<PAGE>
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
-----------
AMENDMENT NO. 1
TO
FORM T-3
FOR APPLICATIONS FOR QUALIFICATION OF INDENTURES UNDER THE
TRUST INDENTURE ACT OF 1939
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THE GRAND UNION COMPANY
(Name of applicant)
201 Willowbrook Boulevard
Wayne, New Jersey 07470-0966
(Address of principal executive offices)
------------
SECURITIES TO BE ISSUED UNDER THE INDENTURE TO BE QUALIFIED
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TITLE OF CLASS AMOUNT
12% Senior Notes $595,475,922
due September 1, 2004
Approximate date of proposed public offering: On or promptly after the
Effective Date (as defined in the Second Amended Chapter 11 Plan of
Reorganization of The Grand Union Company, dated April 19, 1995).
Name and address of agent for service:
Joseph J. McCaig
President and Chief Executive Officer
The Grand Union Company
201 Willowbrook Boulevard
Wayne, New Jersey 07470-0966
The applicant hereby amends this application for qualification on such date or
dates as may be necessary to delay its effectiveness until (i) the 20th day
after the filing of a further amendment which specifically states that it shall
supersede this amendment, or (ii) such date as the Commission, acting pursuant
to Section 307(c) of the Act, may determine upon the written request of the
applicant.
<PAGE>
GENERAL
1. GENERAL INFORMATION. FURNISH THE FOLLOWING AS TO THE APPLICANT:
a. Form of organization: A corporation.
b. State or other sovereign power under the laws of which organized:
Delaware
2. SECURITIES ACT EXEMPTION APPLICABLE. STATE BRIEFLY THE FACTS RELIED UPON
BY THE APPLICANT AS A BASIS FOR THE CLAIM THAT REGISTRATION OF THE INDENTURE
SECURITIES UNDER THE SECURITIES ACT OF 1933 IS NOT REQUIRED.
On January 25, 1995 (the "Filing Date"), the applicant, The Grand
Union Company (the "Company" or the "Debtor"), commenced a case under Chapter 11
of the United States Bankruptcy Code, 11 U.S.C. section 101 et seq. (the
"Bankruptcy Code"), in the United States Bankruptcy Court for the District of
Delaware (the "Bankruptcy Court"). Since the Filing Date, the Debtor has
continued to operate as a debtor-in-possession subject to the supervision of the
Bankruptcy Court in accordance with the Bankruptcy Code.
The Company proposes to issue, as part of its Second Amended Chapter
11 Plan of Reorganization dated April 19, 1995 (the "Plan"), pursuant to section
1121(a) of the Bankruptcy Code, up to $595,475,922 of its 12% Senior Notes due
September 1, 2004 (the "Senior Notes"). The Senior Notes will be issued to
discharge in part claims of existing creditors in the bankruptcy proceedings
described below.
The Senior Notes are proposed to be issued in reliance upon the
exemption from registration under the Securities Act of 1933, as amended
(the "Securities Act"), set forth in section 1145(a)(1) of the Bankruptcy Code.
Section 1145 of the Bankruptcy Code exempts the offer or sale of securities
under a plan of reorganization from registration under the Securities Act and
state law. Under section 1145, the issuance of securities is exempt from
registration if three principal requirements are satisfied: (1) the securities
are issued by a debtor, its successor, or an affiliate participating in a joint
plan with the debtor (provided that such entity is not an underwriter as defined
in section 1145(b) of the Bankruptcy Code) under a plan of reorganization; (2)
the recipients of the securities hold a claim against the debtor or such
affiliate, an interest in the debtor or such affiliate, or a claim for an
administrative expense against the debtor or such affiliate; and (3) the
securities are issued entirely in exchange for the recipients' claim against or
interest in the debtor or such affiliate, or "principally" in such exchange and
"partly" for cash or property.
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<PAGE>
The applicant believes that the issuance of the Senior Notes under the
indenture to be entered into by the Company and IBJ Schroder Bank & Trust
Company, as Trustee (the "Indenture") to holders of prepetition senior secured
notes under the Plan will satisfy all three conditions of section 1145 of the
Bankruptcy Code because (a) the issuances are expressly contemplated under the
Plan as part of the reorganization; (b) the recipients are holders of "claims"
against the Debtor; and (c) the recipients would obtain such Senior Notes in
exchange for their claims.
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<PAGE>
AFFILIATIONS
3. AFFILIATES. FURNISH A LIST OR DIAGRAM OF ALL AFFILIATES OF THE APPLICANT
AND INDICATE THE RESPECTIVE PERCENTAGES OF VOTING SECURITIES OR OTHER BASES OF
CONTROL.
AS OF MAY 8, 1995
----------------------------------------
GAC HOLDINGS PARTNERS, INC.
(general partner of GAC Holdings, L.P.)
------------------------------------------
|
|
------------------
GAC HOLDINGS, L.P.
------------------
|
|
37.680 % *
|
|
--------------------------------
GRAND UNION HOLDINGS CORPORATION
--------------------------------
|
|
100.000 %
|
|
-------------------------------
GRAND UNION CAPITAL CORPORATION
-------------------------------
|
|
100.000 %
|
|
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THE GRAND UNION COMPANY
-----------------------
- --------------------------
* Percentage indicates voting power of, in each case, entity named above
percentage in entity named below percentage, on a fully diluted basis.
AS OF EFFECTIVE DATE
The holders of prepetition subordinated debt of The Grand Union Company on
the Effective Date will own all of the originally issued shares of common stock
of the reorganized company.
-4-
<PAGE>
MANAGEMENT AND CONTROL
4. DIRECTORS AND EXECUTIVE OFFICERS. LIST THE NAMES AND COMPLETE MAILING
ADDRESSES OF ALL DIRECTORS AND EXECUTIVE OFFICERS OF THE APPLICANT AND ALL
PERSONS CHOSEN TO BECOME DIRECTORS OR EXECUTIVE OFFICERS. INDICATE ALL OFFICES
WITH THE APPLICANT HELD OR TO BE HELD BY EACH PERSON NAMED.
AS OF MAY 8, 1995
<TABLE>
<CAPTION>
Name Address Office
---- ------- -------
<S> <C> <C>
Gary D. Hirsch The Grand Union Company Director and
201 Willowbrook Boulevard Chairman
Wayne, New Jersey 07470-0966
Martin A. Fox The Grand Union Company Director, Vice President
201 Willowbrook Boulevard and Assistant Secretary
Wayne, New Jersey 07470-0966
Joseph J. McCaig The Grand Union Company Director, President and
201 Willowbrook Boulevard Chief Executive Officer
Wayne, New Jersey 07470-0966
William A. Louttit The Grand Union Company Director, Executive Vice
201 Willowbrook Boulevard President and Chief Operating
Wayne, New Jersey 07470-0966 Officer
Kenneth R. Baum The Grand Union Company Director, Senior Vice President,
201 Willowbrook Boulevard Chief Financial Officer and
Wayne, New Jersey 07470-0966 Secretary
Darrell W. Stine The Grand Union Company Executive Vice President
201 Willowbrook Boulevard - New York Region
Wayne, New Jersey 07470-0966
John S. McLaughlin The Grand Union Company Vice President - Northern
201 Willowbrook Boulevard Region
Wayne, New Jersey 07470-0966
Raymond H. Ayers The Grand Union Company Vice President - Real Estate
201 Willowbrook Boulevard
Wayne, New Jersey 07470-0966
Francis E. Nicastro The Grand Union Company Vice President and Treasurer
201 Willowbrook Boulevard
Wayne, New Jersey 07470-0966
Glenn L. Goldberg The Grand Union Company Vice President and Assistant
201 Willowbrook Boulevard Secretary
Wayne, New Jersey 07470-0966
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<PAGE>
Name Address Office
---- ------- -------
John Hinkel The Grand Union Company Vice President - Distribution
201 Willowbrook Boulevard
Wayne, New Jersey 07470-0966
William E. Kinslow The Grand Union Company Vice President - Management
201 Willowbrook Boulevard Information Systems
Wayne, New Jersey 07470-0966
Donald C. Vaillancourt The Grand Union Company Vice President - Corporate
201 Willowbrook Boulevard Communications
Wayne, New Jersey 07470-0966
Gilbert Vuolo The Grand Union Company Vice President - Personnel
201 Willowbrook Boulevard
Wayne, New Jersey 07470-0966
Louis Andrew DePaolis The Grand Union Company Vice President - Advertising
201 Willowbrook Boulevard and Sales Promotion
Wayne, New Jersey 07470-0966
Alfred T. Rossi The Grand Union Company Vice President - Facilities
201 Willowbrook Boulevard Management
Wayne, New Jersey 07470-0966
Alan Dudish The Grand Union Company Vice President - Nonperishables
201 Willowbrook Boulevard Merchandising and
Wayne, New Jersey 07470-0966 Distribution
</TABLE>
AS OF EFFECTIVE DATE
The Company anticipates that, as of the Effective Date, the following
persons will constitute the Board of Directors of the Company: Roger E.
Stangeland (Chairman of the Board), Joseph J. McCaig, William A. Louttit,
Daniel E. Josephs, William G. Kagler, Douglas T. McClure, Jr. and David Y.
Ying. Their addresses will be The Grand Union Company, 201 Willowbrook
Boulevard, Wayne, New Jersey 07470-0966. With the exception of Mr. Hirsch,
Mr. Fox and Mr. Goldberg, who will not continue to be employed by the Company,
the executive officers are expected to continue.
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<PAGE>
5. PRINCIPAL OWNERS OF VOTING SECURITIES. FURNISH THE FOLLOWING INFORMATION
AS TO EACH PERSON OWNING 10 PERCENT OR MORE OF THE VOTING SECURITIES OF THE
APPLICANT.
AS OF MAY 8, 1995
Name and Complete Title of Class Amount Percentage of
Mailing Address Owned Owned Voting Securities
Owned
Grand Union
Capital Corporation Common Stock 801.5 100%
shares
AS OF EFFECTIVE DATE
The holders of prepetition subordinated debt of The Grand Union Company on
the Effective Date will own all of the originally issued shares of common stock
of the reorganized company.
UNDERWRITERS
6. UNDERWRITERS. GIVE THE NAME AND COMPLETE MAILING ADDRESS OF (A) EACH
PERSON WHO, WITHIN THREE YEARS PRIOR TO THE DATE OF FILING THE APPLICATION,
ACTED AS AN UNDERWRITER OF ANY SECURITIES OF THE OBLIGOR WHICH WERE OUTSTANDING
ON THE DATE OF FILING THE APPLICATION, AND (B) EACH PROPOSED PRINCIPAL
UNDERWRITER OF THE SECURITIES PROPOSED TO BE OFFERED. AS TO EACH PERSON
SPECIFIED IN (A), GIVE THE TITLE OF EACH CLASS OF SECURITIES UNDERWRITTEN.
a. Goldman, Sachs & Co.
85 Broad Street
New York, New York 10004
and
BT Securities Corporation
130 Liberty Street
New York, New York 10006
Goldman, Sachs & Co. and BT Securities Corporation each served as
underwriter for the Company's issuances of 11-1/4% Senior Notes due 2000 and
12-1/4% Senior Subordinated Notes due 2002.
b. None
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<PAGE>
CAPITAL SECURITIES
7. CAPITALIZATION. (A) FURNISH THE FOLLOWING INFORMATION AS TO EACH
AUTHORIZED CLASS OF SECURITIES OF THE APPLICANT.
AS OF MAY 8, 1995
<TABLE>
<CAPTION>
AMOUNT AMOUNT
TITLE OF CLASS AUTHORIZED OUTSTANDING
<S> <C> <C>
Common Stock, 900 shares 801.5 shares
$50,000 par value
13% Senior Subordinated $200,000,000 $ 16,150,000
Notes Due 1998
11-1/4% Senior Notes $350,000,000 $350,000,000
Due 2000
12-1/4% Senior $500,000,000 $500,000,000
Subordinated Notes Due
2002
11-3/8% Senior Notes $175,000,000 $175,000,000
Due 1999
12-1/4% Senior $ 50,000,000 $ 50,000,000
Subordinated Notes Due
2002, Series A
</TABLE>
AS OF EFFECTIVE DATE
<TABLE>
<CAPTION>
AMOUNT AMOUNT
TITLE OF CLASS AUTHORIZED OUTSTANDING
<S> <C> <C>
12% Senior Notes $595,475,922 Up to $595,475,922
Due 2004
Common Stock,
$1.00 par value 30 million shares Up to 10 million shares
Preferred Stock,
$1.00 par value 10 million shares none
</TABLE>
(B) GIVE A BRIEF OUTLINE OF THE VOTING RIGHTS OF EACH CLASS OF
VOTING SECURITIES REFERRED TO IN PARAGRAPH (A) ABOVE.
-8-
<PAGE>
AS OF MAY 8, 1995
With respect to the voting rights of the common stock of the Company, each
holder of a share of such common stock is entitled to one vote on all matters on
which such shareholders are entitled to vote.
AS OF EFFECTIVE DATE
With respect to the voting rights of the common stock of the Company, each
holder of a share of such common stock will be entitled to one vote on all
matters on which such shareholders are entitled to vote.
INDENTURE SECURITIES
8. ANALYSIS OF INDENTURE PROVISIONS. INSERT AT THIS POINT THE ANALYSIS OF
INDENTURE PROVISIONS REQUIRED UNDER SECTION 305(A)(2) OF THE ACT.
(a) Definition of Default: Events of Default under the Indenture include
the following:
(i) the failure by the Company to pay interest on any Senior Note
for a period of 30 days after such interest becomes due and payable;
(ii) the failure by the Company to pay the principal of (or premium,
if any, on) any Senior Note when such principal becomes due and payable,
whether at the stated maturity or upon acceleration, redemption or
otherwise;
(iii) a default in the observance of any other covenant contained in
the Indenture that continues for 30 days after the Company has been given
notice of the default by the Trustee or the holders of 25% in principal
amount of the Senior Notes then outstanding;
(iv) a default or defaults on other Indebtedness (as defined in the
Indenture) of the Company or any subsidiary, which Indebtedness has an
outstanding principal amount of more than $15,000,000 individually or in
the aggregate if such Indebtedness has attained final maturity or if the
holders of such Indebtedness have accelerated payment thereof under the
terms of the instrument under which such Indebtedness is or may be
outstanding and, in each case, it remains unpaid;
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<PAGE>
(v) one or more judgments or decrees is entered against the Company
or any subsidiary involving a liability (not paid or fully covered by
insurance) of $5,000,000 or more in the case of any one such judgment or
decree or $10,000,000 or more in the aggregate for all such judgments and
decrees for the Company and all its subsidiaries and all such judgments and
decrees have not been vacated, discharged or stayed or bonded pending
appeal within 30 days from the date of entry thereof;
(vi) the Company or any Material Subsidiary (as defined in the
Indenture) pursuant to or within the meaning of the Bankruptcy Code (as
defined in the Indenture):
(1) commences a voluntary case in bankruptcy or any other action
or proceeding for any other relief under any law affecting creditors'
rights that is similar to the Bankruptcy Code;
(2) consents by answer or otherwise to the commencement against
it of an involuntary case or proceeding of bankruptcy or insolvency;
(3) seeks or consents to the appointment of a receiver, trustee,
assignee, liquidator, custodian or similar official (collectively, a
"Custodian") of it or for all or substantially all of its Property (as
defined in the Indenture);
(4) makes a general assignment for the benefit of its creditors;
or
(5) consents to the entry of a judgment, decree or order for
relief against it in an involuntary case; and
(vii) a court of competent jurisdiction enters a judgment, order or
decree under any Bankruptcy Code (as defined in the Indenture) that is for
relief against the Company or any Material Subsidiary in an involuntary
case or proceeding which shall:
(1) approve a petition seeking reorganization, arrangement,
adjustment or composition in respect of the Company or any Material
Subsidiary of the Company,
(2) appoint a Custodian for the Company or any Material
Subsidiary or for all or substantially all of the Property of any of
them; or
(3) order the winding up or liquidation of the Company or any
Material Subsidiary,
-10-
<PAGE>
and in each case the judgment, order or decree remains unstayed and in
effect for 60 days, or any dismissal, stay, rescission or termination
ceases to remain in effect. (Section 5.01)
Within 90 days after the occurrence of a Default or an Event of
Default that is continuing and known to a Trust Officer of the Trustee, the
Trustee shall mail notice thereof to the Holders. Except in the case of a
default in payment on the Senior Notes, the Trustee may withhold such notice
if and as long as a committee of Trust Officers in good faith determines that
such withholding is in the interests of the Holders. (Section 6.05)
(b) Authentication and Delivery; Application of Proceeds.
The Indenture provides that, upon a written order of the Company
signed by two officers, the Trustee shall authenticate Senior Notes for original
issue up to $595,475,922. The Senior Notes will be signed for the Company by
the Company's President or a Vice President and shall be attested by the
Company's Secretary or an Assistant Secretary. A Senior Note shall not be valid
until authenticated by the manual signature of the Trustee. The signature shall
be conclusive evidence that the Senior Note has been authenticated under the
Indenture.
The Trustee may appoint an Authenticating Agent acceptable to the
Company to authenticate Senior Notes. An Authenticating Agent may authenticate
Senior Notes whenever the Trustee may do so. Each reference in the Indenture to
authentication by the Trustee includes authentication by such agent. An
Authenticating Agent has the same rights as an Agent (as defined in the
Indenture) to deal with the Company or an Affiliate (as defined in the
Indenture). (Section 2.02)
The Senior Notes will be issued in exchange for claims against the
Company or its affiliates as provided in the Plan, and accordingly, the issuance
of the Senior Notes will not result in proceeds to the Company.
(c) Release and Substitution of Property Subject to the Lien of the
Indenture: Not Applicable.
(d) Satisfaction and Discharge. The Indenture shall cease to be of
further effect (except that the Company's obligations under Sections 6.07 and
7.04 of the Indenture and the Trustee's and Paying Agents obligations under
Section 7.03 of the Indenture shall survive) when all outstanding Senior Notes
theretofore authenticated and issued have been delivered to the Trustee for
cancellation, the Company has paid all sums payable by it under the Indenture
and the Company has delivered an Opinion of Counsel and Officers' Certificate to
the Trustee. In addition, the Company may elect to either (i) terminate its
obligations under the Indenture and the outstanding Senior Notes or (ii) be
released and discharged from its obligations under any covenant contained in
Sections 3.02, 3.03, 3.04, 3.05, 3.06, 3.08, 3.09, 3.10, 3.11, 3.14 and 4.01
of the Indenture and the omission to comply with any such covenant shall not
constitute a Default or an Event of Default, if, in either case,
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<PAGE>
the Company irrevocably deposits with the Trustee (or, at the option of the
Trustee, a trustee satisfactory to the Trustee and the Company) in trust
money or U.S. Government Obligations (as defined in the Indenture) sufficient
(without reinvestment thereof) to pay principal and interest on the
Senior Notes to maturity and to pay all other sums then payable by it to the
Trustee under Section 6.07 of the Indenture and if the Company satisfies
certain other conditions. If the Company so terminates its obligations under
the Indenture and the Senior Notes pursuant to clause (i) above,
the Company's obligations in Sections 2.03, 2.04, 2.05, 2.06, 2.07, 3.17,
6.07, 6.08 and 7.04 and the Trustee's and Paying Agent's obligations in
Section 7.02 and 7.03 shall survive until the Senior Notes are no longer
outstanding. Thereafter, only the Company's obligations in Section 6.07 and
7.04 and the Trustee's and Paying Agent's obligations in Section 7.03 shall
survive. In the case of the Company's being released and discharged from the
covenants set forth in clause (ii) above, all of the remaining provisions of
the Indenture shall survive until the Senior Notes are no longer outstanding.
Thereafter, only the Company's obligations in Section 6.07 and 7.04, and
the Trustee's and Paying Agent's obligations in Section 7.03 shall survive.
(Section 7.01)
(e) Evidence of Compliance.
The Company shall deliver to the Trustee, within 120 days after the
end of each Fiscal Year of the Company, a certificate signed by two officers of
the Company (one of whom must be the Chairman of the Board of Directors, the
Chief Executive Officer, the President, any Vice President or the Treasurer of
the Company), stating that a review of the activities of the Company and its
subsidiaries during the preceding Fiscal Year has been made and, as to each
such officer signing such certificate, that to the best of his or her
knowledge the Company has kept, observed, performed and fulfilled each and
every covenant contained in the Indenture and is not in default in the
performance or observance of any of the terms, provisions and conditions
thereof (or, if a Default or Event of Default shall have occurred, describing
all such Defaults or Events of Defaults of which he or she may have
knowledge and the status thereof).
The Company shall, as long as any of the Senior Notes are outstanding,
deliver to the Trustee, promptly, but in any case within 10 Business Days (as
defined in the Indenture) of any Officer becoming aware of any Default, Event
of Default or default in the performance of any covenant, agreement or
condition contained in the Indenture, a certificate signed by two officers
of the Company (one of whom must be the Chairman of the Board of Directors,
the Chief Executive Officer, the President, any Vice President or the
Treasurer of the Company) specifying such Default or Event of Default and the
status thereof.
Upon payment in full of all outstanding Indebtedness under the Bank
Credit Agreement (as defined in the Indenture), the Company shall deliver a
certificate signed by two officers of the Company (one of whom must be the
Chairman of the Board of Directors, the Chief Executive Officer,
the President, any Vice President or the Treasurer of the Company) to the
Trustee stating that such Indebtedness has been paid in full and discharged.
(Section 3.18)
9. OTHER OBLIGORS. GIVE THE NAME AND COMPLETE MAILING ADDRESS OF ANY PERSON,
OTHER THAN THE APPLICANT, WHO IS AN OBLIGOR UPON THE INDENTURE SECURITIES.
There are no other obligors with respect to the Senior Notes.
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<PAGE>
CONTENTS OF APPLICATION FOR QUALIFICATION. This application for
qualification comprises:
a. Pages numbered 1 to 15, consecutively.
b. The statement of eligibility and qualification of the trustee
under the Indenture to be qualified. *
c. The following exhibits in addition to those filed as a part of
the statement of eligibility and qualification of the trustee.
Exhibit T3A1. Certificate of Incorporation of the Company, as amended,
incorporated by reference to Exhibit No. 3.1 to the Registration
Statement on Form S-1 of the Company, Grand Union Capital
Corporation and Grand Union Holdings Corporation (Registration
No. 33-48282 (the "1992 Grand Union Registration Statement")
Exhibit T3A2. Proposed Restated Certificate of Incorporation of the Company
(included in Exhibit T3E1 hereof)
Exhibit T3B1. By-Laws of the Company, incorporated by reference to Exhibit No.
3.4 to the 1992 Grand Union Registration Statement
Exhibit T3B2. Proposed Restated By-Laws of the Company (included in Exhibit
T3E1 hereof)
Exhibit T3C. Form of Indenture
Exhibit T3E1. Disclosure Statement for Second Amended Chapter 11 Plan of
Reorganization of The Grand Union Company dated April 19, 1995,
including Plan as an exhibit thereto, as filed with the United
States Bankruptcy Court for the District of Delaware *
Exhibit T3E2. Order approving disclosure statement, establishing voting
procedures and setting confirmation hearing *
Exhibit T3E3. Notice of hearing to consider confirmation of and time fixed for
voting on the Second Amended Chapter 11 Plan of Reorganization
filed by The Grand Union Company *
Exhibit T3E4. Ballots for voting on Second Amended Plan of Reorganization,
dated April 19, 1995, submitted by The Grand Union Company, Class
4-Senior Note Claims *
Exhibit T3E5. Summary ballots for voting on Second Amended Plan of
Reorganization, dated April 19, 1995, submitted by The Grand
Union Company, Class 4-Senior Note Claims *
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- ------------------------
* Previously filed
<PAGE>
Exhibit T3F. Cross Reference Sheet showing the location in the Indenture of
the provisions inserted therein pursuant to Section 310 through
318(a), inclusive, of the Trust Indenture Act of 1939 (included
in Exhibit T3C hereof)
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<PAGE>
SIGNATURE
Pursuant to the requirements of the Trust Indenture Act of 1939, the
applicant, The Grand Union Company, a corporation organized and existing under
the laws of the State of Delaware, has duly caused this application to be signed
on its behalf by the undersigned, thereunto duly authorized, and its seal to be
hereunto affixed and attested, all in the City of Wayne, and State of New
Jersey, on the 31st day of May, 1995.
THE GRAND UNION COMPANY
[SEAL]
By: /s/ Kenneth R. Baum
_________________________________
Name: Kenneth R. Baum
Title: Senior Vice President,
Chief Financial Officer
and Secretary
Attest:
/s/ Stephen H. Maier
______________________________
Name: Stephen H. Maier
Title: Assistant Secretary
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<PAGE>
Exhibit T3C
DRAFT 5/26/95
THE GRAND UNION COMPANY, as Issuer
and IBJ SCHRODER BANK & TRUST COMPANY, as Trustee
$595,475,922
- -------------------------------------------------------------------------------
INDENTURE
Dated as of _______________, 1995
- -------------------------------------------------------------------------------
12% Senior Notes due September 1, 2004
<PAGE>
CROSS REFERENCE TABLE(1)
[SUBJECT TO FURTHER REVIEW]
Trust Indenture Reference
Act Section Section
- --------------- ---------
310(a)(1) 6.10
(a)(2) 6.10
(a)(3) N.A.
(a)(4) N.A.
(a)(5) 6.10
(b) 6.10, 6.08(c)
(c) N.A.
311(a) 6.11
(b) 6.11
(c) N.A.
312(a) 2.05
(b) 10.03
(c) 10.03
313(a) 6.06
(b)(1) N.A.
(b)(2) 6.06
(c) 6.06, 10.02
(d) 6.06
314(a) 3.07(a), 3.18(a), 10.05
(b) N.A.
(c)(1) 10.04
(c)(2) 10.04
(c)(3) N.A.
(d) N.A.
(e) 10.05
315(a) 6.01(b)
(b) 6.05, 10.02
(c) 6.01(a)
(d) 6.01(c), 6.02
(e) 5.11
316(a) 2.09
(a)(1)(A) 5.05
(a)(1)(B) 5.04
(a)(2) N.A.
(b) 5.07
(c) 8.04(b)
317(a)(1) 5.08
(a)(2) 5.09
(b) 2.04
318(a) 10.01
N.A. means not applicable
- --------------------
1 This Cross-Reference Table is not part of the Indenture
<PAGE>
TABLE OF CONTENTS
Page
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ARTICLE 1
DEFINITIONS AND INCORPORATION
BY REFERENCE . . . . . . . . . . . . . . . 1
SECTION 1.01.
(a) DEFINITIONS. . . . . . . . . . . . . . . . . . . . . . . . . . 1
(b) ACCOUNTING TERMS. . . . . . . . . . . . . . . . . . . . . . . 16
SECTION 1.02. OTHER DEFINITIONS . . . . . . . . . . . . . . . . . . . . . . 16
SECTION 1.03. INCORPORATION BY REFERENCE OF
TRUST INDENTURE ACT.. . . . . . . . . . . . . . . . . . . . . 17
SECTION 1.04. RULES OF CONSTRUCTION . . . . . . . . . . . . . . . . . . . . 17
ARTICLE 2
THE SECURITIES. . . . . . . . . . . . . . . 18
SECTION 2.01. FORM AND DATING . . . . . . . . . . . . . . . . . . . . . . . 18
SECTION 2.02. EXECUTION AND AUTHENTICATION. . . . . . . . . . . . . . . . . 18
SECTION 2.03. REGISTRAR AND PAYING AGENT. . . . . . . . . . . . . . . . . . 19
SECTION 2.04. PAYING AGENT TO HOLD MONEY IN TRUST . . . . . . . . . . . . . 19
SECTION 2.05. HOLDER LISTS. . . . . . . . . . . . . . . . . . . . . . . . . 20
SECTION 2.06. TRANSFER AND EXCHANGE . . . . . . . . . . . . . . . . . . . . 20
SECTION 2.07. REPLACEMENT SECURITIES. . . . . . . . . . . . . . . . . . . . 21
SECTION 2.08. OUTSTANDING SECURITIES. . . . . . . . . . . . . . . . . . . . 21
SECTION 2.09. TREASURY SECURITIES . . . . . . . . . . . . . . . . . . . . . 22
SECTION 2.10. TEMPORARY SECURITIES. . . . . . . . . . . . . . . . . . . . . 22
SECTION 2.11. CANCELLATION. . . . . . . . . . . . . . . . . . . . . . . . . 22
SECTION 2.12. DEFAULTED INTEREST. . . . . . . . . . . . . . . . . . . . . . 22
ARTICLE 3
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COVENANTS. . . . . . . . . . . . . . . . 23
SECTION 3.01. PAYMENT OF SECURITIES . . . . . . . . . . . . . . . . . . . . 23
SECTION 3.02. LIMITATION ON RESTRICTED PAYMENTS . . . . . . . . . . . . . . 23
SECTION 3.03. LIMITATION ON INDEBTEDNESS. . . . . . . . . . . . . . . . . . 25
SECTION 3.04. LIMITATION ON LIENS . . . . . . . . . . . . . . . . . . . . . 29
SECTION 3.05. LIMITATION ON SALE AND LEASEBACK
TRANSACTIONS. . . . . . . . . . . . . . . . . . . . . . . . . 30
SECTION 3.06. LIMITATION ON ASSET SALES . . . . . . . . . . . . . . . . . . 31
SECTION 3.07. SEC REPORTS . . . . . . . . . . . . . . . . . . . . . . . . . 34
SECTION 3.08. LIMITATION ON PAYMENT RESTRICTIONS
AFFECTING SUBSIDIARIES. . . . . . . . . . . . . . . . . . . . 35
SECTION 3.09. LIMITATION ON INDEBTEDNESS AND PREFERRED
STOCK OF SUBSIDIARIES (OTHER THAN
NON-BORROWING SUBSIDIARIES) . . . . . . . . . . . . . . . . . 36
SECTION 3.10. LIMITATION ON INDEBTEDNESS OF NON-BORROWING
SUBSIDIARIES. . . . . . . . . . . . . . . . . . . . . . . . . 39
SECTION 3.11. TRANSACTIONS WITH AFFILIATES. . . . . . . . . . . . . . . . . 39
SECTION 3.12. RESTRICTIONS ON BECOMING AN
INVESTMENT COMPANY. . . . . . . . . . . . . . . . . . . . . . 40
SECTION 3.13. CONTINUED EXISTENCE AND RIGHTS. . . . . . . . . . . . . . . . 40
SECTION 3.14. MAINTENANCE OF PROPERTIES AND
OTHER MATTERS . . . . . . . . . . . . . . . . . . . . . . . . 40
SECTION 3.15. TAXES AND CLAIMS. . . . . . . . . . . . . . . . . . . . . . . 41
SECTION 3.16. STAY, EXTENSION AND USURY LAWS. . . . . . . . . . . . . . . . 42
SECTION 3.17. MONEY FOR SECURITY PAYMENTS
TO BE HELD IN TRUST . . . . . . . . . . . . . . . . . . . . . 42
SECTION 3.18. COMPLIANCE CERTIFICATE. . . . . . . . . . . . . . . . . . . . 43
ARTICLE 4
SUCCESSORS; CHANGE OF CONTROL; OPTIONAL PREPAYMENT. . . . . . 44
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SECTION 4.01. WHEN COMPANY MAY MERGE, ETC.;
CHANGE OF CONTROL; HOLDERS'
RIGHT OF OPTIONAL PREPAYMENT. . . . . . . . . . . . . . . . . 44
ARTICLE 5
DEFAULTS AND REMEDIES. . . . . . . . . . . . . 46
SECTION 5.01. EVENTS OF DEFAULT . . . . . . . . . . . . . . . . . . . . . . 46
SECTION 5.02. ACCELERATION. . . . . . . . . . . . . . . . . . . . . . . . . 48
SECTION 5.03. OTHER REMEDIES. . . . . . . . . . . . . . . . . . . . . . . . 49
SECTION 5.04. WAIVER OF DEFAULTS. . . . . . . . . . . . . . . . . . . . . . 49
SECTION 5.05. CONTROL BY MAJORITY . . . . . . . . . . . . . . . . . . . . . 49
SECTION 5.06. LIMITATION ON SUITS . . . . . . . . . . . . . . . . . . . . . 50
SECTION 5.07. RIGHTS OF HOLDERS TO RECEIVE PAYMENT. . . . . . . . . . . . . 50
SECTION 5.08. COLLECTION SUIT BY TRUSTEE. . . . . . . . . . . . . . . . . . 50
SECTION 5.09. TRUSTEE MAY FILE PROOFS OF CLAIM. . . . . . . . . . . . . . . 51
SECTION 5.10. PRIORITIES. . . . . . . . . . . . . . . . . . . . . . . . . . 52
SECTION 5.11. UNDERTAKING FOR COSTS . . . . . . . . . . . . . . . . . . . . 52
ARTICLE 6
TRUSTEE . . . . . . . . . . . . . . . . 52
SECTION 6.01. DUTIES OF TRUSTEE . . . . . . . . . . . . . . . . . . . . . . 52
SECTION 6.02. RIGHTS OF TRUSTEE . . . . . . . . . . . . . . . . . . . . . . 54
SECTION 6.03. INDIVIDUAL RIGHTS OF TRUSTEE. . . . . . . . . . . . . . . . . 54
SECTION 6.04. TRUSTEE'S DISCLAIMER. . . . . . . . . . . . . . . . . . . . . 54
SECTION 6.05. NOTICE OF DEFAULTS. . . . . . . . . . . . . . . . . . . . . . 55
SECTION 6.06. REPORTS BY TRUSTEE TO HOLDERS . . . . . . . . . . . . . . . . 55
SECTION 6.07. COMPENSATION AND INDEMNITY. . . . . . . . . . . . . . . . . . 55
SECTION 6.08. REPLACEMENT OF TRUSTEE. . . . . . . . . . . . . . . . . . . . 56
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SECTION 6.09. SUCCESSOR TRUSTEE BY MERGER, ETC. . . . . . . . . . . . . . . 57
SECTION 6.10. ELIGIBILITY; DISQUALIFICATION . . . . . . . . . . . . . . . . 57
SECTION 6.11. PREFERENTIAL COLLECTION OF
CLAIMS AGAINST COMPANY. . . . . . . . . . . . . . . . . . . . 58
SECTION 6.12. AUTHENTICATING AGENT. . . . . . . . . . . . . . . . . . . . . 58
ARTICLE 7
DISCHARGE OF INDENTURE. . . . . . . . . . . . . 59
SECTION 7.01. TERMINATION OF COMPANY'S OBLIGATIONS. . . . . . . . . . . . . 59
SECTION 7.02. APPLICATION OF TRUST MONEY. . . . . . . . . . . . . . . . . . 62
SECTION 7.03. REPAYMENT TO COMPANY. . . . . . . . . . . . . . . . . . . . . 62
SECTION 7.04. REINSTATEMENT . . . . . . . . . . . . . . . . . . . . . . . . 63
ARTICLE 8
AMENDMENTS. . . . . . . . . . . . . . . . 63
SECTION 8.01. WITHOUT CONSENT OF HOLDERS. . . . . . . . . . . . . . . . . . 63
SECTION 8.02. WITH CONSENT OF HOLDERS . . . . . . . . . . . . . . . . . . . 64
SECTION 8.03. COMPLIANCE WITH TRUST INDENTURE ACT . . . . . . . . . . . . . 64
SECTION 8.04. REVOCATION AND EFFECT OF CONSENTS . . . . . . . . . . . . . . 65
SECTION 8.05. NOTATION ON EXCHANGE OF SECURITIES. . . . . . . . . . . . . . 65
SECTION 8.06. TRUSTEE PROTECTED . . . . . . . . . . . . . . . . . . . . . . 65
ARTICLE 9
REDEMPTIONS . . . . . . . . . . . . . . . 66
SECTION 9.01. NOTICE TO TRUSTEE . . . . . . . . . . . . . . . . . . . . . . 66
SECTION 9.02. SELECTION OF THE SECURITIES TO BE REDEEMED. . . . . . . . . . 66
SECTION 9.03. NOTICE OF REDEMPTION. . . . . . . . . . . . . . . . . . . . . 67
SECTION 9.04. EFFECT OF NOTICE OF REDEMPTION. . . . . . . . . . . . . . . . 67
SECTION 9.05. DEPOSIT OF REDEMPTION PRICE ON
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OPTIONAL REDEMPTION. . . . . . . . . . . . . . . . . . . . . 68
SECTION 9.06. SECURITIES REDEEMED IN PART . . . . . . . . . . . . . . . . . 68
ARTICLE 10
MISCELLANEOUS. . . . . . . . . . . . . . . 68
SECTION 10.01. TRUST INDENTURE ACT CONTROLS. . . . . . . . . . . . . . . . . 68
SECTION 10.02. NOTICES . . . . . . . . . . . . . . . . . . . . . . . . . . . 68
SECTION 10.03. COMMUNICATION BY HOLDERS
WITH OTHER HOLDERS. . . . . . . . . . . . . . . . . . . . . . 70
SECTION 10.04. CERTIFICATE AND OPINION AS
TO CONDITIONS PRECEDENT . . . . . . . . . . . . . . . . . . . 70
SECTION 10.05. STATEMENTS REQUIRED IN
CERTIFICATE OR OPINION. . . . . . . . . . . . . . . . . . . . 70
SECTION 10.06. RULES BY TRUSTEE AND AGENTS . . . . . . . . . . . . . . . . . 71
SECTION 10.07. LEGAL HOLIDAYS. . . . . . . . . . . . . . . . . . . . . . . . 71
SECTION 10.08. NO RECOURSE AGAINST OTHERS. . . . . . . . . . . . . . . . . . 71
SECTION 10.09. DUPLICATE ORIGINALS . . . . . . . . . . . . . . . . . . . . . 71
SECTION 10.10. GOVERNING LAW . . . . . . . . . . . . . . . . . . . . . . . . 71
SECTION 10.11. NO ADVERSE INTERPRETATION
OF OTHER AGREEMENTS . . . . . . . . . . . . . . . . . . . . . 71
SECTION 10.12. SUCCESSORS. . . . . . . . . . . . . . . . . . . . . . . . . . 72
SECTION 10.13. SEVERABILITY. . . . . . . . . . . . . . . . . . . . . . . . . 72
SECTION 10.14. TABLE OF CONTENTS, HEADINGS, ETC. . . . . . . . . . . . . . . 72
SECTION 10.15. BENEFITS OF INDENTURE . . . . . . . . . . . . . . . . . . . . 73
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<PAGE>
INDENTURE dated as of _______, 1995 between THE GRAND UNION COMPANY, a
Delaware corporation (the "Company"), and IBJ SCHRODER BANK & TRUST COMPANY, a
banking company organized under the laws of the State of New York, as trustee
(the "Trustee").
Each party agrees as follows for the benefit of the other party and
for the equal and ratable benefit of the Holders of the Company's 12% Senior
Notes due September 1, 2004 (the "Securities").
ARTICLE 1.
DEFINITIONS AND INCORPORATION
BY REFERENCE
SECTION 1.01.
(a) DEFINITIONS.
"ADDITIONAL ASSETS" means any Property or assets substantially related
to the Company's primary business.
"AFFILIATE" means, with respect to any referenced Person, a Person (i)
which directly or indirectly through one or more intermediaries controls, or is
controlled by, or is under direct or indirect common control with, such
referenced Person, (ii) which directly or indirectly through one or more
intermediaries beneficially owns or holds 5% or more of the combined voting
power of the total Voting Stock of such referenced Person or (iii) of which 5%
or more of the combined voting power of the total Voting Stock (or in the case
of a Person which is not a corporation, 5% or more of the equity interest)
directly or indirectly through one or more intermediaries is beneficially owned
or held by such referenced Person, or a Subsidiary of such referenced Person.
For purposes of this definition, "control" (including, with correlative
meanings, the terms "controlling," "controlled by" and "under common control
with"), as used with respect to any Person, shall mean the possession, directly
or indirectly, of the power to direct or cause the direction of the management
or policies of such Person, whether through the ownership of voting securities,
by agreement or otherwise; PROVIDED, HOWEVER, that beneficial ownership of 5% or
more of the voting securities of another Person, shall be deemed to be control.
When used herein without reference to any Person, Affiliate means an Affiliate
of the Company.
"AGENT" means any Registrar, Paying Agent or co-Registrar.
<PAGE>
"ASSET SALE" means the sale or other disposition, in a transaction
which is not a Sale and Leaseback Transaction permitted under the terms of this
Indenture, by the Company or any of its Subsidiaries to any Person other than
the Company or another of its Subsidiaries of (i) any of the Capital Stock of
any of the Subsidiaries of the Company or (ii) any other assets of the Company
or any other assets of its Subsidiaries outside the ordinary course of business
of the Company or such Subsidiary.
"AVERAGE LIFE" means, as of the date of determination, with respect to
any debt security, the quotient obtained by dividing (i) the sum of the products
of (x) the numbers of years from the date of determination to the dates of each
successive scheduled principal payment of such debt security multiplied by (y)
the amount of such principal payment by (ii) the sum of all such principal
payments.
"BANK CREDIT AGREEMENT" means either (i) the Bankers Trust Bank Credit
Agreement, (ii) the Alternative Credit Documents (as defined in the Plan), if
the Company has made the election provided for in Section 6.01(a) (ii) of the
Plan, or (iii) any successor agreement, together with documents related thereto,
including, without limitation, any security agreements, pledge agreements,
mortgages or guarantees, in the case of each of clause (i), (ii) or (iii) hereof
as such agreements may be amended, restated, supplemented or otherwise modified
from time to time and includes any agreement renewing, extending the maturity
of, refinancing (including by way of placement or issuance of notes) or
restructuring (including the inclusion of additional borrowers, guarantors or
lenders) all or any portion of the Indebtedness under such agreements.
"BANKERS TRUST BANK CREDIT AGREEMENT" means the Amended and Restated
Credit Agreement dated as of ________, 1995 among the Company, Bankers Trust
Company, for itself and as agent, and the other parties thereto.
"BANKRUPTCY CODE" means Title 11 of the United States Code, as from
time to time in effect. For purposes of Sections 5.01, 6.07 and 6.08 hereof,
the term "Bankruptcy Code" also includes any similar federal, state or foreign
law relating to bankruptcy, insolvency, receivership, winding-up, liquidation,
reorganization or relief of debtors or any amendment to, succession to or change
in any such law.
"BOARD OF DIRECTORS" means the Board of Directors of the Company or
any duly authorized committee of such board.
"BORROWING SUBSIDIARY" means any direct or indirect wholly-owned
Subsidiary of the Company which is permitted to
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incur Indebtedness under the terms of this Indenture pursuant to Section 3.09
hereof and which is primarily engaged in any business in which a supermarket
chain is at the time engaged or any related business or in any business in which
the Company is engaged on the Issue Date.
"BUSINESS DAY" means any day which is not a Legal Holiday.
"CAPITAL STOCK" means, with respect to any Person, any and all shares,
interests, participations, rights in or other equivalents (however designated)
of such Person's capital stock, including, without limitation, preferred or
preference stock, and any rights (other than debt securities convertible into
capital stock), warrants or options exchangeable for or convertible into such
capital stock.
"CAPITALIZED LEASE OBLIGATIONS" means, at the time any determination
thereof is made, as to any Person, the obligation of such Person to pay rent or
other amounts under a lease of (or other agreement conveying the right to use)
real or personal Property which obligation is required to be classified and
accounted for as a capital lease obligation on a balance sheet of such Person
under GAAP and, for purposes of this Indenture, the amount of such obligation at
any date shall be the outstanding amount thereof at such date, determined in
accordance with GAAP.
"CHANGE OF CONTROL" means the occurrence of any of the following
events:
(a) any Person or Persons acting together which would constitute a
"group" (a "Group") for purposes of Section 13(d) of the Exchange Act, or
any successor provision thereto, together with any Affiliates thereof
(other than a Permitted Holder or Permitted Holders), is or becomes the
beneficial owner of more than 50% of the total Voting Stock of the Company;
(b) the Company consolidates with, or merges into, another Person or
sells, assigns, conveys, transfers, leases or otherwise disposes of all or
substantially all of its assets to any Person in one transaction or a
series of related transactions, or any Person consolidates with, or merges
with or into, the Company, in any such event pursuant to a transaction in
which the outstanding Voting Stock of the Company is converted into or
exchanged for cash, securities (other than Voting Stock) or other property
with the effect that any Person or Group (other than a Permitted Holder or
Permitted Holders) becomes the beneficial owner of more than 50% of the
total Voting Stock of the Company or any successor
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<PAGE>
corporation or securities representing more than 50% of the total Voting
Stock of the Company or any successor corporation;
(c) during any consecutive two-year period, commencing as of the date
of this Indenture, individuals who at the beginning of such period
constituted the Board of Directors of the Company (together with any new
directors whose election by such Board or whose nomination for election by
the stockholders of the Company was approved by a vote of 66 2/3% of the
directors then still in office who were either directors at the beginning
of such period or whose election or nomination for election was previously
so approved) cease for any reason (other than death or disability) to
constitute a majority of the Board of Directors of the Company then in
office; or
(d) any order, judgment or decree shall be entered against the
Company decreeing the dissolution or split-up of the Company and such order
shall remain undischarged or unstayed for a period in excess of 60 days;
PROVIDED, HOWEVER, that none of the events described in the foregoing clauses
(a) through (d) shall constitute a "Change of Control" unless Standard & Poor's
Corporation or Moody's Investors Service, Inc. or, if both of the two named
rating agencies cease publishing ratings of investments, another nationally
recognized rating service which publicly rates investments shall within 180 days
after the occurrence of such event (such 180-day period to be extended by that
number of days, not exceeding 45 days, during which the Securities shall have
been placed after the date of such event on credit watch with negative
implications status) have downgraded the rating assigned by such agency to the
Securities on the date of such event.
"COMPANY" means the Person designated as the "Company" in the first
paragraph of this instrument until any successor corporation shall have become
such Person pursuant to the terms of this Indenture, and thereafter means any
such successor.
"CONSOLIDATED INTEREST COVERAGE RATIO" means, with respect to the
Company for any period, the ratio of:
(i) the aggregate amount of Consolidated Operating Income of the
Company for the four consecutive fiscal quarters for which financial
information in respect thereof is available immediately prior to the
Transaction Date
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<PAGE>
to
(ii) the aggregate amount of Consolidated Interest Expense of the
Company for the four consecutive fiscal quarters for which financial
information in respect thereof is available immediately prior to the
Transaction Date; PROVIDED, HOWEVER, that, for purposes of calculating the
Consolidated Interest Coverage Ratio of the Company, (a) Consolidated
Operating Income shall be calculated on the basis of the first-in,
first-out method of inventory valuation, as determined in accordance with
GAAP, (b) the Consolidated Operating Income and Consolidated Interest
Expense of the Company shall include the Consolidated Operating Income and
Consolidated Interest Expense of any Person to be acquired by the Company
or any of its Subsidiaries in connection with the transaction giving rise
to the need to calculate the Consolidated Interest Coverage Ratio, on a pro
forma basis for the four consecutive fiscal quarters for which financial
information in respect thereof is available immediately prior to the
Transaction Date and shall also include the Consolidated Operating Income
and Consolidated Interest Expense of any other Person which has been
acquired during such four consecutive fiscal quarters, on a pro forma basis
from the beginning of such four consecutive fiscal quarters through the
date first included in the Company's Consolidated Operating Income and
Consolidated Interest Expenses, such pro forma Consolidated Operating
Income and Consolidated Interest Expense to be determined on the same basis
as used in determining such items for the Company, and (c) Consolidated
Interest Expense and Redeemable Dividends shall be calculated as if (i) any
Indebtedness incurred or proposed to be incurred or issued since the
beginning of the four consecutive fiscal quarters for which financial
information in respect thereof is available immediately prior to the
Transaction Date, or to be incurred or issued at or prior to the time of
the transaction giving rise to the need to calculate the Consolidated
Interest Coverage Ratio is effected (the "Transaction Time"), had been
incurred or issued as of the beginning of such four quarter period, and
(ii) any Indebtedness repaid since the beginning of such four quarter
period or to be repaid with the proceeds of such Indebtedness or equity
incurred or issued or to be incurred or issued at or prior to the
Transaction Time, had been repaid as of the beginning of such four quarter
period. For purposes of determining the Consolidated Interest Coverage
Ratio of the Company for any period, (i) any Indebtedness incurred or
proposed to be incurred or Redeemable Stock issued or proposed to be issued
which for purposes of clause (c) above is deemed to have been
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<PAGE>
incurred or issued as of the beginning of the four quarter period described
in clause (c) which bearsinterest at a fluctuating rate will be deemed to
have borne interest during such four quarter period at the rate in effect
on the Transaction Date and (ii) "Subsidiary" shall mean any Subsidiary of
the Company other than any Subsidiary (and Subsidiaries of such Subsidiary)
of which the Company does not own or control, directly or indirectly, a
sufficient amount of Voting Stock in order to cause a merger of such
Subsidiary into the Company or another Subsidiary without the approval of
any other holder of Voting Stock of such Subsidiary.
"CONSOLIDATED INTEREST EXPENSE" means, for any period, without
duplication (A) the sum of (i) the aggregate amount of interest recognized by
the Company and its Subsidiaries during such period in respect of Indebtedness
of the Company and its Subsidiaries (including, without limitation, all interest
capitalized by the Company or any of its Subsidiaries during such period and all
commissions, discounts and other fees and charges owed by the Company and its
Subsidiaries with respect to letters of credit and bankers' acceptance financing
and the net costs associated with Interest Swap Obligations of the Company and
its Subsidiaries), (ii) to the extent any Indebtedness of any Person is
guaranteed by the Company or any of its Subsidiaries, the aggregate amount of
interest paid or accrued by such Person during such period attributable to any
such Indebtedness, and (iii) any cash [Redeemable Dividend] accrued and payable,
and less (B) amortization or write-off of deferred financing costs of the
Company and its Subsidiaries during such period and, to the extent included in
(A) above, any charge related to any premium or penalty paid in connection with
redeeming or retiring any Indebtedness prior to its stated maturity, and in the
case of both (A) and (B) above, elimination of intercompany accounts among the
Company and its Subsidiaries and as determined in accordance with GAAP.
"CONSOLIDATED NET INCOME" means, for any period, the aggregate net
income of the Company and its Subsidiaries for such period on a consolidated
basis, determined in accordance with GAAP but excluding for such purpose the
impact of any Fresh Start Accounting adjustment; PROVIDED, HOWEVER, that there
shall be excluded therefrom, after giving effect to any related tax effect, (i)
gains and losses from Asset Sales or reserves relating thereto, (ii) items
classified as extraordinary or nonrecurring, including without limitation income
relating to the cancellation of Indebtedness resulting from the Restructuring,
(iii) the income (or loss) of any Joint Venture, except to the extent of the
amount of cash dividends or other distributions in respect of its
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<PAGE>
capital stock or interest in the Joint Venture actually paid to, and received
by, the Company or any of its Subsidiariesduring such period by such Joint
Venture out of funds legally available therefor, (iv) except to the extent
includable pursuant to clause (iii), the income (or loss) of any Person accrued
or attributable to any period prior to the date it becomes a Subsidiary of the
Company or is merged into or consolidated with the Company or any of its
Subsidiaries or that Person's assets (or a portion thereof) are acquired by the
Company or any of its Subsidiaries and (v) the cumulative effect of changes in
accounting principles in the year of adoption of such change.
"CONSOLIDATED OPERATING INCOME" means, with respect to the Company for
any period, the Consolidated Net Income of the Company and its Subsidiaries for
such period (A) increased by the sum of (i) Consolidated Interest Expense of the
Company for such period, (ii) income tax expense of the Company and its
Subsidiaries, on a consolidated basis, for such period (after giving effect to
any income tax expense adjustments made in arriving at Consolidated Net Income),
(iii) depreciation expense of the Company and its Subsidiaries, on a
consolidated basis, for such period, (iv) amortization expense of the Company
and its Subsidiaries, on a consolidated basis, for such period, (v) amortization
or write-off of deferred financing costs of the Company and its Subsidiaries, on
a consolidated basis, for such period and (vi) other non cash items, but only to
the extent the items referred to in subclauses (i) through (vi) of this clause
(A) reduced such Consolidated Net Income and (B) decreased by the sum of (i) non
cash items increasing such Consolidated Net Income and (ii) any revenues
received or accrued by the Company or any of its Subsidiaries from any Person
(other than the Company or any of its Subsidiaries) in respect of any Investment
for such period (other than revenue from any Qualified Investment), but only to
the extent that subclauses (i) and (ii) of this clause (B) increased such
Consolidated Net Income, all as determined in accordance with GAAP.
"DEFAULT" means an event or condition that is, or, with the lapse of
time or the giving of notice or both, would become, an Event of Default as
defined in Section 5.01.
"FAIR MARKET VALUE" means, with respect to any Asset Sale or any
non-cash consideration received by or transferred to any Person, the sale value
that would be obtained in an arm's-length transaction between an informed and
willing seller under no compulsion to sell and an informed and willing buyer, as
determined in good faith by the Board of Directors of the Company.
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<PAGE>
"FISCAL YEAR" means the Company's fiscal year ended the Saturday
closest to the last day of March in any calendar year or such other date as the
Company shall designate for use in connection with its obligations under the
federal taxing laws of the United States and relevant accounting standards.
"FRESH START ACCOUNTING" means Fresh Start Accounting as described in
Statement of Position 90-7, "Financial Reporting by Entities in Reorganization
Under the Bankruptcy Code" (Am. Inst. of Certified Public Accountants 1990), as
then in effect, or such comparable statement then in effect.
"GAAP" means, at any particular time, generally accepted accounting
principles as in effect in the United States of America at such time.
"GUARANTEE" means any direct or indirect obligation, contingent or
otherwise, of a Person guaranteeing or having the economic effect of
guaranteeing any Indebtedness of any other Person in any manner.
"HOLDER" means a Person in whose name a Security is registered.
"INDEBTEDNESS," as applied to any Person, means, without duplication,
(i) any obligation, contingent or otherwise, for borrowed money (whether or not
the recourse of the lender is to the whole of the assets of such Person or only
to a portion thereof), (ii) any obligation owed for all or any part of the
purchase price of Property or other assets or for the cost of Property or other
assets constructed or of improvements thereto (including any obligation under or
in connection with any letter of credit related thereto), other than accounts
payable included in current liabilities incurred in respect of Property and
services purchased in the ordinary course of business which are not overdue by
more than 90 days, according to the terms of sale, unless being contested or
negotiated in good faith, (iii) any obligation, contingent or otherwise, of a
Person under or in connection with any letter of credit issued for the account
of such Person, and all drafts drawn, or demands for payment honored,
thereunder, (iv) any obligation, contingent or otherwise, as set forth in
subclauses (i) and (ii) of this definition, secured by any Lien in respect of
Property even though the Person owning the Property has not assumed or become
liable for payment of such obligation, (v) any Capitalized Lease Obligation,
(vi) any note payable, bond, debenture, draft accepted or similar instrument
representing an extension of credit (other than extensions of credit for
Property and services purchased in the ordinary course of business which are not
overdue by more than 90 days, according to the terms of sale, unless being
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contested or negotiated in good faith), whether or not representing an
obligation for borrowed money, (vii) the maximum fixed repurchase price of any
Redeemable Stock, (viii) any obligations of such Person in respect of Interest
Swap Obligations and (ix) any Guarantees and any obligation which is in economic
effect a Guarantee, regardless of its characterization, with respect to
Indebtedness (of a kind otherwise described in this definition) of another
Person. For purposes of the preceding sentence, the maximum fixed repurchase
price of any Redeemable Stock which does not have a fixed repurchase price shall
be calculated in accordance with the terms of such Redeemable Stock as if such
Redeemable Stock were repurchased on any date on which Indebtedness shall be
required to be determined pursuant to the Indenture. The amount of Indebtedness
of any Person at any date shall be the outstanding balance at such date of all
unconditional obligations as described above and the maximum liability of any
such contingent obligations at such date.
"INDENTURE" means this Indenture, as amended, modified or supplemented
from time to time, together with any exhibits, schedules or other attachments
hereto.
"INTEREST SWAP OBLIGATIONS" means the obligations of any Person
pursuant to any interest rate swap agreement, interest rate cap, collar or floor
agreement or other similar agreement or arrangement.
"INVESTMENT" means, with respect to any Person (such Person being
referred to in this definition as the "Investor"), (i) any amount paid by the
Investor, directly or indirectly, or any transfer of Property by the Investor,
directly or indirectly (such amount to be the Fair Market Value of such Property
at the time of transfer by the Investor), to any other Person for Capital Stock
of, or as a capital contribution to, any other Person; (ii) any direct or
indirect loan or advance to any other Person (other than accounts receivable of
such Investor arising in the ordinary course of business); and (iii) Guarantees
of the Indebtedness of another Person.
"ISSUE DATE" means ___________, 1995, the date on which the Securities
are first to be issued under this Indenture.
"JOINT VENTURE" means any Person (other than a Subsidiary of the
Company) in which any Person other than the Company or any of its Subsidiaries
has a joint or shared equity interest with the Company or any of its
Subsidiaries.
"LIEN" means any mortgage, lien (statutory or other), charge, pledge,
hypothecation, conditional sales
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agreement, adverse claim, title retention agreement or other security interest,
encumbrance or title defect in or on, or any interest or title of any vendor,
lessor, lender or other secured party to or of such Person under any conditional
sale, trust receipt or other title retention agreement with respect to, any
Property or asset of such Person.
"MATERIAL ACQUISITION" means any merger, consolidation, acquisition or
lease of assets, acquisition of securities or other business combination or
acquisition, or any two or more such transactions if part of a common plan to
acquire a business or group of businesses, if the assets thus acquired in the
aggregate would have constituted a Material Subsidiary if they had been acquired
as a Subsidiary, based upon the consolidated financial statements of the Company
and its Subsidiaries for the most recent Fiscal Year for which financial
statements are available.
"MATERIAL SUBSIDIARY" means, with respect to the Company, at any time,
each existing Subsidiary and each Subsidiary hereafter acquired or formed which
(i) for the most recent Fiscal Year of the Company for which financial
statements are available accounted for more than 10% of the consolidated
revenues of the Company and its Subsidiaries or (ii) as of the end of such
Fiscal Year, was the owner (beneficial or otherwise) of more than 10% of the
consolidated assets of the Company and its Subsidiaries, all as shown on the
consolidated financial statements of the Company and its Subsidiaries for such
Fiscal Year.
"NET PROCEEDS" means, with respect to an Asset Sale by the Company or
any of its Subsidiaries, (i) the gross proceeds received by the Company or its
Subsidiary in connection with such Asset Sale (the amount of any non-cash
consideration received as proceeds to be the Fair Market Value of such
consideration, provided that liabilities assumed by the buyer shall not be
deemed proceeds received by the Company or its Subsidiary), minus (ii) the sum
of (a) reasonable fees and expenses incurred by the Company or such Subsidiary
in connection with such Asset Sale, including any tax on income resulting from
the gain realized from such Asset Sale, (b) payments made with respect to
liabilities associated with the assets which are the subject of the Asset Sale,
including without limitation, trade payables and other accrued liabilities, and
payments made to retire Indebtedness where the assets disposed of in such Asset
Sale constituted security for or had been pledged to secure such Indebtedness
and payment of such Indebtedness is required in connection with such Asset Sale
and (c) appropriate amounts to be provided by the Company or any Subsidiary
thereof, as the case may be, as a reserve, in accordance with GAAP, against any
liabilities associated with such assets and retained by the Company or any
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Subsidiary thereof, as the case may be, after such Asset Sale, including,
without limitation, liabilities under any indemnification obligations and
severance and other employee termination costs associated with such Asset Sale.
"NON-BORROWING SUBSIDIARY" means any direct or indirect wholly-owned
Subsidiary of the Company which (i) is not permitted to incur Indebtedness and
does not at any time, in the present or future, have outstanding Indebtedness
and (ii) is not permitted to issue preferred or preference stock, pursuant to
its certificate of incorporation or otherwise, and does not at any time, in the
present or the future, have outstanding preferred or preference stock.
"OFFICER" means the Chairman of the Board of Directors, the Chief
Executive Officer, the President, any Vice President, the Treasurer, the
Secretary, any Assistant Treasurer or any Assistant Secretary of the Company.
"OFFICERS' CERTIFICATE" means a certificate signed by two Officers of
the Company, one of whom must be the Chairman of the Board of Directors, the
Chief Executive Officer, the President, any Vice President or the Treasurer of
the Company.
"OPINION OF COUNSEL" means a written opinion from legal counsel who is
acceptable to the Trustee. The counsel may be an employee of or counsel to the
Company or the Trustee.
"PERMITTED HOLDERS" means any Person which directly or indirectly
through one or more intermediaries beneficially owns or holds or is entitled to
receive on the Issue Date 20% or more of the combined voting power of the Voting
Stock of the Company, or any Affiliate of any such Person.
"PERSON" means any individual, corporation, limited or general
partnership, joint venture, association, joint stock company, trust,
unincorporated organization or government or any agency or political subdivision
thereof.
"PLAN" means the plan of reorganization of the Company, as confirmed
by the United States Bankruptcy Court for the District of Delaware on _________,
1995.
"PRINCIPAL", or "PRINCIPAL" of a debt security means the principal
amount of a debt security plus the premium, if any, on such debt security.
"PROPERTY" means any interest in any kind of property or asset,
whether real, personal or mixed, or tangible or intangible.
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"QUALIFIED INVESTMENT" means the following kinds of instruments if, on
the date of purchase or other acquisition of any such instrument by the Company
or any Subsidiary the remaining term to maturity thereof is not more than one
year: (i) obligations issued or unconditionally guaranteed as to principal and
interest by the United States of America or by any agency or authority
controlled or supervised by and acting as an instrumentality of the United
States of America; (ii) obligations (including, but not limited to, demand or
time deposits, bankers' acceptances and certificates of deposit) issued by (a) a
depository institution or trust company incorporated under the laws of the
United States of America, any state thereof or the District of Columbia or (b) a
branch office or agency located in the United States of any foreign depository
institution and guaranteed by such a U.S. trust company or depository, provided
that, in the case of both clause (a) and clause (b), such U.S. trust company or
depository has, at the time of the Company's or any Subsidiary's investment
therein or contractual commitment providing for such investment, capital,
surplus and undivided profits (as of the date of such institution's most
recently published financial statements) in excess of $100 million and the
long-term unsecured debt obligations (other than such obligations rated on the
basis of the credit of a person or entity other than such institution) of such
institution, at the time of the Company's or any Subsidiary's investment therein
or contractual commitment providing for such investment, is rated at least A-1
by Standard & Poor's Corporation or A3 by Moody's Investors Service, Inc. or
carries an equivalent rating from a nationally recognized rating agency, if both
these two named rating agencies cease publishing ratings of investments; and
(iii) debt obligations (including, but not limited to, commercial paper and
medium-term notes) issued or unconditionally guaranteed as to principal and
interest by any corporation, state or municipal government or agency or
instrumentality thereof, or foreign sovereignty if the commercial paper of such
corporation, state or municipal government or foreign sovereignty has, at the
time of the Company's or any Subsidiary's investment therein or contractual
commitment providing for such investment, credit ratings of A-1 by Standard &
Poor's Corporation, or P-1 by Moody's Investors Service, Inc. or carries an
equivalent rating from a nationally recognized rating agency, if both these two
named rating agencies cease publishing ratings of investments, or the debt
obligations of such corporation, state or municipal government or foreign
sovereignty, at the time of the Company's or any Subsidiary's investment therein
or contractual commitment providing for such investment, have credit ratings of
at least A-1 by Standard & Poor's Corporation or A3 by Moody's Investors
Service, Inc. or carry an equivalent rating from a nationally recognized rating
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agency, if both these two named rating agencies cease publishing ratings of
investments.
"REDEEMABLE DIVIDEND" means, for any dividend payable with regard to
Redeemable Stock, the quotient of the dividend divided by the difference between
one and the maximum statutory federal income tax rate (expressed as a decimal
number between 1 and 0) then applicable to the issuer of such Redeemable Stock.
"REDEEMABLE STOCK" means, with respect to any Person, any equity
security that by its terms or otherwise is required to be redeemed or is
redeemable at the option of the holder thereof at any time prior to the maturity
of the Securities.
"REDEMPTION DATE" means, when used with respect to any Security to be
redeemed, the date fixed for such redemption pursuant to this Indenture and the
Securities.
"REDEMPTION PRICE" means, when used with respect to any Security to be
redeemed, the price fixed for such redemption pursuant to this Indenture and the
Securities as set forth in Article 9 of this Indenture and paragraph 6 of the
Securities.
"RESTRICTED PAYMENT" means (i) a dividend or other distribution
declared and paid on the Capital Stock of the Company to its stockholders (in
their capacity as such), other than dividends or distributions consisting of
shares of the Company's Capital Stock (or rights or warrants to subscribe for or
purchase shares of such Capital Stock), (ii) a payment made by the Company or
any Subsidiary to purchase, redeem, acquire or retire any Capital Stock of the
Company (or rights or warrants to subscribe for or purchase shares of such
Capital Stock), (iii) a payment made by the Company or any Subsidiary to
acquire, retire or redeem any debt of or equity interest in any Affiliate of the
Company or any of its Subsidiaries, (iv) any other Investment in any Affiliate
of the Company or any of its Subsidiaries (other than in any Non-Borrowing
Subsidiary) or (v) a payment made in purchase, redemption, defeasance or other
acquisition or retirement for value of Subordinated Debt. For purposes of this
Indenture, a guarantee of Indebtedness of the Company by a Subsidiary of the
Company required by the Bank Credit Agreement shall not be deemed a Restricted
Payment.
"RESTRUCTURING" means the restructuring of the Company's debt and
equity capitalization pursuant to the Plan.
"REVOLVING CREDIT FACILITY" means the revolving credit facility (or
any similar facility) available under the Bank Credit Agreement, including any
related letters of credit.
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"SALE AND LEASEBACK TRANSACTION" means any direct or indirect
arrangement with any Person or to which such Person is a party, providing for
the leasing to the Company or a Subsidiary of any Property, whether owned at the
date of this Indenture or thereafter acquired, which has been or is to be sold
or transferred by the Company or such Subsidiary to such Person, or to any other
Person to whom funds have been or are to be advanced by such Person, on the
security of such Property.
"SEC" means the Securities and Exchange Commission or any successor
thereto.
"SECURITIES" has the meaning set forth in the second paragraph of this
Indenture.
"SENIOR INDEBTEDNESS" means, at any date, (i) Indebtedness under the
Bank Credit Agreement and the Securities including, in each case, interest
thereon accruing at the contract rate, whether or not an allowed claim in a case
under the Bankruptcy Code, and all other obligations and indemnities owing
thereunder; (ii) any renewals, extensions, modifications, amendments or
refundings of Indebtedness under the Securities; (iii) Indebtedness arising as a
result of Interest Swap Obligations of the Company or any Subsidiary; and (iv)
any other Indebtedness of the Company for money borrowed or under letters of
credit, in either case entered into in compliance with the Indenture, unless the
instrument under which such Indebtedness is created, incurred, assumed or
guaranteed expressly provides that such Indebtedness is subordinated in right of
payment to any Indebtedness.
"SUBORDINATED DEBT" means, at any date, any Indebtedness of the
Company that is expressly subordinated in any respect in right of payment to the
Securities, Indebtedness under the Bank Credit Agreement or to any other Senior
Indebtedness, including, without limitation, principal, premium, interest, fees,
indemnities and amounts in respect of claims and rights of rescission.
"SUBSIDIARY" means, with respect to any Person, any corporation,
association or other business entity of which securities representing more than
50% of the combined voting power of the total Voting Stock (or in the case of an
association or other business entity which is not a corporation, more than 50%
of the equity interest) is at the time owned or controlled, directly or
indirectly, by that Person or one or more of the other Subsidiaries of that
Person or a combination thereof. When used herein without reference to any
Person, Subsidiary means a Subsidiary of the Company.
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"SURVIVING CORPORATION" means the corporation formed by or surviving
any consolidation or merger involving the Company or to which a transfer, sale
or lease of all or substantially all of the Company's Property is made.
"TIA" means the Trust Indenture Act of 1939 (15 U.S.C. Sections 77aaa-
77bbbb), as amended by the Trust Indenture Reform Act of 1990, as in effect on
the date of execution of this Indenture, except as provided in Section 8.03.
"TRANSACTION DATE" means the date of the transaction giving rise to
the need to calculate the Consolidated Interest Coverage Ratio; PROVIDED that if
such transaction is related to or in connection with any acquisition of any
Person, the Transaction Date shall be the earlier of (i) the date on which the
Company or any of its Subsidiaries enters into an agreement with such Person to
effect such acquisition, (ii) the date on which the Company or any of its
Subsidiaries first makes a public announcement of any offer or proposal to
effect such acquisition, (iii) the date on which the Company or any of its
Subsidiaries first makes a filing with the SEC or the Federal Trade Commission
in connection with any proposed acquisition, and (iv) the date such acquisition
is consummated, PROVIDED, HOWEVER, that if subsequent to the occurrence of an
event described in clause (i), (ii) or (iii) above or clause (A), (B) or (C)
below the Company or any of its Subsidiaries shall amend the terms of such
acquisition with respect to the consideration payable by the Company or any of
its Subsidiaries in connection with such acquisition, the Transaction Date shall
be the earlier of (A) the date on which the Company or any of its Subsidiaries
enters into a binding written agreement with such Person to effect such
acquisition on such amended terms, (B) the date on which the Company or any of
its Subsidiaries makes a public announcement of any offer or proposal to effect
such acquisition on such amended terms and (C) the date on which the Company or
any of its Subsidiaries first makes a filing disclosing such amended terms with
the SEC or the Federal Trade Commission in connection with any proposed
acquisition.
"TRUSTEE" means the party named as such above unless and until a
successor replaces it in accordance with the terms of this Indenture and
thereafter means such successor.
"TRUST OFFICER," when used with respect to the Trustee, means any
officer within the Corporate Trust Department (or any successor group) of the
Trustee, including without limitation any Vice President, Assistant Vice
President, Secretary or any other officer customarily performing functions
similar to those performed by any of the above-designated officers who shall, in
any case, be responsible for the administration of this Indenture or have
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familiarity with it, and also means, with respect to a particular corporate
trust matter, any other officer of the Trustee to whom such matter is referred
because of his knowledge of and familiarity with the particular subject.
"VOTING STOCK" means any class or classes of Capital Stock pursuant to
which the holders thereof have the general voting power under ordinary
circumstances to vote for the election of directors, managers or trustees of any
Person (irrespective of whether or not at the time stock of any class or classes
will have or might have voting power by the reason of the happening of any
contingency).
(b) ACCOUNTING TERMS. Unless otherwise specified herein, all
accounting terms herein shall be interpreted, all accounting determinations
shall be made, and all financial statements required to be delivered hereunder
shall be prepared in accordance with GAAP.
SECTION 1.02. OTHER DEFINITIONS.
Term Defined in Section
"Authenticating Agent" 6.12
"Custodian" 5.01
"Discharged" 7.01
"Event of Default" 5.01
"Exchange Act" 3.07
"Legal Holiday" 10.07
"Paying Agent" 2.03
"Registrar" 2.03
"Repayment Date" 4.01
"Repurchase Date" 3.06
"U.S. Government Obligations" 7.01
SECTION 1.03. INCORPORATION BY REFERENCE OF
TRUST INDENTURE ACT.
Whenever this Indenture refers to a provision of the TIA, the provision is
incorporated by reference in and made a part of this Indenture.
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The following TIA terms used in this Indenture have the following meanings:
"indenture securities" means the Securities;
"indenture security holder" means a Holder;
"indenture to be qualified" means this Indenture;
"indenture trustee" or "institutional trustee" means the Trustee;
"obligor" on the Securities means the Company.
All other terms used in this Indenture that are defined by the TIA, defined
by TIA reference to another statute or defined by SEC rule under the TIA have
the meanings assigned to them thereby.
SECTION 1.04. RULES OF CONSTRUCTION.
Unless the context otherwise requires:
(a) a term has the meaning assigned to it;
(b) an accounting term not otherwise defined has the meaning assigned to it
in accordance with generally accepted accounting principles in effect on the
date of the construction of such term;
(c) "OR" is not exclusive;
(d) words in the singular include the plural, and in the plural include the
singular; and
(e) provisions apply to successive events and transactions.
ARTICLE 2.
THE SECURITIES
SECTION 2.01. FORM AND DATING.
The Securities shall be substantially in the form of Exhibit A, which is
part of this Indenture. The Securities may have notations, legends or
endorsements required by law, stock exchange rule or usage. If determined to be
necessary by the Company or its counsel, the Company may require that a legend
be placed on the Securities relating to original issue discount or other
applicable tax matters or as required by any
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securities exchange on which the Securities may be listed. The Company shall
furnish any such legend in writing to the Trustee. Each Security shall be dated
the date of its authentication.
SECTION 2.02. EXECUTION AND AUTHENTICATION.
The Securities shall be signed for the Company by the Company's President
or a Vice President and shall be attested by the Company's Secretary or an
Assistant Secretary, in each case by manual or facsimile signature. The
Company's seal shall be reproduced on the Securities.
If an Officer whose signature is on a Security no longer holds that
office at the time the Security is authenticated, the Security shall
nevertheless be valid.
A Security shall not be valid until authenticated by the manual
signature of the Trustee. The signature shall be conclusive evidence that the
Security has been authenticated under this Indenture.
The Trustee shall authenticate Securities for original issue up to
$595,475,922 upon a written order of the Company signed by two Officers. The
aggregate principal amount of Securities outstanding at any time may not exceed
the amount of $595,475,922 except as provided in Section 2.07. Such order shall
specify the amount of the Securities to be authorized and the date or dates upon
which the original issue of Securities is to be authenticated.
The Trustee may appoint an Authenticating Agent acceptable to the
Company to authenticate Securities. An Authenticating Agent may authenticate
Securities whenever the Trustee may do so. Each reference in this Indenture to
authentication by the Trustee includes authentication by such agent. An
Authenticating Agent has the same rights as an Agent to deal with the Company or
an Affiliate.
The Securities shall be issuable in denominations of $1,000 and any
integral multiples thereof.
SECTION 2.03. REGISTRAR AND PAYING AGENT.
The Company shall maintain an office or agency where Securities may be
presented for registration of transfer or for exchange ("Registrar") and an
office or agency where Securities may be presented for payment ("Paying Agent").
The Registrar shall keep a register of the Securities and of their transfer and
exchange. The Company may appoint one or more co-Registrars and one or more
additional Paying Agents. The term Paying Agent includes any additional Paying
Agent. The
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Company or any of its Subsidiaries may act as Paying Agent,
Registrar or co-Registrar. Upon any bankruptcy or reorganization proceeding
relative to the Company, the Trustee shall serve as the Paying Agent.
The Company shall enter into an appropriate agency agreement with any
Agent not a party to this Indenture that shall implement the provisions of this
Indenture that relate to such Agent. The Company shall give prompt written
notice to the Trustee of the name and address of any such Agent and any change
in the address of such Agent. If the Company fails to maintain a Registrar or
Paying Agent, the Trustee shall act as such. The Company initially appoints the
Trustee as Paying Agent and Registrar.
SECTION 2.04. PAYING AGENT TO HOLD MONEY IN TRUST.
The Company shall require each Paying Agent other than the Trustee to
execute and deliver to the Trustee an instrument in which such Paying Agent
shall agree that such Paying Agent will:
(a) hold all sums held by it for the payment of the principal of,
premium, if any, or interest on the Securities in trust for the benefit of
the Persons entitled thereto until such sums shall be paid to such Persons
or otherwise disposed of as herein provided;
(b) give the Trustee notice of any default by the Company (or any
other obligor upon the Securities) in the making of any payment of
principal, premium, if any, or interest; and
(c) at any time during the continuance of any such default, upon the
written request of the Trustee, forthwith pay to the Trustee all sums so
held in trust by such Paying Agent.
Upon such payment over to the Trustee, the Paying Agent shall have no further
liability for such money.
If the Company or any of its Subsidiaries acts as Paying Agent, it
shall comply with the requirements of Section 3.17 of this Indenture.
SECTION 2.05. HOLDER LISTS.
The Trustee shall preserve in as current a form as is reasonably
practicable the most recent list available to it of the names and addresses of
Holders. If the Trustee is not the Registrar, the Company shall furnish to the
Trustee not less than ten days before each interest payment date and at
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such other times as the Trustee may request in writing all information in the
possession or control of the Company or any Paying Agent as to the names and
addresses of the Holders, in such form and as of such date as the Trustee may
reasonably require.
SECTION 2.06. TRANSFER AND EXCHANGE.
When Securities are presented to the Registrar or a co-Registrar with
a request to register the transfer of, or to exchange them for an equal
principal amount of Securities of other authorized denominations, the Registrar
shall register the transfer or make the exchange provided that every Security
presented or surrendered for registration of transfer or exchange shall be duly
endorsed, or be accompanied by a written instruction of transfer in form
acceptable to the Registrar duly executed by the Holder thereof or his attorney
duly authorized in writing and its requirements for such transactions are met.
To permit registrations of transfer and exchanges, the Company shall issue and
the Trustee shall authenticate Securities at the Registrar's request.
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.
The Company shall not be required (i) to issue, register the transfer
of or exchange Securities during a period beginning at the opening of business
15 days before the day of any selection of Securities for redemption under
Section 9.02 and ending at the close of business on the day of such day of
selection, or (ii) 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.
SECTION 2.07. REPLACEMENT 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 like tenor and principal amount and bearing a number
not contemporaneously outstanding.
If the Holder of a Security claims that the Security has been lost,
destroyed or wrongfully taken, the Company shall issue and the Trustee shall
authenticate a replacement Security if the Trustee's requirements are met,
provided that the Trustee shall not be required to authenticate or replace any
such Security which has been called for redemption. If
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required by the Trustee or the Company, such Holder shall provide an indemnity
bond sufficient in the judgment of both the Company and the Trustee to protect
the Company, the Trustee, any Agent or any Authenticating Agent from any loss
which any of them may suffer if a Security is replaced. The Company may charge
the Holder for its expenses in replacing a Security.
Every replacement Security issued pursuant to the provisions of this
Section 2.07 by virtue of the fact that any Security is destroyed, lost or
stolen shall constitute an additional contractual obligation of the Company,
whether or not the destroyed, lost or stolen Security shall be found at any
time, and shall be entitled to all the benefits of this Indenture equally and
proportionally with any and all other Securities duly issued hereunder.
SECTION 2.08. OUTSTANDING SECURITIES.
The Securities outstanding at any time are all the Securities
authenticated by the Trustee except for (a) those canceled by it, (b) those
delivered to it for cancellation and (c) those described in this Section as not
outstanding.
If a Security is replaced pursuant to Section 2.07, it ceases to be
outstanding unless the Trustee receives proof satisfactory to it that the
replaced Security is held by a bona fide purchaser.
If Securities are considered paid under Section 3.01, they cease to be
outstanding and interest on them ceases to accrue.
Except as provided in Section 2.09, a Security does not cease to be
outstanding because the Company or an Affiliate holds the Security.
SECTION 2.09. TREASURY SECURITIES.
In determining whether the Holders of the required principal amount of
Securities have concurred in any direction, waiver or consent, Securities owned
by the Company or an Affiliate shall be considered as though they are not
outstanding, except that for the purposes of determining whether the Trustee
shall be protected in relying on any such direction, waiver or consent, only
Securities which the Trustee actually knows are so owned shall be so considered.
SECTION 2.10. TEMPORARY SECURITIES.
Until definitive Securities are ready for delivery, the Company may
prepare and the Trustee shall authenticate
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temporary Securities. Temporary Securities shall be substantially in the form
of definitive Securities but may have variations that the Company considers
appropriate for temporary Securities. Without unreasonable delay, the Company
shall prepare and deliver to the Trustee, and the Trustee shall authenticate,
definitive Securities in exchange for temporary Securities.
SECTION 2.11. CANCELLATION.
The Company at any time may deliver Securities to the Trustee for
cancellation. The Registrar and the Paying Agent shall forward to the Trustee
any Securities surrendered to them for registration of transfer, exchange or
payment. The Trustee shall cancel all Securities surrendered for registration
of transfer, exchange, payment, replacement or cancellation and shall, upon the
request of the Company, destroy canceled Securities and deliver a certificate of
such destruction to the Company. Subject to Section 2.07, the Company may not
issue new Securities to replace Securities that it has paid or that have been
delivered to the Trustee for cancellation.
SECTION 2.12. DEFAULTED INTEREST.
If the Company fails to make a payment of interest on the Securities,
it shall pay such interest thereafter in any lawful manner. It may pay such
interest, plus any interest payable on such interest, to the Persons who are
Holders on a subsequent special record date. The Company shall fix in a manner
satisfactory to the Trustee such special record date and payment date, except
for a payment of interest made within the 30-day period referred to in paragraph
(i) of Section 5.01 of this Indenture which may be paid to the holders of the
Securities on the regular record date for such interest payment. Such special
record date shall not be less than 10 days prior to the payment date of such
defaulted interest. The Company shall notify the Trustee, in a writing delivered
to the Trustee, of the amount of defaulted interest proposed to be paid on
each Security and the date of the proposed payment, and at the same time, the
Company shall deposit with the Trustee an amount of money equal to the
aggregate amount proposed to be paid in respect of such defaulted interest or
shall make arrangements satisfactory to the Trustee for such deposit prior to
the date of the proposed payment, such money, when deposited, to be held in
trust for the benefit of the Person entitled to such defaulted interest as
provided in this section. At least 5 days before such
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special record date, the Company shall deliver to the Trustee and mail to
Holders a notice that states the special record date, payment date, and amount
of such interest to be paid.
ARTICLE 3
.
COVENANTS
SECTION 3.01. PAYMENT OF SECURITIES.
The Company shall punctually pay the principal of and interest on the
Securities on the dates and in the manner provided in the Securities.
Principal, premium, if any, and interest shall be considered paid on the date
due if the Paying Agent has received by 10:00 a.m. New York City time on that
date immediately available funds designated for and sufficient to pay all
principal and interest then due.
The Company shall pay interest on overdue principal and premium, if
any, at the rate borne by the Securities; it shall pay interest on overdue
installments of interest at the same rate to the extent permitted by law.
SECTION 3.02. LIMITATION ON RESTRICTED PAYMENTS.
(a) The Company shall not, nor shall it permit any of its
Subsidiaries to, make any Restricted Payment (other than Investments in (i)
Affiliates which are not wholly-owned Subsidiaries in an aggregate amount not to
exceed $20 million at any time outstanding and (ii) Borrowing Subsidiaries in an
aggregate amount at any time outstanding not to exceed the sum of (x) $30
million less (y) the aggregate amount of outstanding Investments in Affiliates
which are not wholly-owned Subsidiaries permitted by clause (i) hereof) if,
after giving effect thereto:
(A) any Default shall have occurred and be continuing, or
(B) the Company could not incur at least $1.00 of additional
Indebtedness pursuant to Section 3.03(a) of this Indenture, or
(C) the aggregate amount of Restricted Payments made subsequent
to the date of this Indenture by the Company and its Subsidiaries (other than
(i) Investments in Affiliates which are not wholly-owned Subsidiaries in an
amount not to exceed $20 million in the aggregate and (ii) Investments in
Borrowing Subsidiaries in an aggregate amount not to exceed the sum of (x) $30
million less (y) the aggregate amount of outstanding Investments in Affiliates
which are not
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wholly-owned Subsidiaries permitted by clause (i) of the first paragraph of this
Section 3.02(a)) would exceed the sum of (a) 50% (or minus 100% in the event of
a deficit) of aggregate Consolidated Net Income (which is defined to exclude the
impact of any Fresh Start Accounting adjustment and any extraordinary income,
including income relating to cancellation of indebtedness resulting from the
Restructuring) of the Company for the period commencing on April 2, 1995 and
ending on the last day of the fiscal quarter immediately preceding the date of
such payment, and (b) the aggregate Net Proceeds, including cash and the Fair
Market Value of Property other than cash, received by the Company subsequent to
the Issue Date from capital contributions from any of its stockholders or from
the issuance or sale (other than to a Subsidiary) subsequent to the Issue Date
of shares of its Capital Stock (other than Redeemable Stock) of any class (or
rights or warrants to subscribe for or purchase shares of such capital stock) or
of any convertible securities or debt obligations which have been converted
into, exchanged for or satisfied by the issuance of shares of the Company's
Capital Stock (other than Redeemable Stock).
(b) The provisions of this Section 3.02 shall not prevent the Company
from (i) paying a dividend on Capital Stock within 60 days after the declaration
thereof if, on the date on which the dividend was declared, the Company could
have paid such dividend in accordance with the provisions of this Indenture, or
(ii) repurchasing shares of its Capital Stock (X) solely in exchange for other
shares of its Capital Stock (other than Redeemable Stock) or (Y) pursuant to a
court order.
(c) The provisions of this Section 3.02 shall not prevent redemptions
or repurchases of the Company's common stock in connection with repurchase
provisions under employee stock option or stock purchase agreements or other
agreements to compensate management employees, PROVIDED that such redemptions or
purchases shall not exceed $2,000,000 in any Fiscal Year or $5,000,000 in the
aggregate subsequent to the date hereof.
(d) Payments made in purchase, redemption, defeasance or other
acquisition or retirement for value of Subordinated Debt must meet the tests set
forth in paragraph (a) of this Section 3.02 except to the extent that any such
purchase, redemption, defeasance or other acquisition or retirement for value is
made out of the proceeds of the issuance of (i) Subordinated Debt having a final
maturity no earlier than the final maturity of, and an Average Life equal to or
longer than, the Indebtedness being retired or repurchased or (ii) Capital Stock
(other than Redeemable Stock) of the Company.
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SECTION 3.03. LIMITATION ON INDEBTEDNESS.
(a) The Company shall not create, incur, assume, guarantee or
otherwise become liable with respect to, or become responsible for the payment
of, any Indebtedness, unless, after giving effect thereto, the Consolidated
Interest Coverage Ratio of the Company on a pro forma basis for the four
consecutive fiscal quarters for which financial information in respect thereof
is available immediately prior to any Transaction Date that is prior to
September 1, 1997 would be greater than 1.85:1 and for any Transaction Date
thereafter would be greater than 2.0:1.
(b) Notwithstanding the foregoing, the Company may incur, create,
assume, guarantee or otherwise become liable with respect to, any or all of the
following Indebtedness:
(i) Indebtedness evidenced by the Securities, and Indebtedness under
the Bank Credit Agreement (including any refinancings thereof permitted by
clause (ii) of this Section 3.03(b)) in a maximum principal amount at any
time outstanding not to exceed the greater of (x) $250 million or (y) the
sum of $100 million plus 65% of the total inventory of the Company and its
Subsidiaries (calculated on a "first-in" "first-out" basis) plus 85% of the
total accounts receivable of the Company and its Subsidiaries, subject to
one or more permanent reductions of both (x) and (y) as provided in clause
(iii) of Section 3.05 and the proviso set forth in the second paragraph of
Section 3.06(a);
(ii) Indebtedness the proceeds of which are used to refinance (x) all
or a portion of the Indebtedness evidenced by the Securities, or (y)
Indebtedness under the Bank Credit Agreement (as limited by clause (i) of
this Section 3.03(b)) or (z) other Indebtedness of the Company and of its
Subsidiaries, in each case in a principal amount not to exceed the
principal amount so refinanced (or, if such Indebtedness provides for an
amount less than the principal amount thereof to be due and payable upon a
declaration of acceleration of the maturity thereof, in an amount not
greater than such lesser amount) plus any prepayment penalties and
premiums, accrued and unpaid interest on the Indebtedness so refinanced,
plus customary fees, expenses and costs related to the incurrence of such
refinancing Indebtedness, PROVIDED that, in the case of this clause (ii),
(1) if the Securities are refinanced in part, such new
Indebtedness is expressly made pari passu or subordinate in right of
payment to the remaining Securities,
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(2) if the Indebtedness to be refinanced is subordinate in right
of payment to the Securities, such new Indebtedness is subordinate in
right of payment to the Securities at least to the extent that the
Indebtedness to be refinanced is subordinate in right of payment to
the Securities,
(3) if the Indebtedness to be refinanced is pari passu in right
of payment to the Securities, such new Indebtedness is expressly made
pari passu or subordinate in right of payment to the Securities, and
(4) if the Securities are refinanced in part or if the
Indebtedness to be refinanced is pari passu or subordinate in right of
payment to the Securities and scheduled to mature after the maturity
date of the Securities, such new Indebtedness as of the date of
incurrence does not mature prior to the final scheduled maturity date
of the Securities and has an Average Life equal to or greater than the
remaining Average Life of the Securities;
(iii) Indebtedness of the Company remaining outstanding immediately
after the issuance of the Securities;
(iv) Indebtedness to a Subsidiary of the Company;
(v) Indebtedness incurred in connection with the refurbishment,
improvement, construction or acquisition (whether by acquisition of stock,
assets or otherwise) of any Property or Properties of the Company or of any
Subsidiary that constitute a part of the then present business of the
Company or of any Subsidiary (or incurred within twelve months of any such
acquisition or the completion of such refurbishment, improvement or
construction), PROVIDED THAT at the time of the incurrence thereof:
(a)(1) such Indebtedness, together with any other then
outstanding Indebtedness incurred during the most recently completed
four consecutive fiscal quarter period in reliance upon either this
clause (v) or clause (vi) of Section 3.09 hereof does not exceed, in
the aggregate, 3% of consolidated net sales of the Company and its
Subsidiaries during the four consecutive fiscal quarter period ended
immediately prior to the date of calculation; provided, that for
purposes of this clause (a)(1), such Indebtedness shall include,
without limitation, an
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amount equal to (x) the aggregate outstanding principal amount of any
mortgages that the Company or any Subsidiary is deemed to have entered
into in connection with any Sale and Leaseback Transaction that the
Company or any Subsidiary has entered into during the four consecutive
fiscal quarter period ended immediately prior to the date of
calculation, less (y) the aggregate principal amount of any Senior
Indebtedness that has been repaid with the Net Proceeds of any Sale
and Leaseback Transaction that the Company or any Subsidiary has
entered into within twelve months of the acquisition, or completion of
construction or refurbishment, of the Property that is the subject of
any such transaction; and
(2) such Indebtedness, together with all then outstanding Indebtedness
incurred in reliance upon either this clause (v) or clause (vi) of
Section 3.09 hereof does not exceed, in the aggregate, 3% of the
consolidated net sales of the Company and its Subsidiaries during the
most recently completed twelve consecutive fiscal quarter period;
provided that, for purposes of this clause (a)(2), such Indebtedness
shall include, without limitation, an amount equal to (x) the
aggregate outstanding principal amount of any mortgages that the
Company or any Subsidiary is deemed to have entered into in connection
with any Sale and Leaseback Transactions to which the Company or any
Subsidiary is then a party less (y) the aggregate principal amount of
any Senior Indebtedness that has been repaid with the Net Proceeds of
any Sale and Leaseback Transaction that the Company or any Subsidiary
has entered into within twelve months of the acquisition, or
completion of construction or refurbishment, of the Property that is
the subject of any such transaction; except that, for purposes of
calculating the limitation set forth in clause (a)(2) the seven Sale
and Leaseback Transactions identified in clause (ii) of Section 3.05
hereof shall not be included; or
(b) such Indebtedness (including an amount equal to the sum of (x) the
aggregate outstanding principal amount of any mortgages that the
Company or any Subsidiary is deemed to have entered into in connection
with any Sale and Leaseback
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Transaction to which the Company or any Subsidiary is then a party
less (y) the aggregate principal amount of any Senior Indebtedness
that has been repaid with the Net Proceeds of any Sale and Leaseback
Transaction) does not exceed the amount of proceeds received by the
Company or any of its Subsidiaries from insurance policies maintained
by the Company or any Subsidiary in respect of such Property or
Properties;
(vi) Indebtedness consisting of Guarantees by the Company of
Indebtedness of any Subsidiary, provided that such Indebtedness is
otherwise permitted under this Indenture;
(vii) Indebtedness under Interest Swap Obligations, PROVIDED that such
Interest Swap Obligations are related to payment obligations on
Indebtedness otherwise permitted under this Section 3.03;
(viii) commercial letters of credit and standby letters of credit
incurred in the ordinary course of business by the Company;
(ix) Indebtedness represented by industrial revenue or development
bonds, provided that the aggregate amount of Indebtedness incurred in
reliance upon the exception of this clause (ix) or of clause (x) of Section
3.09 shall not exceed at any one time an aggregate principal amount
outstanding of $25,000,000;
(x) Capitalized Lease Obligations relating to Property used in the
business of the Company;
(xi) Indebtedness incurred in respect of performance bonds and
performance and completion Guarantees incurred in the ordinary course of
business;
(xii) Indebtedness arising from the honoring by a bank or other
financial institution of a check, draft or similar instrument inadvertently
(except in the case of daylight overdrafts) drawn against insufficient
funds in the ordinary course of business, PROVIDED that such Indebtedness
is extinguished within five Business Days from the date of its incurrence;
and
(xiii) other Indebtedness for borrowed money in an amount not to exceed
$75,000,000 in the aggregate.
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SECTION 3.04. LIMITATION ON LIENS.
Neither the Company nor any Subsidiary shall create, incur, assume or
permit to exist any Lien on or with respect to any Property or assets of the
Company or of any Subsidiary or any interest therein or any income or profits
therefrom, other than:
(i) any Lien existing as of the date of this Indenture and any Lien
securing Indebtedness under the Bank Credit Agreement pursuant to the terms
of such Bank Credit Agreement as in effect on the Issue Date;
(ii) any Lien arising in the ordinary course of business, other than
in connection with Indebtedness for borrowed money;
(iii) any Lien on the Company's or a Subsidiary's accounts receivable,
inventories, and proceeds thereof securing Indebtedness incurred pursuant
to the provisions of the Revolving Credit Facility;
(iv) any Lien on Property acquired by the Company or by any Subsidiary
after the date of this Indenture created solely to secure Indebtedness
incurred to finance such acquisition or assumed in connection with such
acquisition, whether by acquisition of stock, assets or otherwise (or
entered into in connection with Indebtedness that is permitted under clause
(v) of Section 3.03(b) or clause (vi) of Section 3.09), PROVIDED that in
each case such acquisition does not constitute a Material Acquisition;
(v) any Lien on Property acquired by the Company or any Subsidiary
which constitutes a Material Acquisition created solely to secure
Indebtedness incurred to finance such Material Acquisition or assumed in
connection with such Material Acquisition, PROVIDED that after giving
effect to such Indebtedness the Consolidated Interest Coverage Ratio would
be greater than the then applicable Consolidated Interest Coverage Ratio
described in Section 3.03(a) above;
(vi) any Lien on any asset of the Company or any Subsidiary created
solely to secure Indebtedness incurred to finance the refurbishment,
improvement, construction or acquisition (whether by acquisition of stock,
assets or otherwise) of such asset (or created within twelve months of any
such acquisition or the completion of such refurbishment, improvement or
construction) or relating to Indebtedness assumed in connection with any
such acquisition, PROVIDED that such Lien secures Indebtedness
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permitted under clause (v) of Section 3.03(b), or clause (vi) of Section
3.09;
(vii) any Lien created in connection with a Capitalized Lease
Obligation that the Company or a Subsidiary is permitted to enter into
under the terms of this Indenture;
(viii) any Lien relating to judgments or awards that the Company or any
Subsidiary is contesting in good faith;
(ix) any Lien for taxes that are not yet due or that the Company or
any Subsidiary is contesting in good faith; and
(x) any Lien extending, renewing or replacing any Liens permitted by
clauses (i), (iv), (v), (vi) or (vii).
In the case of Liens permitted under clauses (i), (iv), (v), (vi), (vii) and
(x), such Liens may relate solely to the Property (including any improvements
thereon) subject thereto as of the date of this Indenture or the date such Lien
was incurred, as the case may be (and, in the case of Indebtedness under the
Bank Credit Agreement, any after acquired Property), and may secure the payment
only of the Indebtedness so secured as of such date.
SECTION 3.05. Limitation on Sale and Leaseback
TRANSACTIONS.
The Company shall not, and shall not permit any Subsidiary to, enter
into, assume, guarantee or otherwise become liable with respect to any Sale and
Leaseback Transaction, PROVIDED, that the Company may enter into:
(i) a Sale and Leaseback Transaction that, had such Sale and
Leaseback Transaction been structured as a mortgage rather than as a Sale
and Leaseback Transaction, the Company would have been permitted to enter
into such transaction pursuant to clause (v) of Section 3.03(b), clause
(vi) of Section 3.04 and clause (vi) of Section 3.09, PROVIDED, HOWEVER,
that such Sale and Leaseback Transaction is entered into within twelve
months of the acquisition, or completion of construction or refurbishment,
of the Property that is the subject of any such transactions;
(ii) a Sale and Leaseback Transaction with respect to the Company's
Property located in New Fairfield, Connecticut, Dumont, New Jersey,
Valatie, New York,
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Morrisville, Vermont, Corinth, New York, Tannersville, New York and
Manchester Center, Vermont; and
(iii) a Sale and Leaseback Transaction if within 90 days of entering
into such arrangement either (1) the Company applies the Net Proceeds of
the sale of the Property leased pursuant to such Sale and Leaseback
Transaction to the payment of Senior Indebtedness other than Indebtedness
incurred under the Bank Credit Agreement (except that Indebtedness under
the Bank Credit Agreement may be repaid from such Net Proceeds to the
extent the principal amount of Indebtedness under the Bank Credit Agreement
permitted by Section 3.03(b) is permanently reduced by an amount equal to
the principal amount of the Indebtedness under the Bank Credit Agreement so
repaid from Net Proceeds) or (2)(a) if such arrangement is entered into
prior to September 1, 2000, the Company makes a pro rata offer to all
Holders of Securities to repurchase Securities at 104% of their principal
amount, plus accrued and unpaid interest through the date of repurchase, or
(b) if such arrangement is entered into on or after September 1, 2000, the
Company redeems the Securities, in either case at par plus the then
applicable premium, if any, and in an aggregate amount equal to the greater
of the Net Proceeds of the sale of the Property leased pursuant to such
Sale and Leaseback Transaction or the Fair Market Value of the Property so
leased at the time of entering into such Sale and Leaseback Transaction.
SECTION 3.06. LIMITATION ON ASSET SALES.
(a) The Company shall not consummate, and shall not permit any
Subsidiary to consummate, any Asset Sale unless (i) such sale is for Fair Market
Value and (ii) at least 75% of the Net Proceeds thereof received by the Company
or such Subsidiary is in the form of cash; PROVIDED, that for purposes of this
covenant securities received by the Company or any Subsidiary from such
transferee that are promptly converted by the Company or such Subsidiary into
cash shall be deemed to be cash, and provided further, that notwithstanding any
other provision in this paragraph, the Company or any Subsidiary may consummate
Asset Sales for which it receives, in a single transaction or in a series of
related transactions, aggregate Net Proceeds in an amount not to exceed
$25,000,000 without regard to the foregoing limitation on receiving a specified
percentage of the Net Proceeds in cash.
To the extent the Company or such Subsidiary has not reinvested such
Net Proceeds in Additional Assets or used such Net Proceeds to repay Senior
Indebtedness (other than the Securities) within twelve months following the
consummation of
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the Asset Sale (or in the case of Net Proceeds received in the form of
securities, within twelve months after such securities are converted into cash),
the Company shall, not later than ten (10) days after the expiration of such
twelve months, either apply such Net Proceeds (or any portion thereof) to the
repayment of such Senior Indebtedness or commence an offer to repurchase the
Securities to which such Net Proceeds (or the remaining portion thereof) shall
be applied (such offer to repurchase to be made on the terms described in the
following paragraph); PROVIDED, HOWEVER, that if Net Proceeds of Asset Sales are
applied to reduce the Indebtedness under the Bank Credit Agreement (or any
refinancing or renewal thereof), the principal amount of Indebtedness under the
Bank Credit Agreement permitted by Section 3.03(b) shall be reduced permanently
by an amount equal to the principal amount of the Indebtedness under the Bank
Credit Agreement so repaid from Net Proceeds.
If (1) no Senior Indebtedness other than the Securities is outstanding
at such time or the Company does not apply any or applies only a portion of such
Net Proceeds to the repayment of Senior Indebtedness other than the Securities
or (2) the application of such Net Proceeds results in the payment of all
outstanding Senior Indebtedness other than the Securities, then such Net
Proceeds or any remaining portion thereof, in each case not so applied to the
reinvestment in Additional Assets or the payment of Senior Indebtedness other
than the Securities, shall, except as otherwise provided in this Indenture, be
applied to a pro rata offer to all Holders of Securities to repurchase the
Securities at a purchase price in cash equal to 102% of their principal amount
plus accrued and unpaid interest through the Repurchase Date. Not less than
twenty (20) nor more than sixty (60) Business Days prior to the Repurchase Date,
the Company shall give Holders prior written notice of such right of repurchase,
mailed by first class mail to the Holders' last addresses as they appear upon
the register. Such notice shall state: (i) that Holders are entitled to have
their Securities repurchased in whole or in part at 102% of their principal
amount plus accrued and unpaid interest through the Repurchase Date, (ii) the
date of repurchase (the "Repurchase Date"), (iii) the name and address of the
Paying Agent, (iv) that the Securities must be tendered to the Paying Agent by
five Business Days prior to the Repurchase Date to collect the principal,
premium and accrued interest thereon, (v) that any Security not tendered
by five Business Days prior to the Repurchase Date shall continue to accrue
interest at the applicable rate borne by the Security, (vi) that any Security
accepted for payment shall cease to accrue interest after the Repurchase Date,
(vii) that Holders electing to have a Security repurchased shall be required to
surrender the Security, with the form entitled "Option of
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Holder to Elect Repurchase" on the reverse of the Security completed, to the
Paying Agent at the address specified in the notice on or prior to the close of
business on the fifth Business Day preceding the Repurchase Date, (viii) that
Holders shall be entitled to withdraw their election if the Paying Agent
receives, not later than the close of business on the fifth Business Day
preceding the Repurchase Date, a telegram, telex, facsimile transmission or
letter setting forth the name of the Holder, the principal amount of Securities
the Holder delivered for repurchase, the certificate number(s) of the Securities
the Holder delivered for repurchase and a statement that such Holder is
withdrawing his election to have such Securities repurchased, (ix) that, if the
aggregate repurchase price of the Securities surrendered exceeds the available
Net Proceeds, the Company shall select the Securities to be purchased on pro
rata basis (with such adjustment as may be deemed appropriate by the Company so
that only Securities in denominations of $1,000 or multiples thereof shall be
purchased); (x) that Holders whose Securities are purchased in part shall be
issued new Securities equal in principal amount to the unpurchased portion of
the Securities surrendered; and (xi) any other information necessary to enable
Holders to tender Securities and have such Securities repurchased pursuant to
this Section. Notwithstanding the foregoing, in the event the Net Proceeds
resulting from any Asset Sale, after giving effect to any related repayment of
Senior Indebtedness other than Securities and any reinvestment in Additional
Assets are less than $25,000,000, the Company may defer extending such pro rata
offer to repurchase Securities until such time as such Net Proceeds, plus the
aggregate amount of Net Proceeds resulting from any subsequent Asset Sale or
Asset Sales not otherwise reinvested in Additional Assets or applied to repay
Senior Indebtedness other than Securities, are equal to at least $25,000,000, at
which time the Company shall apply the aggregate amount of such Net Proceeds to
a pro rata offer to repurchase the Securities at a purchase price in cash equal
to 102% of their principal amount, plus accrued and unpaid interest through the
date of repurchase.
(b) Pending the application thereof in accordance with paragraph (a)
of this Section, the Company shall either apply the Net Proceeds of any Asset
Sale to repay temporarily any Senior Indebtedness other than the Securities or
invest such Net Proceeds in Qualified Investments.
SECTION 3.07. SEC REPORTS.
(a) The Company shall deliver to the Trustee within 5 days after
filed with the SEC, copies of the annual, quarterly and periodic reports and of
the information, documents and other reports (or copies of such portions of any
of the foregoing as the SEC may by rules and regulations
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prescribe) which the Company files with the SEC pursuant to Sections 13 and
15(d) of the Securities Exchange Act of 1934, as amended (the "Exchange Act").
Whether or not required by the rules and regulations of the SEC, as long as any
Securities are outstanding, the Company shall continue to file with the SEC for
public availability (unless the SEC will not accept such a filing) and the
Trustee on the same timely basis such reports, information and other documents
as the Company would be required to file with the SEC if the Company were
subject to the requirements of such Section 13 or 15(d) of the Exchange Act and
had a class of securities listed on a national securities exchange. The Company
also will make such information available to Holders who request it in writing
and shall comply with the other provisions of TIA Section 314(a).
(b) So long as any of the Securities remain outstanding, the Company
shall cause any annual report to stockholders and any quarterly or other
financial reports furnished by it to stockholders, excluding internal management
reports and distributions to stockholders in their capacity as directors or
officers of the Company, to be filed with the Trustee and mailed to the Holders
at their addresses appearing in the register of Securities maintained by the
Registrar within 5 days after having been provided to stockholders. If the
Company is not required to furnish annual or quarterly reports to its
stockholders pursuant to the Exchange Act, the Company shall cause its
consolidated financial statements, including any notes thereto, and with respect
to the annual information only, a report thereon by the Company's certified
independent accountants, and a "Management's Discussion and Analysis of
Financial Condition and Results of Operations," comparable to that which would
have been required to appear in annual or quarterly reports filed under Section
13 or 15(d) of the Exchange Act if the Company had a class of securities listed
on a national securities exchange, to be so filed with the Trustee and mailed to
the Holders at their addresses appearing in the register of Securities
maintained by the Registrar within 100 days after the end of each Fiscal Year
and within 60 days after the end of each of the Company's first three fiscal
quarters in each Fiscal Year. The Company shall advise the Trustee promptly in
writing of any change of its Fiscal Year, provided that a failure by the Company
to advise the Trustee of such change shall not affect the effectiveness of such
change.
(c) The Company shall furnish to Holders and to beneficial owners of
Securities and to prospective purchasers of Securities that are designated by
Holders, upon their request, the information required to be delivered pursuant
to Rule 144(A)(d)(4) under the Securities Act of 1933, as amended.
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SECTION 3.08. LIMITATION ON PAYMENT RESTRICTIONS
AFFECTING SUBSIDIARIES.
The Company shall not, and shall not permit any Subsidiary to, create
or otherwise cause or suffer to exist or become effective any consensual
encumbrance or restriction that by its terms expressly restricts the ability of
any Subsidiary to:
(a) pay dividends or make any other distributions on such Subsidiary's
capital stock or pay any Indebtedness owed to the Company or any Subsidiary,
(b) make any loans or advances to the Company or any Subsidiary, or
(c) transfer any of its Property to the Company or any Subsidiary,
other than, with respect to clauses (b) and (c) of this Section, encumbrances or
restrictions specifically:
(i) permitted under the terms of any instrument or agreement relating
to any Indebtedness of the Company or any Subsidiary existing on the date
of this Indenture, including, without limitation, this Indenture or the
Bank Credit Agreement;
(ii) relating to any Property acquired by the Company or any of its
Subsidiaries after the date of this Indenture, provided that such
encumbrance or restriction relates only to the Property which is acquired,
and, in the case of any encumbrance or restriction that constitutes a Lien,
the Company or such Subsidiary would be permitted to incur the Lien under
Section 3.04 of this Indenture;
(iii) relating to (x) any industrial revenue or development bonds, (y)
any obligation of the Company or any Subsidiary incurred in the ordinary
course of business to pay the purchase price of Property acquired by the
Company or such Subsidiary, or (z) any lease of Property by the Company or
such Subsidiary in the ordinary course of business, provided that such
encumbrance or restriction relates only to the Property which is the
subject of such industrial revenue or development bond, such Property
purchased or such Property leased and any such lease, as the case may be;
(iv) relating to any Indebtedness of any Subsidiary at the date of
acquisition of such Subsidiary by the Company or any Subsidiary of the
Company, provided that
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such Indebtedness was not incurred in connection with or in anticipation of
such acquisition and, provided further that the Company or Subsidiary would
be permitted to incur any Lien securing such Indebtedness under Section
3.04 of this Indenture; or
(v) under any replacement or refinancing agreements of instruments
referred to in clauses (i), (ii) and (iii), provided that the provisions
relating to such encumbrance or restriction contained in any such
replacement or refinancing agreement or instrument are no more restrictive
than the provisions relating to such encumbrance or restriction contained
in such original agreement or instrument.
SECTION 3.09. LIMITATION ON INDEBTEDNESS AND PREFERRED
STOCK OF SUBSIDIARIES (OTHER THAN
NON-BORROWING SUBSIDIARIES).
The Company shall not permit any Subsidiary to create, incur,
guarantee, assume or issue any Indebtedness or issue any preferred or preference
stock, except for:
(i) Indebtedness or preferred stock outstanding on the date of this
Indenture;
(ii) Indebtedness or preferred stock issued to and held by the
Company or a wholly-owned Subsidiary (but only as long as held or owned by
the Company or a wholly-owned Subsidiary);
(iii) Indebtedness or preferred stock issued by a Person prior to the
time (a) such Person becomes a Subsidiary, (b) such Person merges with or
into a Subsidiary or (c) a Subsidiary merges with or into such Person,
provided that such Indebtedness or preferred stock was not issued or
incurred by such Person in anticipation of the type of transaction
contemplated by subclauses (a), (b) or (c);
(iv) Indebtedness under the Bank Credit Agreement;
(v) Indebtedness the proceeds of which are used to refinance any
other Indebtedness of any Subsidiary, in each case in a principal amount
not to exceed the principal amount so refinanced (or, if such Indebtedness
provides for an amount less than the principal amount thereof to be due and
payable upon a declaration of acceleration of the maturity thereof, in an
amount not greater than such lesser amount), plus any prepayment penalties
and premiums, accrued and unpaid interest on the Indebtedness so
refinanced, plus customary fees,
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expenses and costs related to the incurrence of such refinancing
Indebtedness;
(vi) Indebtedness incurred in connection with the refurbishment,
improvement, construction or acquisition (whether by acquisition of stock,
assets or otherwise) of any Property or Properties of a Subsidiary of the
Company that constitute a part of the then present business of the Company
or any Subsidiary of the Company (or incurred within twelve months of any
such acquisition or the completion of such refurbishment, improvement or
construction), provided that either:
(a) (1) such Indebtedness, together with any other then outstanding
Indebtedness incurred during the most recently completed four
consecutive fiscal quarter period in reliance upon either this clause
(vi) or clause (v) of Section 3.03(b) hereof does not exceed in the
aggregate 3% of consolidated net sales of the Company and its
Subsidiaries during the four consecutive fiscal quarter period ended
immediately prior to the date of calculation; provided that for
purposes of this subclause (a)(1), such Indebtedness shall include,
without limitation, an amount equal to (x) the aggregate outstanding
principal amount of any mortgages that the Company or any Subsidiary
is deemed to have entered into in connection with any Sale and
Leaseback Transaction that the Company or any Subsidiary has entered
into during the four consecutive fiscal quarter period ended
immediately prior to the date of calculation, less (y) the aggregate
principal amount of any Senior Indebtedness that has been repaid with
the Net Proceeds of any Sale and Leaseback Transaction that the
Company or any Subsidiary has entered into within twelve months of the
acquisition, or completion of construction or refurbishment, of the
Property that is the subject of any such transaction; and
(2) such Indebtedness, together with all then outstanding
Indebtedness incurred in reliance upon either this clause (vi) or
clause (v) under Section 3.03(b) hereof does not exceed in the
aggregate 3% of the consolidated net sales of the Company and its
Subsidiaries during the most recently completed twelve consecutive
fiscal quarter period; provided that, for purposes of this SUBCLAUSE
(a)(2), such Indebtedness shall include, without limitation, an
amount equal to (x) the aggregate outstanding principal amount of any
mortgages that the Company
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or any Subsidiary is deemed to have entered into in connection with
any Sale and Leaseback Transactions to which the Company or any
Subsidiary is then a party less (y) the aggregate principal amount of
any Senior Indebtedness that has been repaid with the Net Proceeds of
any Sale and Leaseback Transaction that the Company or any Subsidiary
has entered into within twelve months of the acquisition, or
completion of construction or refurbishment, of the Property that is
the subject of any such transaction; except that, for purposes of
calculating the limitation set forth in SUBCLAUSE (a)(2), the seven
Sale and Leaseback Transactions identified in clause (ii) of Section
3.05 shall not be included; or
(b) such Indebtedness (including an amount equal to the sum of (x) the
aggregate outstanding principal amount of any mortgages that the
Company or any Subsidiary is deemed to have entered into in connection
with any Sale and Leaseback Transaction to which the Company or any
Subsidiary is then a party less (y) the aggregate principal amount of
any Senior Indebtedness that has been repaid with the Net Proceeds of
any Sale and Leaseback Transaction) does not exceed the amount of
proceeds received by the Company or any of its Subsidiaries from
insurance maintained by the Company or any Subsidiary in respect of
such Property or Properties;
(vii) Indebtedness consisting of Guarantees by a Subsidiary of
Indebtedness of the Company or any other Subsidiary, provided that such
Indebtedness is otherwise permitted under this Indenture;
(viii) Indebtedness under Interest Swap Obligations, provided that
such Interest Swap Obligations are related to payment obligations on
Indebtedness otherwise permitted under this Section 3.09;
(ix) commercial letters of credit and standby letters of credit
incurred in the ordinary course of business by a Subsidiary;
(x) Indebtedness represented by industrial revenue or development
bonds, provided that the aggregate amount of Indebtedness incurred in
reliance upon this clause (x)
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or clause (ix) of Section 3.03(b) shall not exceed at any one time an
aggregate principal amount outstanding of $25,000,000;
(xi) Capitalized Lease Obligations relating to Property used in the
business of a Subsidiary;
(xii) Indebtedness incurred in respect of performance bonds and
performance and completion Guarantees incurred in the ordinary course of
business; and
(xiii) Indebtedness arising from the honoring by a bank or other
financial institution of a check, draft or similar instrument inadvertently
(except in the case of daylight overdrafts) drawn against insufficient
funds in the ordinary course of business, provided that such Indebtedness
is extinguished within five Business Days of its incurrence.
SECTION 3.10. LIMITATION ON INDEBTEDNESS OF NON-BORROWING
SUBSIDIARIES.
Notwithstanding Section 3.09, the Company shall not permit any
Non-Borrowing Subsidiary to create, incur, assume, issue or guarantee any
Indebtedness or issue any preferred or preference stock, or to engage in any
Sale and Leaseback Transaction.
SECTION 3.11. TRANSACTIONS WITH AFFILIATES.
(a) The Company shall not, and shall not permit any Subsidiary to,
enter into any transaction after the Issue Date of the Securities with any
Affiliate (other than the Company or a Subsidiary) unless (i) the Board of
Directors of the Company determines, in its reasonable good faith judgment, that
such transaction is in the best interests of the Company or such Subsidiary,
based on full disclosure of all relevant facts and circumstances, (ii) such
transaction is on terms no less favorable to the Company or such Subsidiary than
those that could be obtained in a comparable arm's-length transaction with an
entity that is not an Affiliate, and (iii) the transaction is otherwise
permissible under this Indenture.
(b) This covenant does not apply to redemptions or repurchases of
common stock in connection with repurchase provisions under employee stock
option or stock purchase agreements or other agreements to compensate management
employees, PROVIDED that such redemptions or purchases shall not exceed
$2,000,000 in any Fiscal Year or $5,000,000 in the aggregate subsequent to the
date of this Indenture.
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(c) The provisions of this Section 3.11 shall not prevent the Company
from (i) paying a dividend on Capital Stock within 60 days after the declaration
thereof if, on the date on which the dividend was declared, the Company could
have paid such dividend in accordance with the provisions of this Indenture, or
(ii) repurchasing shares of its Capital Stock (x) solely in exchange for other
shares of its Capital Stock (other than Redeemable Stock) or (y) pursuant to a
court order.
SECTION 3.12. RESTRICTIONS ON BECOMING AN
INVESTMENT COMPANY.
Neither the Company nor any Subsidiary shall become an investment
company within the meaning of the Investment Company Act of 1940, as such
statute and the regulations thereunder and any successor statute or regulations
thereto may from time to time be in effect.
SECTION 3.13. CONTINUED EXISTENCE AND RIGHTS.
Subject to Article 4, the Company shall do or cause to be done all
things necessary to preserve and keep in full force and effect (i) its existence
as a corporation, and the corporate, partnership or other existence of each of
its Subsidiaries, in accordance with the respective organizational documents (as
the same may be amended from time to time) of the Company or any such Subsidiary
and (ii) the licenses, rights (charter and statutory) and franchises of the
Company and its Subsidiaries; PROVIDED, HOWEVER, that the Company shall not be
required to preserve any such right, license or franchise, or the corporate,
partnership or other existence of any of its Subsidiaries, 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 its Subsidiaries, taken as a
whole.
SECTION 3.14. MAINTENANCE OF PROPERTIES AND
OTHER MATTERS.
(a) The Company shall, and shall cause each of its Subsidiaries to,
maintain its Properties in good working order and condition to the extent
material to the operations of the Company and make all necessary repairs,
renewals, replacements, additions, betterments and improvements thereto,
ordinary wear and tear excepted, to the extent and in the manner customary for
similar types of business; PROVIDED, HOWEVER, that nothing in this Section shall
prevent the Company or any of its Subsidiaries from discontinuing the operation
and maintenance of any of its Properties, if such discontinuance is, in the
judgment of the Company or the Subsidiary, as the case may be, desirable in the
conduct of
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its respective business and not disadvantageous in any material respect to the
Holders.
(b) The Company shall insure and keep insured, and shall cause each
Subsidiary to insure and keep insured, with financially sound and reputable
insurers, so much of their respective Properties and in such amounts as is
usually and customarily insured by companies engaged in a similar business with
respect to Properties of a similar character against loss by fire and the
extended coverage perils. The Trustee shall not be required to see that such
insurance is effected or maintained.
(c) The Company shall keep, and shall cause each Subsidiary to keep,
proper books of record and account in which full and correct entries shall be
made of all its business transactions, and shall reflect in its financial
statements adequate accruals and appropriations to reserves. The Company shall
cause its books of record and account and those of each of its Subsidiaries to
be examined, either on a consolidated or an individual basis, by one or more
firms of independent public accountants not less frequently than annually and
shall not make any change in the accounting principles applied to its financial
statements not concurred in by such firm or firms. The Company shall prepare
its financial statements in accordance with GAAP.
(d) The Company shall, and shall cause each of its Subsidiaries to,
comply with all applicable statutes, laws, orders, ordinances and all rules,
regulations and restrictions of any governmental department, commission, board,
regulatory authority, bureau, agency and instrumentality of the foregoing and to
obtain all licenses, permits, franchises and other governmental authorizations
necessary to the ownership or operation of its Properties and to the conduct of
its business, except such as are being contested in good faith and by
appropriate proceedings and except if such non-compliance or failure to obtain
does not materially adversely affect, and as far the Company can at the time
foresee, is not reasonably likely to materially and adversely affect, the
business, earnings, Properties, prospects or condition, financial or other, of
the Company and its Subsidiaries taken as a whole.
SECTION 3.15. TAXES AND CLAIMS.
The Company shall pay, and shall cause each of its Subsidiaries to,
pay (or, if appropriate, withhold and pay over) prior to delinquency:
(i) all material taxes, assessments and governmental charges or
levies imposed upon it or its Property (or required by it to withhold and
pay over), and
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(ii) all material claims or demands of materialmen, mechanics,
carriers, warehousemen, landlords and other like Persons which if unpaid
might result in the creation of a Lien upon its Properties;
PROVIDED that items of the foregoing description need not be paid while being
contested in good faith (and by appropriate proceedings in the opinion of the
Company's independent counsel in any case involving more than $1,000,000); and
PROVIDED FURTHER that adequate book reserves (in the opinion of the Company's
independent accountants) have been established with respect thereto; and
PROVIDED FURTHER that the owning company's title to, and its right to use, its
Property is not materially adversely affected thereby.
SECTION 3.16. STAY, EXTENSION AND USURY LAWS.
The Company covenants (to the extent that it may lawfully do so) that
it shall not at any time insist upon, plead, or in any manner whatsoever claim
or take the benefit or advantage of, any stay, extension or usury law wherever
enacted, now or at any time hereafter in force, that 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 shall not, by resort to any such law, hinder, delay
or impede the execution of any power herein granted to the Trustee, but shall
suffer and permit the execution of every such power as though no such law has
been enacted.
SECTION 3.17. MONEY FOR SECURITY PAYMENTS
TO BE HELD IN TRUST.
(a) If the Company or any of its Subsidiaries shall at any time act
as the Paying Agent, it shall, on or before each due date of the principal of,
premium, if any, and interest on the Securities, segregate and hold in trust for
the benefit of the Persons entitled thereto a sum sufficient to pay the
principal, premium, if any, and interest so becoming due until such sum shall be
paid to such Persons or otherwise disposed of as herein provided, and shall
promptly notify the Trustee of its action or failure so to act.
(b) Whenever the Company shall have one or more Paying Agents, it
shall, prior to or by 10:00 a.m. New York City time on each date for the payment
of the principal of or interest on the Securities, deposit immediately available
funds with a Paying Agent a sum sufficient to pay the principal, premium, if
any, and interest so becoming due, such sum to be held in trust for the benefit
of the Persons entitled to such payments; and, unless such Paying Agent is the
Trustee,
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the Company shall promptly notify the Trustee of its action or failure so to
act.
(c) For the purpose of obtaining the satisfaction and discharge of
this Indenture or for any other purpose, the Company may at any time pay, or
direct any Paying Agent to pay, to the Trustee all sums held in trust by the
Company or by 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 the Company or any Paying Agent to the
Trustee, the Company or such Paying Agent, as the case may be, shall be released
from all further liability with respect to such money.
SECTION 3.18. COMPLIANCE CERTIFICATE.
1. The Company shall deliver to the Trustee, within 120 days after
the end of each Fiscal Year of the Company, an Officers' Certificate, complying
with Section 314(a)(4) of the TIA, stating that a review of the activities of
the Company and its Subsidiaries during the preceding Fiscal Year has been made
under the supervision of the signing Officers with a view to determining whether
the Company has kept, observed, performed and fulfilled its obligations under
this Indenture, and further stating, as to each such Officer signing such
certificate, that to the best of his or her knowledge the Company has kept,
observed, performed and fulfilled each and every covenant contained in this
Indenture and is not in default in the performance or observance of any of the
terms, provisions and conditions hereof (or, if a Default or Event of Default
shall have occurred, describing all such Defaults or Events of Defaults of which
he or she may have knowledge and the status thereof).
(b) The Company shall, as long as any of the Securities are
outstanding, deliver to the Trustee, promptly, but in any case within 10
Business Days of any Officer becoming aware of any Default, Event of Default or
default in the performance of any covenant, agreement or condition contained in
this Indenture, an Officers' Certificate specifying such Default or Event of
Default and the status thereof.
(c) Upon payment in full of all outstanding Indebtedness under the
Bank Credit Agreement, the Company shall deliver an Officers' Certificate to the
Trustee stating that such Indebtedness has been paid in full and discharged.
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ARTICLE 4
SUCCESSORS; CHANGE OF CONTROL; OPTIONAL PREPAYMENT
SECTION 4.01. WHEN COMPANY MAY MERGE, ETC.;
CHANGE OF CONTROL; HOLDERS'
RIGHT OF OPTIONAL PREPAYMENT.
(a) The Company shall not consolidate with or merge into, or
transfer, sell or lease all or substantially all of its Property to, another
Person unless (i) the Surviving Corporation is a United States corporation, (ii)
the Surviving Corporation is bound by all the terms of this Indenture, (iii)
immediately after giving effect to such transaction no Default or Event of
Default exists, (iv) the consolidated net worth (determined in accordance with
GAAP) of the Surviving Corporation is equal to or greater than the consolidated
net worth of the Company immediately prior to such transaction and (v) in the
case of any such consolidation, merger, transfer, sale or lease other than into
or to a wholly-owned Subsidiary of the Company, immediately after and giving
effect to any such consolidation, merger, transfer, sale or lease and any
financings or other transactions in connection therewith the Consolidated
Interest Coverage Ratio of the Surviving Corporation would be greater than the
then applicable Consolidated Interest Coverage Ratio described under paragraph
(a) of Section 3.03 of this Indenture.
(b) In the event of a Change of Control, the Company shall be
obligated to make an offer to purchase all of the then outstanding Securities at
a purchase price in cash equal to 101% of its principal amount plus accrued
interest, after the occurrence of such Change of Control.
(c) Not less than 20 nor more than 60 Business Days prior to the
consummation of a merger, consolidation, transfer, sale or lease that would
constitute a Change of Control and not more than 45 Business Days following the
occurrence of any other event constituting a Change of Control, the Company
shall give Holders notice of such right of prepayment, mailed by first class
mail to the Holders' last addresses as they appear upon the register. Such
notice shall state: (i) that Holders are entitled to have their Securities
prepaid in whole but not in part at 101% of their principal amount plus accrued
interest through the payment date pursuant to this Section 4.01; (ii) if a
Change of Control has occurred, that a Change of Control has occurred, or, if a
proposed merger, consolidation, transfer, sale or lease would constitute a
Change of Control, the proposed date of the consummation of the merger,
consolidation, transfer, sale or lease; (iii) that Holders shall be entitled to
tender their Securities for repayment, specifying the repayment price and
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the repayment date (the "Repayment Date") (which, in the case of a merger,
consolidation, transfer, sale or lease that would constitute a Change of Control
shall not be later than the consummation date of the merger, consolidation,
transfer, sale or lease, and, in the case of any other Change of Control, shall
be no earlier than 30 days and no later than 60 days after the date such notice
is mailed) and that Holders shall be entitled to tender their Securities for
repayment until five Business Days prior to the Repayment Date, (iv) the name
and address of the Paying Agent, (v) that the Securities must be tendered to the
Paying Agent by five Business Days prior to the Repayment Date to collect the
principal, premium and accrued interest thereon, (vi) that any Security not
tendered by five Business Days prior to the Repayment Date shall continue to
accrue interest at the applicable rate borne by the Security, (vii) that any
Security accepted for payment shall cease to accrue interest after the Repayment
Date, (viii) that Holders electing to have a Security repurchased shall be
required to surrender the Security, with the form entitled "Option of Holder to
Elect Repurchase" on the reverse of the Security completed, to the Paying Agent
at the address specified in the notice on or prior to the close of business on
the fifth Business Day preceding the Repayment Date, (ix) that Holders shall be
entitled to withdraw their election if the Paying Agent receives, not later than
the close of business on the fifth Business Day preceding the Repayment Date, a
telegram, telex, facsimile transmission or letter setting forth the name of the
Holder, the principal amount of Securities the Holder delivered for repurchase,
the certificate number(s) of the Securities the Holder delivered for repurchase
and a statement that such Holder is withdrawing his election to have such
Securities repurchased, (x) that Holders electing to have their Securities
repurchased must tender all Securities which they hold, (xi) that the Company
shall have no obligation to consummate a merger, consolidation, transfer, sale
or lease that would constitute a Change of Control that is the subject of any
such notice, provided that the Company shall mail a notice to Holders and the
Trustee, stating that the proposed merger, consolidation, transfer, sale or
lease was not consummated within the specified period and (xii) any other
information necessary to enable Holders to tender Securities and have such
Securities repurchased pursuant to this Section. Notwithstanding that the
Company shall have given any such notice pursuant to this paragraph, the Company
shall have no obligation to consummate a merger, consolidation, transfer, sale
or lease that would constitute a Change of Control that is the subject of any
such notice, provided that the Company shall mail a notice to Holders and the
Trustee, stating that the proposed merger, consolidation, transfer, sale or
lease was not consummated and that Holders shall not have the right to require
the Company to prepay their Securities, not later than two Business Days after
the
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Company determines that such proposed merger, consolidation, transfer, sale or
lease shall not be consummated, and the Company shall promptly return any
Securities tendered for prepayment to their respective Holders.
(d) The Company shall deliver to the Trustee, contemporaneously with
the mailing of the notice specified in paragraph (c) of this Section informing
Holders of their right to tender their Securities for prepayment, (i) an
Officers' Certificate to the foregoing effect stating that the Holders are
entitled to have their Securities repaid and (ii) an Opinion of Counsel stating
that the proposed transaction complies with this Indenture and that all
conditions precedent to the consummation of the transaction under this Indenture
have been met. The Company shall also deliver to the Trustee an Officers'
Certificate and an Opinion of Counsel in connection with any Supplemental
Indenture upon the execution thereof, as specified in Section 8.06 of this
Indenture.
ARTICLE 5
DEFAULTS AND REMEDIES
SECTION 5.01. EVENTS OF DEFAULT.
Each of the following events is an "EVENT OF DEFAULT":
(i) the failure by the Company to pay interest on any Security for a
period of 30 days after such interest becomes due and payable;
(ii) the failure by the Company to pay the principal of (or premium,
if any, on) any Security when such principal becomes due and payable,
whether at the stated maturity or upon acceleration, redemption or
otherwise;
(iii) a default in the observance of any other covenant contained in
this Indenture that continues for 30 days after the Company has been given
notice of the default by the Trustee or the Holders of 25% in principal
amount of the Securities then outstanding;
(iv) a default or defaults on other Indebtedness of the Company or any
Subsidiary, which Indebtedness has an outstanding principal amount of more
than $15,000,000 individually or in the aggregate if such Indebtedness has
attained final maturity or if the holders of such Indebtedness have
accelerated payment thereof under the terms of the instrument under which
such Indebtedness is or may be outstanding and, in each case, it remains
unpaid;
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(v) one or more judgments or decrees is entered against the Company
or any Subsidiary involving a liability (not paid or fully covered by
insurance) of $5,000,000 or more in the case of any one such judgment or
decree or $10,000,000 or more in the aggregate for all such judgments and
decrees for the Company and all its Subsidiaries and all such judgments and
decrees have not been vacated, discharged or stayed or bonded pending
appeal within 30 days from the date of entry thereof;
(vi) the Company or any Material Subsidiary pursuant to or within the
meaning of the Bankruptcy Code:
(1) commences a voluntary case in bankruptcy or any other action
or proceeding for any other relief under any law affecting creditors'
rights that is similar to the Bankruptcy Code;
(2) consents by answer or otherwise to the commencement against
it of an involuntary case or proceeding of bankruptcy or insolvency;
(3) seeks or consents to the appointment of a receiver, trustee,
assignee, liquidator, custodian or similar official (collectively, a
"Custodian") of it or for all or substantially all of its Property;
(4) makes a general assignment for the benefit of its creditors;
or
(5) consents to the entry of a judgment, decree or order for
relief against it in an involuntary case; and
(vii) a court of competent jurisdiction enters a judgment, order or
decree under any Bankruptcy Code that is for relief against the Company or
any Material Subsidiary in an involuntary case OR proceeding which shall:
(1) approve a petition seeking reorganization, arrangement,
adjustment or composition in respect of the Company or any Material
Subsidiary of the Company,
(2) appoint a Custodian for the Company or any Material
Subsidiary or for all or substantially all of the Property of any of
them; or
(3) order the winding up or liquidation of the Company or any
Material Subsidiary,
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and in each case the judgment, order or decree remains unstayed and in
effect for 60 days, or any dismissal, stay, rescission or termination
ceases to remain in effect.
SECTION 5.02. ACCELERATION.
If an Event of Default (other than an Event of Default relating to the
Company or a Material Subsidiary described in paragraphs (vi) or (vii) of
Section 5.01 of this Indenture) shall have occurred and be continuing, the
Trustee by written notice to the Company, or the Holders of at least 25% in
principal amount of the Securities by written notice to the Company and the
Trustee, may declare to be due and payable the principal amount of the
Securities, plus accrued interest, and such amounts shall become due and payable
upon the earlier of (x) five days from the date of such notice, so long as the
Event of Default giving rise to such notice has not been cured or waived and (y)
the acceleration of the Indebtedness under the Bank Credit Agreement (or any
renewal or refinancing thereof). If an Event of Default relating to the Company
or a Material Subsidiary of the kind described in paragraphs (vi) or (vii) of
Section 5.01 of this Indenture shall occur, such amount shall IPSO FACTO become
immediately due and payable without any declaration or other act on the part of
the Trustee or any Holder.
Subject to Sections 5.07 and 8.02, the Holders of not less than a
majority in principal amount of the then outstanding Securities by written
notice to the Trustee, on behalf of the Holders of all the Securities, may
rescind an acceleration and its consequences, including any related payment
default that resulted from such acceleration, (a) if the rescission would not
conflict with any judgment or decree, (b) if all existing Events of Default have
been cured or waived except nonpayment of principal or interest that has become
due solely because of acceleration, (c) to the extent the payment of such
interest is lawful, interest on overdue installments of interest and overdue
principal, which has become due otherwise than by the declaration of
acceleration, has been paid, and (d) in the event of the cure or waiver of a
Default or Event of Default under Section 5.01(iv), the Trustee shall have
received an Officers' Certificate and an Opinion of Counsel that such Default or
Event of Default has been cured or waived. Upon any such rescission, 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 rescission
shall extend to any subsequent or other Default or impair any right consequent
thereon.
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SECTION 5.03. OTHER REMEDIES.
(a) If an Event of Default occurs and is continuing, the Trustee may
pursue any available remedy by an action at law, suit in equity or other
appropriate proceeding to collect the payment of principal of or interest on the
Securities or to enforce the performance of any provision of the Securities or
this Indenture.
(b) The Trustee may maintain a proceeding even if it does not possess
any of the Securities or does not produce any of them in the proceeding. A
delay or omission by the Trustee or any Holder in exercising any right or remedy
accruing upon an Event of Default or a Default shall not impair the right or
remedy or constitute a waiver of or acquiescence in such Event of Default or a
Default. All remedies are cumulative to the extent permitted by law.
SECTION 5.04. WAIVER OF DEFAULTS.
Subject to Sections 5.07 and 8.02, the Holders of not less than a
majority in principal amount of the then outstanding Securities by written
notice to the Trustee may waive any existing Default or Event of Default and its
consequences except a continuing Default or Event of Default (i) in the payment
of the principal, premium, if any, or interest on any Security as specified in
paragraphs (i) or (ii) of Section 5.01 or (ii) in respect of a covenant or
provision hereof which under Article 8 cannot be modified or amended without the
consent of each Holder 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 5.05. CONTROL BY MAJORITY.
The Holders of a majority in principal amount of the then outstanding
Securities may direct the time, method and place of conducting any proceeding
for any remedy available to the Trustee or exercising any trust or power
conferred on it. However, the Trustee may refuse to follow any direction that
conflicts with law or this Indenture or is unduly prejudicial to the rights of
other Holders or would subject the Trustee to personal liability. The Company
may, but shall not be obligated to, pursuant to the procedures of paragraph (b)
of Section 8.04 of this Indenture, fix a record date for the purpose of
determining the Holders entitled to vote on the direction of any such
proceeding.
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SECTION 5.06. LIMITATION ON SUITS.
(a) Except to enforce the right to receive payment of principal,
premium (if any) or interest when due (including in connection with an offer to
purchase or call), no Holder may institute any proceeding with respect to this
Indenture or for any remedy hereunder unless such Holder has previously given to
the Trustee written notice of a continuing Event of Default and unless the
Holders of at least 25% in principal amount of the Securities have requested the
Trustee in writing to pursue remedies in respect of such Event of Default and
have offered the Trustee indemnity satisfactory to the Trustee against loss,
liability, or expense to be thereby incurred and the Trustee has failed so to
act for 60 days after receipt of the same and during which 60 days no contrary
instruction has been received by the Trustee from the Holders of a majority in
principal amount of the then outstanding Securities.
(b) A Holder may not use this Indenture to prejudice the rights of
another Holder or to obtain a preference or priority over another Holder.
SECTION 5.07. RIGHTS OF HOLDERS TO RECEIVE PAYMENT.
Notwithstanding any other provision of this Indenture, the right of
any Holder of a Security to receive payment of principal, premium (if any) and
interest on the Securities on or after the respective due dates expressed in the
Securities (including in connection with an offer to purchase or call), or to
bring suit for the enforcement of any such payment on or after such respective
dates, shall not be impaired or affected without the consent of the Holder.
SECTION 5.08. COLLECTION SUIT BY TRUSTEE.
If an Event of Default specified in paragraphs (i) or (ii) of Section
5.01 of this Indenture occurs and is continuing, the Trustee is authorized to
recover, in any proceeding that it deems, in its sole discretion, most effective
to protect the interests of the Holders, judgment in its own name and as trustee
of an express trust against the Company for the whole amount of principal,
premium (if any) and interest remaining unpaid on the Securities and interest on
overdue principal and to the extent lawful, interest and such further amount as
shall be sufficient to cover the costs and expenses of collection, including the
reasonable compensation, expenses, disbursements and advances of the Trustee,
its agents and counsel and any other amounts due to the Trustee pursuant to
Section 6.07 hereof.
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SECTION 5.09. TRUSTEE MAY FILE PROOFS OF CLAIM.
(a) In case of the pendency of any receivership, insolvency,
liquidation, bankruptcy, reorganization, arrangement, adjustment, composition or
other judicial proceeding relative to the Company or any other obligor upon the
Securities or the property of the Company or of such other obligor or their
creditors, the Trustee (irrespective of whether the principal of the Securities
shall then be due and payable as therein expressed or by declaration or
otherwise and irrespective of whether the Trustee shall have made any demand on
the Company for the payment of overdue principal or interest) shall be entitled
and empowered, by intervention in such proceeding or otherwise,
(i) to file and prove a claim for the whole amount of principal (and
premium, if any) and interest owing and unpaid in respect of the Securities
and to file such other papers or documents as may be necessary or advisable
in order to have the claims of the Trustee (including any claim for the
reasonable compensation, expenses, disbursements and advances of the
Trustee, its agents and counsel) and of the Holders allowed in such
judicial proceeding, and
(ii) to collect and receive any moneys or other securities or property
payable or deliverable upon the conversion or exchange of the Securities or
upon any such claims and to distribute the same;
and any 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 to it for the reasonable compensation, expenses,
disbursements and advances of the Trustee, its agents and counsel, and any other
amounts due the Trustee under Section 6.07 of this Indenture.
(b) Nothing herein contained shall be deemed to authorize the Trustee
to authorize or consent to or accept or adopt on behalf of any Holder any plan
of reorganization, arrangement, adjustment or composition affecting the
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.
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SECTION 5.10. PRIORITIES.
Any money collected by the Trustee pursuant to this Article shall be
paid and applied in the following order:
First: to the Trustee, its agents and attorneys for amounts due under
Section 6.07 of this Indenture;
Second: to Holders for amounts due and unpaid on the Securities for
principal, premium, if any, and interest, ratably, without
preference or priority of any kind, according to the amounts due
and payable on the Securities for principal, premium, if any, and
interest, respectively; and
Third: to the Company or to such party as a court of competent
jurisdiction shall direct.
The Trustee may fix a record date and payment date for any payment to
Holders under this Section.
SECTION 5.11. UNDERTAKING FOR COSTS.
In any suit for the enforcement of any right or remedy under this
Indenture or in any suit against the Trustee for any action taken or omitted to
be taken by it as a Trustee, a court in its discretion may require the filing by
any party litigant in the suit of an undertaking to pay the costs of the suit,
and the court in its discretion may assess reasonable costs including reasonable
attorneys' fees and disbursements, against any party litigant in the suit,
having due regard to the merits and good faith of the claims or defenses made by
the party litigant. This Section does not apply to a suit by the Trustee, a
suit by a Holder pursuant to Section 5.06 of this Indenture, or a suit by
Holders of more than 10% in principal amount of the then outstanding Securities.
ARTICLE 6
TRUSTEE
SECTION 6.01. DUTIES OF TRUSTEE.
(a) If an Event of Default has occurred and is continuing, the
Trustee shall exercise such of the rights and powers vested in it by this
Indenture, and use the same degree of care and skill in their exercise, as a
prudent man would exercise or use under the circumstances in the conduct of his
own affairs.
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(b) Except during the continuance of an Event of Default:
(1) the Trustee need perform only those duties that are specifically
set forth in this Indenture and no others and no implied covenants or
obligations shall be read into this Indenture against the Trustee; and
(2) the Trustee may conclusively rely, as to the truth of the
statements and the correctness of the opinions expressed therein, in the
absence of bad faith on its part, upon certificates or opinions furnished
to the Trustee and conforming to the requirements of this Indenture. The
Trustee, however, shall examine the certificates and opinions to determine
whether or not they conform to the requirements of this Indenture.
(c) The Trustee may not be relieved from liability for its own
negligent action, its own negligent failure to act, or its own wilful
misconduct, except that:
(1) this paragraph does not limit the effect of paragraph (b) of this
Section;
(2) the Trustee shall not be liable for any error of judgment made in
good faith by a Trust Officer, unless it is proved that the Trustee was
negligent in ascertaining the pertinent facts; and
(3) the Trustee shall not be liable with respect to any action it
takes or omits to take in good faith in accordance with a direction
received by it pursuant to Section 5.05 of this Indenture or any other
direction of the Holders permitted under this Indenture.
(d) Every provision of this Indenture that in any way relates to the
Trustee is subject to paragraphs (a), (b) and (c) of this Section.
(e) The Trustee may refuse to perform any duty or exercise any right
or power unless it receives indemnity satisfactory to it against any loss,
liability or expense.
(f) The Trustee shall not be liable for interest on any money
received by it except as the Trustee may agree with the Company in writing.
Money held in trust by the Trustee need not be segregated from other funds
except to the extent required by law.
(g) No provision of this Indenture shall require the Trustee to
expend or risk any of its own funds or incur any liability.
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SECTION 6.02. RIGHTS OF TRUSTEE.
(a) The Trustee may rely on any document believed by it to be genuine
and to have been signed or presented by the proper Person. The Trustee need not
investigate any fact or matter stated in the document. The Trustee may
conclusively rely as to the identity and addresses of Holders and other matters
contained therein on the register of the Securities maintained by the Registrar
pursuant to Section 2.03 of this Indenture and shall not be affected by notice
to the contrary.
(b) Before the Trustee acts or refrains from acting, it may require
an Officers' Certificate and an Opinion of Counsel. The Trustee shall not be
liable for any action it takes or omits to take in good faith in reliance on
such Certificate or Opinion or both. 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 to be taken by it hereunder in good faith and reliance thereon.
(c) The Trustee may act through agents and shall not be responsible
for the misconduct or negligence of any agent appointed with due care.
(d) The Trustee shall not be liable for any action it takes or omits
to take in good faith which it believes to be authorized or within its rights or
powers.
SECTION 6.03. INDIVIDUAL RIGHTS OF TRUSTEE.
The Trustee in its individual or any other capacity may become the
owner or pledgee of Securities and may otherwise deal with the Company or any
Affiliate with the same rights it would have as if it were not Trustee. Any
Agent may do the same with like rights. The Trustee, however, is subject to
Sections 6.10 and 6.11 of this Indenture.
SECTION 6.04. TRUSTEE'S DISCLAIMER.
The Trustee makes no representation as to the validity or adequacy of
this Indenture or the Securities; it shall not be accountable for the Company's
use of the proceeds from the Securities, or any money paid to the Company or
upon the Company's direction under any provision hereof; it shall not be
responsible for the use or application of any money received by any Paying Agent
other than the Trustee; and it shall not be responsible for any statement in the
Securities other than its certificate of authentication or for any statement of
the Company in this Indenture.
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SECTION 6.05. NOTICE OF DEFAULTS.
If a Default or Event of Default occurs and is continuing and if it is
known to a Trust Officer of the Trustee, the Trustee shall mail the Holders a
notice of the Default or Event of Default within 90 days after it occurs.
Except in the case of a Default or Event of Default in payment on any Security,
the Trustee may withhold notice if and so long as a committee of Trust Officers
in good faith determines that withholding the notice is in the interest of
Holders.
SECTION 6.06. REPORTS BY TRUSTEE TO HOLDERS.
If required by the TIA, within 60 days after each February 15
following the date of this Indenture, the Trustee shall mail to Holders and the
Company a brief report dated as of such February 15 that complies with TIA
Section 313(a). The Trustee shall also comply with TIA Section 313(b)(2) and
transmit all reports in accordance with TIA Section 313(c).
A copy of each such report shall be filed, at the time of its mailing
to Holders, with the SEC and each stock exchange, if any, on which the
Securities are listed. The Company shall notify the Trustee in writing when the
Securities are listed or delisted on or from any stock exchange.
SECTION 6.07. COMPENSATION AND INDEMNITY.
(a) The Company shall pay to the Trustee from time to time reasonable
compensation for its services. The Trustee's compensation shall not be limited
by any law on compensation of a trustee of an express trust. The Company shall
reimburse the Trustee upon request for all reasonable out-of-pocket expenses
incurred by it. Such expenses shall include the reasonable compensation and
out-of-pocket expenses of the Trustee's agents and counsel.
(b) The Company shall defend and indemnify the Trustee, its officers,
directors, employees and agents, against any loss or liability incurred by any
of them in connection with the Trustee's duties hereunder except as set forth in
the next paragraph. The Trustee shall notify the Company promptly of any claim
for which it may seek indemnity; PROVIDED that the failure to give prompt notice
shall not release the Company from any liability to the Trustee to the extent
the Company is not prejudiced thereby. The Company shall defend such claim and
the Trustee shall cooperate in such defense.
(c) The Company need not reimburse any expense or indemnify against
any loss or liability incurred by the Trustee through negligence, bad faith or
wilful misconduct.
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(d) The Trustee may have separate counsel, and the Company shall pay
the reasonable fees and expenses of such counsel.
(e) To secure the Company's payment obligations in this Section, the
Trustee shall have a lien prior to the Securities on all money or Property held
or collected by the Trustee, except that held in trust to pay principal and
interest on particular Securities. Such lien shall survive the satisfaction and
discharge of this Indenture or any other termination under the Bankruptcy Code.
(f) When the Trustee incurs expenses or renders services after an
Event of Default specified in paragraph (vi) or (vii) of Section 5.01 of this
Indenture occurs, such expenses and the compensation for such services are
intended to constitute expenses of administration under the Bankruptcy Code.
(g) The Company's payment obligations under this Section 6.07 shall
survive the discharge of this Indenture.
SECTION 6.08. REPLACEMENT OF TRUSTEE.
(a) A resignation or removal of the Trustee and appointment of a
successor Trustee shall become effective only upon the successor Trustee's
acceptance of appointment as provided in this Section.
(b) The Trustee may resign by so notifying the Company. The Holders
of a majority in principal amount of the then outstanding Securities may remove
the Trustee by so notifying the Trustee and the Company. The Company may remove
the Trustee if:
(1) the Trustee fails to comply with Section 6.10;
(2) the Trustee is adjudged a bankrupt or an insolvent or an order
for relief is entered with respect to the Trustee under the Bankruptcy
Code;
(3) a Custodian or public officer takes charge of the Trustee or its
Property; or
(4) the Trustee becomes incapable of acting.
(c) If the Trustee resigns or is removed or if a vacancy exists in
the office of Trustee for any reason, the Company shall promptly appoint a
successor Trustee. Within one year after the successor Trustee takes office,
the Holders of a majority in principal amount of the then outstanding
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Securities may appoint a successor Trustee to replace the successor Trustee
appointed by the Company.
(d) If a successor Trustee does not take office within 60 days after
the retiring Trustee resigns or is removed, the retiring Trustee, the Company or
the Holders of at least 10% in principal amount of the then outstanding
Securities may petition any court of competent jurisdiction for the appointment
of a successor Trustee.
(e) If the Trustee fails to comply with Section 6.10, any Holder may
petition any court of competent jurisdiction for the removal of the Trustee and
the appointment of a successor Trustee.
(f) A successor Trustee shall deliver a written acceptance of its
appointment to the retiring Trustee and to the Company. Thereupon the
resignation or removal of the retiring Trustee shall become effective, and the
successor Trustee shall have all the rights, powers and duties of the Trustee
under this Indenture. The successor Trustee shall mail a notice of its
succession to Holders. The retiring Trustee shall promptly transfer all
Property held by it as Trustee to the successor Trustee, subject to the lien
provided for in Section 6.07 of this Indenture.
(g) Notwithstanding the replacement of the Trustee pursuant to this
Section 6.08, the Company's obligations under Section 6.07 of this Indenture
hereof shall continue for the benefit of the retiring Trustee in connection with
the rights and duties hereunder prior to such replacement.
SECTION 6.09. SUCCESSOR TRUSTEE BY MERGER, ETC.
If the Trustee consolidates, merges or converts into, or transfers all
or substantially all of its corporate trust business to, another corporation,
the successor corporation without any further act shall be the successor
Trustee.
SECTION 6.10. ELIGIBILITY; DISQUALIFICATION.
This Indenture shall always have a Trustee who satisfies the
requirements of TIA Section 310(a). The Trustee shall always have a combined
capital and surplus of at least $50,000,000 as set forth in its most recent
published annual report of condition. Neither the Company nor any Person
directly or indirectly controlling, controlled by, or under common control with
the Company shall serve as trustee. The Trustee is subject to TIA Section
310(b).
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SECTION 6.11. PREFERENTIAL COLLECTION OF
CLAIMS AGAINST COMPANY.
The Trustee is subject to TIA Section 311(a). A Trustee who has
resigned or been removed shall be subject to TIA Section 311(a) to the extent
indicated therein.
SECTION 6.12. AUTHENTICATING AGENT.
(a) Each Authenticating Agent appointed by the Trustee pursuant to
Section 2.02 of this Indenture (an "Authenticating Agent") shall at all times be
a corporation organized and doing business under the laws of the United States,
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
$5,000,000 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.
(b) 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 Company, the Trustee or the Authenticating Agent.
(c) 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 6.12, the Trustee may appoint a successor
Authenticating Agent which shall be acceptable to the Company and shall mail
written notice of such appointment to all Holders of the Se-
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curities. 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.
(d) The Company agrees to pay each Authenticating Agent from time to
time reasonable compensation for its services under Section 2.02 of this
Indenture and this Section 6.12 and the Trustee shall be entitled to be
reimbursed for any such payments made by it.
(e) If an appointment is made pursuant to Section 2.02 of this
Indenture or this Section 6.12, the Securities may have endorsed thereon, in
addition to the Trustee's certificate of authentication, an alternate
certificate of authentication in the following form:
"This is one of the 12% Senior Notes due September 1, 2004 issued
under the within-mentioned Indenture.
Dated:
IBJ SCHRODER BANK & TRUST COMPANY,
as Trustee
By:______________________________
as Authenticating Agent
By:______________________________
Authorized Signatory"
ARTICLE 7.
DISCHARGE OF INDENTURE
SECTION 7.01. TERMINATION OF COMPANY'S OBLIGATIONS.
This Indenture shall cease to be of further effect (except that the
Company's obligations under Sections 6.07 and 7.04 and the Trustee's and Paying
Agent's obligations under Section 7.03 shall survive) when all outstanding
Securities theretofore authenticated and issued have been
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delivered (other than mutilated, destroyed, lost or stolen Securities which have
been replaced or paid) to the Trustee for cancellation, the Company has paid all
sums payable by it hereunder, and the Company has delivered to the Trustee an
Officers' Certificate and an Opinion of Counsel, each stating that all
conditions precedent specified herein relating to the Indenture ceasing to be of
further effect have been complied with. In addition, subject to the remaining
provisions of this Section 7.01, the Company may, by resolution of its Board of
Directors filed with the Trustee, elect to either (i) terminate its obligations
under this Indenture and the outstanding Securities or (ii) be released and
discharged from its obligations under any covenant contained in Sections 3.02,
3.03, 3.04, 3.05, 3.06, 3.08, 3.09, 3.10, 3.11, 3.14 and 4.01 and the omission
to comply with any such covenant shall not constitute a Default or an Event of
Default, if, in either case:
(1) the Company has irrevocably deposited in trust with the Trustee
or, at the option of the Trustee, with a trustee satisfactory to the
Trustee and the Company under the terms of an irrevocable trust agreement
in form and substance satisfactory to the Trustee, money or U.S. Government
Obligations sufficient (without reinvestment thereof) in the opinion of a
nationally recognized accounting firm to pay principal and interest on the
Securities to maturity, and to pay all other sums then payable by it to the
Trustee under Section 6.07 of this Indenture, provided that (i) the trustee
of the irrevocable trust shall have been irrevocably instructed to pay such
money or the proceeds of such U.S. Government Obligations to the Trustee
and (ii) the Trustee shall have been irrevocably instructed to apply such
money or the proceeds of such U.S. Government Obligations to the payment of
said principal and interest with respect to the Securities; PROVIDED,
however, that the Trustee shall have received an Opinion of Counsel stating
that after the passage of 90 days following the deposit of the trust funds
(except, with respect to any trust funds for the account of any Holder who
may be deemed to be an "insider" for purposes of the Bankruptcy Code, after
one year following the deposit) such funds will not be subject to any
bankruptcy laws affecting creditors' rights generally;
(2) the Company delivers to the Trustee an Officers' Certificate
stating that all conditions precedent to (i) the termination of the
Company's obligations under this Indenture and the outstanding Securities
or (ii) the Company's release and discharge from the covenants set forth in
clause (ii) of the second
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sentence of this Section 7.01, have been complied with, and an Opinion of
Counsel to the same effect;
(3) the Company shall have delivered to the Trustee (x) in the case
of the Company terminating its obligations under the Indenture and the
Securities pursuant to clause (i) of the second sentence of this Section
7.01, an Opinion of Counsel (which shall be accompanied by a ruling from
the Internal Revenue Service), which Opinion of Counsel provides that the
Holders will not recognize income, gain or loss for Federal income tax
purposes as a result of the Company's exercise of its option under clause
(i) of the second sentence of this Section 7.01 and will be subject to
Federal income tax on the same amount and in the same manner and at the
same times as would have been the case if such option had not been
exercised or (y) in the case of the Company being released and discharged
from the covenants set forth in clause (ii) of the second sentence of this
Section 7.01, an Opinion of Counsel to the effect that the Holders will not
recognize income, gain or loss for Federal income tax purposes as a result
of the Company's exercise of its option under clause (ii) of the second
sentence of this Section 7.01 and will be subject to Federal income tax on
the same amount and in the same manner and at the same times as would have
been the case if such option had not been exercised; and
(4) the Company has delivered to the Trustee an Opinion of Counsel to
the effect that such deposit will not cause the Trustee or the trust so
created to be subject to the Investment Company Act of 1940, as amended;
and, in each case, the Trustee shall have received such other documents and
assurances as the Trustee may reasonably request. Then, this Indenture or such
covenants, as the case may be, shall cease to be of further effect (except as
provided below), and the Trustee, on demand of the Company, shall execute proper
instruments acknowledging confirmation of and discharge under this Indenture or
such covenants, as the case may be. However, in the case of the Company
terminating its obligations under the Indenture and the Securities pursuant to
clause (i) of the second sentence of this Section 7.01, the Company's
obligations in Sections 2.03, 2.04, 2.05, 2.06, 2.07, 3.17, 6.07, 6.08 and 7.04
and the Trustee's and Paying Agent's obligations in Section 7.02 and 7.03 shall
survive until the Securities are no longer outstanding. Thereafter, only the
Company's obligations in Section 6.07 and 7.04 and the Trustee's and Paying
Agent's obligations in Section 7.03 shall survive. In the case of the Company's
being released and discharged from the covenants set
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forth in clause (ii) of the second sentence of this Section 7.01, all of the
remaining provisions of the Indenture shall survive until the Securities are no
longer outstanding. Thereafter, only the Company's obligations in Section 6.07
and 7.04, and the Trustee's and Paying Agent's obligations in Section 7.03 shall
survive.
In order to have money available on a payment date to pay principal or
interest on the Securities, the U.S. Government Obligations shall be payable as
to principal or interest on or before such payment date in such amounts as will
provide the necessary money. U.S. Government Obligations shall not be callable
at the issuer's option.
"U.S. Government Obligations" means direct obligations of, or
obligations guaranteed by, the United States of America for the payment of which
the full faith and credit of the United States of America is pledged.
SECTION 7.02. APPLICATION OF TRUST MONEY.
The Trustee or a trustee satisfactory to the Trustee and the Company
shall hold in trust money or U.S. Government Obligations deposited with it
pursuant to Section 7.01 of this Indenture. It shall apply the deposited money
and the money from U.S. Government Obligations through the Paying Agent and in
accordance with this Indenture to the payment of principal and interest on the
Securities.
SECTION 7.03. REPAYMENT TO COMPANY.
(a) The Trustee and the Paying Agent shall promptly pay to the
Company upon written request any excess money or securities held by them at any
time.
(b) The Trustee and the Paying Agent shall pay to the Company upon
written request any money held by them for the payment of principal, premium, if
any, or interest that remains unclaimed for two years after the date upon which
such payment shall have come due; PROVIDED, HOWEVER, that the Trustee or such
Paying Agent, shall, upon the written request and at the expense of the Company,
cause to be published once in a newspaper of general circulation in The City of
New York or mailed to each such Holder, notice that such money remains unclaimed
and that, after a date specified therein, which shall not be less than 30 days
from the date of such publication or mailing, any unclaimed balance of such
money then remaining shall be repaid to the Company. After payment to the
Company, Holders entitled to the money must look to the Company for payment as
general creditors unless an applicable abandoned property law designates another
Person.
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SECTION 7.04. REINSTATEMENT.
If the Trustee or Paying Agent is unable to apply any money or U.S.
Government Obligations in accordance with Sections 7.01 and 7.02 of this
Indenture by reason of any legal proceeding or by reason of any order or
judgment of any court or governmental authority enjoining, restraining or
otherwise prohibiting such application, the Company's obligations under this
Indenture and the Securities shall be revived and reinstated as though no
deposit had occurred pursuant to Section 7.01 of this Indenture until such time
as the Trustee or Paying Agent is permitted to apply such money or U.S.
Government Obligations in accordance with Section 7.01 of this Indenture;
PROVIDED, HOWEVER, that if the Company has made any payment of interest on or
principal of any Securities because of the reinstatement of its obligations, the
Company shall be subrogated to the rights of the Holders of such Securities to
receive such payment from the money or U.S. Government Obligations held by the
Trustee or Paying Agent.
ARTICLE 8.
AMENDMENTS
SECTION 8.01. WITHOUT CONSENT OF HOLDERS.
The Company, when duly authorized by resolution of its Board of
Directors, and the Trustee may amend this Indenture or the Securities without
the consent of any Holder:
(a) to cure any ambiguity, defect or inconsistency with any other
provision herein;
(b) to comply with Section 4.01 of this Indenture;
(c) to secure the Securities;
(d) to make any change that does not adversely affect the legal
rights hereunder of any Holder; or
(e) to comply with the requirements of the SEC in order to effect or
maintain the qualification of this Indenture under the TIA.
After an amendment under this Section becomes effective, the Company
shall mail to Holders a notice briefly describing the amendment.
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SECTION 8.02. WITH CONSENT OF HOLDERS.
The Company, when duly authorized by resolution of its Board of
Directors, and the Trustee may amend this Indenture or the Securities with the
written consent of the Holders of at least a majority in principal amount of the
then outstanding Securities. However, without the consent of each Holder
affected, an amendment under this Section may not:
(a) reduce the amount of Securities whose Holders must consent to an
amendment;
(b) reduce the rate of or change the time for payment of interest,
including defaulted interest, on any Security;
(c) reduce the principal of or change the fixed maturity of any
Security, or change the date on which any Security may be subject to
redemption or reduce the Redemption Price therefor;
(d) make any Security payable in currency other than that stated in
the Security;
(e) make any change in Section 5.04 or 5.07 or this Section 8.02 of
this Indenture;
(f) make any change in the ranking of the Securities with respect to
any other obligation of the Company in a way that adversely affects the
rights of any Holder; or
(g) waive a Default in the payment of the principal of, and interest
on, any Security.
After an amendment under this Section becomes effective, the Company
shall mail to Holders a notice briefly describing the amendment.
SECTION 8.03. COMPLIANCE WITH TRUST INDENTURE ACT.
Every amendment to this Indenture or the Securities shall be set forth
in a supplemental indenture that complies with the TIA as then in effect.
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SECTION 8.04. REVOCATION AND EFFECT OF CONSENTS.
(a) Until an amendment or waiver becomes effective, a consent to it
by a Holder of a Security is a continuing consent by the Holder and every
subsequent Holder of a Security or portion of a Security that evidences the same
debt as the consenting Holder's Security, even if notation of the consent is not
made on any Security. However, any such Holder or subsequent Holder may revoke
the consent as to his Security or portion of a Security if the Trustee receives
written notice of revocation before the date on which the Trustee receives an
Officers' Certificate certifying that the Holders of the requisite principal
amount of Securities have consented to such amendment or waiver. An amendment
or waiver becomes effective upon receipt by the Trustee of such Officers'
Certificate and the written consents from the Holders of the requisite
percentage in principal amount of Securities.
(b) The Company may, but shall not be obligated to, fix a record date
for the purpose of determining the Holders entitled to consent to any amendment
or waiver, which record date shall be at least 5 Business Days prior to the
first solicitation of such consent. If a record date is fixed, then
notwithstanding the second and third sentence of paragraph (a) of this Section,
those persons who were Holders at such record date (or their duly designated
proxies), and only those persons, shall be entitled to consent to such amendment
or waiver or to revoke any consent previously given, whether or not such persons
continue to be Holders after such record date. No such consent shall be valid
or effective for more than 120 days after such record date.
(c) After an amendment or waiver becomes effective, it shall bind
every Holder.
SECTION 8.05. NOTATION ON EXCHANGE OF SECURITIES.
Upon the Company's written request, the Trustee shall place an
appropriate notation (to be provided by the Company) about an amendment or
waiver on any Security thereafter authenticated. The Company in exchange for
all Securities may issue and the Trustee shall authenticate new Securities that
reflect the amendment or waiver.
SECTION 8.06. TRUSTEE PROTECTED.
The Trustee shall sign all supplemental indentures, except that the
Trustee need not sign any supplemental indenture that adversely affects its
rights. In signing or refusing to sign such amendment or supplemental
indenture, the Trustee shall be entitled to receive and, subject to Section 6.01
of this Indenture, shall be fully protected in relying
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upon, an Officers' Certificate and an Opinion of Counsel as conclusive evidence
that such amendment or supplemental indenture is authorized or permitted by this
Indenture, that it is not inconsistent herewith, that all conditions precedent
to the execution thereof have been met, that it will be valid and binding upon
the Company in accordance with its terms and that, after the execution thereof,
the Company will not be in Default and no Event of Default will have occurred
and be continuing.
ARTICLE 9.
REDEMPTIONS
SECTION 9.01. NOTICE TO TRUSTEE.
If the Company elects to redeem Securities pursuant to the optional
redemption provisions of paragraph 6 of the Securities and Section 9.03 hereof,
the Company shall notify the Trustee in writing of the Redemption Date, the
principal amount of Securities to be redeemed, and the Redemption Price and
shall deliver to the Trustee an Officers' Certificate certifying resolutions of
the Board of Directors authorizing the redemption and an Opinion of Counsel with
respect to the due authorization of such redemption and that such redemption is
being made in accordance with this Indenture and the Securities and does not
violate any other agreement binding on the Company.
The Company shall give the notice to the Trustee provided for in this
Section at least 45 days (unless such shorter period shall be satisfactory to
the Trustee) but not more than 60 days before a Redemption Date.
SECTION 9.02. SELECTION OF THE SECURITIES TO BE REDEEMED.
If less than all of the Securities are to be redeemed, the Trustee,
PRO RATA or by lot, or by any manner that is acceptable to the Trustee, shall
select, subject to the remainder of this Section, the Securities to be redeemed.
The Trustee shall make the selection not more than 60 days and not less than 30
days before each Redemption Date from Securities outstanding not previously
called for redemption. The Trustee may select for redemption portions of the
principal of Securities that have denominations larger than $1,000. Securities
and portions of them it selects shall be in amounts of $1,000 or integral
multiples of $1,000. Provisions of this Indenture that apply to Securities
called for redemption shall also apply to portions of Securities called for
redemption. The Trustee shall notify the Company
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promptly in writing of the Securities or portions of Securities to be called for
redemption.
SECTION 9.03. NOTICE OF REDEMPTION.
(a) At least 30 but not more than 60 days before a Redemption Date,
the Company shall mail a notice of redemption by first-class mail to each Holder
whose Securities are to be redeemed at the Holder's last address as it appears
upon the register.
(b) The notice shall identify the Securities to be redeemed and shall
state:
(i) the Redemption Date;
(ii) the Redemption Price and the amount of accrued interest to be
paid;
(iii) the name and address of the Paying Agent;
(iv) that the Securities called for redemption must be surrendered to
the Paying Agent to collect the Redemption Price and accrued interest, if
any;
(v) that, unless the Company defaults in making the redemption
payment, interest on the Securities called for redemption ceases to accrue
on and after the specified Redemption Date; and
(vi) if any Security is being redeemed in part, the portion of the
principal amount (equal to $1,000 or any integral multiple thereof) of such
Security to be redeemed and that, on or after the Redemption Date, upon
surrender of such Security, a new Security or Securities in principal
amount equal to the unredeemed portion thereof will be issued.
At the Company's request, the Trustee shall give the notice of
redemption in the Company's name and at the Company's expense.
SECTION 9.04. EFFECT OF NOTICE OF REDEMPTION.
Once notice of redemption is mailed pursuant to paragraph 6 of the
Securities and in accordance with Section 9.03 hereof, the Securities called for
redemption become irrevocably due and payable on the specified Redemption Date
at the Redemption Price. A notice of redemption may not be conditional.
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Notice of redemption shall be deemed to be given when mailed, whether
or not the Holder receives such notice. In any event, failure to give such
notice, or any defect therein, shall not affect the validity of the proceedings
for the redemption of the Securities.
SECTION 9.05. DEPOSIT OF REDEMPTION PRICE ON
OPTIONAL REDEMPTION.
On or before each Redemption Date the Company shall deposit with the
Trustee or the Paying Agent money (which shall be immediately available funds if
deposited on the Redemption Date and which must be received by such Paying Agent
prior to 10:00 a.m. New York City time) sufficient to pay the Redemption Price
of and accrued interest on all Securities to be redeemed on that date. The
Paying Agent shall return to the Company any money not required for that
purpose.
SECTION 9.06. SECURITIES REDEEMED IN PART.
Upon surrender of a Security that is redeemed in part, the Company
shall issue and the Trustee shall authenticate a new Security equal in principal
amount to the unredeemed portion of the Security surrendered.
ARTICLE 10.
MISCELLANEOUS
SECTION 10.01. TRUST INDENTURE ACT CONTROLS.
If any provision of this Indenture limits, qualifies, or conflicts
with another provision which is required to be included in this Indenture by the
TIA, the required provision shall control.
SECTION 10.02. NOTICES.
Any notice or communication to the Company or the Trustee is duly
given if in writing and (a) delivered in Person, (b) mailed by first-class mail
or (c) transmitted by facsimile transmission (confirmed by guaranteed overnight
courier) to the following addresses:
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The Company's address is:
201 Willowbrook Boulevard
Wayne, New Jersey 07470
Attn: Kenneth R. Baum
Telephone number: (201) 890-6000
Facsimile number: (201) 890-6540
The Trustee's address is:
One State Street
New York, New York 10004
Attn: Corporate Trust Department
Telephone number: (212) 858-2000
Facsimile number: (212) 858-2952
At the date of execution hereof, the Paying Agent's and Registrar's address is:
One State Street
New York, New York 10004
Attn: Corporate Trust Department
Telephone number: (212) 858-2000
Facsimile number: (212) 858-2952
The Company or the Trustee by written notice to the other may
designate additional or different addresses for subsequent notices or
communications.
Any notice or communication to a Holder shall be mailed by first-class
mail (registered or certified, return receipt requested) or overnight air
courier guaranteeing next day delivery, to his address shown on the register
kept by the Registrar; PROVIDED that items required under the TIA to be sent to
Holders in compliance with TIA Section 313(c) shall be mailed to Holders in
compliance with such section. Failure to mail a notice or a communication to a
Holder or any defect in it shall not affect its sufficiency with respect to
other Holders.
If a notice or communication is delivered, mailed or transmitted in
the manner provided above within the time prescribed, it is duly given, whether
or not the addressee receives it.
If the Company mails a notice or communication to Holders, it shall
mail a copy to the Trustee and each Agent at the same time.
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<PAGE>
SECTION 10.03. COMMUNICATION BY HOLDERS
WITH OTHER HOLDERS.
Holders may communicate pursuant to TIA Section 312(b) with other
Holders with respect to their rights under this Indenture or the Securities.
The Trustee shall comply with the provisions of TIA Section 312(b). The
Company, the Trustee, the Registrar and any agent of any of them shall have the
protection of TIA Section 312(c).
SECTION 10.04. CERTIFICATE AND OPINION AS
TO CONDITIONS PRECEDENT.
Upon any request or application by the Company to the Trustee to take
any action under this Indenture, the Company shall furnish to the Trustee:
(a) an Officers' Certificate stating that, in the opinion of the
signers, all conditions precedent, if any, provided for in this Indenture
relating to the proposed action have been complied with; and
(b) an Opinion of Counsel stating that, in the opinion of such
counsel, all such conditions precedent have been complied with and that any
such action or inaction does not conflict with the terms of this Indenture.
SECTION 10.05. STATEMENTS REQUIRED IN
CERTIFICATE OR OPINION.
Each certificate or opinion with respect to compliance with a
condition or covenant provided for in this Indenture shall include:
(a) a statement that the Person making such certificate or opinion
has read such covenant or condition;
(b) 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;
(c) a statement that, in the opinion of such Person, he has made such
examination or investigation as is necessary to enable him to express an
informed opinion as to whether or not such covenant or condition has been
complied with; and
(d) a statement as to whether or not, in the opinion of such Person,
such condition or covenant has been complied with.
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<PAGE>
SECTION 10.06. RULES BY TRUSTEE AND AGENTS.
The Trustee may make reasonable rules for action by or a meeting of
Holders. The Registrar or Paying Agent may make reasonable rules and set
reasonable requirements for its functions.
SECTION 10.07. LEGAL HOLIDAYS.
A "Legal Holiday" is a Saturday, a Sunday or a day on which banking
institutions in the State of New York are not required to be open. If a payment
date is a Legal Holiday at a place of payment, payment may be made at that place
on the next succeeding day that is not a Legal Holiday, and no interest shall
accrue for the intervening period.
SECTION 10.08. NO RECOURSE AGAINST OTHERS.
The Securities and the obligations of the Company under this Indenture
are solely obligations of the Company and no officer, director, employee or
stockholder, as such, shall be liable for any failure by the Company to pay
amounts on the Securities when due or perform any such obligation.
SECTION 10.09. DUPLICATE ORIGINALS.
The parties may sign any number of copies or counterparts of this
Indenture. One signed copy is enough to prove this Indenture.
SECTION 10.10. GOVERNING LAW.
THE LAWS OF THE STATE OF NEW YORK SHALL GOVERN THIS INDENTURE AND THE
SECURITIES, WITHOUT REGARD TO THE CONFLICTS OF LAWS RULES THEREOF.
SECTION 10.11. NO ADVERSE INTERPRETATION
OF OTHER AGREEMENTS.
This Indenture may not be used to interpret another indenture, loan or
debt agreement of the Company or a Subsidiary. Any such indenture, loan or debt
agreement may not be used to interpret this Indenture.
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<PAGE>
SECTION 10.12. SUCCESSORS.
All agreements of the Company in this Indenture and the Securities
shall bind its successor. All agreements of the Trustee in this Indenture shall
bind its successor.
SECTION 10.13. SEVERABILITY.
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 10.14. TABLE OF CONTENTS, HEADINGS, ETC.
The Table of Contents, Cross-Reference Table, and headings of the
Articles and Sections of this Indenture have been inserted for the convenience
of reference only, are not to be considered a part hereof, and shall in no way
modify or restrict any of the terms or provisions hereof.
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<PAGE>
SECTION 10.15. 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.
SIGNATURES
Dated: , 1995 THE GRAND UNION COMPANY
----------------
By:
------------------------
Name:
Title:
Attest:
(SEAL)
- ---------------------------
Dated: , 1995 IBJ SCHRODER BANK & TRUST
------------- COMPANY, Trustee
By:
------------------------
Name:
Title:
Attest:
(SEAL)
- ---------------------------
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<PAGE>
Exhibit A
No. $________
THE GRAND UNION COMPANY
Incorporated under the laws of the State
of Delaware
12% Senior Notes due September 1, 2004
THE GRAND UNION COMPANY promises to pay to __________________ or registered
assigns, the principal sum of _______ Dollars on September 1, 2004 and to pay
interest thereon semiannually in arrears from September 1, 1995 (notwithstanding
that the date of issue is prior thereto) at the rate of 12% per annum on March 1
and September 1 of each year commencing March 1, 1996 until the principal hereof
is paid or made available for payment. Payment of principal and premium, if
any, and interest shall be made in the manner and subject to the terms set forth
in provisions appearing on the reverse hereof, which provisions, in their
entirety, shall for all purposes have the same effect as if set forth at this
place.
IN WITNESS WHEREOF, THE GRAND UNION COMPANY has caused this instrument
to be executed in its corporate name by the manual or facsimile signature of its
President or a Vice President and attested by its Secretary or an Assistant
Secretary.
THE GRAND UNION COMPANY
By
---------------------------
Name:
Title:
Attest:
--------------------
Name:
Title:
SEAL
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<PAGE>
Exhibit A
FORM OF TRUSTEE'S CERTIFICATE OF AUTHENTICATION
This is one of the 12% Senior Notes due September 1, 2004 issued under
the within-mentioned Indenture.
Dated:
IBJ SCHRODER BANK & TRUST COMPANY,
as Trustee
By:
-----------------------------
Authorized Signatory
A-2
<PAGE>
Exhibit A
(Back of Security)
THE GRAND UNION COMPANY
12% Senior Notes due
September 1, 2004
1. INTEREST. THE GRAND UNION COMPANY (the "Company"), a Delaware
corporation, promises to pay interest on the principal amount of this Security
at the rate per annum shown above from September 1, 1995. The Company will pay
interest semiannually in arrears on March 1 and September 1 of each year,
commencing March 1, 1996. Interest on the Securities will accrue from the most
recent date on which interest has been paid or, if no interest has been paid,
from September 1, 1995. Interest will be computed on the basis of a 360-day
year of twelve 30-day months.
2. METHOD OF PAYMENT. The Company will pay interest on the
Securities (except defaulted interest) to the Persons who are registered Holders
of Securities at the close of business on the regular record date, which shall
be the February 15 and August 15, as the case may be, next preceding the
interest payment date even though Securities are canceled after the record date
and on or before the interest payment date. Any such interest not so punctually
paid or duly provided for or paid within the 30-day period in paragraph (i) of
Section 5.01 of the Indenture, and any interest payable on such defaulted
interest (to the extent lawful), will forthwith cease to be payable to the
Holder on such regular record date and shall be payable to the Person in whose
name this Security is registered at the close of business on a special record
date for the payment of such defaulted interest to be fixed by the Company,
notice of which shall be given to Holders not less than 5 days prior to such
special record date. Holders must surrender Securities to a Paying Agent to
collect principal payments. The Company will pay principal and interest in
money of the United States that at the time of payment is legal tender for
payment of public and private debts. However, the Company may pay principal,
premium, if any, and interest by check payable in such money. It may mail an
interest check to a Holder's registered address.
3. PAYING AGENT AND REGISTRAR. Initially, IBJ Schroder Bank &
Trust Company, a banking company organized under the laws of the State of New
York (the "Trustee"), will act as Paying Agent and Registrar. The Company may
change any Paying Agent, Registrar or co-Registrar without notice to any Holder.
The Company may act in any such capacity.
4. INDENTURE. The Company has issued the Securities under an
Indenture dated as of _______, 1995 (the
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<PAGE>
Exhibit A
"Indenture") between the Company and the Trustee. The terms of the Securities
include those stated in the Indenture and those made part of the Indenture by
reference to the Trust Indenture Act of 1939 (15 U.S.C. Sections 77aaa-77bbbb),
as amended by the Trust Indenture Reform Act of 1990, as in effect on the date
of the Indenture ("TIA"). The Securities are subject to all such terms, and
Holders are referred to the Indenture and the TIA for a statement of such terms.
The Securities are obligations of the Company limited to $595,475,922 in
aggregate principal amount. The Securities are unsecured general obligations of
the Company. Unless otherwise defined herein, all capitalized terms shall have
the meanings assigned to them in the Indenture.
5. DENOMINATIONS, TRANSFER, EXCHANGE. The Securities are in
registered form without coupons in denominations of $1,000 and integral
multiples thereof. The transfer of Securities may be registered and Securities
may be exchanged as provided in the Indenture. The Registrar may require a
Holder, among other things, to furnish appropriate endorsements and transfer
documents and to pay any taxes and fees required by law or permitted by the
Indenture. The Registrar need not exchange or register the transfer of any
Security or portion of a Security selected for redemption. Also, it need not
exchange or register the transfer of any Securities for a period of 15 days
before a selection of Securities to be redeemed.
6. OPTIONAL REDEMPTION. The Securities may not be redeemed at the
option of the Company prior to September 1, 2000, except as set forth below. On
or after such date, the Securities may be redeemed at the election of the
Company as a whole at any time or in part from time to time at the Redemption
Prices (expressed in percentages of principal amount) set forth below plus
accrued interest to the Redemption Date, if redeemed during the 12-month period
beginning on September 1 of the years indicated below:
Year Percentage
2000 104%
2001 102
2002 and thereafter 100
Notwithstanding the foregoing, the Securities may be redeemed at the
election of the Company on or after September 1, 1995 and prior to September 1,
1998 with the proceeds of one or more issuances of equity securities, so long as
such redemption, when aggregated with all prior such redemptions, shall not
result in more than 33 1/3% of the principal amount of the Securities originally
issued having been so redeemed, at the Redemption Prices (expressed in
percentages of
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<PAGE>
Exhibit A
principal amount) set forth below plus accrued interest to the Redemption Date,
if redeemed during the 12-month period beginning September 1 of the years
indicated below:
Year Percentage
1995 103%
1996 106
1997 106
Notice of redemption will be mailed by first-class mail at least 30
days but not more than 60 days before the Redemption Date to each Holder of
Securities to be redeemed, at his registered address. Securities in
denominations larger than $1,000 may be redeemed in part but only in whole
multiples of $1,000. On and after the Redemption Date interest ceases to accrue
on Securities or portions of them called for redemption. The Securities will
not have the benefit of any sinking fund obligation.
7. PERSONS DEEMED OWNERS. The registered Holder of a Security may
be treated as its owner for all purposes.
8. AMENDMENTS AND WAIVERS. Subject to certain exceptions, the
Indenture or the Securities may be amended with the consent of the Holders of at
least a majority in principal amount of the then outstanding Securities.
Without the consent of any Holder, the Indenture or the Securities may be
amended to cure any ambiguity, defect or inconsistency, to comply with Section
4.01 of the Indenture, to secure the Securities, to make any change that does
not adversely affect the legal rights of any Holder or to comply with the
requirements of the SEC to maintain qualification of the Indenture under the
TIA.
9. RESTRICTIVE COVENANTS. The Indenture imposes certain
limitations on the ability of the Company and its Subsidiaries to, among other
things, pay dividends or make certain other Restricted Payments, incur
additional Indebtedness or Liens, enter into transactions with Affiliates, merge
or consolidate with any other person or sell, lease, transfer or otherwise
dispose of substantially all of its properties or assets or enter into sale and
leaseback transactions. The limitations are subject to certain qualifications
and exceptions.
10. DEFAULTS AND REMEDIES. An Event of Default, as defined in the
Indenture, is: a. the failure to pay interest on the Securities for a period of
30 days after such interest becomes due and payable; (ii) the failure to pay the
principal or premium, if any, on the Securities when such principal becomes due
and payable, whether at the stated
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<PAGE>
Exhibit A
maturity or upon acceleration, redemption or otherwise; (iii) a default in the
observance of any other covenant contained in the Indenture that continues for
30 days after the Company has been given notice of the default by the Trustee or
the Holders of 25% in principal amount of the Securities then outstanding, (iv)
a default or defaults on other Indebtedness of the Company or any Subsidiary,
which Indebtedness has an outstanding principal amount of more than $15,000,000
individually or in the aggregate if such Indebtedness has attained final
maturity or if the holders of such Indebtedness have accelerated payment thereof
under the terms of the instrument under which such Indebtedness is or may be
outstanding and it remains unpaid; (v) one or more judgments or decrees is
entered against the Company or any Subsidiary involving a liability (not paid or
fully covered by insurance) of $5,000,000 or more in the case of any one such
judgment or decree or $10,000,000 or more in the aggregate for all such
judgments and decrees for the Company and all its Subsidiaries and all such
judgments and decrees have not been vacated, discharged or stayed or bonded
pending appeal within 30 days from the entry thereof; or (vi) certain events of
bankruptcy, insolvency or reorganization affecting the Company or any Material
Subsidiary as provided in the Indenture.
In case an Event of Default (other than an Event of Default resulting
from bankruptcy, insolvency, or reorganization of the Company or a Material
Subsidiary) shall have occurred and be continuing, the Trustee by written notice
to the Company, or the Holders of at least 25% in principal amount of the
Securities by written notice to the Company and the Trustee, may declare to be
due and payable the principal amount of the Securities, plus accrued interest,
and such amounts shall become due and payable upon the earlier of (i) five days
from the date of such notice, so long as the Event of Default giving rise to
such notice has not been cured or waived and (ii) the acceleration of the
Indebtedness under the Bank Credit Agreement (or any renewal or refinancing
thereof). In case an Event of Default resulting from bankruptcy, insolvency, or
reorganization of the Company or a Material Subsidiary shall occur, such amount
shall ipso facto become immediately due and payable without any declaration or
other act on the part of the Trustee or any Holder. Such declaration or
acceleration by the Trustee or the Holders may be rescinded and past defaults
may be waived (except, unless theretofore cured, a default in payment of
principal of or interest on the Securities issued under the Indenture) by the
Holders of a majority in principal amount of the Securities upon conditions
provided in the Indenture. Except to enforce the right to receive payment of
principal, premium (if any) or interest when due, no Holder may institute any
proceeding with respect to the Indenture or for any remedy thereunder except as
provided in the Indenture. Subject to certain
A-6
<PAGE>
Exhibit A
restrictions, the Holders of a majority in principal amount of the Securities
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. The Trustee, however, may refuse to follow any
direction that conflicts with law or the Indenture, that is unduly prejudicial
to the rights of any Holder, or that would subject the Trustee to personal
liability. The Company must furnish an annual compliance certificate to the
Trustee.
11. PREPAYMENT AT HOLDER'S OPTION UPON CHANGE OF CONTROL EVENTS. In
the event of a Change of Control, the Company shall be obligated to make an
offer to purchase this Security at a purchase price in cash equal to 101% of its
principal amount plus accrued interest, after the occurrence of such Change of
Control. Holders of Securities which are the subject of such an offer to
repurchase shall receive an offer to repurchase and may elect to have such
Securities repurchased in accordance with the provisions of the Indenture. The
Company shall give the Holder of this Security notice of such right of
repurchase not less than 20 nor more than 60 Business Days prior to the
consummation of a merger, consolidation, transfer, sale or lease that would
constitute a Change of Control and not more than 45 Business Days following any
other event constituting a Change of Control, mailed by first-class mail to the
Holder's last address as it appears upon the register. The Holder shall have
the right to have this Security repurchased if, among other things, the Security
is tendered for repurchase no later than five Business Days prior to the
applicable repurchase date. The Company shall have no obligation to consummate
any merger, consolidation, transfer, sale or lease that would constitute a
Change of Control, and, if any such merger, consolidation, transfer, sale or
lease that was the subject of any notice described above is not consummated, the
Holder will not be entitled to have this Security prepaid, and any Securities
tendered for prepayment will be returned.
12. TRUSTEE DEALINGS WITH THE COMPANY. The Trustee, in its
individual or any other capacity, may become the owner or pledgee of Securities
and may otherwise deal with the Company or any Affiliate with the same rights it
would have as if it were not the Trustee.
13. OFFERS TO PURCHASE. Under certain circumstances, if the
Company or any Subsidiary consummates an Asset Sale, the Company will be
required to make an offer to purchase a portion of the Securities pursuant to
the provisions of Section 3.06 of the Indenture.
A-7
<PAGE>
Exhibit A
14. NO RECOURSE AGAINST OTHERS. A director, officer, employee or
stockholder, as such, of the Company shall not have any liability for any
obligations of the Company under the Securities or the Indenture or for any
claim based on, in respect of or by reason of such obligations or their
creation. Each Holder by accepting a Security waives and releases all such
liability. The waiver and release are part of the consideration for the issue of
the Securities.
15. UNCLAIMED MONEY. If money for the payment of principal of or
interest on any Security remains unclaimed for two years after the date on which
such payment shall have come due, the Trustee or Paying Agent will pay the money
back to the Company at the Company's written request. After that, Holders
entitled to this money must look to the Company for payment, unless a law
governing abandoned property designates another Person.
16. DISCHARGE UPON REDEMPTION OR MATURITY. Subject to the terms of
the Indenture, the Indenture will be discharged and canceled upon the payment of
all Securities. The Indenture contains provisions for defeasance at any time of
certain restrictive covenants with respect to this Security (in each case upon
compliance with certain conditions set forth therein).
17. AUTHENTICATION. This Security shall not be valid until
authenticated by the manual signature of the Trustee or an Authenticating Agent.
18. GOVERNING LAW. The laws of the State of New York shall
govern this Security and the Indenture, without regard to the conflicts of laws
rules thereof.
19. ABBREVIATIONS. Customary abbreviations may be used in the name
of a Holder or an assignee, such as TEN COM (= tenants in common), TEN ENT
(= tenants by the entireties), JT TEN (= joint tenants with right of
survivorship and not as tenants in common), CUST (= Custodian), and UNIF GIFT
MIN ACT (= Uniform Gifts to Minors Act).
The Company will furnish to any Holder upon written request and
without charge a copy of the Indenture, which contains, in larger type, the text
of this Security. Requests may be made to The Grand Union Company, 201
Willowbrook Boulevard, Wayne, New Jersey 07470, Attention: Kenneth R. Baum.
A-8
<PAGE>
Exhibit A
OPTION OF HOLDER TO ELECT REPURCHASE
If you want to elect to have this Security purchased by the Company
pursuant to Section 3.06 or 4.01 of the Indenture, check the box below*:
/ / Section 3.06 / / Section 4.01
If you want to elect to have only part of this Security purchased by
the Company pursuant to Section 3.06 of the Indenture, state the amount you
elect to have purchased:
$___________
Date: Your signature
------------- ---------------------------
(Sign exactly as your name appears on the
other side of this Security)
Tax Identification No.:
----------
Signature Guarantee:
----------------------
(Signature must be
guaranteed by an eligible
institution within the
meaning of Rule 17(A)(d)-15
under the Securities Exchange
Act of 1934, as amended)
- -------------------------
* Check applicable box.
A-9
<PAGE>
Exhibit A
ASSIGNMENT FORM
To assign this Security, fill in the form below: I or we assign and transfer
this Security to
_______________________________________________________________________________
(Insert assignee's soc. sec. or tax I.D. no.)
_______________________________________________________________________________
_______________________________________________________________________________
_______________________________________________________________________________
_______________________________________________________________________________
(Print or type assignee's name, address and zip code)
and irrevocably appoint_____________________ agent to transfer this Security on
the books of the Company. The agent may substitute another to act for him.
_______________________________________________________________________________
Date: Your signature
----------------- -------------------
(Sign exactly as your name
appears on the other side of
this Security)
Signature Guarantee:
--------------------------------------
(Signature must be guaranteed by an eligible institution
within the meaning of Rule 17(A)(d)-15 under the Securities
Exchange Act of 1934, as amended)
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