms of the
offering thereof and related matters, in each case so as not to violate any
applicable law or any agreement or instrument to which the Company is a party
or by which it is bound, (B) the Depositary Agreement or Agreements relating to
the Depositary Shares and the related Depositary Receipts have been duly
authorized and validly executed and delivered by the Company and the Depositary
Agent appointed by the Company, (C) the shares of Preferred Stock underlying
such Depositary shares have been duly and validly issued and are fully paid and
nonassessable as contemplated in paragraph (3) above and deposited with a bank
or trust company (which meets the requirements for the Depositary set forth in
the Registration Statement) under the applicable Depositary Agreements, and
<PAGE> 3
Edison Brothers Stores, Inc.
April 13, 1995
Page 3
(D) the Depositary Receipts representing the Depositary Shares have been duly
executed, countersigned, registered and delivered in accordance with the
appropriate Depositary Agreement and the applicable definitive purchase,
underwriting or similar agreement approved by the Board of Directors of the
Company and upon payment of the consideration therefor provided for therein,
will be validly issued, fully paid and non-assessable;
5. The shares of Common Stock, when both (A) the Board of
Directors of the Company has taken all necessary corporate action to approve
the issuance of and the terms of the offering of the shares of Common Stock and
related matters, in each case so as not to violate any applicable law or any
agreement or instrument to which the Company is a party or by which it is
bound, and (B) certificates representing the shares of Common Stock have been
duly executed, countersigned, registered and delivered either (i) in accordance
with the applicable definitive purchase, underwriting or similar agreement
approved by the Board of Directors of the Company upon payment of the
consideration therefor (not less than the par value of the Common Stock)
provided for therein, or (ii) upon conversion or exercise of any other Offered
Security, in accordance with the terms of such Offered Security or the
instrument governing such Offered Security providing for such conversion or
exercise as approved by the Board of Directors of the Company, for the
consideration approved by the Board of Directors of the Company (not less than
the par value of the Common Stock), will be validly issued, fully paid and non-
assessable;
6. The Common Stock Warrants and Debt Warrants, when both
(A) the Board of Directors of the Company has taken all necessary corporate
action to approve the issuance and terms of such Warrants, the terms of the
offering thereof and related matters, in each case so as not to violate any
applicable law or any agreement or instrument to which the Company is a party
or by which it is bound, (B) the Warrant Agreement or Agreements relating to
such Warrants have been duly authorized and validly executed and delivered by
the Corporation and the Warrant Agent appointed by the Company, and (C) the
warrants or certificates representing such Common Stock Warrants or Debt
Warrants and the applicable definitive purchase, underwriting or similar
agreement approved by the Board upon payment of consideration therefor provided
for therein, such Common Stock Warrants or Debt Warrants will be validly
issued, fully paid and non-assessable; and
7. The Preferred Stock Warrants, when both (A) the Board
of Directors and shareholders of the Company have taken all necessary corporate
action to approve the issuance and terms of the Preferred Stock Warrants, the
terms of the offering thereof and related matters, in each case so as not to
violate any applicable law or any agreement or instrument to which the Company
is a party or by which it is bound, (B) the Warrant Agreement or Agreements
relating to such Preferred Stock Warrants have been duly authorized and validly
executed and delivered by the Corporation and the Warrant Agent appointed by
the Company, and (C) the warrants or certificates representing such Preferred
Stock and the applicable definitive purchase, underwriting or similar agreement
approved by the Board upon payment of consideration therefor provided for
therein, the Preferred Stock Warrants will be validly issued, fully paid and
non-assessable.
<PAGE> 4
Edison Brothers Stores, Inc.
April 13, 1995
Page 4
This opinion is not rendered with respect to any laws other
than the laws of the State of Missouri, the laws of the State of New York and
the General Corporation Law of the State of Delaware, and the federal laws of
the United States.
You have informed us that you intend to issue the Offered
Securities from time to time on a delayed or continuous basis, and this opinion
is limited to the laws, including the rules and regulations, as in effect on
the date hereof. We understand that prior to issuing any Offered Securities
you will afford us an opportunity to review the operative documents pursuant to
which such Offered Securities are to be issued (including the applicable
Prospectus Supplement) and will file such supplement or amendment to this
opinion (if any) as we may reasonably consider necessary or appropriate by
reason of the terms of such Offered Securities.
We hereby consent to the filing of this opinion as an exhibit
to the Registration Statement and to use our name under the caption "Legal
Opinion" in the Prospectus constituting a part of the Registration Statement.
We also consent to your filing copies of this opinion as an exhibit to the
Registration Statement with agencies of such states as you deem necessary in
the course of complying with the laws of such states regarding the offering and
sale of the Securities. In giving this consent, we do not hereby admit that we
are within the category of persons whose consent is required under Section 7 of
the Securities Act of 1933, as amended, or the rules and regulations of the
Securities and Exchange Commission.
Very truly yours,
/S/ BRYAN CAVE
BRYAN CAVE
<PAGE> 1
EXHIBIT 12
<TABLE>
COMPUTATION OF CONSOLIDATED RATIOS
OF EARNINGS TO FIXED CHARGES
<CAPTION>
Fiscal Year
------------------------------------------------
1994 1993 1992 1991 1990
-------- -------- -------- -------- --------
<S> <C> <C> <C> <C> <C>
EARNINGS
Pretax income from continuing operations before the
cumulative effect of accounting changes................. $ 32.4 $ 32.7 $111.9 $ 93.4 $ 93.7
ADD:
Interest expense........................................ 20.6 20.4 19.9 20.0 16.1
Interest factor in rents................................ 48.5 44.8 43.4 40.5 33.4
Amortization of capitalized interest.................... 0.1 0.1 0.1 0.1 0.1
-------- -------- -------- -------- --------
Total Earnings..................................... $101.6 $ 98.0 $175.3 $154.0 $143.3
FIXED CHARGES
Interest expense........................................ $ 20.6 $ 20.4 $ 19.9 $ 20.0 $ 16.1
Interest capitalized.................................... 0.3 0.2 0.1 0.2 1.1
Interest factor in rents................................ 48.5 44.8 43.4 40.5 33.4
-------- -------- -------- -------- --------
Total Fixed Charges................................ $ 69.4 $ 65.4 $ 63.4 $ 60.7 $ 50.6
-------- -------- -------- -------- --------
Ratio of earnings to fixed charges <F1>................... 1.5 1.5 2.8 2.5 2.8
-------- -------- -------- -------- --------
- ---------------
<FN>
<F1> For purposes of computing such ratio, earnings consist of income before income taxes plus fixed
charges net of interest capitalized, and fixed charges consist of interest expense, interest
capitalized, and the portion of rental expense attributable to interest.
</TABLE>
<PAGE> 1
EXHIBIT 23.1
CONSENT OF INDEPENDENT AUDITORS
We consent to the reference to our firm under the caption "Experts" in the
Registration Statement (Form S-3) and related Prospectus of Edison Brothers
Stores, Inc. for the registration of debt and equity securities and to the
incorporation by reference therein of our report dated March 8, 1995, with
respect to the consolidated financial statements of Edison Brothers Stores,
Inc. incorporated by reference in its Annual Report (Form 10-K) for the year
ended January 28, 1995 filed with the Securities and Exchange Commission.
/S/ ERNST & YOUNG LLP
St. Louis, Missouri
April 12, 1995
<PAGE> 1
EXHIBIT 25
SECURITIES ACT OF 1933 FILE NO: 33- (IF APPLICATION TO DETERMINE
ELIGIBILITY OF TRUSTEE FOR DELAYED OFFERING PURSUANT TO SECTION 305(b)(2))
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
---------------------
FORM T-1
STATEMENT OF ELIGIBILITY AND QUALIFICATION
UNDER THE TRUST INDENTURE ACT OF 1939 OF A
CORPORATION DESIGNATED TO ACT AS TRUSTEE
Check if an Application to Determine Eligibility of a Trustee Pursuant to
Section 305(b)(2) / /
---------------------
FLEET BANK OF MASSACHUSETTS, N.A.
(Exact name of trustee as specified in its charter)
U.S. NATIONAL BANK
(Jurisdiction of incorporation or organization if not a U.S. national bank)
05-0414875
(I.R.S. employer identification number)
75 State Street, Boston, Massachusetts 02109
(Address of trustee's principal executive (Zip Code)
offices)
Barbara Worthen, Esq.
75 State Street, Boston, Massachusetts 02109
(617) 346-3128
General Counsel
(Name, address and telephone number of agent for service)
---------------------
Edison Brothers Stores, Inc.
Exact name of obligor as specified in its charter)
DELAWARE 43-0254900
(State or other jurisdiction (I.R.S. employer
of incorporation or organization) identification no.)
501 North Broadway
St. Louis, Missouri 63102
(Address of principal executive offices) (Zip Code)
Debt Securities
(Title of the indenture securities)
<PAGE> 2
Item 1. General Information.
Furnish the following information as to the trustee:
(a) Name and address of each examining or supervising authority to
which it is subject.
Comptroller of the Currency, Washington, D.C.
Board of Governors of the Federal Reserve System, Washington, D.C.
FDIC, Washington, D.C.
(b) Whether it is authorized to exercise corporate trust powers.
Yes.
Item 2. Affiliations with Obligor.
If the obligor is an affiliate of the trustee, describe each such
affiliation.
None.
Items 3, 4, 5, 6, 7, 8, 9, 10, 11, 12, 13, 14 and 15 have been omitted
pursuant to General Instruction B.
Item 16. List of Exhibits.
List below all exhibits filed as part of this statement of eligibility and
qualification.
1.* A copy of the articles of association of the trustee as now in effect.
(See Exhibit T-1 (Item 12), Registration Statement No. 33-60068.)
2.* A copy of the certificate of authority of the trustee to commence
business. (See Exhibit T-1 (Item 12), Registration Statement No. 22-
24018.)
3.* A copy of the authorization of the trustee to exercise corporate trust
powers. (See Exhibit T-1 (Item 12), Registration Statement no. 22-
24018.)
4.* A copy of the bylaws of the trustee as now in effect. (See Exhibit T-1
(Item 12), Registration Statement No. 33-60068.)
5. Not applicable.
6. Consent of the trustee required by Section 321(b) of the Trust
Indenture Act of 1939.
7. A copy of the latest report of condition of the trustee published
pursuant to law or the requirements of its supervising or examining
authority.
8. Not applicable.
9. Not applicable.
<PAGE> 3
- ---------------
* The Exhibits thus designated are incorporated herein by reference.
Following the description of such Exhibits is a reference to the copy of
the Exhibit heretofore filed with the Securities and Exchange commission,
to which there have been no amendments or changes.
<PAGE> 4
SIGNATURE
Pursuant to the requirements of the Trust Indenture Act of 1939, the
trustee, Fleet Bank of Massachusetts, N.A., a national banking association
incorporated and existing under the laws of the United States, has duly caused
this statement of eligibility and qualification to be signed on its behalf by
the undersigned, thereunto duly authorized all in the City of Boston, and the
Commonwealth of Massachusetts on the th day of April, 1995.
FLEET BANK OF MASSACHUSETTS, N.A.
By FRANKLIN C. COCKRELL
--------------------------------------
Franklin C. Cockrell
Vice President
NOTE
1. Inasmuch as this Form T-1 is filed prior to the ascertainment by the
trustee of all facts on which to base responsive answers to Item 2, the answers
to said Item is based on incomplete information.
Item 2 may, however, be considered as correct unless amended by an
amendment to this Form T-1.
<PAGE> 5
EXHIBIT 6
CONSENT OF TRUSTEE
Pursuant to the requirements of Section 321(b) of the Trust Indenture Act
of 1939 in connection with the Debt Securities of Edison Brothers Stores, Inc.,
we hereby consent that reports of examinations of federal, state, territorial
or district authorities may be furnished by such authorities to the Securities
and Exchange Commission upon request therefor.
FLEET BANK OF MASSACHUSETTS, N.A.
By FRANKLIN C. COCKRELL
--------------------------------------
Franklin C. Cockrell
Vice President
Dated: th day of April, 1995
<PAGE> 6
EXHIBIT 7
REPORT OF CONDITION
Consolidating domestic and foreign subsidiaries of the Fleet Bank of
Massachusetts, N.A. of Boston in the State of Massachusetts, at the close of
business on December 31, 1994, published in response to call made by
Comptroller of the Currency, under Title 12, United States Code, Section 161,
Charter Number 26305 Comptroller of the Currency Northeastern District.
Statement of Resources and Liabilities
<TABLE>
ASSETS
<CAPTION>
Thousands
of
dollars
-----------
<S> <C> <C>
Cash and balances due from depository institutions:
Noninterest-bearing balances and currency and coin. . . . . . $ 739,923
Interest-bearing balances . . . . . . . . . . . . . . . . . . 1,000,057
Held-to-maturity securities. . . . . . . . . . . . . . . . . . . . 71,812
Available-for-sale securities. . . . . . . . . . . . . . . . . . . 1,418,517
Federal funds sold and securities purchased under agreements to
resell in domestic offices of the bank and of its Edge and
Agreement subsidiaries, and in IBFs:
Federal funds sold. . . . . . . . . . . . . . . . . . . . . . 10,134
Securities purchased under agreements to resell . . . . . . . 291,982
Loans and lease financing receivables:
Loans and leases, net of unearned income. . . . $5,835,651
LESS: Allowance for loan and lease losses . . . 132,725
LESS: Allocated transfer risk reserve . . . . . 0
----------
Loans and leases, net of unearned income, allowance and
reserve . . . . . . . . . . . . . . . . . . . . . . . . . . 5,702,926
Assets held in trading accounts. . . . . . . . . . . . . . . . . . 58,474
Premises and fixed assets (including capitalized leases) . . . . . 125,475
Other real estate owned. . . . . . . . . . . . . . . . . . . . . . 6,610
Investments in unconsolidated subsidiaries and associated
companies. . . . . . . . . . . . . . . . . . . . . . . . . . . . 0
Customers' liability to this bank on acceptances outstanding . . . 2,253
Intangible assets. . . . . . . . . . . . . . . . . . . . . . . . . 79,863
Other assets . . . . . . . . . . . . . . . . . . . . . . . . . . . 249,025
----------
TOTAL ASSETS . . . . . . . . . . . . . . . . . . . . . . $9,757,051
==========
LIABILITIES
Deposits:
In domestic offices . . . . . . . . . . . . . . . . . . . . . $6,523,645
Noninterest-bearing. . . . . . . . . . . . $1,736,791
Interest-bearing . . . . . . . . . . . . . 4,786,854
----------
<PAGE> 7
In foreign offices, Edge and Agreement subsidiaries, and
IBFs. . . . . . . . . . . . . . . . . . . . . . . . . . . . 1,472,872
Noninterest-bearing. . . . . . . . . . . . 559
Interest-bearing . . . . . . . . . . . . . 1,472,313
----------
Federal funds purchased and securities sold under agreements to
repurchase in domestic offices of the bank and of its Edge and
Agreement subsidiaries, and in IBF's:
Federal funds purchased . . . . . . . . . . . . . . . . . . . 306,732
Securities sold under agreements to repurchase. . . . . . . . 39,079
Demand notes issued to the U.S. Treasury . . . . . . . . . . . . . 177,521
Trading liabilities. . . . . . . . . . . . . . . . . . . . . . . . 50,485
Other borrowed money:
With original maturity of one year or less. . . . . . . . . . 326,582
With original maturity of more than one year. . . . . . . . . 18,258
Mortgage indebtedness and obligations under capitalized leases . . 842
Bank's liability on acceptances executed and outstanding . . . . . 2,255
Subordinated notes and debentures. . . . . . . . . . . . . . . . . 0
Other liabilities. . . . . . . . . . . . . . . . . . . . . . . . . 115,056
Total Liabilities. . . . . . . . . . . . . . . . . . . . 9,033,327
Limited-life preferred stock and related surplus . . . . . . . . . 0
----------
EQUITY CAPITAL
Perpetual preferred stock and related surplus. . . . . . . . . . . 0
Common stock . . . . . . . . . . . . . . . . . . . . . . . . . . . 15,000
Surplus . . . . . . . . . . . . . . . . . . . . . . . . . . . . 542,245
Undivided profits and capital reserves . . . . . . . . . . . . . . 213,013
Net unrealized holding gains (losses) on available-for-sale
securities . . . . . . . . . . . . . . . . . . . . . . . . . . . (46,534)
Cumulative foreign currency translation adjustments. . . . . . . . 0
Total equity capital . . . . . . . . . . . . . . . . . . . . . . . 723,724
----------
TOTAL LIABILITIES, limited-life preferred stock, and
equity capital . . . . . . . . . . . . . . . . . . . . $9,757,051
==========
</TABLE>
<PAGE> 8
We, the undersigned directors, attest to the correctness of this statement
of resources and liabilities. We declare that it has been examined by us, and
to the best of our knowledge and belief has been prepared in conformance with
the instructions and is true and correct.
George Detomassi I, Giro DeRosa
Stephen Carlotti Vice-President & Controller of the
Leo R. Breitman above-named bank do hereby declare that
this Report of Condition is true and
correct to the best of my knowledge and
belief.
GIRO DEROSA
.........................................
Signature
October 27, 1994
.........................................
Date
