Securities and Exchange Commission
Washington, DC 20549
FORM 10-Q
Quarterly Report Pursuant to Section 13 or 15(d)
of the Securities Exchange Act of 1934
For The Quarterly Period Ended March 31, 1995
UNITED STATIONERS INC.
(Exact name of Registrant as specified in its charter)
DELAWARE 0-10653 36-3141189
(State or other jurisdiction of (Commission (I.R.S. Employer
incorporation or organization) File Number) Identification No.)
2200 East Golf Road, Des Plaines, Illinois 60016-1267
(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code: (708) 699-5000
Indicate by check mark whether the Registrant (1) has filed all reports
required to be filed by Section 13 or 15(d) of the Securities Exchange Act of
1934 during the preceding 12 months (or for such shorter period that the
Registrant was required to file such reports), and (2) has been subject to such
filing requirements for the past 90 days.
(1) Yes X No
(2) Yes X No
As of May 9, 1995, United Stationers Inc. had 5,624,486 shares of
Common Stock, $0.10 par value, and 403,906 shares of Nonvoting Common Stock,
$0.01 par value, outstanding.
This Form 10-Q consists of 542 pages with the Index to Exhibits appearing on
Page 25.
INDEX
PAGE
NUMBER
PART I - FINANCIAL INFORMATION
Important Explanatory Note 3
Condensed Consolidated Balance Sheets as of
March 31, 1995 and December 31, 1994. 4
Condensed Consolidated Statements of Operations
for the Three Months Ended March 31, 1995
and March 31, 1994. 5
Condensed Consolidated Statements of Cash Flows
for the Three Months Ended March 31, 1995 and
March 31, 1994. 6
Notes to Condensed Consolidated Financial Statements. 7
Management's Discussion and Analysis of
Financial Condition and Results of Operations. 13
PART II - OTHER INFORMATION 17
SIGNATURE 24
INDEX TO EXHIBITS 25
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UNITED STATIONERS INC. AND SUBSIDIARIES
IMPORTANT EXPLANATORY NOTE
On March 30, 1995, Associated Holdings, Inc. ("Associated") was merged with
United Stationers Inc. (the "Company"). Although the Company was the surviving
corporation in the merger, the transaction was treated as a reverse acquisition
for accounting purposes, with Associated as the acquiring corporation.
Therefore, the Condensed Consolidated Statements of Operations and Cash Flows
for the periods ended March 31, 1995 and 1994 on Pages 5 and 6 in this Form 10-
Q reflect the financial information of Associated and its consolidated
subsidiary only. The Condensed Consolidated Balance Sheet as of March 31, 1995
on Page 4 of this Form 10-Q reflects the consolidated balances of Associated
and the Company. The Condensed Consolidated Balance Sheet as of December 31,
1994 on Page 4 of this Form 10-Q reflects Associated only.
Please see Note 1, "Business Combination and Restructuring Charge" for further
information relating to the merger and financial information contained herein.
Please see Part II - "Other Information" for historical financial information
for the two companies.
-3-
UNITED STATIONERS INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED BALANCE SHEETS
(In thousands of dollars)
ASSETS
(Unaudited) (Audited)
March 31, December 31,
1995 1994
CURRENT ASSETS
Cash and cash equivalents $ 21,611 $ 1,849
Accounts receivable, net 201,056 45,139
Inventories 396,085 88,197
Other current assets 25,135 3,795
Total Current Assets $643,887 $138,980
PROPERTY, PLANT AND EQUIPMENT, at cost $236,150 $ 58,277
Less-Accumulated depreciation and amortization (13,820) ( 12,830)
Net Property, Plant and Equipment $222,330 $ 45,447
GOODWILL, NET $ 71,628 $ 4,948
OTHER ASSETS, NET $ 38,104 $ 3,104
TOTAL ASSETS $975,949 $192,479
LIABILITIES AND STOCKHOLDERS' EQUITY
CURRENT LIABILITIES
Short-term debt and current maturities
of long-term obligations $ 17,138 $ 5,901
Accounts payable 183,994 54,351
Accrued liabilities 88,694 18,994
Other liabilities 13,435 3,280
Total Current Liabilities $303,261 $ 82,526
DEFERRED TAXES $ 31,469 $ 2,060
LONG-TERM OBLIGATIONS:
Senior Revolver Loan $199,708 $ 37,850
Bridge Loan 130,000
Senior Term Loan - Tranche A 110,000 6,000
Senior Term Loan - Tranche B 74,000 9,557
Other Long-Term Debt 42,011
Other Long-Term Liabilities 4,401 4,872
TOTAL LONG-TERM OBLIGATIONS $560,120 $ 58,279
REDEEMABLE PREFERRED STOCK $ 23,761 $ 23,189
REDEEMABLE WARRANTS $ 11,879 $ 1,650
STOCKHOLDERS' EQUITY $ 45,459 $ 24,775
TOTAL LIABILITIES & STOCKHOLDERS' EQUITY $975,949 $192,479
The accompanying notes to condensed consolidated financial
statements are an integral part of these balance sheets.
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UNITED STATIONERS INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(In thousands of dollars, except share data)
(Unaudited)
FOR THE THREE MONTHS ENDED
March 31, March 31,
1995 1994 *
NET SALES $137,272 $123,850
COST OF GOODS SOLD 103,568 94,162
Gross profit $ 33,704 $ 29,688
OPERATING EXPENSES:
Warehousing, marketing and
administrative expenses $ 28,949 $ 26,752
Restructuring charge (Note 1) 9,759
Total operating expenses $ 38,708 $ 26,752
Income (loss) from operations $ (5,004) $ 2,936
INTEREST EXPENSE, net 2,203 1,732
Income (loss) before income taxes $ (7,207) $ 1,204
INCOME TAXES (BENEFIT) (2,973) 462
Net income (loss) before extraordinary
item $ (4,234) $ 742
EXTRAORDINARY ITEM - loss on early retire-
ment of debt, net of taxes ($967) (Note 5) (1,449)
NET INCOME (LOSS) $ (5,683) $ 742
PREFERRED STOCK DIVIDENDS ISSUED
AND ACCRUED 573 534
Net income (loss) attributable to
common shareholders $ (6,256) $ 208
Net Income (Loss) Attributable to Common
and Common Equivalent Share (Primary and
Fully Diluted):
Earnings (loss) before extraordinary item $(.80) $ .05
Extraordinary item (.24)
Net income (loss) attributable to
common and common equivalent share $(1.04) $ .05
Average Number of Common Shares Used
in Primary Calculation 5,998,077 4,090,433
Average Number of Common Shares Used
in Fully Diluted Calculation 5,998,077 4,138,023
* Not reviewed by independent accountants.
The accompanying notes to condensed consolidated financial
statements are an integral part of these statements.
-5-
UNITED STATIONERS INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(In thousands of dollars)
(Unaudited)
FOR THE THREE MONTHS ENDED
March 31, March 31,
1995 1994 *
CASH FLOWS FROM OPERATING ACTIVITIES:
Net cash provided by operating
activities $ 2,087 $ 3,183
CASH FLOWS FROM INVESTING ACTIVITIES:
Acquisition of the Company - net of cash
acquired of approximately $14,500 $(257,259) $
Capital expenditures (182) (242)
Net cash used in investing activities $(257,441) $ (242)
CASH FLOWS FROM FINANCING ACTIVITIES:
Issuance of debt $ 536,708 $
Retirements and payments of debt (266,920) (1,000)
Net borrowings (repayment) under revolver 18,100 (1,500)
Financing costs (24,873)
Issuance of common stock 12,000
Other (154) (151)
Net cash provided by (used in) financing
activities $ 274,861 $(2,651)
NET CHANGE IN CASH $ 19,507 $ 290
Cash and Cash Equivalents, beginning of period 2,104 991
Cash and Cash Equivalents, end of period $ 21,611 $ 1,281
Other Cash Flow Information
Cash payments during the quarter for:
Income taxes paid $ 1,834 $ 304
Interest paid 2,050 1,720
Noncash investing and financing activities:
Common stock issued in exchange for
services related to financing the
acquisition of the Company $ 2,100
Common stock issued to retire a deferred
obligation related to an agreement
for contracted services $ 9,000
* Not reviewed by independent accountants.
The accompanying notes to condensed consolidated financial
statements are an integral part of these statements.
-6-
UNITED STATIONERS INC. AND SUBSIDIARIES
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(Unaudited)
(1) Business Combination and Restructuring Charge
On March 30, 1995, pursuant to an Agreement and Plan of Merger, dated as of
February 13, 1995 (the "Merger Agreement"), between Associated Holdings, Inc.,
a Delaware corporation ("Associated") and United Stationers Inc., a Delaware
corporation (the "Company") and Associated's related Offer to Purchase dated
February 21, 1995 (the "Offer"), Associated purchased 17,201,839 shares of
Common Stock, $0.10 par value (the "Shares"), of the Company at a purchase
price of $15.50 per share, or approximately $266.6 million, from the Company's
stockholders. On March 30, 1995, pursuant to the terms of the Merger
Agreement, Associated was merged with and into the Company, with the Company
surviving (the "Merger"), and immediately thereafter, Associated Stationers,
Inc., a Delaware corporation and wholly owned subsidiary of Associated ("ASI")
was merged with and into United Stationers Supply Co., an Illinois corporation
and wholly owned subsidiary of the Company ("USSC"), with USSC surviving. The
acquisition of the Shares by Associated pursuant to the Offer together with the
Merger is referred to herein as the "Acquisition."
Immediately following the Merger, the number of outstanding Shares was
5,998,077 (or 6,973,720 on a fully diluted basis), of which (i) the former
holders of Class A Common Stock, $0.01 par value, and Class B Common Stock,
$0.01 par value, of Associated ("Associated Common Stock") and warrants or
options to purchase Associated Common Stock in the aggregate owned 4,603,333
Shares constituting approximately 76.7% of the outstanding Shares and
outstanding warrants or options for 975,643 Shares (collectively 80.0% on a
fully diluted basis) and (ii) pre-Merger holders of Shares (other than
Associated-owned Shares and treasury Shares) in the aggregate owned 1,394,744
Shares constituting approximately 23.3% of the outstanding Shares (or 20.0% on
a fully diluted basis). As used in this paragraph, the term "Shares" includes
shares of Nonvoting Common Stock, $0.01 par value, of the Company, which are
immediately convertible into Shares for no additional consideration.
To finance the Offer, refinance existing debt of ASI, the Company and USSC,
repurchase stock options and pay related fees and expenses, Associated, ASI,
USSC and the Company entered into (i) new credit facilities ("New Credit
Facilities") with a group of banks and financial institutions providing for
term loan borrowings of $200.0 million and revolving loan borrowings of up to
$300.0 million and (ii) a senior subordinated bridge loan facility in the
aggregate principal amount of $130.0 million (the "Subordinated Bridge
Facility"). In addition, simultaneously with the consummation of the Offer,
Associated obtained $12.0 million from the sale of additional shares of
Associated Common Stock, which proceeds were used to finance the purchase of a
portion of the Shares pursuant to the Offer.
-7-
UNITED STATIONERS INC. AND SUBSIDIARIES
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(Unaudited)
(1) Business Combination and Restructuring Charge (Continued)
On May 3, 1995, USSC completed the issuance of $150.0 million of 12 3/4% Senior
Subordinated Notes (the "Notes") due 2005. The net proceeds of the Notes
(after discount and fees of approximately $5.5 million) were used to pay
certain expenses, to repay the $130.0 million Subordinated Bridge Facility
(together with $1.6 million in accrued and unpaid interest thereon), to repay a
portion of the Tranche A and Tranche B term loans (totaling approximately $6.5
million) and provide working capital. In the event the necessary consents are
obtained, the Company is permitted to redeem the Series B Preferred Stock
(approximately $7.0 million).
Although the Company was the surviving corporation in the Merger, the
transaction was treated as a reverse acquisition for accounting purposes with
Associated as the acquiring corporation. The total purchase price of
approximately $293.4 million was allocated to assets and liabilities of the
Company based on the estimated fair value as of the date of acquisition. The
allocation was based on preliminary estimates which may be revised at a later
date. The excess of consideration paid over the estimated fair value of net
assets acquired in the amount of $66.7 million has been recorded as goodwill
and is being amortized on a straight-line basis over 40 years.
Effective for 1995, the Company changed its fiscal year from a year-end of
August 31 to December 31. A report on Form 8-K was filed on April 26, 1995,
reporting that the Company had changed its fiscal year end to December 31. A
Form 10-K will be filed by the Company by June 28, 1995 which will include
audited financial statements for the period from September 1, 1994 through
March 30, 1995, the date on which the Merger was consummated.
The Condensed Consolidated Balance Sheet combines Associated and the Company as
of March 31, 1995 and reflects a preliminary allocation of the purchase price
which may be revised at a later date. The Condensed Consolidated Balance Sheet
as of December 31, 1994 reflects Associated only. The Condensed Consolidated
Statements of Operations reflects the results of operations for Associated only
for the three months ended March 31, 1995 and March 31, 1994. The Condensed
Consolidated Statement of Cash Flows for the three months ended March 31, 1995
and March 31, 1994 reflects that of Associated only, including the effects of
the Acquisition and Merger.
-8-
UNITED STATIONERS INC. AND SUBSIDIARIES
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(Unaudited)
(1) Business Combination and Restructuring Charge (Continued)
The actual results for the quarter ended March 31, 1995 include a restructuring
charge of $9.8 million ($5.9 million net of tax benefit of $3.9 million) for
costs expected to be incurred in connection with integration and transition
(e.g., severance and the cost of closing certain facilities operated by
Associated prior to the Merger) and compensation expense relating to employee
stock options of approximately $1.5 million ($0.9 million net of tax benefit of
$0.6 million). The actual results for the quarter ended March 31, 1995 also
include an extraordinary write-off of approximately $2.4 million ($1.4 million
net of tax benefit of $1.0 million) of financing costs and original issue
discount relating to the debt retired. See Note 5 - Extraordinary Item.
The unaudited Pro Forma Combined Financial Statements for the two companies for
the year ended December 31, 1994 were included in the Company's Form
8-K dated April 14, 1995.
The following summarized unaudited pro forma operating data for the three
months ended March 31, 1995 and 1994 is presented giving effect to the
Acquisition as if it had been consummated at the beginning of the respective
periods and, therefore, reflects the results of the Company and Associated on a
consolidated basis. These pro forma results have been prepared for comparative
purposes only and do not purport to be indicative of the results of operations
that actually would have resulted had the combination been in effect on the
dates indicated, or which may result in the future. The pro forma results
exclude one-time non-recurring charges or credits directly attributable to the
transaction. The estimated cost savings that the Company expects to realize
($26.0 million on a total year basis and $6.5 million on a quarterly basis)
pursuant to its consolidation plan that has been approved by the Board of
Directors of the Company have been reflected in the pro forma results as if the
Company's consolidation plan had been implemented in full for the periods
reflected. The Company plans to implement its consolidation plan over a 12-
month period following the Acquisition.
-9-
UNITED STATIONERS INC. AND SUBSIDIARIES
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(Unaudited)
(1) Business Combination and Restructuring Charge (Continued)
The pro forma income statement adjustments consisted of (i) estimated cost
savings of $6.5 million that the Company expects to realize, (ii) increased
depreciation expense resulting from the write-up of certain fixed assets to
fair value, (iii) additional incremental goodwill amortization, (iv) additional
incremental interest expense due to debt issued, net of debt retired, (v)
reduction in preferred stock dividends due to the assumed retirement of the
Series B Preferred Stock, which the Company is permitted to redeem pursuant to
its New Credit Facilities.
(In thousands of dollars, except Pro Forma Quarter Ended March 31
share data) (unaudited) 1995 1994
Net sales $587,170 $503,919
Net income $ 9,409 $ 4,405
Preferred stock dividends issued
and accrued $ 442 $ 393
Net income available to common
stockholders $ 8,967 $ 4,012
Net income per common and common
equivalent share:
Primary $ 1.30 $ 0.98
Fully diluted $ 1.30 $ 0.97
Weighted average number of
common shares outstanding:
Primary 6,894,076 4,090,433
Fully diluted 6,898,757 4,138,023
The pro forma net sales amount of $587.2 million for the first quarter of 1995
reflects $449.9 million in net sales for the Company and $137.3 million for
Associated. The pro forma net sales amount of $503.9 million for the first
quarter of 1994 reflects $380.1 million in net sales for the Company and $123.8
million for Associated.
These pro forma results have been prepared for comparative purposes only and do
not purport to be indicative of the results of operations that actually would
have resulted had the combination been in effect on the dates indicated, or
which may result in the future.
-10-
UNITED STATIONERS INC. AND SUBSIDIARIES
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(Unaudited)
(2) Changes in Accounting Principles
Effective January 1, 1995, Associated changed its method of valuing its
inventory from the FIFO to the LIFO method. The Company previously valued the
majority of its inventory under the LIFO method with the remainder of inventory
valued under the FIFO method. Associated changed its method to conform to that
of the Company. This change resulted in a charge to pre-tax income of
approximately $0.5 million ($0.3 million net of tax benefit) or $.05 per common
and common equivalent share for the quarter ended March 31, 1995. The
cumulative effect of this accounting change for years prior to 1995 is not
determinable, nor are the pro forma effects of retroactive application of the
LIFO method to prior years. The Associated LIFO reserve as of March 31, 1995
was $0.5 million.
(3) Basis of Presentation
The accompanying condensed consolidated financial statements are unaudited,
except for the Associated Consolidated Balance Sheet as of December 31, 1994,
which is condensed from the audited Consolidated Balance Sheet of Associated at
that date. Certain prior-year amounts have been reclassified to conform with
current-year presentations. These financial statements have been prepared in
accordance with the rules and regulations of the Securities and Exchange
Commission. Certain information and footnote disclosures normally included in
financial statements prepared in accordance with generally accepted accounting
principles have been condensed or omitted pursuant to such rules and
regulations. In the opinion of the Company's management, the condensed
consolidated financial statements for the unaudited interim periods presented
include all adjustments necessary to fairly present the results of such interim
periods and the financial position as of the end of said periods. Other than
the restructuring charge, the extraordinary item and the compensation expense
relating to employee stock options, these adjustments were of a normal
recurring nature and did not have a material impact on the financial statements
presented. Certain interim expense and inventory estimates are recognized
throughout the fiscal year relating to marginal income tax rates, shrinkage,
inflation and product mix. Any appropriate adjustments to reflect actual
experience, which historically have been immaterial, will be recognized in the
fourth quarter.
(4) Review
Ernst & Young LLP, independent public accountants, have performed a review of
the condensed consolidated financial statements referred to above. Since they
did not perform an audit, they express no opinion on these statements. Refer
to the Independent Accountant's Review Report included in this filing. A
report on Form 8-K was filed on April 26, 1995, reporting that the Company had
changed its independent public accountants effective with the first quarter of
1995.
-11-
UNITED STATIONERS INC. AND SUBSIDIARIES
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(Unaudited)
(5) Extraordinary Item
The Extraordinary Item reflects the write-off of financing costs and original
issue discount relating to the retired debt which was being amortized over the
life of the original debt.
(6) Net Income (Loss) Attributable to Common and Common Equivalent Shares
Net income (loss) per common and common equivalent shares is based on net
income (loss) after preferred stock dividend requirements. Net income per
common and common equivalent share in the first quarter of 1994 on a primary
and fully diluted basis are computed using the weighted average number of
shares outstanding adjusted for the effect of stock options and warrants
considered to be dilutive common stock equivalents. For the first quarter of
1995, the stock options and warrants were excluded from the calculation of net
loss attributable to common and common equivalent shares as they would be anti-
dilutive.
-12-
UNITED STATIONERS INC. AND SUBSIDIARIES
MANAGEMENT'S DISCUSSION AND ANALYSIS
OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS
RESULTS OF OPERATIONS
FISCAL 1995 COMPARED TO FISCAL 1994
THE MERGER, WHICH WAS CONSUMMATED ON MARCH 30, 1995, WAS ACCOUNTED FOR AS A
REVERSE ACQUISITION; THEREFORE, THE FOLLOWING FIRST QUARTER OPERATING AND CASH
FLOW DATA REFLECT THAT OF ASSOCIATED ONLY, INCLUDING THE EFFECTS OF THE
ACQUISITION AND MERGER.
First Quarter Results
Net sales were $137.3 million for the first quarter of 1995, a 10.8% increase
over net sales of $123.9 million in the comparable period in 1994. The sales
growth reflects increased unit volume.
Gross profit as a percent of net sales increased to 24.6% in the first quarter
of 1995 from 24.0% in the first quarter of 1994. The increase reflects higher
levels of vendor volume allowances and increased forward-buying efforts in
anticipation of future price increases. The increase was partially offset by a
higher level of volume allowances earned by Associated's customers.
Operating expenses as a percent of net sales increased to 28.2% in the first
quarter of 1995 from 21.6% in the first quarter of 1994. The increase includes
a $9.8 million Merger related restructuring charge in 1995. The decrease in
operating expenses as a percent of net sales before the restructuring charge is
primarily due to improved productivity and higher sales volume, partially
offset by merger related compensation expense relating to the redemption of
employee stock options of approximately $1.5 million ($0.9 million net of tax
benefit). Operating expenses in the first quarter of 1995 as a percent of net
sales before the restructuring charge and the compensation expense relating to
the redemption of stock options were 20.0%.
Income (loss) from operations as a percent of net sales was a negative 3.6% in
the first quarter of 1995 (a positive 3.5% before the restructuring charge)
compared with a positive 2.4% in the first quarter of 1994.
Interest expense increased to $2.2 million in the first quarter of 1995 from
$1.7 million in 1994. The increase is primarily due to higher interest rates.
Income (loss) before income taxes as a percent of net sales was a negative 5.3%
in the first quarter of 1995 compared to a positive 1.0% in the first quarter
of 1994. Net income (loss) before extraordinary items and preferred stock
dividends was a negative $4.2 million (net income of $1.5 million before the
restructuring charge) in the first quarter of 1995 compared to a positive $0.7
million in the first quarter of 1994. An extraordinary item, the loss on early
retirement of debt related to the Merger of $2.4 million ($1.4 million after
tax benefit), was recognized in the first quarter of 1995. The net income
(loss) attributable to common stock after the extraordinary item was a negative
$6.3 million (net loss of $0.5 million before the restructuring charge) in the
first quarter of 1995 compared to a positive $0.2 million in the year ago
quarter.
-13-
UNITED STATIONERS INC. AND SUBSIDIARIES
MANAGEMENT'S DISCUSSION AND ANALYSIS
OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS
(CONTINUED)
Liquidity and Capital Resources
Refer to "Item 5 - Subsequent Event" for additional disclosure regarding
Liquidity and Capital Resources.
In connection with the consummation of the Acquisition, Associated received an
equity investment of $12.0 million and borrowed an aggregate of $406.7 million
under the New Credit Facilities and $130.0 million under the Subordinated
Bridge Facility. The proceeds of these investments and borrowings were used to
(i) finance the purchase of Shares pursuant to the Offer, (ii) refinance
certain existing indebtedness of Associated (including all amounts outstanding
under the existing old Associated credit facilities) and indebtedness of the
Company (including certain amounts outstanding under the old Company and USSC
credit facilities), (iii) redeem Company employee stock options, and (iv) pay
fees and expenses relating to the Acquisition.
The New Credit Facilities consist of $200.0 million of term loan borrowings
("Term Loan Facilities") and up to $300.0 million of revolving loan borrowings
("Revolving Credit Facility").
Prior to the offering of the Notes and the related prepayment of a portion of
the Term Loan Facilities, the Term Loan Facilities consisted of a $125.0
million Tranche A term loan facility ("Tranche A Facility") and a $75.0 million
Tranche B term loan facility ("Tranche B Facility"). Amounts outstanding under
the Tranche A Facility are required to be repaid in 20 consecutive
installments, the first four of which (each in the aggregate principal amount
of $3.75 million) will be due on the last day of each of the first four
calendar quarters commencing with the quarter ending June 30, 1995. Subsequent
quarterly payments under the Tranche A Facility are each in the aggregate
principal amount of $6.25 million for each of the eight consecutive calendar
quarters commencing with the quarter ending June 30, 1996 and $7.5 million for
each of the eight consecutive calendar quarters commencing with the quarter
ending June 30, 1998. Amounts outstanding under the Tranche B Facility will be
repaid in 28 consecutive quarterly installments, the first twenty of which (in
the aggregate principal amount of $.25 million each) will be due on the last
day of each of the first twenty calendar quarters commencing with the quarter
ending June 30, 1995. The remaining eight installments in the aggregate
principal amount of $8.75 million each will be due on the last day of each
calendar quarter commencing with the quarter ending June 30, 2000. The final
installments under the Tranche A Facility and the Tranche B Facility will be
payable on March 31, 2000 and March 31, 2002, respectively.
-14-
UNITED STATIONERS INC. AND SUBSIDIARIES
MANAGEMENT'S DISCUSSION AND ANALYSIS
OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS
(CONTINUED)
The Revolving Credit Facility is limited to the lesser of $300.0 million or a
borrowing base equal to: 80% of Eligible Receivables (as defined in the New
Credit Agreement); plus 50% of Eligible Inventory (as defined in the New Credit
Agreement) (provided that no more than 60% or, during certain periods 65%, of
the Borrowing Base may be attributable to Eligible Inventory); plus the
aggregate amount of cover for Letter of Credit Liabilities (as defined). The
Revolving Credit Facility provides that, for each fiscal year commencing
January 1, 1996, the Company must repay revolving loans so that for a
consecutive period of 30 consecutive days in each fiscal year the aggregate
revolving loans do not exceed $200.0 million. The Revolving Credit Facility
matures on March 31, 2000.
The Term Loan Facilities and the Revolving Credit Facility are secured by first
priority pledges of the stock of USSC, all of the stock of the domestic direct
and indirect subsidiaries of USSC, certain of the stock of all of the foreign
direct and indirect subsidiaries of USSC and security interests in and liens
upon all accounts receivable, inventory, contract rights and other certain
personal and certain real property of USSC and its domestic subsidiaries.
The agreement governing the New Credit Facilities (the "New Credit Facilities
Agreement") contains representations and warranties, affirmative and negative
covenants and events of default customary for financings of this type. The
Company is in the process of obtaining the consent of the requisite under the
New Credit Facilities Agreement to permit the redemption of the Company's
Series B Preferred Stock.
Immediately prior to the acceptance for payment of Shares in the Offer,
Associated and ASI entered into the Subordinated Bridge Facility with The
Roebling Fund, as agent and lender, and Chase Bank, as lender, providing for a
bridge loan to ASI in the aggregate principal amount of $130.0 million. Upon
consummation of the Merger, the obligations of Associated and ASI related to
the Subordinated Bridge Facility were assumed by the Company and USSC,
respectively. The Subordinated Bridge Facility was scheduled to mature on
March 30, 1996. The Subordinated Bridge Facility bore interest at varying
rates plus the applicable margin. The Subordinated Bridge Facility has been
refinanced in full from a portion of the proceeds from the sale of $150.0
million of Notes issued under an indenture, dated as of May 3, 1995, among
USSC, the Company, as guarantor, and The Bank of New York, as trustee (the
"Indenture").
On March 30, 1995, the Company filed with the Secretary of State of the State
of Delaware a certificate of the Powers, Designations, Preferences, and Rights
of the Series A Preferred Stock, Series B Preferered Stock and Series C
Preferred Stock of the Company (collectively, the "Preferred
-15-
UNITED STATIONERS INC. AND SUBSIDIARIES
MANAGEMENT'S DISCUSSION AND ANALYSIS
OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS
(CONTINUED)
Stock"), which was duly authorized by the Company's Board of Directors. As a
result of the Merger, each outstanding share (and fractions thereof) of the
Class A Preferred Stock, Class B Preferred Stock and Class C Preferred Stock of
Associated was converted into one share (and corresponding fraction thereof) of
Series A Preferred Stock, Series B Preferred Stock and Series C Preferred
Stock, respectively, of the Company.
Quarterly dividends currently accrue on the Preferred Stock at the respective
rates of 10.0% for Series A and 9.0% for Series B and C per annum (or, when
dividends are not paid in cash, 13.0% for Series A and 10.0% for Series B and
C), and may be paid in the form of additional shares of the respective series
of Preferred Stock (except, in the case of the Series C Preferred Stock, for
dividends payable after January 31, 1999, which must be paid in cash). Based
upon the Company's anticipated operating results and the requirements under the
New Credit Facilities Agreement and the Indenture, management expects to pay
dividends on the Preferred Stock when such dividends become due and payable in
kind (rather than in cash) for the foreseeable future.
The New Credit Facilities permit capital expenditures for the Company of up to
$12.0 million for the post-Merger portion of its fiscal year ending December
31, 1995. Capital expenditures will be financed from internally generated
funds and available borrowings under the New Credit Facilities.
Management anticipates making changes in the operations of the Company and
Associated as conducted prior to the Acquisition. Consistent with its business
strategy, since the consummation of the Acquisition on March 30, 1995, the
Company has been implementing its consolidation plan to integrate its business
with the business of Associated. Through the integration of distribution
facilities and product lines in a manner designed to enable the Company to
offer its customers increased service and product availability, the Company
expects to improve its competitive position. In addition, the Company plans to
achieve cost savings and other benefits from the elimination of redundant or
overlapping functions and facilities and by minimizing overlapping products.
Based on internally generated funds and the expected results of these changes,
management believes that the Company's cash on hand, anticipated funds
generated from operations and available borrowings under the New Credit
Facilities will be sufficient to meet the short-term (less than twelve months)
and long-term operating and capital needs of the Company after the Acquisition
as well as to service its debt in accordance with its terms. There is,
however, no assurance this will be accomplished.
-16-
UNITED STATIONERS INC. AND SUBSIDIARIES
PART II - OTHER INFORMATION
ITEM 5 SUBSEQUENT EVENT
On May 3, 1995, USSC completed the issuance of $150.0 million of
Notes. The net proceeds of the Notes (after discount and fees
of approximately $5.5 million) were used to pay certain
expenses, to repay the $130.0 million Subordinated Bridge
Facility (together with $1.6 million in accrued and unpaid
interest thereon), to repay a portion of the Tranche A and
Tranche B term loans (totaling approximately $6.5 million) and
working capital. In the event the necessary consents are
obtained, the Company is permitted to redeem the Series B
Preferred Stock (approximately $7.0 million).
The Notes are unconditionally guaranteed on a senior
subordinated basis (the "Guarantees") by the Company and any
future domestic Restricted Subsidiary (as defined) of the
Company.
Interest on the Notes will be payable semiannually on May 1 and
November 1 of each year, commencing November 1, 1995. The Notes
are redeemable at the option of USSC, in whole or in part, at
any time on or after May 1, 2000 at the redemption prices set
forth in the Indenture, together with accrued and unpaid
interest, if any, to the date of redemption. In addition, on or
prior to May 1, 1998, USSC may redeem up to $50.0 million
principal amount of the Notes with the proceeds of one or more
Public Equity Offerings (as defined) at 112.75% of the aggregate
principal amount thereof, together with accrued and unpaid
interest, if any, to the date of redemption; provided that Notes
having an aggregate principal amount of at least $100.0 million
remain outstanding immediately after any such redemption. Upon
the occurrence of a Change of Control (as defined), each holder
of the Notes may require USSC to repurchase all or a portion of
such holder's Notes at 101% of the principal amount thereof,
together with accrued and unpaid interest, if any, to the date
of repurchase.
The Notes and the Company's Guarantees are subordinated to all
Senior Indebtedness (as defined) of USSC and Senior Guarantor
Indebtedness (as defined) of the Company, respectively.
-17-
UNITED STATIONERS INC. AND SUBSIDIARIES
PART II - OTHER INFORMATION
ITEM 5 SUBSEQUENT EVENT (CONTINUED)
The Indenture contains certain covenants, including limitations
on the incurrence of indebtedness, the making of restricted
payments, transactions with affiliates, the existence of liens,
disposition of proceeds of asset sales, the making of guarantees
by restricted subsidiaries, transfers and issuances of stock of
subsidiaries, the imposition of certain payment restrictions on
restricted subsidiaries and certain mergers and sale of assets.
The Notes have been designated as eligible for trading in the
PORTAL Market.
The Company and USSC have agreed to use their best efforts to
file a registration statement with the Securities Exchange
Commission under the Securities Act of 1993 with respect to a
registered offer to exchange the Notes for similar notes (the
"Exchange Offer"). The Exchange Offer is to be consummated
within 150 days of the original issue date of the Notes. If
certain events are not completed within the prescribed timetable
for the consummation of the Exchange Offer, the interest rate
borne by the Notes shall be increased, not to exceed one-half of
one percent per annum, until the completion of such events.
ITEM 5 OTHER INFORMATION - HISTORICAL SUMMARY FINANCIAL INFORMATION
The following historical financial information of the Company
and its subsidiaries and Associated and its subsidiaries has
been included for reference purposes.
-18-
UNITED STATIONERS INC. AND SUBSIDIARIES
PART II - OTHER INFORMATION
ITEM 5 OTHER INFORMATION - HISTORICAL SUMMARY FINANCIAL INFORMATION
(Continued) THE COMPANY - HISTORICAL
The summary financial information of the Company set forth below for
each of the fiscal years in the five-year period ended August 31, 1994 has been
derived from the financial statements of the Company, which have been audited
by Arthur Andersen LLP, independent public accountants. The summary financial
information for the six-month periods ended February 28, 1994 and 1995 is
unaudited and in the opinion of management reflects all adjustments considered
necessary for a fair presentation of such data. The results of operations for
any interim period are not necessarily indicative of results of operations for
the fiscal year and should be read in conjunction with, and is qualified in its
entirety by, "Management's Discussion and Analysis of Financial Condition and
Results of Operations - Historical Results of Operations of the Company" and
"Historical Liquidity and Capital Resources of the Company" and the financial
statements of the Company included in the Company's Form 10-K for the fiscal
year ended August 31, 1994.
Six Months Ended
Year Ended August 31, February 28,
(dollars in thousands) 1990 1991 1992 1993 1994
1994 1995
(unaudited)
Income Statement Data:
Net sales $933,178$951,109$1,094,275$1,470,115$1,473,024 $ 740,585
$833,838
Gross profit on sales224,230218,708245,687344,519322,901 167,334 175,586
Operating expenses 195,863195,694219,285 298,405286,607 145,739145,469
Income from operations28,36723,01426,402 46,114 36,294 21,59530,117
Interest expense, net7,350 6,082 6,503 9,550 10,461 4,984 6,226
Income before income taxes 21,361 16,918 20,263 36,91926,058 16,697
23,953
Income taxes 8,523 7,008 8,899 15,559 10,309 6,929 9,648
Net income 12,838 9,910 11,364 21,360 15,749 9,768 14,305
Operating and Other Data:
EBITDA (1) $ 43,851$ 41,912$ 46,645$ 67,712$ 57,755$ 32,089 $ 40,949
EBITDA margin (2) 4.4% 4.4% 4.3% 4.6% 3.9% 4.3% 4.9%
Depreciation & amort.$ 15,140$ 18,912$ 19,879$ 21,243$ 21,236$ 10,408 $
10,770
Net capital expenditures15,06715,7658,291 29,958 10,499 3,312 4,812
Balance Sheet Data (at period end):
Working capital $134,420$135,347$ 214,611$ 216,074$ 239,827$287,308 $262,725
Total assets 401,661409,958601,465 634,786618,550655,029700,235
Total debt and capital
leases (3) 73,683 73,123150,728 150,251155,803209,955198,485
Stockholders' investment177,777181,584223,387237,697246,010243,831256,541
____________
(1) EBITDA is defined as earnings before interest, taxes, depreciation and
amortization and is presented because it is commonly used by certain
investors and analysts to analyze and compare companies on the basis of
operating performance and to determine a company's ability to service and
incur debt. EBITDA should not be considered in isolation from or as a
substitute for net income, cash flows from operating activities or other
consolidated income or cash flow statement data prepared in accordance
with generally accepted accounting principles or as a measure of
profitability or liquidity.
(2) EBITDA margin represents EBITDA as a percentage of net sales.
(3) Total debt and capital leases includes current maturities but excludes
original issue discount.
-19-
UNITED STATIONERS INC. AND SUBSIDIARIES
PART II - OTHER INFORMATION
ITEM 5 OTHER INFORMATION - HISTORICAL SUMMARY FINANCIAL INFORMATION
(Continued) ASSOCIATED - HISTORICAL
The summary financial information of Associated set forth below with
respect to the years ended December 31, 1994 and 1993 and the period from
January 31, 1992 (when certain of the assets and certain liabilities of ASI
were acquired (the "Boise Transaction") from the Wholesale Division of Boise
Cascade Office Products Corporation ("BCOP")) through December 31, 1992 has
been derived from and should be read in conjunction with, and is qualified in
its entirety by, "Management's Discussion and Analysis of Financial Condition
and Results of Operations - Historical Results of Operations of Associated" and
"Historical Liquidity and Capital Resources of Associated" and the financial
statements of Associated included in the Company's Form 8-K filed April 14,
1995, which have been audited by Arthur Andersen LLP, independent public
accountants. The data at and for the years ended December 31, 1990 and 1991
and the one month ended January 31, 1992 is derived from the unaudited
financial statements of BCOP for such periods. Associated has accounted for
the Boise Transaction using the purchase method of accounting. There are
material operational and accounting differences between BCOP and Associated
resulting from the Boise Transaction. Accordingly, the historical financial
data of BCOP may not be comparable in all material respects with data of
Associated.
Predecessor (1) (2)
Associated
January 1
January 31
Year Ended to to
Year Ended
December 31, January 31, December 31,
December 31,
(dollars in thousands) 1990 (3) 1991 (4) 1992 (5)
1992 1993 1994
(unaudited)
Income Statement Data:
Net sales $443,547 $411,343 $39,016$365,944 $462,531 $477,445
Gross profit 112,324 103,253 9,142 89,398 112,280 120,169
Operating expenses 90,773 88,374 7,723 79,889 102,274 103,020
Income from operations 21,551 14,879 1,419 9,509 10,006 17,149
Interest expense - - - 4,782 6,263 6,753
Income before income taxes - - - 4,727 3,743 10,396
Income taxes - - - 1,777 781 3,993
Net income - - - 2,950 2,962 6,403
Preferred stock dividends issued
and accrued - - - 1,449 2,047 2,193
Net income available for common
stock shareholders - - - 1,501 915 4,210
Operating and Other Data:
EBITDA (6) $ 24,511 $ 18,028 $ 1,661$ 14,875 $ 16,481 $ 23,505
EBITDA margin (7) 5.5% 4.4% 4.3% 4.1% 3.6% 4.9%
Depreciation and amortization$ 2,960$ 3,149$ 242$ 5,366$ 6,475$ 6,356
Capital expenditures, net8,129 273 (36) 4,289 3,273 554
Predecessor (1)
Associated
At December 31,
(dollars in thousands) 1990 (3) 1991 (4) 1992
1993 1994
(unaudited)
Balance Sheet Data:
Working capital $ 60,726 $ 54,373$ 46,396 $ 57,302 $ 56,454
Total assets 151,432 140,756 179,069 190,979 192,479
Total debt and capital leases (8) - - 78,297 86,350
64,623
Redeemable preferred stock - - 18,949 20,996 23,189
Redeemable warrants - - 1,435 1,435 1,650
Total stockholders' or predecessor
division equity 102,871 93,642 10,466 11,422 24,775
-20-
UNITED STATIONERS INC. AND SUBSIDIARIES
PART II - OTHER INFORMATION
ITEM 5 HISTORICAL SUMMARY FINANCIAL INFORMATION (Continued)
ASSOCIATED - HISTORICAL
(1) The capital structure and accounting basis of the
assets and liabilities of the predecessor of ASI, BCOP, differ from those
of Associated and ASI. Accordingly, certain of the financial information
for periods before January 31, 1992 is not comparable to that for periods
after January 31, 1992 and therefore is not presented in this table.
(2)The Predecessor operated as a segment of BCOP. BCOP did not allocate income
tax or interest expense to the Predecessor. Accordingly, actual operating
results for the Predecessor reflect only income from operations before
interest expense and income taxes.
(3)Derived from the unaudited financial statements of BCOP at and for the year
ended December 31, 1990.
(4)Derived from the unaudited financial statements of BCOP at and for the year
ended December 31, 1991.
(5)Derived from the unaudited financial statements of BCOP for the one month
ended January 31, 1992.
(6)EBITDA is defined as earnings before interest taxes, depreciation and
amortization and is presented because it is commonly used by certain
investors and analysts to analyze and compare companies on the basis of
operating performance and to determine a company's ability to service and
incur debt. EBITDA should not be considered in isolation from or as a
substitute for net income, cash flows from operating activities or other
consolidated income or cash flow statement data prepared in accordance with
generally accepted accounting principles or as a measure of profitability
or liquidity.
(7)EBITDA margin represents EBITDA as a percentage of net sales.
(8)Total debt and capital leases is defined as long-term debt including current
maturities but excluding original issue discount, plus deferred obligations
due to the holder of the Associated Class B redeemable preferred stock.
-21-
UNITED STATIONERS INC. AND SUBSIDIARIES
PART II - OTHER INFORMATION
ITEM 6 EXHIBITS AND REPORTS ON FORM 8-K
(a) Exhibit
Number
2 Not applicable
4 Instruments defining the rights of Security holders
(a) Material Agreements:
(i) Credit Agreement dated as of March 30, 1995
among: Associated Stationers, Inc. (together
with its successors and assigns, including United
Stationers Supply Co.; Associated Holdings, Inc.
(together with its successors and assigns,
including United Stationers Inc.); The Chase
Manhattan Bank (National Association, as agent
for the lenders); and a group of lenders.
(ii) Indenture dated as of May 3, 1995 among:
United Stationers Supply Co.; United Stationers
Inc., as guarantor; and The Bank of New York, as
trustee.
(iii)Form of 12 3/4% Senior Subordinated Notes
due 2005
(iv) Certificate of Powers, Designations,
Preferences, and Rights of the Series A Preferred
Stock, Series B Preferred Stock and Series C
Preferred Stock.
(v) Certificate of Ownership and Merger of
Associated Holdings, Inc. (which includes
amendments to the Company's Restated Certificate
of Incorporation).
10 Not applicble
11 Not applicable
15 Letter regarding unaudited interim
financial information
18 Not applicable
19 Not applicable
22 Not applicable
23 Not applicable
24 Not applicable
27 Not applicable
99 Not applicable
-22-
UNITED STATIONERS INC. AND SUBSIDIARIES
PART II - OTHER INFORMATION
ITEM 6 EXHIBITS AND REPORTS ON FORM 8-K (CONTINUED)
(b) A report on Form 8-K was filed on February 13, 1995, reporting
that the Company had entered into the Merger Agreement with
Associated.
The following Form 8-K's were filed subsequent to the end of the
quarter:
A report on Form 8-K was filed on April 14, 1995, reporting a
change in control, which included audited financial statements
of the Company and its subsidiaries for the fiscal year ended
August 31, 1994 and unaudited financial statements for the six
months ended February 28, 1995, audited financial statements
of Associated and its subsidiaries for the fiscal year ended
December 31, 1994, and unaudited pro forma financial
information based on historical financial information of
Associated and the Company as of December 31, 1994.
A report on Form 8-K was filed on April 26, 1995, reporting
that the Company changed its fiscal year end from August 31 to
December 31 and that the Company's Board of Directors
appointed Ernst & Young LLP as independent accountants to
replace Arthur Andersen LLP.
-23-
UNITED STATIONERS INC. AND SUBSIDIARIES
SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of 1934, the
Registrant has duly caused this report to be signed on its behalf by the
undersigned thereunto duly authorized.
UNITED STATIONERS INC.
(Registrant)
Date: May 15, 1995 /s/Daniel H. Bushell
Executive Vice President and
Chief Financial Officer
-24-
UNITED STATIONERS INC. AND SUBSIDIARIES
SIGNATURE
Pursuant to the requirements of the Securities and Exchange Act of 1934, the
Registrant has duly caused this report to be signed on its behalf by the
undersigned thereunto duly authorized.
UNITED STATIONERS INC.
(Registrant)
Date: May 15, 1995
Daniel H. Bushell
Executive Vice President and
Chief Financial Officer
-24-
UNITED STATIONERS INC. AND SUBSIDIARIES
INDEX TO EXHIBITS
(a) Exhibit
Number
2 Not applicable
4 Instruments defining the rights of Security holders
(a) Material Agreements:
(i) Credit Agreement dated as of March 30, 1995
among: Associated Stationers, Inc. (together
with its successors and assigns, including United
Stationers Supply Co.; Associated Holdings, Inc.
(together with its successors and assigns,
including United Stationers Inc.); The Chase
Manhattan Bank (National Association, as agent
for the lenders); and a group of lenders.
(ii) Indenture dated as of May 3, 1995 among:
United Stationers Supply Co.; United Stationers
Inc., as guarantor; and The Bank of New York, as
trustee.
(iii)Form of 12 3/4% Senior Subordinated Notes
due 2005
(iv) Certificate of Powers, Designations,
Preferences, and Rights of the Series A Preferred
Stock, Series B Preferred Stock and Series C
Preferred Stock.
(v) Certificate of Ownership and Merger of
Associated Holdings, Inc. (which includes
amendments to the Company's Restated Certificate
of Incorporation).
10 Not applicble
11 Not applicable
15 Letter regarding unaudited interim
financial information
18 Not applicable
19 Not applicable
22 Not applicable
23 Not applicable
24 Not applicable
27 Not applicable
99 Not applicable
-25-
BII\27636_10
EXECUTION
COPY
************************************************************
ASSOCIATED STATIONERS, INC.
To Be Merged With and
Into UNITED STATIONERS
SUPPLY CO.
and
ASSOCIATED HOLDINGS, INC.
To Be Merged With and
Into
UNITED STATIONERS INC.
____________________________
__ CREDIT AGREEMENT
Dated as of March 30, 1995
______________________________
$500,000,000
____________________________
__
THE CHASE MANHATTAN BANK
(NATIONAL ASSOCIATION),
as Agent
************************************************************
TABLE OF CONTENTS
This Table of Contents is not part of the Agreement
to which it is attached but is inserted for convenience of
reference only.
Page
Section 1. Definitions and Accounting Matters
2
1.01 Certain Defined Terms
2
1.02 Accounting Terms and Determinations
36
1.03 Classes and Types of Loans
37
Section 2. Commitments, Loans, Notes and Prepayments
37
2.01 Loans
37
2.02 Borrowings
39
2.03 Letters of Credit
39
2.04 Changes of Commitments
45
2.05 Commitment Fee
46
2.06 Lending Offices
46
2.07 Several Obligations; Remedies Independent
46
2.08 Notes
47
2.09 Optional Prepayments and Conversions or
Continuations of Loans
48
2.10 Mandatory Prepayments and Reductions of
Commitments
49
Section 3. Payments of Principal and Interest
53
3.01 Repayment of Loans
53
3.02 Interest
53
Section 4. Payments; Pro Rata Treatment; Computations;
Etc.
54
4.01 Payments
54
4.02 Pro Rata Treatment
55
4.03 Computations
56
4.04 Minimum Amounts
56
4.05 Certain Notices
57
4.06 Non-Receipt of Funds by the Agent
58
4.07 Sharing of Payments, Etc.
59
Section 5. Yield Protection, Etc.
60
5.01 Additional Costs
60
5.02 Limitation on Types of Loans
63
5.03 Illegality
64
5.04 Treatment of Affected Loans
65
5.05 Compensation
65
5.06 Additional Costs in Respect of Letters of
Credit
66
5.07 U.S. Taxes
67
Section 6. Guarantee
71
6.01 The Guarantee
71
6.02 Obligations Unconditional
71
6.03 Reinstatement
72
6.04 Subrogation
73
6.05 Remedies
73
6.06 Continuing Guarantee
73
Section 7. Conditions Precedent
73
7.01 Initial Loan
73
7.02 Initial and Subsequent Extensions of Credit
84
Section 8. Representations and Warranties
85
8.01 Corporate Existence
85
8.02 Financial Condition
85
8.03 Litigation
86
8.04 No Breach
87
8.05 Action
87
8.06 Approvals
88
8.07 Use of Credit
88
8.08 ERISA
89
8.09 Taxes
89
8.10 Investment Company Act
89
8.11 Public Utility Holding Company Act
90
8.12 Material Agreements and Liens
90
8.13 Environmental Matters
91
8.14 Capitalization
93
8.15 Subsidiaries, Etc.
95
8.16 Title to Assets
96
8.17 True and Complete Disclosure
96
8.18 Real Property
97
8.19 Security Documents
97
8.20 Acquisition Costs
97
Section 9. Covenants of the Obligors
97
9.01 Financial Statements, Etc
97
9.02 Litigation
103
9.03 Existence, Etc.
103
9.04 Insurance
104
9.05 Prohibition of Fundamental Changes
105
9.06 Limitation on Liens
107
9.07 Indebtedness
110
9.08 Investments
111
9.09 Dividend Payments
112
9.10 Net Worth
114
9.11 Debt to Cash Flow Ratio
114
9.12 Fixed Charges Ratio
114
9.13 Interest Coverage Ratio
115
9.14 Capital Expenditures
115
9.15 Interest Rate Protection Agreements
116
9.16 Subordinated Indebtedness
116
9.17 Lines of Business
116
9.18 Transactions with Affiliates
116
9.19 Use of Proceeds
117
9.20 Modifications of Certain Documents
117
9.21 Ownership of the Company
118
9.22 Management Fees, Etc
118
9.23 Taxes; Tax Sharing Agreement
118
9.24 Subsidiary Guarantors; Repayment of
Indebtedness;
Additional Mortgaged Property
119
9.25 Termination of ERISA Plans.
120
9.26 Consummation of the Mergers
120
Section 10. Events of Default
120
Section 11. The Agent
125
11.01 Appointment, Powers and Immunities
125
11.02 Reliance by Agent
126
11.03 Defaults
126
11.04 Rights as a Lender
127
11.05 Indemnification
127
11.06 Non-Reliance on Agent and Other Lenders
128
11.07 Failure to Act
128
11.08 Resignation or Removal of Agent
129
11.09 Consents under Other Basic Documents
129
11.10 Collateral Sub-Agents
129
Section 12. Miscellaneous
130
12.01 Waiver
130
12.02 Notices
130
12.03 Expenses, Etc.
130
12.04 Amendments, Etc.
132
12.05 Successors and Assigns
133
12.06 Assignments and Participations
133
12.07 Survival
137
12.08 Captions
138
12.09 Counterparts
138
12.10 Governing Law; Submission to Jurisdiction
138
12.11 Waiver of Jury Trial
138
12.12 Treatment of Certain Information;
Confidentiality
138
12.13 Certain Tax Information
140
SCHEDULE I - Indebtedness and Liens
SCHEDULE II - Environmental Matters
SCHEDULE III - Subsidiaries and
Investments
SCHEDULE IV - Real Property
SCHEDULE V - Litigation
SCHEDULE VI - Capitalization
SCHEDULE VII - Target EBITDA
SCHEDULE VIII - Taxes
EXHIBIT A-1 - Form of Revolving Credit Note
EXHIBIT A-2 - Form of Tranche A Term Loan Note
EXHIBIT A-3 - Form of Tranche B Term Loan Note
EXHIBIT B - Form of Borrowing Base
Certificate
EXHIBIT C - Form of Security Agreement
EXHIBIT D - Form of Pledge Agreement
EXHIBIT E - Form of Mortgage
EXHIBIT F - Form of Assumption Agreement
EXHIBIT G-1 - Form of Opinion of Special New York Counsel
to
the Obligors, to be delivered on the Initial
Borrowing Date
EXHIBIT G-2 - Form of Opinion of Special Illinois Counsel
to
the Obligors, to be delivered on the Initial
Borrowing Date
EXHIBIT G-3 - Form of Opinion of Special Delaware Counsel
to
the Obligors, to be delivered on the Initial
Borrowing Date
EXHIBIT G-4 - Form of Opinion of Local Counsel
EXHIBIT H - Form of Opinion of Special New York Counsel
to
the Agent to be delivered on the Initial
Borrowing Date
EXHIBIT I - Form of Confidentiality Agreement
EXHIBIT J - Form of Notice of Assignment
CREDIT AGREEMENT dated as of March 30, 1995 (this
"Agreement") among: ASSOCIATED STATIONERS, INC., a corporation
duly organized and validly existing under the laws of the State
of Delaware (together with its successors and assigns,
including United Stationers Supply Co. ("Supply"), an Illinois
corporation and a Wholly-Owned Subsidiary of United (as defined
below) from and after the effectiveness of the Supply Merger
(as defined below), the "Company"); ASSOCIATED HOLDINGS, INC.,
a corporation duly organized and validly existing under the
laws of the State of Delaware (together with its successors and
assigns, including United Stationers Inc., a Delaware
corporation ("United"), from and after the effectiveness of the
United Merger (as defined below), the "Guarantor" and, together
with the Company, the "Obligors"); each of the lenders that is
a signatory hereto identified under the caption "LENDERS" on
the signature pages hereto or that, pursuant to Section
12.06(b) hereof, shall become a "Lender" hereunder
(individually, a "Lender" and, collectively, the "Lenders");
and THE CHASE MANHATTAN BANK (NATIONAL ASSOCIATION), a national
banking association, as agent for the Lenders (in such
capacity, together with its successors in such capacity, the
"Agent").
WHEREAS, each of the Obligors has requested the
Lenders to make loans to the Company in an aggregate principal
amount not exceeding $500,000,000 at any one time outstanding
to provide
financing for the acquisition by the Guarantor of up to
17,201,839 United Shares (as defined below), representing as of
the date hereof approximately 92.5% of the issued and
outstanding United Shares, and for certain related purposes and
to refinance certain Indebtedness of the Company, United and
Supply existing at the Initial Borrowing Date (as defined
below) and to provide working capital requirements and other
general corporate purposes of the Company and Supply;
WHEREAS, following the purchase of United Shares
pursuant to the Tender Offer (as defined below), it is
contemplated that the Guarantor will merge with and into United
with the result that United will be the surviving corporation
(the "United Merger") and the Company will merge with and into
Supply with the result that Supply will be the surviving
corporation (the "Supply Merger" and, together with the United
Merger, the "Mergers"), each such merger to be in accordance
with the terms of the Merger Agreement (as defined below); and
WHEREAS, in order to finance the purchase of the
United Shares described in the first recital hereof, to finance
the payment of certain amounts owing in connection with the
Mergers and to provide working capital for the Company, the
Lenders are prepared to make available the credit facilities
provided for herein;
NOW, THEREFORE, the parties hereto agree as follows:
Section 1. Definitions and Accounting Matters.
1.01 Certain Defined Terms. As used herein, the
following terms shall have the following meanings (all terms
defined in this Section 1.01 or in other provisions of this
Agreement in the singular to have the same meanings when used
in the plural and vice versa):
"Accrued Warrant Liabilities" shall mean any
liabilities of the Guarantor under Section 7.02(c) of the
Warrant Agreement.
"ACS" shall mean Affiliated Computer Services, Inc.
"Acquisition" shall mean (a) the purchase by the
Guarantor of up to 17,201,839 United Shares (at a price per
share not to exceed $15.50) for cash pursuant to the Tender
Offer Documents and (b) the Mergers.
"Acquisition Costs" shall mean all costs and expenses
incurred by the Obligors in connection with the Acquisition and
related transactions other than severance payments made or to
be made to officers or directors of United.
"Acquisition Documents" shall mean the Tender Offer
Documents, the Additional Tender Offer Documents, the Merger
Agreement, the certificates of merger with respect to the
Mergers, the Information Statement and any other document or
information sent by the Guarantor or United to the stockholders
of United or filed with the Commission in connection with the
Acquisition.
"Additional Tender Offer Documents" shall mean all
amendments and exhibits to, and documents related to, the
Tender Offer Documents filed directly or indirectly with the
Commission, or distributed to the stockholders of United, in
each case delivered to the Agent and Lenders on or after the
date of this
Agreement.
"Affiliate" shall mean, in respect of any Person (the
"Relevant Person"), any other Person that directly or
indirectly controls, or is under common control with, or is
controlled by, the Relevant Person and, if such other Person is
an individual, any member of the immediate family (including
parents, spouse, children and siblings) of such individual and
any trust whose principal beneficiary is such individual or one
or more members of such immediate family and any Person who is
controlled by any such member or trust. As used in this
definition, "control" (including, with its correlative
meanings, "controlled by" and "under common control with")
shall mean possession, directly or indirectly, of power to
direct or cause the direction of management or policies
(whether through ownership of securities or partnership or
other ownership interests, by contract or other wise), provided
that, in any event, any Person that owns directly or indirectly
securities having 5% or more of the voting power for the
election of directors or other governing body of a cor poration
or 5% or more of the partnership or other ownership interests
of any other Person (other than as a limited partner of such
other Person) will be deemed to control such corporation or
other Person. Notwithstanding the foregoing, (a) no individual
shall be an Affiliate of any Relevant Person solely by reason
of his or her being a director, officer or employee of such
Relevant Person or any of its Subsidiaries, (b) none of the
Subsidiaries of the Guarantor shall be Affiliates of the
Guarantor or of any other Subsidiary of the Guarantor, (c) the
Guarantor shall not be an Affiliate of any of its Subsidiaries,
(d) neither the Agent nor any Lender shall be an Affiliate of
the Guarantor or of any Subsidiary of the Guarantor, (e)
neither The Chase Manhattan Corporation nor any of its
Subsidiaries or Affiliates shall be an Affiliate of the
Guarantor or of any Subsidiary of the Guarantor and (f) BCOP
and Boise shall be Affiliates of the Guarantor and of each
Subsidiary of the Guarantor.
"Applicable Lending Office" shall mean, for each
Lender and for each Type of Loan, the "Lending Office" of such
Lender (or of an affiliate of such Lender) designated for such
Type of Loan on the signature pages hereof or such other office
of such Lender (or of an affiliate of such Lender) as such
Lender may from time to time specify to the Agent and the
Company as the office by which its Loans of such Type are to be
made and maintained.
"Applicable Margin" shall mean: (a) with respect to
Revolving Credit Loans, 2.75% per annum for Eurodollar Loans
and 1.75% per annum for Base Rate Loans; (b) with respect to
Tranche A Term Loans, 2.75% per annum for Eurodollar Loans and
1.75% per annum for Base Rate Loans; and (c) with respect to
Tranche B Term Loans, 3.25% per annum for Eurodollar Loans and
2.25% per annum for Base Rate Loans; provided that the
Applicable Margin for each Type of Tranche A Term Loan and
Revolving Credit Loan, for any period from and including any
Fiscal Date occurring not earlier than December 31, 1995 and on
or immediately following the date on which the Guarantor shall
have delivered a certificate of the Guarantor signed on its
behalf by a Responsible Officer to the Agent demonstrating in
reasonable detail (based upon financial statements for the
fiscal period of the Company most recently ended that have been
delivered to the Lenders pursuant to Section 9.01(b) or (c)
hereof) that the Debt to Cash Flow Ratio, as of such Fiscal
Date, is within one of the ranges set forth below, to but
excluding the next succeeding Fiscal Date, shall equal the
percentage set forth below for Tranche A Term Loans and
Revolving Credit Loans of such Type:
Base Rate
Eurodollar Ratio Loans
Loans
Less than 1.25% 2.25%
or equal to
3.50 to 1 but
greater than
3 to 1
Less than 1.00% 2.00%
or equal to
3 to 1
provided further that the "Applicable Margin", during any
period when an Event of Default shall have occurred and be
continuing, shall be determined without reference to the
immediately preceding proviso.
"Assumption Agreement" shall mean the Assumption
Agreement, in substantially the form of Exhibit F hereto, dated
as of the Initial Borrowing Date and executed and delivered by
United and Supply, pursuant to which United and Supply shall
expressly assume all of the obligations incurred by the
Guarantor and the Company prior to the Mergers under this
Agreement and the other Basic Documents.
"Bankruptcy Code" shall mean the Federal Bankruptcy
Code of 1978, as amended from time to time.
"Base Rate" shall mean, for any day, a rate per annum
equal to the higher of (a) the Federal Funds Rate for such day
plus 1/2 of 1% and (b) the Prime Rate for such day. Each
change in any interest rate provided for herein based upon the
Base Rate resulting from a change in the Base Rate shall take
effect at the time of such change in the Base Rate.
"Base Rate Loans" shall mean Loans that bear interest
at rates based upon the Base Rate.
"Basic Documents" shall mean, collectively, this
Agreement, the Notes, the Letter of Credit Documents, the
Security Documents and the Assumption Agreement.
"BCOP" shall mean Boise Cascade Office Products
Corporation, a Delaware corporation.
"Boise" shall mean Boise Cascade Corporation, a
Delaware corporation.
"Borrowing Base" shall mean, as at any date, the sum
of (a) 80% of the aggregate amount of Eligible Receivables at
said date plus (b) 50% of Eligible Inventory at said date plus
(c) the aggregate amount of cover for Letter of Credit
Liabilities held by the Agent in the Collateral Account as
contemplated in Section 2.10(h) hereof; provided that in no
event shall the portion of the Borrowing Base attributable to
Eligible Inventory (i) at any time from November 1 through
February 28, exceed 65% of the Borrowing Base and the Borrowing
Base shall be reduced to the extent such portion would
otherwise exceed 65% and (ii) at any other time, exceed 60% of
the Borrowing Base and the Borrowing Base shall be reduced to
the extent such portion would otherwise exceed 60%.
"Borrowing Base Certificate" shall mean a certificate
of a Responsible Officer of the Company, substantially in the
form of Exhibit B hereto and appropriately completed.
"Business Day" shall mean any day (a) on which
commercial banks are not authorized or required to close in New
York City and (b) if such day relates to a borrowing of, a
payment or prepayment of principal of or interest on, a
Conversion of or into, or an Interest Period for, a Eurodollar
Loan or a notice by the Company with respect to any such
borrowing, payment, prepayment, Conversion or Interest Period,
that is also a day on which dealings in Dollar deposits are
carried out in the London interbank market.
"Capital Expenditures" shall mean, without
duplication, for any period, expenditures (including, without
limitation, the aggregate amount of Capital Lease Obligations
incurred during such period) made by the Guarantor or any of
its Subsidiaries to acquire or construct fixed assets, plant
and equipment (including renewals, improvements and
replacements, but excluding repairs) during such period
computed in accordance with GAAP.
"Capital Lease Obligations" shall mean, for any
Person, all obligations of such Person to pay rent or other
amounts under a lease of (or other agreement conveying the
right to use) Property to the extent such obligations are
required to be classified and accounted for as a capital lease
on a balance sheet of such Person under GAAP (including
Statement of Financial Accounting Standards No. 13 of the
Financial Accounting Standards Board); and, for purposes of
this Agreement, the amount of such obligations shall be the
capitalized amount thereof, determined in accordance with GAAP
(including such Statement No. 13).
"Cash Flow" shall mean, for any period, for the
Guarantor and its Subsidiaries (determined on a consolidated
basis without duplication in accordance with GAAP), EBITDA for
such period minus Capital Expenditures made during such period
(provided that Capital Lease Obligations shall be deducted only
to the extent of payments actually made during such period).
"Casualty Event" shall mean, with respect to any
Property of any Person, any loss of or damage to, or any
condemnation or other taking of, such Property for which such
Person or any of its Subsidiaries receives insurance proceeds,
or proceeds of a condemnation award or other compensation.
"Change of Control" shall mean (i) the Guarantor
shall cease to own and control, of record and beneficially,
100% of each class of outstanding capital stock of the Company,
(ii) the Wingate Group (as defined below) shall cease to have
the power, directly or indirectly, to vote or direct the voting
of (x) prior to the United Merger, 315,298 shares of the Class
A Common Stock of the Guarantor or (y) after the United Merger,
1,030,790 shares of the Class A Common Stock of the Guarantor
(such number of shares to be increased or decreased, as
appropriate, to give effect to any stock dividends, split-up,
revision or reclassification), (iii) any "person" or "group" of
"persons" (within the meaning of Section 13(d) of the Exchange
Act) shall have the power, directly or indirectly, to vote or
direct the voting of a greater number of securities (other than
securities held by the Lenders (as defined in the Senior
Subordinated Loan Agreement) that were distributed to such
Lenders on the Conversion Date (as defined in the Senior
Subordinated Loan Agreement) or securities held by initial
purchasers of the TakeOut Notes and distributed to such
purchasers in connection with the issuance of the Take-Out
Notes) than the Wingate Group. The term "Wingate Group" shall
mean Wingate and, for so long as they are party to the Voting
Trust Agreement, dated as of January 31, 1992, as amended by
the First Amendment thereto dated as of the
date hereof, among Wingate Partners, L.P., Wingate Partners II,
L.P., Cumberland Capital Corporation, Good Capital Co., Inc.,
ASI Partners, L.P., ASI Partners II, L.P. and the other
stockholders party thereto, and such Voting Trust Agreement is
in full force and effect, Cumberland Capital Corporation, Good
Capital Co., Inc., ASI Partners, L.P. and ASI Partners II, L.P.
"Chase" shall mean The Chase Manhattan Bank (National
Association).
"Class" shall have the meaning assigned to such term
in Section 1.03 hereof.
"Code" shall mean the Internal Revenue Code of 1986,
as amended from time to time.
"Collateral Account" shall have the meaning assigned
to such term in Section 4.01 of the Security Agreement.
"Collateral Auditing Agent" shall have the meaning
assigned to such term in Section 9.01(i) hereof.
"Commission" shall mean the Securities and Exchange
Commission, or any regulatory body that succeeds to the
functions thereof.
"Commitments" shall mean the Revolving Credit
Commitments and the Term Loan Commitments.
"Continue", "Continuation" and "Continued" shall
refer to the continuation pursuant to Section 2.09 hereof of a
Eurodollar Loan from one Interest Period to the next Interest
Period.
"Convert", "Conversion" and "Converted" shall refer
to a conversion pursuant to Section 2.09 hereof of one Type of
Loans into another Type of Loans, which may be accompanied by
the transfer by a Lender (at its sole discretion) of a Loan
from one Applicable Lending Office to another.
"Debt to Cash Flow Ratio" shall mean, as at any date,
the ratio of (a) the aggregate Indebtedness of the Guarantor
and its Subsidiaries (determined on a consolidated basis
without duplication in accordance with GAAP) as of such date to
(b) Cash Flow for the Reporting Period as of such date;
provided that, for purposes of this definition only, (i) until
at least four full fiscal quarters of the Guarantor have
occurred since the Initial Borrowing Date, Cash Flow shall mean
(1) Cash Flow for the Reporting Period as of such date
multiplied by (2) the quotient of (x) four divided by (y) the
number of full fiscal quarters included in such Reporting
Period and (ii) except for purposes of the definitions of
"Applicable Margin" and "Letter of Credit Fee Rate" in this
Section 1.01, Indebtedness (as used in this definition of "Debt
to Cash Flow Ratio") shall not include any undrawn amount under
any Letter of Credit.
"Default" shall mean an Event of Default or an event
that with notice or lapse of time or both would become an Event
of Default.
"Disposition" shall mean any sale, assignment,
transfer or other disposition of any Property (whether now
owned or hereafter acquired) by the Company or any of its
Subsidiaries to any other Person excluding (i) any sale,
assignment, transfer or other disposition of any Property sold
or disposed of in the ordinary course of business and on
ordinary business terms,
(ii) the licensing of general intangibles in the ordinary
course of business, (iii) the sale of overdue receivables in
the ordinary course of business, (iv) the sale of wornout or
obsolete equipment in the ordinary course of business and (v)
any Disposition of Property in connection with any Casualty
Event.
"Dividend Payment" shall mean, with respect to any
Person, dividends (in cash, Property or obligations) on, or
other payments or distributions on account of, or the setting
apart of money for a sinking or other analogous fund for, or
the purchase, redemption, retirement or other acquisition of,
any shares of any class of stock of such Person or of any
warrants, options or other rights to acquire the same (or to
make any payments to any Person, such as "phantom stock"
payments, where the amount thereof is calculated with reference
to the fair market or equity value of such Person or any of its
Subsidiaries), but excluding (i) dividends payable solely in
shares of common stock of such Person, (ii) in the case of the
Guarantor, dividends of additional shares of Guarantor
Preferred Stock payable to the holders of Guarantor Preferred
Stock or (iii) any cancellation of the Guarantor Note after the
Initial Borrowing Date.
"Dollars" and "$" shall mean lawful money of the
United States of America.
"Domestic Subsidiary" shall mean any Subsidiary of
the Guarantor that is organized or created under the laws of
the United States of America, any State thereof or the District
of Columbia.
"EBITDA" shall mean, for any period, the sum, for the
Guarantor and its Subsidiaries (determined on a consolidated
basis without duplication in accordance with GAAP), of the
following: (a) net income for such period plus (b) Interest
Expense for such period, together with any original issue
discount to the extent deducted in calculating net income plus
(c) income taxes for such period plus (d) extraordinary and
unusual items of loss for such period, including any
restructuring charges incurred in connection with the
Acquisition not exceeding $15,000,000 (pre-tax) in the
aggregate, plus (e) losses attributable to equity in Affiliates
for such period plus (f) depreciation and amortization (to the
extent deducted in computing net income) for such period minus
(g) extraordinary and unusual items of income or gain for such
period minus (h) gains attributable to equity in Affiliates for
such period plus (i) all non-cash charges related to employee
compensation to the extent deducted in calculating net profits.
"Eligible Inventory" shall mean, as at any date, with
respect to the Company, the aggregate value of all Inventory
that as of the last day of the immediately preceding month (a)
is owned by the Company and in the possession or under the
control of the Company or the Agent as at such date, (b) is (i)
located in a jurisdiction in the United States of America as to
which appropriate Uniform Commercial Code financing statements
have been filed naming the Company as "debtor" and the Agent on
behalf of the Secured Parties (as defined in the Security
Agreement) as "secured party" or (ii) covered by an on-board
bill of lading or other document of title issued in the name of
the Company or the Agent and in the possession of the Agent,
(c) is in good and merchantable condition, (d) meets all
standards imposed by any governmental agency or department or
division thereof having regulatory authority over such
Inventory, its use or sale and (e) is currently saleable in the
normal course of the Company's business without any notice to,
or consent of, any governmental agency or department or
division thereof (excluding however,
except to the extent that the Majority Revolving Credit Lenders
otherwise agree with respect to any specific customer, any such
Inventory which has been shipped to a customer of the Company,
even if on a consignment or "sale or return" basis); provided
that "Eligible Inventory" shall in no event include the
following:
(a) the value of any calendars, except that
calendars for the next succeeding calendar year shall not
be excluded from "Eligible Inventory" by reason of this
clause (a) for purposes of any determination of "Eligible
Inventory" made as of the last day of June, July, August,
September, October, November or December;
(b) the value of any catalogues;
(c) the value of any Inventory (other than New
Inventory), to the extent that such value exceeds 100% of
the Company's sales of such Inventory for the 12-month
period most recently ended prior to such date; and
(d) any Inventory intended for internal use by the
Company;
provided further, that the Majority Revolving Credit Lenders
(through the Agent) may at any time exclude from Eligible
Inventory any type of Inventory that the Majority Revolving
Credit Lenders (in their reasonable determination) determine to
be unmarketable. The "value" of Eligible Inventory shall be
determined at the lower of cost or market in accordance with
GAAP, except that cost shall be determined on a first-in-first-
out basis.
"Eligible Receivables" shall mean, as at any date,
the sum of (a) all Receivables of the Company as of the last
day of the immediately preceding month minus (b) all Receivable
Adjustments of the Company as of the last day of the
immediately preceding month minus (c) the aggregate amount of
Ineligible Receivables as of the last day of the immediately
preceding month.
"Environmental Claim" shall mean, with respect to any
Person, any written or oral notice, claim, demand or other
communication (collectively, a "claim") by any other Person
alleging or asserting such Person's liability for investigatory
costs, cleanup costs, governmental response costs, damages to
natural resources or other Property, personal injuries, fines
or penalties arising out of, based on or resulting from (i) the
presence, or Release, of any Hazardous Material at any
location, whether or not owned by such Person, or (ii)
circumstances forming the basis of any violation, or alleged
violation, of any Environmental Law. The term "Environmental
Claim" shall include, without limitation, any claim by any
governmental authority for enforcement, cleanup, removal,
response, remedial or other actions or damages pursuant to any
applicable Environmental Law, and any claim by any third party
seeking damages, contribution, indemnification, cost recovery,
compensation or injunctive relief resulting from the presence
of Hazardous Materials or arising from alleged injury or threat
of injury to health, safety or the environment from Hazardous
Materials.
"Environmental Laws" shall mean any and all
applicable Federal, state, local and foreign laws, rules or
regulations, and applicable and legally binding orders or
decrees, in each case as now or hereafter in effect, relating
to the regulation or protection of human health, safety or the
environment or to
emissions, discharges, releases or threatened releases of
pollutants, contaminants, chemicals or toxic or hazardous
substances or wastes into the indoor or outdoor environment,
including, without limitation, ambient air, soil, surface
water, ground water, wetlands, land or subsurface strata, or
otherwise relating to the manufacture, processing,
distribution, use, treatment, storage, disposal, transport or
handling of pollutants, contaminants, chemicals or toxic or
hazardous substances or wastes.
"Equity Issuance" shall mean (a) any issuance or sale
by the Guarantor or any of its Subsidiaries after the Initial
Borrowing Date of (i) any of its capital stock, (ii) any
warrants or options exercisable in respect of its capital stock
or
(iii) any other security or instrument representing an equity
interest (or the right to obtain any equity interest) in the
Guarantor or any of its Subsidiaries or (b) the receipt by the
Guarantor or any of its Subsidiaries after the Initial
Borrowing Date of any capital contribution (whether or not
evidenced by any equity security issued by the recipient of
such contribution); provided that Equity Issuance shall not
include (1) any such issuance or sale by any Subsidiary of the
Guarantor to the Guarantor or any Wholly-Owned Subsidiary of
the Guarantor,
(2) any capital contribution by the Guarantor or any Wholly-
Owned Subsidiary of the Guarantor to any Subsidiary of the
Guarantor, (3) any issuance, after the Initial Borrowing Date,
by the Guarantor of Guarantor Preferred Stock to the Company in
exchange for the Guarantor Note, (4) any cancellation of the
Guarantor Note after the Initial Borrowing Date or (5) any
warrants or options issued to directors, officers or employees
of the Guarantor or any of its Subsidiaries pursuant to
employee benefit plans, incentive plans or similar plans or
programs established in the ordinary course of business and any
capital stock of the Guarantor issued upon the exercise of such
warrants or options.
"Equity Rights" shall mean, with respect to any
Person, any subscriptions, options, warrants, commitments,
preemptive rights or agreements of any kind (including, without
limitation, any stockholders' or voting trust agreements) for
the issuance, sale, registration or voting of, or securities
convertible into, any additional shares of capital stock of any
class, or partnership or other ownership interests of any type
in, such Person.
"ERISA" shall mean the Employee Retirement Income
Security Act of 1974, as amended from time to time.
"ERISA Affiliate" shall mean any corporation or trade
or business that is a member of any group of organizations
(i) described in Section 414(b) or (c) of the Code of which
either Obligor, or prior to the Mergers, United or Supply, is a
member and (ii) solely for purposes of potential liability
under Section 302(c)(11) of ERISA and Section 412(c)(11) of the
Code and the lien created under Section 302(f) of ERISA and
Section 412(n) of the Code, described in Section 414(m) or (o)
of the Code of which either Obligor, or prior to the Mergers,
United or Supply, is a member.
"Eurodollar Base Rate" shall mean, with respect to
any Eurodollar Loan for any Interest Period therefor, the
arithmetic mean (rounded upwards, if necessary, to the nearest
1/16 of 1%), as determined by the Agent, of the rates per annum
quoted by the respective Reference Banks at approximately 11:00
a.m. London time (or as soon thereafter as practicable) on the
date two Business Days prior to the first day of such Interest
Period for the offering by the respective Reference Banks to
leading banks
in the London interbank market of Dollar deposits having a term
comparable to such Interest Period and in an amount comparable
to the principal amount of the Eurodollar Loan to be made by
the respective Reference Banks for such Interest Period. If
any Reference Bank is not participating in any Eurodollar Loans
during any Interest Period therefor, the Eurodollar Base Rate
for such Loans for such Interest Period shall be determined by
reference to the amount of such Loans that such Reference Bank
would have made or had outstanding had it been participating in
such Loan during such Interest Period.
"Eurodollar Loans" shall mean Loans that bear
interest at rates based on rates referred to in the definition
of "Eurodollar Base Rate" in this Section 1.01.
"Eurodollar Rate" shall mean, for any Eurodollar Loan
for any Interest Period therefor, a rate per annum (rounded
upwards, if necessary, to the nearest 1/100 of 1%) determined
by the Agent to be equal to the Eurodollar Base Rate for such
Loan for such Interest Period divided by 1 minus the Reserve
Requirement (if any) for such Loan for such Interest Period.
"Event of Default" shall have the meaning assigned to
such term in Section 10 hereof.
"Excess Cash Flow" shall mean, for any period, the
excess of (a) Cash Flow for such period minus (b) the aggregate
amount of Fixed Charges for such period minus (c) any severance
payments incurred in connection with the Acquisition and paid
in cash.
"Exchange Act" shall mean the Securities Exchange Act
of 1934, as amended from time to time.
"Existing Letters of Credit" shall mean the Letters
of Credit described in Item 3 of Part C of Schedule I hereto.
"Federal Funds Rate" shall mean, for any day, the
rate per annum (rounded upwards, if necessary, to the nearest
1/100 of 1%) equal to the weighted average of the rates on
overnight Federal funds transactions with members of the
Federal Reserve System arranged by Federal funds brokers on
such day, as published by the Federal Reserve Bank of New York
on the Business Day next succeeding such day, provided that (a)
if the day for which such rate is to be determined is not a
Business Day, the Federal Funds Rate for such day shall be such
rate on such transactions on the next preceding Business Day as
so published on the next succeeding Business Day and (b) if
such rate is not so published for any Business Day, the Federal
Funds Rate for such Business Day shall be the average rate
charged to Chase on such Business Day on such transactions as
determined by the Agent.
"Fiscal Date" shall mean the last day of each fiscal
year of the Guarantor and the last day of each of the first
three fiscal quarters of the Guarantor.
"Fixed Charges" shall mean, for any Reporting Period,
the sum, for the Guarantor and its Subsidiaries (determined on
a consolidated basis without duplication in accordance with
GAAP), of the following: (a) all payments of principal of
Indebtedness scheduled to be made during such Reporting Period
plus (b) all Interest Expense for such Reporting Period plus
(c) income taxes paid in cash during such Reporting Period plus
(d) all dividends paid in cash to the Guarantor during such
Reporting Period.
"Fixed Charges Ratio" shall mean, as at any date, the
ratio of (a) Cash Flow for the Reporting Period as of such date
to (b) Fixed Charges for such Reporting Period.
"GAAP" shall mean generally accepted accounting
principles applied on a basis consistent with those that, in
accordance with the last sentence of Section 1.02(a) hereof,
are to be used in making the calculations for purposes of
determining compliance with this Agreement in accordance with
the requirements of the Commission and the Emerging Issues Task
Force established by the Financial Accounting Standards Board.
"Guarantee" shall mean a guarantee, an endorsement, a
contingent agreement to purchase or to furnish funds for the
payment or maintenance of, or otherwise to be or become
contingently liable under or with respect to, the Indebtedness,
net worth, working capital or earnings of any Person, or a
guarantee of the payment of dividends or other distributions
upon the stock or equity interests of any Person, or an
agreement to purchase, sell or lease (as lessee or lessor)
Property, products, materials, supplies or services primarily
for the purpose of enabling a debtor to make payment of such
debtor's obligations or an agreement to assure a creditor
against loss, and including, without limitation, causing a bank
or other financial institution to issue a letter of credit or
other similar instrument for the benefit of another Person, but
excluding endorsements for collection or deposit in the
ordinary course of business. The terms "Guarantee" and
"Guaranteed" used as a verb shall have a correlative meaning.
"Guarantor Note" shall have the meaning assigned to
such term in Section 7.01(q) hereof.
"Guaranteed Obligations" shall have the meaning
assigned to such term in Section 6.01 hereof.
"Guarantor Preferred Stock" shall mean the preferred
stock of the Guarantor described in Part B of Schedule VI
hereto.
"Hazardous Material" shall mean, collectively, (a)
any petroleum or petroleum products, explosives, radioactive
materials, asbestos that is or could become friable, urea
formaldehyde foam insulation, and transformers or other
equipment that contain polychlorinated biphenyls in excess of
50 parts per million ("PCB's"), (b) any chemicals or other
materials or substances that are now or hereafter become
defined as or included in the definition of "hazardous
substances", "hazardous wastes", "hazardous materials",
"extremely hazardous wastes", "restricted hazardous wastes",
"toxic substances", "toxic pollutants", "contaminants",
"pollutants" or words of similar import under any Environmental
Law and (c) any other chemical or other material or substance,
exposure to which is now or hereafter prohibited, limited or
regulated under any Environmental Law.
"Indebtedness" shall mean, for any Person:
(a) obligations created, issued or incurred by such Person for
borrowed money (whether by loan, the issuance and sale of debt
securities or the sale of Property to another Person subject to
an understanding or agreement, contingent or otherwise, to
repurchase such Property from such Person); (b) obligations of
such Person to pay the deferred purchase or acquisition price
of Property or services, other than trade accounts payable
(other than for borrowed money) arising, and accrued expenses
incurred, in the ordinary course of business so long as such
trade accounts payable are payable within 90 days of the date
the respective
goods are delivered or the respective services are rendered;
(c) Indebtedness of others secured by a Lien on the Property of
such Person, whether or not the respective indebtedness so
secured has been assumed by such Person; (d) obligations of
such Person in respect of letters of credit or similar
instruments issued or accepted by banks and other financial
institutions for account of such Person; (e) Capital Lease
Obligations of such Person; (f) Indebtedness of others
Guaranteed by such Person; and (g) any Redeemable Capital Stock
issued by the Guarantor or any of its Subsidiaries after the
Initial Borrowing Date; provided that any Accrued Warrant
Liabilities shall not constitute "Indebtedness" hereunder. The
amount of any Indebtedness of any Person described in clause
(c) above that is non-recourse to such Person shall, for
purposes of this Agreement, be deemed to be equal to the lesser
of (i) the aggregate unpaid amount of such Indebtedness and
(ii) the fair market value of the property or asset encumbered,
as determined by such Person in good faith. The amount of any
Indebtedness of any Person described in clause (f) above shall,
for purposes of this Agreement, be deemed to be the aggregate
amount of Indebtedness Guaranteed by such Person (if a fixed
amount) or the maximum reasonably anticipated liability arising
as a result of such Guarantee (if not a fixed amount),
determined by such Person in good faith.
"Ineligible Receivables" shall mean, as at any date,
the following:
(a) any Receivable not payable in Dollars, other
than Receivables in an aggregate amount not exceeding
$5,000,000 that are payable in Canadian dollars;
(b) any Receivable (other than Receivables created
in connection with published promotional programs in the
ordinary course of business) that, at the date of issuance
of the billing statement therefor, was payable more than
60 days after the issuance of such billing statement;
(c) any Receivable payable by a Subsidiary or
Affiliate (other than Boise or BCOP) of the Company;
(d) any Receivable payable by an account debtor
whose principal place of business is located outside of
the United States of America or any of its possessions
unless such Receivable is backed by U.S. Government
insurance or a letter of credit issued or confirmed by a
bank organized under the laws of the United States of
America or a State and having capital and surplus in
excess of $500,000,000 and except for Receivables payable
by account debtors whose principal place of business is
located in Canada to the extent such Receivables in the
aggregate do not exceed $5,000,000;
(e) any Receivable payable by an account debtor that
the Majority Revolving Credit Lenders (through the Agent)
have notified the Company, prior to the creation of such
Receivable, does not have a satisfactory credit standing
(as determined in the reasonable discretion of the
Majority Revolving Credit Lenders) or with respect to
which, subsequent to the creation of such Receivable, any
event described in Section 10(f) or (g) shall have
occurred;
(f) any Receivable that remains unpaid for more than
90 days after the date of the issuance of the original
billing statement therefor;
(g) all Receivables payable by any account debtor if
more than 50% of the aggregate amount of the Receivables
due from such account debtor shall at the time have
remained unpaid for more than 90 days after the date of
the issuance of the original billing statements therefor;
(h) all Receivables payable by any account debtor
(other than BCOP or Boise) to the extent the Receivables
payable by such account debtor and its Subsidiaries and
Affiliates at the time exceed 10% of all Receivables then
payable to the Company;
(i) any Receivable as to which there is any
unresolved dispute with the respective account debtor (but
only to the extent of the amount thereof in dispute);
(j) any Receivable evidenced by an Instrument (as
defined in the Security Agreement);
(k) any Receivable representing an obligation for
goods sold on consignment, approval or a sale-or-return
basis or subject to any other repurchase or return
arrangement (other than return arrangements in the
ordinary course of the Company's business consistent with
past practices of the business of the Company), except to
the extent the Majority Revolving Credit Lenders (through
the Agent) shall have otherwise agreed in writing;
(l) any Receivable arising from the sale of general
full-line catalogues, except that such Receivables shall
not constitute "Ineligible Receivables" by reason of this
clause (l) for purposes of any determination of
"Ineligible Receivables" made as of the last day of
September, October, November, December, January or
February;
(m) any Receivable payable by any Federal, state,
municipal or other governmental department, commission,
board, bureau, agency or instrumentality, including any
state or local public college or university;
(n) any Receivable payable by any employee of the
Guarantor or any of its Subsidiaries or Affiliates; and
(o) any Receivable payable on a cash on delivery
basis.
"Information Statement" shall mean the Information
Statement to be filed by United with the Commission, if less
than 90% of the United Shares shall have been purchased by the
Guarantor, with respect to the United Merger and the Merger
Agreement pursuant to Rule 14c-2 promulgated under the Exchange
Act, together with all exhibits and schedules thereto.
"Initial Borrowing Date" shall mean the date on which
the initial Loans are made hereunder.
"Interest Coverage Ratio" shall mean, as at any date,
the ratio of (a) EBITDA for the Reporting Period as of such
date to (b) Interest Expense for such Reporting Period.
"Interest Expense" shall mean, for any period, the
sum, for the Guarantor and its Subsidiaries (determined on a
consolidated basis without duplication in accordance with
GAAP), of the following: (a) all cash interest in respect of
Indebtedness (including, without limitation, the interest
component of any payments in respect of Capital Lease
Obligations) accrued during such period (whether or not
actually
paid during such period) plus (b) the net amount payable (or
minus the net amount receivable) under Interest Rate Protection
Agreements during such period (whether or not actually paid or
received during such period).
"Interest Period" shall mean, with respect to any
Eurodollar Loan, each period commencing on the date such
Eurodollar Loan is made or Converted from a Base Rate Loan or
the last day of the next preceding Interest Period for such
Loan and ending on the numerically corresponding day in the
first, second, third or sixth calendar month thereafter, as the
Company may select as provided in Section 4.05 hereof, except
that each Interest Period that commences on the last Business
Day of a calendar month (or on any day for which there is no
numerically corresponding day in the appropriate subsequent
calendar month) shall end on the last Business Day of the
appropriate subsequent calendar month. Notwithstanding the
foregoing: (i) no Interest Period for any Revolving Credit
Loan may end after the Revolving Credit Commitment Termination
Date; (ii) no Interest Period for any Term Loan of any Class
may commence before and end after any Principal Payment Date
for the Loans of such Class unless, after giving effect
thereto, the aggregate principal amount of the Term Loans of
such Class having Interest Periods that end after such
Principal Payment Date shall be equal to or less than the
aggregate principal amount of the Term Loans of such Class
scheduled to be outstanding after giving effect to the payments
of principal required to be made on such Principal Payment
Date; (iii) each Interest Period that would otherwise end on a
day that is not a Business Day shall end on the next succeeding
Business Day (or, if such next succeeding Business Day falls in
the next succeeding calendar month, on the next preceding
Business Day); and (iv) notwithstanding clauses (i) and (ii)
above, no Interest Period shall have a duration of less than
one month and, if the Interest Period for any Eurodollar Loan
would otherwise be a shorter period, such Loan shall not be
available hereunder for such period.
"Interest Rate Protection Agreement" shall mean, for
any Person, an interest rate swap, cap or collar agreement or
similar arrangement between such Person and one or more
financial institutions providing for the transfer or mitigation
of interest risks either generally or under specific
contingencies.
"Inventory" shall mean office products, office fur
niture, computer accessories, catalogues and other readily
marketable goods (including specialty products) of a type sold
by the Company in the ordinary course of business conducted
immediately after the Mergers.
"Investment" shall mean, for any Person: (a) the
acquisition (whether for cash, Property, services or securities
or otherwise) of capital stock, bonds, notes, debentures,
partnership or other ownership interests or other securities of
any other Person or any agreement to make any such acquisition
(including, without limitation, any "short sale" or any sale of
any securities at a time when such securities are not owned by
the Person entering into such sale but excluding any agreement
referred to above if the acquisition contemplated thereunder is
expressly conditioned upon the approval of the Lenders
hereunder); (b) the making of any deposit with, or advance,
loan or other extension of credit to, any other Person
(including the purchase of Property from another Person subject
to an understanding or agreement, contingent or otherwise, to
resell such Property to such Person), but excluding any such
advance, loan or extension of credit having a term not
exceeding 90 days arising in connection with the sale of
inventory or supplies by
such Person in the ordinary course of business; (c) the
entering into of any Interest Rate Protection Agreement; or (d)
the making of any payment, on behalf of any other Person, with
respect to any obligation of such other Person.
"Issuing Bank" shall mean Chase, as the issuer of
Letters of Credit under Section 2.03 hereof, together with its
successors and assigns in such capacity.
"Letter of Credit" shall have the meaning assigned to
such term in Section 2.03 hereof.
"Letter of Credit Documents" shall mean, with respect
to any Letter of Credit, collectively, any application therefor
and any other agreements, instruments, guarantees or other
documents (whether general in application or applicable only to
such Letter of Credit) governing or providing for (a) the
rights and obligations of the parties concerned or at risk with
respect to such Letter of Credit or (b) any collateral security
for any of such obligations, each as the same may be modified
and supplemented and in effect from time to time.
"Letter of Credit Fee Rate" shall mean a rate per annum equal
to 2.75%; provided that (i) the Letter of Credit Fee Rate
for any period from and including any Fiscal Date occurring not
earlier than December 31, 1995 and on or immediately following
the date on which the Company shall have delivered to the Agent
a certificate of the Company signed on its behalf by a
Responsible Officer, demonstrating in reasonable detail (based
upon financial statements for the fiscal period of the Company
most recently ended that have been delivered to the Lenders
pursuant to Section 9.01(b) or (c) hereof) that the Debt to
Cash Flow Ratio, as of such Fiscal Date, is within one of the
ranges set forth below to but excluding the next succeeding
Fiscal Date, shall equal the percentage set forth below:
Ratio Rate
Less than or equal to 2.25%
3.50 to 1 but greater
than 3 to 1
Less than or equal to 2.00%
3 to 1
; (ii) the "Applicable Margin", during any period when an Event
of Default shall have occurred and be continuing, shall be
determined without reference to the immediately preceding
proviso; and (iii) the Letter of Credit Fee Rate for any Letter
of Credit arising out of the purchase of goods and requiring
the presentation of a bill of lading or other transportation
document of title shall be the rate per annum set forth above
minus 1.00%.
"Letter of Credit Interest" shall mean, for each
Revolving Credit Lender, such Lender's participation interest
(or, in the case of the Issuing Bank, the Issuing Bank's
retained interest) in the Issuing Bank's liability under
Letters of Credit and such Lender's rights and interests in
Reimbursement Obligations and fees, interest and other amounts
payable in connection with Letters of Credit and Reimbursement
Obligations.
"Letter of Credit Liability" shall mean, without
duplication, at any time and in respect of any Letter of
Credit, the sum of (a) the undrawn amount of such Letter of
Credit plus (b) the aggregate unpaid principal amount of all
Reimbursement Obligations of the Company at such time due and
payable in
respect of all drawings made under such Letter of Credit. For
purposes of this Agreement, a Revolving Credit Lender (other
than the Issuing Bank) shall be deemed to hold a Letter of
Credit Liability in an amount equal to its participation
interest in the related Letter of Credit under Section 2.03
hereof, and the Issuing Bank shall be deemed to hold a Letter
of Credit Liability in an amount equal to its retained interest
in the related Letter of Credit after giving effect to the
acquisition by the Revolving Credit Lenders other than the
Issuing Bank of their participation interests under said
Section 2.03.
"Lien" shall mean, with respect to any Property, any
mortgage, lien, pledge, charge, security interest or
encumbrance of any kind in respect of such Property. For
purposes of this Agreement and the other Basic Documents, a
Person shall be deemed to own subject to a Lien any Property
that it has acquired or holds subject to the interest of a
vendor or lessor under any conditional sale agreement, capital
lease or other title retention agreement (other than a lease
evidencing an Operating Lease Obligation) relating to such
Property.
"Loans" shall mean the Revolving Credit Loans, the
Tranche A Term Loans and the Tranche B Term Loans.
"Majority Lenders" shall mean Lenders holding at
least 51% of the sum of (a) the aggregate unused Commitments,
(b) the aggregate unpaid principal amount of the Loans and (c)
the aggregate amount of all Letter of Credit Liabilities.
"Majority Revolving Credit Lenders" shall mean
Revolving Credit Lenders holding at least 51% of the aggregate
amount of the Revolving Credit Commitments or, if the Revolving
Credit Commitments shall have terminated, Lenders holding at
least 51% of the sum of (a) the aggregate unpaid principal
amount of the Revolving Credit Loans plus (b) the aggregate
amount of all Letter of Credit Liabilities.
"Majority Term Loan Lenders" shall mean Majority
Tranche A Term Loan Lenders and Majority Tranche B Term Loan
Lenders.
"Majority Tranche A Term Loan Lenders" shall mean
Tranche A Term Loan Lenders holding at least 51% of the
aggregate outstanding principal amount of the Tranche A Term
Loans or, if the Tranche A Term Loans shall not have been made,
at least 51% of the Tranche A Term Loan Commitments.
"Majority Tranche B Term Loan Lenders" shall mean
Tranche B Term Loan Lenders holding at least 51% of the
aggregate outstanding principal amount of the Tranche B Term
Loans or, if the Tranche B Term Loans shall not have been made,
at least 51% of the Tranche B Term Loan Commitments.
"Margin Stock" shall mean "margin stock" within the
meaning of Regulations G, U and X.
"Material Adverse Effect" shall mean a material
adverse effect on (a) the Property, business, operations,
financial condition, prospects, liabilities or capitalization
of (i) the Guarantor and its Subsidiaries taken as a whole or
the Company and its Subsidiaries taken as a whole or (ii) prior
to the Tender Offer Closing Date, the Guarantor and its
Subsidiaries taken as a whole or United and its Subsidiaries
taken as a whole, (b) the ability of any Obligor to perform its
obligations under any of the Basic Documents to which it is a
party, (c) the validity or enforceability of any of the Basic
Documents, (d) the rights and
remedies of the Lenders and the Agent under any of the Basic
Documents, (e) the ability of the Guarantor to consummate the
Tender Offer, (f) the consummation of the Mergers or the other
transactions contemplated hereby or (g) the timely payment of
the principal of or interest on the Loans or the Reimbursement
Obligations or other amounts payable in connection therewith.
"Merger Agreement" shall mean the Agreement and Plan
of Merger dated as of February 13, 1995 between the Guarantor
and United, true copies of which have been delivered to the
Lenders prior to the date hereof, as the same shall, subject to
Section 9.20 hereof, be modified and supplemented and in effect
from time to time.
"Mortgages" shall mean, collectively, one or more
instruments of Mortgage, Assignment of Rents, Security
Agreement and Fixture Filing or Deed of Trust, Assignment of
Rents, Security Agreement and Fixture Filing executed by the
Company in favor of the Agent for the benefit of the Agent and
the Lenders (or, in the case of a Deed of Trust, to the Deed of
Trust trustee in favor of the Agent for the benefit of the
Lenders), substantially in the form of Exhibit E hereto
(conformed to local lending practices in the jurisdiction in
which the relevant real Property is located including, without
limitation, additional remedies available to lenders in such
jurisdiction and, if applicable, conformed to the extent
necessary to secure a tenant's interest in a ground lease) and
covering the respective owned and leasehold real Properties
identified under the heading "Mortgages" in Schedule IV hereto,
as said instruments of Mortgage, Assignment of Rents, Security
Agreement and Fixture Filing and Deed of Trust, Assignment of
Rents, Security Agreement and Fixture Filing shall be modified,
amended, extended and supplemented and in effect from time to
time.
"Multiemployer Plan" shall mean a multiemployer plan
defined as such in Section 3(37) of ERISA to which
contributions have been made by the Guarantor or the Company,
or, prior to the Mergers, United or Supply, or any ERISA
Affiliate and that is covered by Title IV of ERISA.
"Net Available Proceeds" shall mean:
(i) in the case of any Disposition, the amount of
Net Cash Payments received in connection with such
Disposition;
(ii) in the case of any Equity Issuance, the
aggregate amount of all cash received by the Guarantor and
its Subsidiaries in respect of such Equity Issuance net of
(a) reasonable expenses incurred in connection therewith
(including, without limitation, any underwriting,
brokerage or other customary selling commissions, all due
diligence costs or expenses paid for, or reimbursed by the
Guarantor or any of its Subsidiaries, attorneys fees and
expenses paid for or reimbursed by the Guarantor or any of
its Subsidiaries and other direct costs associated
therewith) and (b) the amount of any such cash applied to
the prepayment of the Senior Subordinated Bridge Loans;
and
(iii) in the case of any Casualty Event, the aggregate
amount of proceeds of insurance, condemnation awards and
other compensation received by the Company and its
Subsidiaries in respect of such Casualty Event net of
(A) reasonable expenses incurred by the Company and its
Subsidiaries in connection therewith (including, without
limitation, any legal, accounting, appraisal or expert
fees or expenses paid for by the Company or its
Subsidiaries and
other direct costs associated therewith), (B)
contractually required repayments of Indebtedness to the
extent secured by a Lien on such Property, (C) any income
and transfer taxes payable by the Company or any of its
Subsidiaries in respect of such Casualty Event and (D)
other payments contractually required to be paid to
lessors, sublessors, lessees and sublessees and other
holders (other than Affiliates) of interests in the
Property subject to such Casualty Event.
"Net Cash Payments" shall mean, with respect to any
Disposition, the aggregate amount of all cash payments
(including any cash payments with respect to non-cash
consideration as received) received by the Guarantor and its
Subsidiaries directly or indirectly in connection with such
Disposition; provided that (a) Net Cash Payments shall be net
of (i) the amount of any legal, title and recording tax
expenses, commissions and other fees and expenses paid by the
Guarantor and its Subsidiaries in connection with such
Disposition, (ii) any Federal, state and local income or other
taxes estimated to be payable by the Guarantor and its
Subsidiaries as a result of such Disposition (but only to the
extent that such estimated taxes (other than income taxes) are
in fact paid to the relevant Federal, state or local
governmental authority within three months of the date of such
Disposition), (iii) brokerage or other customary selling
commissions and (iv) expenses incurred in preparing such asset
for sale and (b) Net Cash Payments shall be net of any
repayments by the Guarantor or any of its Subsidiaries of
Indebtedness (other than Indebtedness to the Lenders hereunder)
to the extent that (i) such Indebtedness is secured by a Lien
on the Property that is the subject of such Disposition and
(ii) the transferee of (or holder of a Lien on) such Property
requires that such Indebtedness be repaid as a condition to the
purchase of such Property.
"Net Income" shall mean, for any period, the
consolidated net income of the Guarantor and its Subsidiaries
determined in accordance with GAAP.
"Net Worth" shall mean, as at any date, the
consolidated net worth of the Guarantor and its Subsidiaries
(determined in accordance with GAAP) minus any write-up in the
book value of assets resulting from a revaluation thereof
except any such writeup relating to the Mergers plus any
restructuring charges incurred in connection with the
Acquisition not exceeding $15,000,000 (pre-tax) in the
aggregate plus the aggregate book value of all Guarantor
Preferred Stock described in Schedule VI hereto plus the
aggregate book value of all warrants described in Schedule VI
hereto.
"New Inventory" shall mean, at any time, any
Inventory that was offered by the Company for sale for the
first time within the preceding 12 months.
"Notes" shall mean the Revolving Credit Notes and the
Term Loan Notes.
"Offer to Purchase" shall mean the Offer to Purchase
dated February 21, 1995 issued by the Guarantor in connection
with the Acquisition, as the same shall, subject to Section
9.20 hereof, be modified and supplemented and in effect from
time to time.
"Part A Property" shall mean any of the Property
described in Part A of Schedule IV hereto under the heading
"Dispositions".
"Part B Property" shall mean any of the Property
described in Part B of Schedule IV hereto under the heading
"Dispositions".
"PBGC" shall mean the Pension Benefit Guaranty
Corporation or any entity succeeding to any or all of its
functions under ERISA.
"Permitted Investments" shall mean: (a) direct
obligations of the United States of America, or of any agency
thereof, or obligations guaranteed as to principal and interest
by the United States of America, or of any agency thereof, in
either case maturing not more than 90 days from the date of
acquisition thereof; (b) certificates of deposit issued by any
bank or trust company organized under the laws of the United
States of America or any state thereof and having capital,
surplus and undivided profits of at least $500,000,000,
maturing not more than 90 days from the date of acquisition
thereof; and (c) commercial paper rated A-1 or better or P-1 by
Standard & Poor's Corporation or Moody's Investors Services,
Inc., respectively, maturing not more than 90 days from the
date of acquisition thereof (or 180 days from the date of
acquisition thereof if acquired by United or any of its
Subsidiaries prior to the Tender Offer Closing); in each case
so long as the same (x) provide for the payment of principal
and interest (and not principal alone or interest alone) and
(y) are not subject to any contingency regarding the payment of
principal or interest.
"Person" shall mean any individual, corporation,
company, voluntary association, partnership, joint venture,
limited liability corporation, trust, unincorporated
organization or government (or any agency, instrumentality or
political subdivision thereof).
"Plan" shall mean an employee benefit or other plan
established or maintained by the Company, or prior to the
Mergers, United, or any ERISA Affiliate and that is covered by
Title IV of ERISA, other than a Multiemployer Plan.
"Pledge Agreement" shall mean a Pledge Agreement,
substantially in the form of Exhibit D hereto, between the
Guarantor and the Agent, as the same shall be modified and
supplemented and in effect from time to time.
"Post-Default Rate" shall mean, in respect of any
principal of any Loan, any Reimbursement Obligation or any
other amount under this Agreement, any Note or any other Basic
Document that is not paid when due (whether at stated maturity,
by acceleration, by optional or mandatory prepayment or
otherwise), a rate per annum during the period from and
including the due date to but excluding the date on which such
amount is paid in full equal to (a) in the case of any
principal of any Loan or any interest thereon, 2% plus the
Applicable Margin with respect to such Loan plus the Base Rate
as in effect from time to time or (b) in the case of any other
such amount, 4.00% plus the Base Rate as in effect from time to
time (provided that, if the amount so in default is principal
of a Eurodollar Loan and the due date thereof is a day other
than the last day of the Interest Period therefor, the "Post-
Default Rate" for such principal shall be, for the period from
and including such due date to but excluding the last day of
such Interest Period, 2% plus the interest rate for such Loan
as provided in Section 3.02(b) hereof and, thereafter, the rate
provided for above in this definition).
"Prime Rate" shall mean the rate of interest from
time to time announced by Chase at the Principal Office as its
prime
commercial lending rate.
"Principal Office" shall mean the principal office of
Chase, located on the date hereof at 1 Chase Manhattan Plaza,
New York, New York 10081.
"Principal Payment Date" shall mean each Quarterly
Date on which a principal payment in respect of the Term Loans
is required to be made pursuant to Section 3.01 hereof.
"Property" shall mean any right or interest in or to
property of any kind whatsoever, whether real, personal or
mixed and whether tangible or intangible.
"Quarterly Dates" shall mean March 31, June 30,
September 30 and December 31 of each year, beginning June 30,
1995; provided that, if any such date is not a Business Day,
the relevant Quarterly Date shall be the next succeeding
Business Day.
"Receivable Adjustments" shall mean (a) any current
liabilities of the Company arising because of any credits,
rebates or offsets owed to any customer, (b) any commissions
payable to third parties and (c) the aggregate amount of late
charges included in the Company's Receivables.
"Receivables" shall mean, as at any date, the unpaid
portion of the obligation, as stated on the respective billing
statement, of a customer of the Company in respect of Inventory
sold and shipped by (or services performed by) the Company to
such customer.
"Redeemable Capital Stock" shall mean, with respect
to any Person, any capital stock of such Person that, either by
its terms or by the terms of any security into which it is
convertible or exchangeable or otherwise, is or upon the
happening of an event or passage of time would be, required to
be redeemed or is redeemable at the option of the holder
thereof prior to April 1, 2002, or is exchangeable for debt
securities at any time at the option of the holder thereof.
"Reference Banks" shall mean Chase, The First
National Bank of Chicago and PNC Bank, National Association (or
their respective Applicable Lending Offices, as the case may
be).
"Registered Holder" shall have the meaning assigned
to such term in Section 5.07(a)(ii) hereof.
"Registered Loan" shall have the meaning assigned to
such term in Section 2.08(f) hereof.
"Registered Note" shall have the meaning assigned to
such term in Section 2.08(f) hereof.
"Regulations A, D, G, U and X" shall mean,
respectively, Regulations A, D, G, U and X of the Board of
Governors of the Federal Reserve System (or any successor), as
the same may be modified and supplemented and in effect from
time to time.
"Regulatory Change" shall mean, with respect to any
Lender, any change after the date hereof in applicable Federal,
state or foreign law or regulations (including, without
limitation, Regulation D) or the adoption or making after such
date of any interpretation, directive or request applying to a
class of banks including such Lender of or under any Federal,
state or foreign law or regulations (whether or not having the
force of law and whether or not failure to comply therewith
would be unlawful) by any court or governmental or monetary
authority charged with the interpretation or administration
thereof.
"Reimbursement Obligations" shall mean, at any time,
the obligations of the Company then outstanding, or that may
thereafter arise in respect of all Letters of Credit then
outstanding, to reimburse amounts paid by the Issuing Bank in
respect of any drawings under a Letter of Credit.
"Release" shall mean any release, spill, emission,
leaking, pumping, injection, deposit, disposal, discharge,
dispersal, leaching or migration into the indoor or outdoor
environment.
"Reporting Period" shall mean, as of any date, the
period of four consecutive fiscal quarters of the Guarantor
ending on or most recently ended prior to such date; provided
that, until the end of the fourth full fiscal quarter of the
Guarantor occurring after the Initial Borrowing Date,
"Reporting Period" shall mean, as of any date, the period
consisting of the full fiscal quarters of the Guarantor
occurring since the Initial Borrowing Date.
"Reserve Requirement" shall mean, for any Interest
Period for any Eurodollar Loan, the average maximum rate at
which reserves (including, without limitation, any marginal,
supplemental or emergency reserves) are required to be
maintained during such Interest Period under Regulation D by
member banks of the Federal Reserve System in New York City
with deposits exceeding one billion Dollars against
"Eurocurrency liabilities" (as such term is used in Regulation
D). Without limiting the effect of the foregoing, the Reserve
Requirement shall include any other reserves required to be
maintained by such member banks by reason of any Regulatory
Change with respect to (i) any category of liabilities that
includes deposits by reference to which the Eurodollar Base
Rate is to be determined as provided in the definition of
"Eurodollar Base Rate" in this Section 1.01 or (ii) any
category of extensions of credit or other assets that includes
Eurodollar Loans.
"Responsible Officer" shall mean, with respect to any
Person, the Treasurer, Chief Financial Officer and Controller
of such Person and such other officers of the relevant Person
as the Agent may agree.
"Revolving Credit Commitment" shall mean, for each
Revolving Credit Lender, the obligation of such Lender to make
Revolving Credit Loans in an aggregate principal amount at any
one time outstanding up to but not exceeding the amount set
forth opposite the name of such Lender on the signature pages
hereof under the caption "Revolving Credit Commitment" (as the
same may be reduced from time to time pursuant to Section 2.04
hereof). The original aggregate principal amount of the
Revolving Credit Commitments is $300,000,000.
"Revolving Credit Commitment Percentage" shall mean,
with respect to any Revolving Credit Lender, the ratio of (a)
the amount of the Revolving Credit Commitment of such Lender to
(b) the aggregate amount of the Revolving Credit Commitments of
all of the Lenders.
"Revolving Credit Commitment Termination Date" shall
mean March 31, 2000.
"Revolving Credit Lenders" shall mean (a) on the date
hereof, the Lenders having Revolving Credit Commitments on the
signature pages hereof and (b) thereafter, the Lenders from
time to time holding Revolving Credit Loans and Revolving
Credit Commitments after giving effect to any assignments
thereof permitted by Section 12.06(b) hereof.
"Revolving Credit Loans" shall mean the loans
provided for in Section 2.01(a) hereof, which may be Base Rate
Loans and/or Eurodollar Loans.
"Revolving Credit Notes" shall mean the promissory
notes provided for by Section 2.08(a) hereof and all promissory
notes delivered in substitution or exchange therefor, in each
case as the same shall be modified and supplemented and in
effect from time to time.
"Rollover Loans" shall have the meaning assigned to
such term in Senior Subordinated Loan Agreement.
"Security Agreement" shall mean a Security Agreement,
substantially in the form of Exhibit C hereto, between the
Company and the Agent, as the same shall be modified and
supplemented and in effect from time to time.
"Security Documents" shall mean, collectively, the
Security Agreement, the Mortgages and the Pledge Agreement.
"Senior Subordinated Bridge Loans" shall mean the
"Bridge Loans", as defined in the Senior Subordinated Loan
Agreement.
"Senior Subordinated Debt" shall mean the
Indebtedness of the Company in respect of the Senior
Subordinated Loans and in respect of the Take-Out Notes.
"Senior Subordinated Debt Documents" shall mean the
"Basic Documents", as defined in the Senior Subordinated Loan
Agreement, as the same shall, subject to Section 9.20 hereof,
be modified and supplemented and in effect from time to time.
"Senior Subordinated Lenders" shall mean the
"Lenders", as defined in the Senior Subordinated Loan
Agreement.
"Senior Subordinated Loan Agreement" shall mean the
Senior Subordinated Credit Agreement dated as of March 30,
1995, among the Guarantor, the Company and the Senior
Subordinated Lenders, providing, subject to the terms and
conditions thereof, for the making of loans to the Company by
the Senior Subordinated Lenders in the aggregate principal
amount of $130,000,000, as the same shall, subject to Section
9.20 hereof, be modified and supplemented and in effect from
time to time.
"Senior Subordinated Loans" shall mean the Senior
Subordinated Bridge Loans and the Rollover Loans.
"Sponsor Management Fees" shall have the meaning
assigned to such term in Section 9.22 hereof.
"Subordinated Indebtedness" shall mean, collectively,
(a) Senior Subordinated Debt and (b) other Indebtedness (i) for
which the Company is directly and primarily liable, (ii) in
respect of which none of its Subsidiaries is contingently or
otherwise obligated and (iii) that is subordinated to the
obligations of the Company to pay principal of and interest on
the Loans, Reimbursement Obligations and Notes hereunder on
terms, and pursuant to documentation containing other terms
(including interest, amortization, covenants and events of
default), in form and substance satisfactory to the Majority
Lenders.
"Subsidiary" shall mean, with respect to any Person,
any corporation, partnership or other entity of which at least
a majority of the securities or other ownership interests
having by the terms thereof ordinary voting power to elect a
majority of the board of directors or other persons performing
similar functions of such corporation, partnership or other
entity (irrespective of whether or not at the time securities
or other ownership interests of any other class or classes of
such corporation, partnership or other entity shall have or
might have voting power by reason of the happening of any
contingency) is at the time directly or indirectly owned or
controlled by such Person or one or more Subsidiaries of such
Person or by such Person and one or more Subsidiaries of such
Person.
"Supermajority Lenders" shall have the meaning
assigned to such term in Section 12.04 hereof.
"Take-Out Notes" shall mean the promissory notes
contemplated by Section 7.01(s) of the Senior Subordinated Loan
Agreement, which notes (i) shall contain subordination
provisions no less favorable to the Lenders than those
contained in the form of Rollover Indenture attached to the
Senior Subordinated Loan Agreement, (ii) shall not contain
covenants materially more restrictive or onerous on the Company
than those contained in such form of Rollover Indenture, (iii)
shall mature not earlier than nine years after the Initial
Borrowing Date and shall have an average life of not less than
8.5 years and (iv) shall have a cash interest rate of not more
than 15% per annum.
"Tax Sharing Agreement" shall have the meaning
assigned to such term in Section 9.23 hereof.
"Tender Offer" shall mean the offer by the Guarantor
to purchase for cash up to 17,201,839 United Shares pursuant to
the Tender Offer Documents.
"Tender Offer Closing Date" shall mean the date (on
or before May 15, 1995) of the initial purchase by the
Guarantor of the United Shares tendered pursuant to the Tender
Offer.
"Tender Offer Documents" shall mean the Offer to
Purchase and the Tender Offer Statement on Schedule 14D-1 filed
by the Guarantor with the Commission, the Schedule 14D-9 filed
by United with respect to the Offer to Purchase, and all
amendments, exhibits and schedules thereto and related
documents distributed to the shareholders of United or filed
with the Commission in connection with the Acquisition, in each
case prior to the date of this Agreement.
"Term Loan Commitment Termination Date" shall mean
May 15, 1995.
"Term Loan Commitments" shall mean the Tranche A Term
Loan Commitments and the Tranche B Term Loan Commitments.
"Term Loan Lenders" shall mean Tranche A Term Loan
Lenders and Tranche B Term Loan Lenders.
"Term Loan Notes" shall mean the Tranche A Term Loan
Notes and the Tranche B Term Loan Notes. The term "Term Loan
Notes" shall include any Registered Notes evidencing Term Loans
executed and delivered pursuant to Section 2.08(f) hereof.
"Term Loans" shall mean the Tranche A Term Loans and
the Tranche B Term Loans.
"Title Companies" shall have the meaning assigned to
such term in Section 7.01(n)(ii) hereof.
"Tranche A Term Loan Commitment" shall mean, for each
Tranche A Term Loan Lender, the obligation of such Lender to
make a Tranche A Term Loan in the amount set forth opposite the
name of such Lender on the signature pages hereof under the
caption "Tranche A Term Loan Commitment" (as the same may be
reduced from time to time pursuant to Section 2.04 hereof).
The original aggregate principal amount of the Tranche A Term
Loan Commitments is $125,000,000.
"Tranche A Term Loan Lenders" shall mean (a) on the
date hereof, the Lenders having Tranche A Term Loan Commitments
on the signature pages hereof and (b) thereafter, the Lenders
from time to time holding Tranche A Term Loans or Tranche A
Term Loan Commitments after giving effect to any assignments
thereof permitted by Section 12.06(b) hereof.
"Tranche A Term Loan Notes" shall mean the promissory
notes provided for by Section 2.08(b) hereof and all promissory
notes delivered in substitution or exchange therefor, in each
case as the same shall be modified and supplemented and in
effect from time to time. The term Tranche A Term Loan Note
shall include any Registered Notes evidencing Tranche A Term
Loans executed and delivered pursuant to Section 2.08(f)
hereof.
"Tranche A Term Loans" shall mean the loans provided
for by Section 2.01(b) hereof, which may be Base Rate Loans
and/or Eurodollar Loans.
"Tranche B Term Loan Commitment" shall mean, for each
Tranche B Term Loan Lender, the obligation of such Lender to
make a Tranche B Term Loan in the amount set forth opposite the
name of such Lender on the signature pages hereof under the
caption "Tranche B Term Loan Commitment" (as the same may be
reduced from time to time pursuant to Section 2.04 hereof).
The original aggregate principal amount of the Tranche B Term
Loan Commitments is $75,000,000.
"Tranche B Term Loan Lenders" shall mean (a) on the
date hereof, the Lenders having Tranche B Term Loan Commitments
on the signature pages hereof and (b) thereafter, the Lenders
from time to time holding Tranche B Term Loans or Tranche B
Term Loan Commitments after giving effect to any assignments
thereof permitted by Section 12.06(b) hereof.
"Tranche B Term Loan Notes" shall mean the promissory
notes provided for by Section 2.08(c) hereof and all promissory
notes delivered in substitution or exchange therefor, in each
case as the same shall be modified and supplemented and in
effect from time to time. The term Tranche B Term Loan Note
shall include any Registered Notes evidencing Tranche B Term
Loans executed and delivered pursuant to Section 2.08(f)
hereof.
"Tranche B Term Loans" shall mean the loans provided
for by Section 2.01(c) hereof, which may be Base Rate Loans
and/or Eurodollar Loans.
"Transaction Documents" shall mean the Acquisition
Documents, the Basic Documents and the Senior Subordinated Debt
Documents.
"Type" shall have the meaning assigned to such term
in Section 1.03 hereof.
"United Shares" shall mean the shares of common
stock, $0.10 par value, of United.
"U.S. Person" shall mean a citizen or resident of the
United States of America, a corporation, partnership or other
entity created or organized in or under any laws of the United
States of America or any State thereof, or any estate or trust
the income of which is subject to Federal income taxation
regardless of its source.
"U.S. Taxes" shall mean any present or future tax,
assessment or other charge or levy imposed by or on behalf of
the United States of America or any taxing authority thereof.
"Warrant Agreement" shall mean the Warrant Agreement
dated as of January 31, 1992 among the Guarantor and the
Investors party thereto, as amended by Amendment No. 1 thereto,
dated as of October 27, 1992, and Amendment No. 2 thereto,
dated as of the date hereof, as the same shall be further
modified and supplemented and in effect from time to time.
"Wholly-Owned Subsidiary" shall mean, with respect to
any Person, any corporation, partnership or other entity of
which all of the equity securities or other ownership interests
(other than, in the case of a corporation, directors'
qualifying shares) are directly or indirectly owned or
controlled by such Person or one or more Wholly-Owned
Subsidiaries of such Person or by such Person and one or more
Wholly-Owned Subsidiaries of such Person.
"Wingate" shall mean (i) Wingate Partners, L.P., (ii)
Wingate Partners II, L.P. and (iii) any other Person so long
as, in each such case, one of Thomas W. Sturgess, Frederic B.
Hegi, Jr. and James T. Callier have the power, directly or
indirectly, to vote or direct the voting of all securities of
the Guarantor held by such entity.
1.02 Accounting Terms and Determinations.
(a) Except as otherwise expressly provided herein,
all accounting terms used herein shall be interpreted, and all
financial statements and certificates and reports as to
financial matters required to be delivered to the Lenders
hereunder shall (unless otherwise disclosed to the Lenders in
writing at the time of delivery thereof in the manner described
in subsection (b) below) be prepared, in accordance with
generally accepted accounting principles applied on a basis
consistent with those used in the preparation of the latest
financial statements furnished to the Lenders hereunder (which,
prior to the delivery of the first financial statements under
Section 9.01 hereof, shall mean the audited consolidated
financial statements of the Guarantor as at December 31, 1994
referred to in
Section 8.02(a)(i) hereof except for immaterial variations
thereto). All calculations made for the purposes of
determining compliance with this Agreement shall (except as
otherwise expressly provided herein) be made by application of
generally accepted accounting principles applied on a basis
consistent with those used in the preparation of the latest
annual or quarterly financial statements furnished to the
Lenders pursuant to Section 9.01 hereof (or, prior to the
delivery of the first financial statements under Section 9.01
hereof, used in the
preparation of the audited consolidated financial statements of
the Guarantor as at December 31, 1994 referred to in
Section 8.02(a)(i) hereof) unless (i) the Company shall have
objected to determining such compliance on such basis at the
time of delivery of such financial statements or (ii) the
Majority Lenders shall so object in writing within 30 days
after delivery of such financial statements, in either of which
events such calculations shall be made on a basis consistent
with those used in the preparation of the latest financial
statements as to which such objection shall not have been made
(which, if objection is made in respect of the first financial
statements delivered under Section 9.01 hereof, shall mean the
audited consolidated financial statements of the Guarantor as
at December 31, 1994 referred to in Section 8.02(a)(i) hereof).
Notwithstanding the foregoing, all financial statements
delivered to the Lenders hereunder shall be prepared utilizing
the last-in-first-out basis of inventory valuation but all
calculations made for the purpose of determining compliance
with this Agreement shall be prepared utilizing the first-in-
first-out basis of inventory valuation.
(b) The Company shall deliver to the Lenders at the
same time as the delivery of any annual or quarterly financial
statement under Section 9.01 hereof (i) a description in
reasonable detail of any material variation between the
application of accounting principles employed in the
preparation of such statement and the application of accounting
principles employed in the preparation of the next preceding
annual or quarterly financial statements as to which no
objection has been made in accordance with the last sentence of
subsection (a) above and (ii) reasonable estimates of the
difference between such statements arising as a consequence
thereof.
(c) To enable the ready and consistent determination
of compliance with the covenants set forth in Section 9 hereof,
the Company will not change the last day of its fiscal year
from December 31, or the last days of the first three fiscal
quarters in each of its fiscal years from March 31, June 30 and
September 30 of each year, respectively.
1.03 Classes and Types of Loans. Loans hereunder
are distinguished by "Class" and by "Type". The "Class" of a
Loan (or of a Commitment to make a Loan) refers to whether such
Loan is a Revolving Credit Loan, a Tranche A Term Loan or a
Tranche B Term Loan, each of which constitutes a Class. The
"Type" of a Loan refers to whether such Loan is a Base Rate
Loan or a Eurodollar Loan, each of which constitutes a Type.
Loans may be identified by both Class and Type.
Section 2. Commitments, Loans, Notes and
Prepayments.
2.01 Loans.
(a) Revolving Credit Loans. Each Revolving Credit
Lender severally agrees, on the terms and conditions of this
Agreement, to make loans to the Company in Dollars during the
period from and including the Initial Borrowing Date to but not
including the Revolving Credit Commitment Termination Date in
an aggregate principal amount at any one time outstanding up to
but not exceeding the amount of the Revolving Credit Commitment
of such Lender as in effect from time to time; provided that in
no event shall the aggregate outstanding principal amount of
all Revolving Credit Loans, together with the aggregate amount
of all Letter of Credit Liabilities, exceed the lesser of (i)
the Borrowing Base and (ii) the aggregate amount of the
Revolving Credit Commitments as in effect from time to time.
Subject to
the terms and conditions of this Agreement, during such period
the Company may borrow, repay and reborrow the amount of the
Revolving Credit Commitments by means of Base Rate Loans and
Eurodollar Loans and may Convert Revolving Credit Loans of one
Type into Revolving Credit Loans of another Type (as provided
in Section 2.09 hereof) or Continue Revolving Credit Loans of
one Type as Revolving Credit Loans of the same Type (as
provided in Section 2.09 hereof).
(b) Tranche A Term Loans. Each Tranche A Term Loan
Lender severally agrees, on the terms and conditions of this
Agreement, to make a term loan to the Company in Dollars on the
Initial Borrowing Date in an aggregate principal amount up to
but not exceeding the amount of the Tranche A Term Loan
Commitment of such Lender. Thereafter the Company may Convert
Tranche A Term Loans of one Type into Tranche A Term Loans of
another Type (as provided in Section 2.09 hereof) or Continue
Tranche A Term Loans of one Type as Tranche A Term Loans of the
same Type (as provided in Section 2.09 hereof).
(c) Tranche B Term Loans. Each Tranche B Term Loan
Lender severally agrees, on the terms and conditions of this
Agreement, to make a term loan to the Company in Dollars on the
Initial Borrowing Date in an aggregate principal amount up to
but not exceeding the amount of the Tranche B Term Loan
Commitment of such Lender. Thereafter the Company may Convert
Tranche B Term Loans of one Type into Tranche B Term Loans of
another Type (as provided in Section 2.09 hereof) or Continue
Tranche B Term Loans of one Type as Tranche B Term Loans of the
same Type (as provided in Section 2.09 hereof).
(d) Limit on Eurodollar Loans. No more than seven
separate Interest Periods in respect of Eurodollar Loans of any
Class from each Lender may be outstanding at any one time.
Prior to the date occurring three months after the Initial
Borrowing Date, all Eurodollar Loans of any Class must have an
Interest Period of one month's duration and be coterminous with
Interest Periods of all other Eurodollar Loans of any Class,
and, to the extent that prior to such date a Eurodollar Loan
would not satisfy such conditions, such Loan shall be made, or
Continued or Converted into, a Base Rate Loan.
2.02 Borrowings. The Company shall give the Agent
(which shall promptly notify the relevant Lenders) notice of
each borrowing hereunder as provided in Section 4.05 hereof,
which notice may be delivered by telephone if followed promptly
by notice in writing. Not later than 2:00 p.m. New York time
on the date specified for each borrowing hereunder, each
relevant Lender shall make available the amount of the Loan or
Loans to be made by it on such date to the Agent, at account
number NYAO-DI-900-9-000002 maintained by the Agent with Chase
at the Principal Office, in immediately available funds, for
account of the Company. The amount so received by the Agent
shall, subject to the terms and conditions of this Agreement,
be made available to the Company by depositing the same, in
immediately available funds, in an account of the Company
maintained with Chase at the Principal Office designated by the
Company.
2.03 Letters of Credit. Subject to the terms and
conditions of this Agreement, the Revolving Credit Commitments
may be utilized, upon the request of the Company, in addition
to the Revolving Credit Loans provided for by Sections 2.01(a)
and 2.01(c) hereof, by the issuance by the Issuing Bank of
letters of credit (collectively, "Letters of Credit") for
account of the Company or any of its Subsidiaries (as specified
by the Company) and payable in Dollars, provided that in no
event shall (i) the
aggregate amount of all Letter of Credit Liabilities plus the
aggregate outstanding principal amount of the Revolving Credit
Loans, exceed the lesser of (x) the Borrowing Base and (y) the
aggregate amount of the Revolving Credit Commitments as in
effect from time to time, (ii) the outstanding aggregate amount
of all Letter of Credit Liabilities exceed $90,000,000 and
(iii) the expiration date of any Letter of Credit extend beyond
the earlier of (I) the Revolving Credit Commitment Termination
Date and (II) except for any Letters of Credit issued to PNC
Bank, National Association, with respect to its obligations
under Letters of Credit A-301673 and A-301404 referred to in
the Letter of Credit Chart set forth in Schedule I hereto and
Letters of Credit replacing such letters of credit issued by
PNC Bank, National Association, the date twelve months
following the issuance of such Letter of Credit. The following
additional provisions shall apply to Letters of Credit:
(a) The Company shall give the Agent at least three
Business Days' irrevocable prior notice (effective upon
receipt) specifying the Business Day (which shall be no
later than thirty days preceding the Revolving Credit
Commitment Termination Date) each Letter of Credit is to
be issued and the account party or parties therefor and
describing in reasonable detail the proposed terms of such
Letter of Credit (including the beneficiary thereof) and
the nature of the transactions or obligations proposed to
be supported thereby (including whether such Letter of
Credit is to be a commercial letter of credit or a standby
letter of credit). Upon receipt of any such notice, the
Agent shall advise the Issuing Bank of the contents
thereof.
(b) On each day during the period commencing with
the issuance by the Issuing Bank of any Letter of Credit
and until such Letter of Credit shall have expired or been
terminated, the Revolving Credit Commitment of each
Revolving Credit Lender shall be deemed to be utilized for
all purposes of this Agreement in an amount equal to such
Lender's Revolving Credit Commitment Percentage of the
then undrawn amount of such Letter of Credit. Each
Revolving Credit Lender (other than the Issuing Bank)
agrees that, upon the issuance of any Letter of Credit
hereunder, it shall automatically acquire a participation
in the Issuing Bank's liability under such Letter of
Credit in an amount equal to such Lender's Revolving
Credit Commitment Percentage of such liability, and each
Revolving Credit Lender (other than the Issuing Bank)
thereby shall absolutely, unconditionally and irrevocably
assume, as primary obligor and not as surety, and shall be
unconditionally obligated to the Issuing Bank to pay and
discharge when due, its Revolving Credit Commitment
Percentage of the Issuing Bank's liability under such
Letter of Credit.
(c) Upon receipt from the beneficiary of any Letter
of Credit of any demand for payment under such Letter of
Credit, the Issuing Bank shall promptly notify the Company
(through the Agent) of the amount to be paid by the
Issuing Bank as a result of such demand and the date on
which payment is to be made by the Issuing Bank to such
beneficiary in respect of such demand. Notwithstanding
the identity of the account party of any Letter of Credit,
the Company hereby unconditionally agrees to pay and
reimburse the Agent for account of the Issuing Bank for
the amount of each demand for payment under such Letter of
Credit that is in substantial compliance with the
provisions of such Letter of Credit at or prior to the
date on which payment is to be
made by the Issuing Bank to the beneficiary thereunder,
without presentment, demand, protest or other formalities of
any kind.
(d) Forthwith upon its receipt of a notice referred to
in paragraph (c) of this Section 2.03, the Company shall
advise the Agent whether or not the Company intends to borrow
hereunder to finance its obligation to reimburse the Issuing
Bank for the amount of the related demand for payment and, if
it does, submit a notice of such borrowing as provided in
Section 4.05 hereof. In the event that the Company fails to
so advise the Agent, or if the Company fails to reimburse the
Issuing Bank for a demand for payment under a Letter of
Credit by the date of such payment, the Agent shall give each
Revolving Credit Lender prompt notice of the demand for
payment, specifying such Lender's Revolving Credit Commitment
Percentage of the amount of the related demand for payment.
(e) Each Revolving Credit Lender (other than the
Issuing Bank) shall pay to the Agent for account of the
Issuing Bank at the Principal Office in Dollars and in
immediately available funds, the amount of such Lender's
Revolving Credit Commitment Percentage of any payment under a
Letter of Credit upon notice by the Issuing Bank (through the
Agent) to such Revolving Credit Lender requesting such
payment and specifying such amount, unless such payment under
such Letter of Credit would not have been made but for the
gross negligence or willful misconduct of the Issuing Bank.
Each such Revolving Credit Lender's obligation to make such
payment to the Agent for account of the Issuing Bank under
this paragraph (e), and the Issuing Bank's right to receive
the same, shall, subject to the preceding sentence, be
absolute and unconditional and shall not be affected by any
circumstance whatsoever, including, without limitation, the
failure of any other Revolving Credit Lender to make its
payment under this paragraph (e), the financial condition of
any Obligor (or any other account party), the existence of
any Default or the termination of the Commitments. Each such
payment to the Issuing Bank shall be made without any offset,
abatement, withholding or reduction whatsoever. If any
Revolving Credit Lender shall default in its obligation to
make any such payment to the Agent for account of the Issuing
Bank, for so long as such default shall continue the Agent
may, at the request of the Issuing Bank, withhold from any
payments received by the Agent under this Agreement or any
Note for account of such Revolving Credit Lender the amount
so in default and, to the extent so withheld, pay the same to
the Issuing Bank in satisfaction of such defaulted
obligation.
(f) Upon the making of each payment by a Revolving
Credit Lender to the Issuing Bank pursuant to
paragraph (e) above in respect of any Letter of Credit, such
Lender shall, automatically and without any further action on
the part of the Agent, the Issuing Bank or such Lender,
acquire (i) a participation in an amount equal to such
payment in the Reimbursement Obligation owing to the Issuing
Bank by the Company hereunder and under the Letter of Credit
Documents relating to such Letter of Credit and (ii) a
participation in a percentage equal to such Lender's
Revolving Credit Commitment Percentage in any interest or
other amounts payable by the Company hereunder and under such
Letter of Credit Documents in respect of such Reimbursement
Obligation (other than the commissions, charges, costs and
expenses payable to the Issuing Bank
pursuant to paragraph (g) of this Section 2.03). Upon
receipt by the Issuing Bank from or for account of the
Company of any payment in respect of any Reimbursement
Obligation or any such interest or other amount (including by
way of setoff or application of proceeds of any collateral
security) the Issuing Bank shall promptly pay to the Agent
for account of each Revolving Credit Lender entitled thereto,
such Revolving Credit Lender's Revolving Credit Commitment
Percentage of such payment, each such payment by the Issuing
Bank to be made in the same money and funds in which received
by the Issuing Bank. In the event any payment received by
the Issuing Bank and so paid to the Revolving Credit Lenders
hereunder is rescinded or must otherwise be returned by the
Issuing Bank, each Revolving Credit Lender shall, upon the
request of the Issuing Bank (through the Agent), repay to the
Issuing Bank (through the Agent) the amount of such payment
paid to such Lender, with interest at the rate specified in
paragraph (j) of this Section 2.03.
(g) The Company shall pay to the Agent for account of
each Revolving Credit Lender (ratably in accordance with
their respective Revolving Credit Commitment Percentages) a
letter of credit fee in respect of each Letter of Credit in
an amount equal to a rate per annum equal to the Letter of
Credit Fee Rate of the daily average undrawn amount of such
Letter of Credit for the period from and including the date
of issuance of such Letter of Credit (i) in the case of a
Letter of Credit that expires in accordance with its terms,
to and including such expiration date and (ii) in the case of
a Letter of Credit that is drawn in full or is otherwise
terminated other than on the stated expiration date of such
Letter of Credit, to but excluding the date such Letter of
Credit is drawn in full or is terminated (such fee to be non-
refundable, to be paid in arrears on each Quarterly Date and
on the Revolving Credit Commitment Termination Date and to be
calculated for any day after giving effect to any payments
made under such Letter of Credit on such day). In addition,
the Company shall pay to the Agent for account of the Issuing
Bank a fronting fee in respect of each Letter of Credit in an
amount equal to 1/4 of 1% per annum of the daily average
undrawn amount of such Letter of Credit for the period from
and including the date of issuance of such Letter of Credit
(i) in the case of a Letter of Credit that expires in
accordance with its terms, to and including such expiration
date and (ii) in the case of a Letter of Credit that is drawn
in full or is otherwise terminated other than on the stated
expiration date of such Letter of Credit, to but excluding
the date such Letter of Credit is drawn in full or is
terminated (such fee to be non-refundable, to be paid in
arrears on each Quarterly Date and on the Revolving Credit
Commitment Termination Date and to be calculated for any day
after giving effect to any payments made under such Letter of
Credit on such day) plus all commissions, charges, costs and
expenses in the amounts customarily charged by the Issuing
Bank from time to time in like circumstances with respect to
the issuance of each Letter of Credit and drawings and other
transactions relating thereto and as shown in fee schedules
provided by the Issuing Bank to the Company.
(h) Promptly following the end of each calendar month,
the Issuing Bank shall deliver (through the Agent) to each
Revolving Credit Lender and the Company a notice describing
the aggregate amount of all Letters of Credit outstanding at
the end of the month. Upon the request of any Revolving
Credit Lender from time to time, the Issuing Bank shall
deliver any information reasonably requested by such Lender
with respect to each Letter of Credit then outstanding.
(i) The issuance by the Issuing Bank of each Letter of
Credit shall, in addition to the conditions precedent set
forth in Section 7 hereof, be subject to the conditions
precedent that (i) such Letter of Credit shall be in such
form, contain such terms and support such transactions as
shall be satisfactory to the Issuing Bank consistent with
its then current practices and procedures with respect to
letters of credit of the same type and (ii) the Company
shall have executed and delivered such applications,
agreements and other instruments relating to such Letter of
Credit as the Issuing Bank shall have reasonably requested
consistent with its then current practices and procedures
with respect to letters of credit of the same type, provided
that in the event of any conflict between any such
application, agreement or other instrument and the
provisions of this Agreement or any Security Document, the
provisions of this Agreement and the Security Documents
shall control.
(j) To the extent that any Revolving Credit Lender
shall fail to pay any amount required to be paid pursuant to
paragraph (e) or (f) of this Section 2.03 on the due date
therefor, such Lender shall pay interest to the Issuing Bank
(through the Agent) on such amount from and including such
due date to but excluding the date such payment is made at a
rate per annum equal to the Federal Funds Rate, provided
that if such Lender shall fail to make such payment to the
Issuing Bank within three Business Days of such due date,
then, retroactively to the due date, such Lender shall be
obligated to pay interest on such amount at the Post-Default
Rate.
(k) The issuance by the Issuing Bank of any
modification or supplement to any Letter of Credit hereunder
shall be subject to the same conditions applicable under
this Section 2.03 to the issuance of new Letters of Credit,
and no such modification or supplement shall be issued
hereunder unless either (i) the respective Letter of Credit
affected thereby would have complied with such conditions
had it originally been issued hereunder in such modified or
supplemented form or (ii) the Majority Revolving Credit
Lenders (if such conditions could have been amended with the
consent of the Majority Revolving Credit Lenders or all of
the Revolving Credit Lenders (if such conditions could only
have been amended with the consent of all Revolving Credit
Lenders) shall have consented thereto.
(l) Concurrently with the satisfaction of the
conditions precedent set forth in Section 7.01 hereof, all
Existing Letters of Credit outstanding on the date hereof
shall be deemed to be Letters of Credit outstanding
hereunder and the Revolving Credit Lenders shall,
automatically and without further action on the part of the
Agent, the Issuing Bank or such Revolving Credit Lenders,
acquire a participation interest in each Existing Letter of
Credit as if such Existing Letter of Credit shall have been
issued hereunder.
The Company hereby indemnifies and holds harmless each Revolving
Credit Lender and the Agent from and against any and all claims,
damages, losses, liabilities, costs or expenses that such Lender
or the Agent may incur (or that may be claimed against such
Lender or the Agent by any Person whatsoever) by reason of or in
connection with the execution and delivery or transfer of or
payment or refusal to pay by the Issuing Bank under any Letter of
Credit; provided that the Company shall not be required to
indemnify any Lender or the Agent for any claims, damages,
losses, liabilities, costs or expenses to the extent, but only to
the extent, caused by (x) the willful misconduct or gross
negligence of the Issuing Bank in determining whether a request
presented under any Letter of Credit complied with the terms of
such Letter of Credit or (y) the Issuing Bank's failure to pay
under any Letter of Credit after the presentation to it of a
request strictly complying with the terms and conditions of such
Letter of Credit. Nothing in this Section 2.03 is intended to
limit the other obligations of the Company, any Lender, the
Issuing Bank or the Agent under this Agreement.
2.04 Changes of Commitments.
(a) The Company shall have the right at any time or
from time to time (i) to terminate or reduce the aggregate unused
amount of the Term Loan Commitments, (ii) so long as no Revolving
Credit Loans or Letter of Credit Liabilities are outstanding, to
terminate the Revolving Credit Commitments and (iii) to reduce
the aggregate unused amount of the Revolving Credit Commitments
(for which purpose use of the Revolving Credit Commitments shall
be deemed to include the aggregate amount of Letter of Credit
Liabilities); provided that (x) the Company shall give notice of
each such termination or reduction as provided in Section 4.05
hereof and (y) each partial reduction shall be in an aggregate
amount at least equal to $5,000,000 (or a larger multiple of
$1,000,000).
(b) Any portion of the Term Loan Commitments not used
on the Initial Borrowing Date shall terminate automatically at
the close of business on the Initial Borrowing Date.
(c) The Commitments of any Class once terminated or
reduced may not be reinstated.
2.05 Commitment Fee. The Company shall pay to the
Agent for account of each Lender a commitment fee on the daily
average unused amount of each Term Loan Commitment and Revolving
Credit Commitment of such Lender (solely for which purpose the
aggregate amount of any Letter of Credit Liabilities shall be
deemed to be a pro rata (based on the Revolving Credit
Commitments) use of each Lender's Revolving Credit Commitment),
for the period from and including the date of this Agreement to
but not including the earlier of the date such Commitment
terminates or is terminated, at a rate per annum equal to 1/2 of
1%. Accrued commitment fees on each Commitment shall be payable
monthly on the last Business Day of each month and on the date
such Commitment terminates or is terminated.
2.06 Lending Offices. The Loans of each Class and
Type made by each Lender shall be made and maintained at such
Lender's Applicable Lending Office for Loans of such Class and
Type.
2.07 Several Obligations; Remedies Independent. The
failure of any Lender to make any Loan to be made by it on the
date specified therefor shall not relieve any other Lender of its
obligation to make its Loan on such date, but neither any Lender
nor the Agent shall be responsible for the failure of any other
Lender to make a Loan to be made by such other Lender, and
(except as otherwise provided in Section 4.06 hereof) no Lender
shall have any obligation to the Agent or any other Lender for
the failure by such Lender to make any Loan required to be made
by such Lender; provided that nothing in this sentence shall
limit the recourse of the Company against such Lender. The
amounts payable by the Company at any time hereunder and under
the Notes to each Lender shall be a separate and independent debt
and each Lender shall be entitled, subject to Section 10 hereof
in the case of any acceleration of Indebtedness hereunder or
termination of any Commitments, to protect and enforce its rights
arising out of this Agreement and the Notes, and it shall not be
necessary for any other Lender or the Agent to consent to, or be
joined as an additional party in, any proceedings for such
purposes.
2.08 Notes.
(a) The Revolving Credit Loans made by each Revolving
Credit Lender shall be evidenced by a single promissory note of
the Company substantially in the form of Exhibit A-1 hereto,
dated the Initial Borrowing Date, payable to such Lender in a
principal amount equal to the amount of its Revolving Credit
Commitment as in effect on the Initial Borrowing Date and
otherwise duly completed.
(b) The Tranche A Term Loans made by each Tranche A
Term Loan Lender shall be evidenced by a single promissory note
of the Company substantially in the form of Exhibit A-2 hereto,
dated the Initial Borrowing Date, payable to such Lender in a
principal amount equal to the amount of the Tranche A Term Loan
made by such Tranche A Term Loan Lender on the Initial Borrowing
Date and otherwise duly completed.
(c) The Tranche B Term Loans made by each Tranche B
Term Loan Lender shall be evidenced by a single promissory note
of the Company substantially in the form of Exhibit A-3 hereto,
dated the Initial Borrowing Date, payable to such Lender in a
principal amount equal to the amount of the Tranche B Term Loan
made by such Tranche B Term Loan Lender on the Initial Borrowing
Date and otherwise duly completed.
(d) The date, amount, Type, interest rate and duration
of Interest Period (if applicable) of each Loan of each Class
made by each Lender to the Company, and each payment made on
account of the principal thereof, shall be recorded by such
Lender on its books and, prior to any transfer of any Note
evidencing the Loans of such Class held by it, endorsed by such
Lender on the schedule attached to such Note or any continuation
thereof; provided that the failure of such Lender to make any
such recordation or endorsement shall not affect the obligations
of either Obligor to make a payment when due of any amount owing
hereunder or under such Note in respect of such Loans.
(e) No Lender shall be entitled to have its Notes substituted or
exchanged for any reason, or subdivided for promissory notes of
lesser denominations, except in connection with a permitted
assignment of all or any portion of such Lender's relevant
Commitment, Loans and Notes pursuant to Section 12.06 hereof
and except as provided in clause (h) below
(and, if requested by any Lender, the Company agrees to so
exchange any Note).
(f) Notwithstanding the foregoing, any Term Loan
Lender that is not a U.S. Person and is not a "bank" within the
meaning of Section 881(c)(3)(A) of the Code may request the
Company (through the Agent), and the Company agrees thereupon, to
record on the Register referred to in Section 12.06(g) hereof any
Term Loans held by such Lender under this Agreement. Term Loans
recorded on the Register ("Registered Loans") may not be
evidenced by promissory notes other than Registered Notes as
defined below and, upon the registration of any Term Loan, any
promissory note (other than a Registered Note) evidencing the
same shall be null and void and shall be returned to the Company.
The Company agrees, at the request of any Term Loan Lender that
is the holder of Registered Loans, to execute and deliver to such
Lender a promissory note in registered form to evidence such
Registered Loans (i.e. containing the optional registered note
language as indicated in Exhibits A-2 or A-3 hereto, as the case
may be) and registered as provided in Section 12.06(g) hereof
(herein, a "Registered Note"), dated the Initial Borrowing Date,
payable to such Term Loan Lender and otherwise duly completed. A
Term Loan once recorded on the Register may not be removed from
the Register so long as it remains outstanding and a Registered
Note may not be exchanged for a promissory note that is not a
Registered Note.
2.09 Optional Prepayments and Conversions or
Continuations of Loans. Subject to Section 4.04 hereof, the
Company shall have the right to prepay Loans, or to Convert
Revolving Credit Loans and Term Loans of one Type into Loans of
another Type or Continue Revolving Credit Loans and Term Loans of
one Type as Loans of the same Type, at any time or from time to
time, provided that: (a) the Company shall give the Agent notice
of each such prepayment, Conversion or Continuation as provided
in Section 4.05 hereof (and, upon the date specified in any such
notice of prepayment, the amount to be prepaid shall become due
and payable hereunder); (b) Eurodollar Loans may be Converted
only on the last day of an Interest Period for such Loans;
(c) prepayments by the Company of the Term Loans shall be applied
pro rata to the Tranche A Term Loans and the Tranche B Term
Loans; and (d) prepayments by the Company of any Class of Term
Loans shall be applied to the remaining installments of such Term
Loans pro rata. Notwithstanding the foregoing, and without
limiting the rights and remedies of the Lenders under Section 10
hereof, in the event that any Event of Default shall have
occurred and be continuing, the Agent may (and at the request of
the Majority Lenders shall) suspend the right of the Company to
Convert any Loan into a Eurodollar Loan, or to Continue any Loan
as a Eurodollar Loan, in which event all Loans shall be Converted
(on the last day(s) of the respective Interest Periods therefor)
or Continued, as the case may be, as Base Rate Loans.
2.10 Mandatory Prepayments and Reductions of
Commitments.
(a) Borrowing Base. Until the Revolving Credit
Commitment Termination Date, the Company shall from time to time
prepay the Revolving Credit Loans (and/or provide cover for
Letter of Credit Liabilities as specified in paragraph (h) below)
in such amounts as shall be necessary so that at all times the
aggregate outstanding amount of the Revolving Credit Loans,
together with the outstanding Letter of Credit Liabilities, shall
not exceed the Borrowing Base, such amount to be applied, first,
to Revolving Credit Loans outstanding and, second, as cover for
Letter of Credit Liabilities outstanding.
(b) Annual Cleanup. The Company shall from time to
time prior to the Revolving Credit Commitment Termination Date
prepay the Revolving Credit Loans in such amounts as shall be
necessary so that, for a period of at least 30 consecutive days
in each fiscal year of the Company, commencing with the fiscal
year beginning January 1, 1996, the aggregate outstanding
principal amount of the Revolving Credit Loans shall not exceed
$200,000,000 or such other greater amount as the Majority Lenders
shall have agreed to, after consideration thereof in good faith.
(c) Excess Cash Flow. Not later than the date 90 days
after the end of each fiscal year of the Company ending after the
date hereof, the Company shall prepay Loans (and/or provide cover
for Letter of Credit Liabilities as specified in paragraph (h)
below), and the Commitments shall be subject to automatic
reduction, without prepayment or commitment reduction premium
other than any amounts payable pursuant to Section 5.05 hereof,
in an aggregate amount equal to the excess of (A) the Required
Percentage (as defined below) of Excess Cash Flow for such fiscal
year (or, in the case of the first fiscal year occurring after
the Initial Borrowing Date, that portion of the fiscal year
occurring after the Initial Borrowing Date) over (B) the
aggregate amount of prepayments of Term Loans made during such
fiscal year pursuant to Section 2.09 hereof and, after the
payment in full of the Term Loans, the aggregate amount of
voluntary reductions of Revolving Credit Commitments made during
such fiscal year pursuant to Section 2.04(c) hereof, such
prepayment and reduction to be effected in each case in the
manner and to the extent specified in paragraph (g) of this
Section 2.10. "Required Percentage" of Excess Cash Flow for any
fiscal year shall mean (i) if the Debt to Cash Flow Ratio as of
the last day of such fiscal year is less than 3 to 1, 50% and
(ii) otherwise, 75%.
(d) Equity Issuance. If, at any time after the
Initial Borrowing Date, the Guarantor or any of its Subsidiaries
shall receive Net Available Proceeds in excess of $15,000,000
("Available Equity Proceeds") from one or more Equity Issuances,
including all prior Equity Issuances as to which a prepayment has
not yet been made under this Section 2.10(d), the Company shall,
within three Business Days of receipt of such Net Available
Proceeds, prepay Loans (and/or provide cover for Letter of Credit
Liabilities as specified in paragraph (h) below), and the
Commitments shall be subject to automatic reduction, in an
aggregate amount equal to the aggregate amount of such Available
Equity Proceeds, such prepayment to be effected in each case in
the manner and to the extent specified in paragraph (g) of this
Section 2.10.
(e) Sale of Assets. Without limiting the obligation
of the Company to obtain the consent of the Majority Lenders
pursuant to Section 9.05 hereof to any Disposition not otherwise
permitted hereunder, in the event that the Net Available Proceeds
of any Disposition (herein, the "Current Disposition"), and of
all prior Dispositions as to which a prepayment has not yet been
made under this Section 2.10(e), shall exceed $10,000,000 then,
no later than five Business Days prior to the occurrence of the
Current Disposition, the Company will deliver to the Lenders a
statement, certified by a Responsible Officer of the Company, in
form and detail satisfactory to the Agent, of the amount of the
anticipated Net Available Proceeds of the Current Disposition and
of all such prior Dispositions as to which a prepayment has not
yet been made under this Section 2.10(e) and will prepay, upon
receipt of such Net Available Proceeds, Loans (and/or provide
cover for Letter of Credit Liabilities as specified in paragraph
(h) below), and the Commitments shall be subject to
automatic reduction, in an aggregate amount equal to 100% of the
Net Available Proceeds of the Current Disposition and such prior
Dispositions in excess of $10,000,000, such prepayment and
reduction to be effected in each case in the manner and to the
extent specified in paragraph (g) of this Section 2.10.
Notwithstanding the foregoing, the Disposition for fair value of
any Part A Property shall not be a "Disposition" for purposes of
the preceding sentence. If, however, any Part B Property is
Disposed of within one year prior to or after the Disposition of
Part A Property located in the same geographical area, the Company
shall, within one year of the last of such Dispositions, apply the
Net Available Proceeds of such Dispositions to (i) the purchase or
construction of a replacement facility or (ii) the prepayment of
the Loans (and/or the provision of cover for Letter of Credit
Liabilities as specified in paragraph (h) below) and the reduction
of Commitments as provided above.
(f) Casualty Events. After the occurrence of any
Casualty Event (other than any Casualty Event with respect only to
Property covered by the Mortgages) resulting in a loss in excess
of $500,000, the Company shall give prompt notice thereof to the
Agent and the Lenders. If no Default has occurred and is
continuing, the Company may, at its option, to be exercised by
delivery of notice to the Agent and the Lenders within four months
of such Casualty Event, elect to apply the Net Available Proceeds
of such Casualty Event to either (i) the repair or replacement of
the Property affected thereby or (ii) the prepayment of the Loans
(and/or the provision of cover for Letter of Credit Liabilities as
specified in paragraph (g) of this Section 2.10). If a Default
has occurred and is continuing, or
if the Company fails to make such an election within four months
from the date of any such Casualty Event, such Net Available
Proceeds shall automatically be applied to the prepayment of the
Loans (and/or the provision of cover for Letter of Credit
Liabilities as specified in paragraph (g) of this Section 2.10).
If the Company elects to so repair or replace the Property subject
to such Casualty Event, the Net Available Proceeds of such
Casualty Event in excess of $500,000 shall be held by the Agent to
be applied to such repair or replacement and advanced to the
Company in periodic installments upon compliance by the Company
with such reasonable conditions as may be imposed by the Agent,
including, but not limited to, reasonable retentions and lien
releases. Interest, if any, actually earned on any Net Available
Proceeds held by the Agent shall be credited to such Net Available
Proceeds, for the benefit of the Company.
(g) Application. Prepayments and reductions of
Commitments described in the above paragraphs of this
Section 2.10 (other than in paragraph (a) or (b) above) shall be
effected as follows:
(i) first, the amount of the prepayment specified in
such paragraphs shall be applied to the Term Loans, pro rata
between each Class of Term Loans and, as to each Class, pro
rata to the remaining installments thereof; and
(ii) second, the Revolving Credit Commitments shall be
automatically reduced in an amount equal to the amount by
which the aggregate amount of the prepayments and reductions
of Commitments provided for in paragraphs (c), (d), (e) and
(f) above exceed any excess over the amount referred to in
the foregoing clause (i) (and to the extent that, after
giving effect to such reduction of Commitments, the aggregate
principal amount of Revolving Credit Loans, together with the
aggregate amount of all Letter of Credit Liabilities, would
exceed the Revolving Credit Commitments, the Company shall,
first, prepay Revolving Credit Loans and, second, provide
cover for Letter of Credit Liabilities as specified in
paragraph (h) below, in an aggregate amount equal to such
excess).
(h) Cover for Letter of Credit Liabilities. In the
event that the Company shall be required pursuant to this Section
2.10, or pursuant to Section 10 hereof, to provide cover
for Letter of Credit Liabilities, the Company shall effect the
same by paying to the Agent immediately available funds in an
amount equal to the required amount, which funds shall be retained
by the Agent in the Collateral Account (as provided therein as
collateral security in the first instance for the Letter of Credit
Liabilities) until such time as the Letters of Credit shall have
been terminated and all of the Letter of Credit Liabilities paid
in full.
Section 3. Payments of Principal and Interest.
3.01 Repayment of Loans.
(a) The Company hereby promises to pay to the Agent for
account of each Revolving Credit Lender the entire outstanding
principal amount of such Lender's Revolving Credit Loans, and each
Revolving Credit Loan shall mature, on the Revolving Credit
Commitment Termination Date.
(b) The Company hereby promises to pay to the Agent for
account of the Tranche A Term Loan Lenders the aggregate principal
amount of the Tranche A Term Loans in twenty (20) consecutive
installments payable on each Quarterly Date, beginning on June 30,
1995, the first four (4) of which shall each be in the aggregate
amount of $3,750,000, the next eight (8) of which shall each be in
the aggregate amount of $6,250,000 and the last eight (8) of which
shall each be in the aggregate amount of $7,500,000. If the
Company does not borrow the full amount of the aggregate Tranche A
Term Loan Commitments on or before the Term Loan Commitment
Termination Date, the shortfall shall be applied to reduce the
foregoing installments ratably.
(c) The Company hereby promises to pay to the Agent for
account of the Tranche B Term Loan Lenders the aggregate principal
amount of the Tranche B Term Loans in twenty-eight (28)
consecutive quarterly installments payable on each Quarterly Date
beginning on June 30, 1995, the first twenty (20) of which shall
each be in the aggregate amount of $250,000 and the last
eight (8) of which shall each be in the aggregate amount of
$8,750,000. If the Company does not borrow the full amount of the
aggregate Tranche B Term Loan Commitments on or before the Term
Loan Commitment Termination Date, the shortfall shall be applied
to reduce the foregoing installments ratably.
3.02 Interest. The Company hereby promises to pay to
the Agent for account of each Lender interest on the unpaid
principal amount of each Loan made by such Lender for the period
from and including the date of such Loan to but excluding the date
such Loan shall be paid in full, at the following rates per annum:
(a) during such periods as such Loan is a Base Rate
Loan, the Base Rate (as in effect from time to time) plus the
Applicable Margin, and
(b) during such periods as such Loan is a Eurodollar
Loan, for each Interest Period relating thereto, the
Eurodollar Rate for such Loan for such Interest Period plus
the Applicable Margin.
Notwithstanding the foregoing, the Company hereby promises to pay
to the Agent for account of each Lender interest at the applicable
Post-Default Rate on any principal of any Loan made by such
Lender, on any Reimbursement Obligation owed to such Lender and on
any other amount payable by the Company hereunder or under
the Notes held by such Lender to or for account of such Lender,
that shall not be paid in full when due (whether at stated
maturity, by acceleration, by mandatory prepayment or otherwise),
for the period from and including the due date thereof to but
excluding the date the same is paid in full. Accrued interest on
each Loan shall be payable (i) in the case of a Base Rate
Loan, quarterly on the Quarterly Dates, (ii) in the case of a
Eurodollar Loan, on the last day of each Interest Period therefor
and, if such Interest Period is longer than three months, at three-
month intervals following the first day of such Interest Period,
and (iii) in the case of any Loan, upon the payment or prepayment
thereof or the Conversion of such Loan to a Loan of another Type
(but only on the principal amount so paid, prepaid or Converted),
except that interest payable at the Post-Default Rate shall be
payable from time to time on demand. Promptly after the
determination of any interest rate provided for herein or any
change therein, the Agent shall give notice thereof to the Lenders
to which such interest is payable and to the Company.
Section 4. Payments; Pro Rata Treatment; Computations;
Etc.
4.01 Payments.
(a) Except to the extent otherwise provided herein, all
payments of principal, interest, Reimbursement Obligations and
other amounts to be made by the Obligors under this Agreement and
the Notes, and, except to the extent otherwise provided therein,
all payments to be made by the Obligors under any other Basic
Document, shall be made in Dollars, in immediately available
funds, without deduction, set-off or counterclaim, to the Agent at
account number NYAO-DI-900-9-000002 maintained by the Agent with
Chase at the Principal Office, not later than 1:00 p.m. New York
time on the date on which such payment shall become due (each such
payment made after such time on such due date to be deemed to have
been made on the next succeeding Business Day).
(b) Any Lender for whose account any such payment is to
be made may (but shall not be obligated to) debit the amount of
any such payment that is not made by such time to any ordinary
deposit account of either Obligor with such Lender (with notice to
such Obligor and the Agent).
(c) Each Obligor shall, at the time of making each
payment under this Agreement or any Note for account of any
Lender, specify to the Agent (which shall so notify the intended
recipient(s) thereof) the Loans, Reimbursement Obligations or
other amounts payable hereunder to which such payment is to be
applied (and in the event that such Obligor fails to so specify,
or if an Event of Default has occurred and is continuing, the
Agent may distribute such payment to the Lenders for application
in such manner as it or the Majority Lenders, subject to Section
4.02 hereof, may determine to be appropriate).
(d) Except to the extent otherwise provided in the last
sentence of Section 2.03(e) hereof, each payment received by the
Agent under this Agreement or any Note for account of any Lender
shall be paid by the Agent promptly to such Lender, in immediately
available funds, for account of such Lender's Applicable Lending
Office for the Loan or other obligation in respect of which such
payment is made.
(e) Except to the extent otherwise provided herein, if
the due date of any payment under this Agreement or any Note
would otherwise fall on a day that is not a Business Day, such
date shall be extended to the next succeeding Business Day, and
interest shall be payable for any principal so extended for the
period of such extension.
4.02 Pro Rata Treatment. Except to the extent
otherwise provided herein: (a) each borrowing of Loans of a
particular Class from the Lenders under Section 2.01 hereof shall
be made from the relevant Lenders, each payment of commitment fee
under Section 2.05 hereof in respect of the Commitments of a
particular Class shall be made for account of the relevant
Lenders, and each termination or reduction of the amount of the
Commitments of a particular Class under Section 2.04 hereof shall
be applied to the respective Commitments of such Class of the
relevant Lenders, pro rata according to the amounts of their
respective Commitments of such Class; (b) except as otherwise
provided in Section 5.04 hereof, Eurodollar Loans of any Class
having the same Interest Period shall be allocated pro rata among
the relevant Lenders according to the amounts of their respective
Revolving Credit and Term Loan Commitments (in the case of the
making of Loans) or their respective Revolving Credit and Term
Loans (in the case of Conversions and Continuations of Loans); (c)
each payment or prepayment of principal of Loans of a particular
Class shall be made for account of the relevant Lenders pro rata
in accordance with the respective unpaid principal amounts of the
Loans of such Class held by them; and (d) each payment of interest
on Loans of a particular Class shall be made for account of the
relevant Lenders pro rata in accordance with the amounts of
interest on such Loans then due and payable to the respective
Lenders.
4.03 Computations. Interest on Eurodollar Loans and
Reimbursement Obligations and commitment fees and letter of credit
fees shall be computed on the basis of a year of 360 days and
actual days elapsed (including the first day but, except as
otherwise provided in Section 2.03(g) hereof, excluding the last
day) occurring in the period for which payable and interest on
Base Rate Loans shall be computed on the basis of a year of 365 or
366 days, as the case may be, and actual days elapsed (including
the first day but excluding the last day) occurring in the period
for which payable. Notwithstanding the foregoing, for each day
that the Base Rate is calculated by reference to the Federal Funds
Rate, interest on Base Rate Loans shall be computed on the basis
of a year of 360 days and actual days elapsed.
4.04 Minimum Amounts. Except for mandatory prepayments
made pursuant to Section 2.10 hereof and Conversions or
prepayments made pursuant to Section 5.04 hereof, each borrowing,
Conversion and partial prepayment of principal of Loans shall be
in an aggregate amount at least equal to $5,000,000 or a larger
multiple of $1,000,000 (borrowings, Conversions or prepayments of
or into Loans of different Types or, in the case of Eurodollar
Loans, having different Interest Periods at the same time
hereunder to be deemed separate borrowings, Conversions and
prepayments for purposes of the foregoing, one for each Type or
Interest Period), provided that the aggregate principal amount of
Eurodollar Loans having the same Interest Period shall be in an
amount at least equal to $10,000,000 or a larger multiple of
$1,000,000 and, if any Eurodollar Loans would otherwise be in a
lesser principal amount for any period, such Loans shall be Base
Rate Loans during such period.
4.05 Certain Notices. Notices by the Company to the
Agent of terminations or reductions of the Commitments, of
borrowings, Conversions, Continuations and optional prepayments
of Loans and of Classes of Loans, of Types of Loans and of the
duration of Interest Periods shall be irrevocable and shall be
effective only if received by the Agent not later than 11:00 a.m.
(in the case of notices in respect of Eurodollar Loans) and 12:00
noon (in the case of notices in respect of Base Rate Loans), New
York time, on the number of Business Days prior to the date of the
relevant termination, reduction, borrowing, Conversion,
Continuation or prepayment or the first day of such Interest
Period specified below:
Number of
Business
Notice Days Prior
Termination or reduction
of Commitments 3
Borrowing or prepayment of,
or Conversions into,
Base Rate Loans same day
Borrowing or prepayment of,
Conversions into, Continuations
as, or duration of Interest
Period for, Eurodollar Loans 3
Each such notice of termination or reduction shall specify the
amount and the Class of the Commitments to be terminated or
reduced. Each such notice of borrowing, Conversion, Continuation
or optional prepayment shall specify the Class of Loans to be
borrowed, Converted, Continued or prepaid and the amount (subject
to Section 4.04 hereof) and Type of each Loan to be borrowed,
Converted, Continued or prepaid and the date of borrowing,
Conversion, Continuation or optional prepayment (which shall be a
Business Day). Each such notice of the duration of an Interest
Period shall specify the Loans to which such Interest Period is to
relate. The Agent shall promptly notify the Lenders of the
contents of each such notice. In the event that the Company fails
to select the Type of Loan, or the duration of any Interest Period
for any Eurodollar Loan, within the time period and otherwise as
provided in this Section 4.05, such Loan (if outstanding as a
Eurodollar Loan) will be automatically Converted into a Base Rate
Loan on the last day of the then current Interest Period for such
Loan or (if outstanding as a Base Rate Loan) will remain as, or
(if not then outstanding) will be made as, a Base Rate Loan.
4.06 Non-Receipt of Funds by the Agent. Unless the
Agent shall have been notified by a Lender or the Company (the
"Payor") prior to the date on which the Payor is to make payment
to the Agent of (in the case of a Lender) the proceeds of a Loan
to be made by such Lender hereunder or (in the case of the
Company) a payment to the Agent for account of one or more of the
Lenders hereunder (such payment being herein called the "Required
Payment"), which notice shall be effective upon receipt, that the
Payor does not intend to make the Required Payment to the Agent,
the Agent may assume that the Required Payment has been made and
may, in reliance upon such assumption (but shall not be required
to), make the amount thereof available to the intended
recipient(s) on such date; and, if the Payor has not in fact made
the Required Payment to the Agent, the recipient(s) of such
payment shall, on demand, repay to the Agent the amount so made
available together with interest thereon in respect of each day
during the period commencing on the date (the "Advance Date") such
amount was so made available by the Agent until the date the Agent
recovers such amount at a rate per annum equal to the
Federal Funds Rate for such day and, if such recipient(s) shall
fail promptly to make such payment, the Agent shall be entitled to
recover such amount, on demand, from the Payor, together with
interest as aforesaid, provided that if neither the recipient(s)
nor the Payor shall return the Required Payment to the Agent
within three Business Days of the Advance Date, then,
retroactively to the Advance Date, the Payor and the recipient(s)
shall each be obligated to pay interest on the Required Payment as
follows:
(i) if the Required Payment shall represent a payment
to be made by the Company to the Lenders, the Company and the
recipient(s) shall each be obligated retroactively to the
Advance Date to pay interest in respect of the Required
Payment at the Post-Default Rate (without duplication of the
obligation of the Company under Section 3.02 hereof to pay
interest on the Required Payment at the Post-Default Rate),
it being understood that the return by the recipient(s) of
the Required Payment to the Agent shall not limit such
obligation of the Company under said Section 3.02 to pay
interest at the Post-Default Rate in respect of the Required
Payment and
(ii) if the Required Payment shall represent proceeds of
a Loan to be made by the Lenders to the Company, the Payor
and the Company shall each be obligated retroactively to the
Advance Date to pay interest in respect of the Required
Payment pursuant to Section 3.02 hereof, it being understood
that the return by the Company of the Required Payment to the
Agent shall not limit any claim the Company may have against
the Payor in respect of such Required Payment.
4.07 Sharing of Payments, Etc.
(a) Each Obligor agrees that, in addition to (and
without limitation of) any right of set-off, banker's lien or
counterclaim a Lender may otherwise have, each Lender shall be
entitled, at its option (to the fullest extent permitted by law),
to set off and apply any deposit (general or special, time or
demand, provisional or final), or other indebtedness, held by it
for the credit or account of such Obligor at any of its offices,
in Dollars or in any other currency, against any principal of or
interest on any of such Lender's Loans, Reimbursement Obligations
or any other amount payable to such Lender hereunder, that is not
paid when due (regardless of whether such deposit or other
indebtedness are then due to such Obligor), in which case it shall
promptly notify such Obligor and the Agent thereof, provided that
such Lender's failure to give such notice shall not affect the
validity thereof.
(b) If any Lender shall obtain from any Obligor payment
of any principal of or interest on any Loan of any Class or Letter
of Credit Liability owing to it or payment of any other amount
under this Agreement or any other Basic Document through the
exercise of any right of set-off, banker's lien or counterclaim or
similar right or otherwise (other than from the Agent as provided
herein), and, as a result of such payment, such Lender shall have
received a greater percentage of the principal of or interest on
the Loans of such Class or Letter of Credit Liabilities or such
other amounts then due hereunder or thereunder by such Obligor to
such Lender than the percentage received by any other Lender, it
shall promptly purchase from such other Lenders participations in
(or, if and to the extent specified by such Lender, direct
interests in) the Loans of such Class or Letter of Credit
Liabilities or such other amounts,
respectively, owing to such other Lenders (or in interest due
thereon, as the case may be) in such amounts, and make such other
adjustments from time to time as shall be equitable, to the end
that all the Lenders shall share the benefit of such excess
payment (net of any expenses that may be incurred by such Lender
in obtaining or preserving such excess payment) pro rata in
accordance with the unpaid principal of and/or interest on the
Loans of such Class or Letter of Credit Liabilities or such other
amounts, respectively, owing to each of the Lenders. To such end
all the Lenders shall make appropriate adjustments among
themselves (by the resale of participations sold or otherwise) if
such payment is rescinded or must otherwise be restored.
(c) Each Obligor agrees that any Lender so purchasing
such a participation (or direct interest) may exercise all rights
of set-off, banker's lien, counterclaim or similar rights with
respect to such participation as fully as if such Lender were a
direct holder of Loans or other amounts (as the case may be) owing
to such Lender in the amount of such participation.
(d) Nothing contained herein shall require any Lender
to exercise any such right or shall affect the right of any Lender
to exercise, and retain the benefits of exercising, any such right
with respect to any other indebtedness or obligation of any
Obligor. If, under any applicable bankruptcy, insolvency or other
similar law, any Lender receives a secured claim in lieu of a set-
off to which this Section 4.07 applies, such Lender shall, to the
extent practicable, exercise its rights in respect of such secured
claim in a manner consistent with the rights of the Lenders
entitled under this Section 4.07 to share in the benefits of any
recovery on such secured claim.
Section 5. Yield Protection, Etc.
5.01 Additional Costs.
(a) The Company shall pay directly to each Lender from
time to time such amounts as such Lender may determine to be
reasonably necessary to compensate such Lender for any costs that
such Lender determines, in good faith, are attributable to its
making or maintaining of any Eurodollar Loans or its obligation to
make any Eurodollar Loans hereunder, or any reduction in any
amount receivable by such Lender hereunder in respect of any of
such Eurodollar Loans or such obligation (such increases in costs
and reductions in amounts receivable being herein called
"Additional Costs"), resulting from any Regulatory Change that:
(i) shall subject any Lender (or its Applicable Lending
Office for any of such Loans) to any tax, duty or other
charge in respect of such Loans or its Notes or changes the
basis of taxation of any amounts payable to such Lender under
this Agreement or its Notes in respect of any of such Loans
(excluding changes in the rate of tax on the overall net
income of such Lender or of such Applicable Lending Office by
the jurisdiction in which such Lender has its principal
office or such Applicable Lending Office); or
(ii) imposes or modifies any reserve, special deposit or
similar requirements (other than the Reserve Requirement
utilized in the determination of the Eurodollar Rate for such
Loan) relating to any extensions of credit or other assets
of, or any deposits with or other liabilities of, such Lender
(including, without limitation, any of such Loans or any
deposits referred to in the definition of "Eurodollar Base
Rate" in Section 1.01 hereof), or any
commitment of such Lender (including, without limitation,
the Commitments of such Lender hereunder); or
(iii) imposes any other condition affecting this
Agreement or its Notes (or any of such extensions of credit
or liabilities) or its Commitments.
If any Lender requests compensation from the Company under this
Section 5.01(a), the Company may, by notice to such Lender (with a
copy to the Agent), suspend the obligation of such Lender
thereafter to make or Continue Eurodollar Loans, or to Convert
Base Rate Loans into Eurodollar Loans, until the Regulatory Change
giving rise to such request ceases to be in effect (in which case
the provisions of Section 5.04 hereof shall be applicable),
provided that such suspension shall not affect the right of such
Lender to receive the compensation so requested.
(b) Without limiting the effect of the provisions of
paragraph (a) of this Section 5.01 (but without duplication), in
the event that, by reason of any Regulatory Change, any Lender
either (i) incurs Additional Costs based on or measured by the
excess above a specified level of the amount of a category of
deposits or other liabilities of such Lender that includes
deposits by reference to which the interest rate on Eurodollar
Loans is determined as provided in this Agreement or a category of
extensions of credit or other assets of such Lender that includes
Eurodollar Loans or (ii) becomes subject to restrictions on the
amount of such a category of liabilities or assets that it may
hold, then, if such Lender so elects by notice to the Company
(with a copy to the Agent), the obligation of such Lender to make
or Continue, or to Convert Base Rate Loans into, Eurodollar Loans
hereunder shall be suspended until such Regulatory Change ceases
to be in effect (in which case the provisions of Section 5.04
hereof shall be applicable).
(c) Without limiting the effect of the foregoing
provisions of this Section 5.01 (but without duplication), the
Company shall pay directly to each Lender from time to time on
request such amounts as such Lender may determine to be necessary
to compensate such Lender (or, without duplication, the bank
holding company of which such Lender is a subsidiary) for any
costs that it determines are attributable to the maintenance by
such Lender (or any Applicable Lending Office or such bank holding
company), pursuant to any law or regulation or any interpretation,
directive or request (whether or not having the force of law and
whether or not failure to comply therewith would be unlawful) of
any court or governmental or monetary authority (i) following any
Regulatory Change or (ii) implementing any risk-based capital
guideline or other requirement (whether or not having the force of
law and whether or not the failure to comply therewith would be
unlawful) hereafter issued by any government or governmental or
supervisory authority implementing at the national level the Basle
Accord (including, without limitation, the Final Risk-Based
Capital Guidelines of the Board of Governors of the Federal
Reserve System (12 C.F.R. Part 208, Appendix A; 12 C.F.R. Part
225, Appendix A) and the Final Risk-Based Capital Guidelines of
the Office of the Comptroller of the Currency
(12 C.F.R. Part 3, Appendix A)), of capital in respect of its
Commitments or Loans (such compensation to include, without
limitation, an amount equal to any reduction of the rate of return
on assets or equity of such Lender (or any Applicable Lending
Office or such bank holding company) to a level below that which
such Lender (or any Applicable Lending Office or such bank holding
company) could have achieved but for such law, regulation,
interpretation, directive or request). For purposes of this
Section 5.01(c) and Section 5.06 hereof, "Basle Accord"
shall mean the proposals for risk-based capital framework
described by the Basle Committee on Banking Regulations and
Supervisory Practices in its paper entitled "International
Convergence of Capital Measurement and Capital Standards" dated
July 1988, as amended, modified and supplemented and in effect
from time to time or any replacement thereof.
(d) Each Lender shall notify the Company of any event
occurring after the date hereof entitling such Lender to
compensation under paragraph (a) or (c) of this Section 5.01 as
promptly as practicable, but in any event within 45 days, after
such Lender obtains actual knowledge thereof; provided that
(i) if any Lender fails to give such notice within 45 days after
it obtains actual knowledge of such an event, such Lender shall,
with respect to compensation payable pursuant to this
Section 5.01 in respect of any costs resulting from such event,
only be entitled to payment under this Section 5.01 for costs
incurred from and after the date 45 days prior to the date that
such Lender does give such notice and (ii) each Lender will
designate a different Applicable Lending Office for the Loans of
such Lender affected by such event if such designation will avoid
the need for, or reduce the amount of, such compensation and will
not, in the sole opinion of such Lender, be disadvantageous to
such Lender, except that such Lender shall have no obligation to
designate an Applicable Lending Office located in the United
States of America. Each Lender will furnish to the Company a
certificate setting forth the basis and amount of each request by
such Lender for compensation under paragraph (a) or (c) of this
Section 5.01. Determinations and allocations by any Lender for
purposes of this Section 5.01 of the effect of any Regulatory
Change pursuant to paragraph (a) or (b) of this Section 5.01, or
of the effect of capital maintained pursuant to paragraph (c) of
this Section 5.01, on its costs or rate of return of maintaining
Loans or its obligation to make Loans, or on amounts receivable by
it in respect of Loans, and of the amounts required to compensate
such Lender under this Section 5.01, shall be conclusive, provided
that such determinations and allocations are made on a good faith
reasonable basis.
5.02 Limitation on Types of Loans. Anything herein to
the contrary notwithstanding, if, on or prior to the determination
of any Eurodollar Base Rate for any Interest Period:
(a) the Agent determines, which determination shall be
conclusive if made in good faith, that quotations of interest
rates for the relevant deposits referred to in the definition
of "Eurodollar Base Rate" in Section 1.01 hereof are not
being provided in the relevant amounts or for the relevant
maturities for purposes of determining rates of interest for
Eurodollar Loans as provided herein; or
(b) if the related Loans are Revolving Credit Loans,
the Majority Revolving Credit Lenders or, if the related
Loans are Term Loans, the Majority Term Lenders determine,
which determination shall be conclusive if made in good
faith, and notify the Agent that the relevant rates of
interest referred to in the definition of "Eurodollar Base
Rate" in Section 1.01 hereof upon the basis of which the rate
of interest for Eurodollar Loans for such Interest Period is
to be determined are not likely adequately to cover the cost
to such Lenders of making or maintaining Eurodollar Loans for
such Interest Period;
then the Agent shall give the Company and each Lender prompt
notice thereof and, so long as such condition remains in effect,
the Lenders shall be under no obligation to make additional
Eurodollar Loans, to Continue Eurodollar Loans or to Convert Base
Rate Loans into Eurodollar Loans, and the Company shall, on the
last day(s) of the then current Interest Period(s) for the
outstanding Eurodollar Loans, either prepay such Loans or Convert
such Loans into Base Rate Loans in accordance with Section 2.09
hereof.
5.03 Illegality. Notwithstanding any other provision
of this Agreement, in the event that it becomes unlawful for any
Lender or its Applicable Lending Office to honor its obligation to
make or maintain Eurodollar Loans hereunder (and, in the sole
opinion of such Lender, the designation of a different Applicable
Lending Office would either not avoid such unlawfulness or would
be disadvantageous to such Lender), then such Lender shall
promptly notify the Company thereof (with a copy to the Agent) and
such Lender's obligation to make or Continue, or to Convert Loans
of any other Type into, Eurodollar Loans shall be suspended until
such time as such Lender may again make and maintain Eurodollar
Loans (in which case the provisions of Section 5.04 hereof shall
be applicable).
5.04 Treatment of Affected Loans. If the obligation of
any Lender to make Eurodollar Loans or to Continue, or to Convert
Base Rate Loans into, Eurodollar Loans shall be suspended pursuant
to Section 5.01 or 5.03 hereof, such Lender's Eurodollar Loans
shall be automatically Converted into Base Rate Loans on the last
day(s) of the then current Interest Period(s) for Eurodollar Loans
(or, in the case of a Conversion required by Section 5.01(b) or
5.03 hereof, on such earlier date as such Lender may specify to
the Company with a copy to the Agent) and, unless and until such
Lender gives notice as provided below that the circumstances
specified in Section 5.01 or 5.03 hereof that gave rise to such
Conversion no longer exist:
(a) to the extent that such Lender's Eurodollar Loans
have been so Converted, all payments and prepayments of
principal that would otherwise be applied to such Lender's
Eurodollar Loans shall be applied instead to its Base Rate
Loans; and
(b) all Loans that would otherwise be made or Continued
by such Lender as Eurodollar Loans shall be made or Continued
instead as Base Rate Loans, and all Base Rate Loans of such
Lender that would otherwise be Converted into Eurodollar
Loans shall remain as Base Rate Loans.
If such Lender gives notice to the Company with a copy to the
Agent that the circumstances specified in Section 5.01 or 5.03
hereof that gave rise to the Conversion of such Lender's
Eurodollar Loans pursuant to this Section 5.04 no longer exist
(which such Lender agrees to do promptly upon such circumstances
ceasing to exist) at a time when Eurodollar Loans made by other
Lenders are outstanding, such Lender's Base Rate Loans shall be
automatically Converted, on the first day(s) of the next
succeeding Interest Period(s) for such outstanding Eurodollar
Loans, to the extent necessary so that, after giving effect
thereto, all Loans held by the Lenders holding Eurodollar Loans
and by such Lender are held pro rata (as to principal amounts,
Types and Interest Periods) in accordance with their respective
Commitments.
5.05 Compensation. The Company shall pay to the Agent
for account of each Lender, upon the request of such Lender
through the Agent, such amount or amounts as shall be sufficient
(in the reasonable opinion of such Lender) to compensate it for
any loss, cost or expense that such Lender determines is
attributable to:
(a) any payment, mandatory or optional prepayment or
Conversion of a Eurodollar Loan made by such Lender for any
reason (including, without limitation, the acceleration of
the Loans pursuant to Section 10 hereof) on a date other than
the last day of the Interest Period for such Loan; or
(b) any failure by the Company for any reason
(including, without limitation, the failure of any of the
conditions precedent specified in Section 7 hereof to be
satisfied) to borrow a Eurodollar Loan from such Lender on
the date for such borrowing specified in the relevant notice
of borrowing given pursuant to Section 2.02 hereof.
Without limiting the effect of the preceding sentence, such
compensation shall include an amount equal to the excess, if any,
of (i) the amount of interest that otherwise would have accrued on
the principal amount so paid, prepaid, Converted or not borrowed
for the period from the date of such payment, prepayment,
Conversion or failure to borrow to the last day of the then
current Interest Period for such Loan (or, in the case of a
failure to borrow, the Interest Period for such Loan that would
have commenced on the date specified for such borrowing) at the
applicable rate of interest for such Loan provided for herein over
(ii) the amount of interest that otherwise would have accrued on
such principal amount at a rate per annum equal to the interest
component of the amount such Lender would have bid in the London
interbank market for Dollar deposits of leading banks in amounts
comparable to such principal amount and with maturities comparable
to such period (as reasonably determined by such Lender).
5.06 Additional Costs in Respect of Letters of Credit.
Without limiting the obligations of the Company under
Section 5.01 hereof (but without duplication), if as a result of
any Regulatory Change or any risk-based capital guideline or other
requirement heretofore or hereafter issued by any government or
governmental or supervisory authority implementing at the national
level the Basle Accord there shall be imposed, modified or deemed
applicable any tax, reserve, special deposit, capital adequacy or
similar requirement against or with respect to or measured by
reference to Letters of Credit issued or to be issued hereunder
and the result shall be to increase the cost to any Lender or
Lenders of issuing (or purchasing participations in) or
maintaining its obligation hereunder to issue (or purchase
participations in) any Letter of Credit hereunder or reduce any
amount receivable by any Lender hereunder in respect of any Letter
of Credit (which increases in cost, or reductions in amount
receivable, shall be the result of such Lender's or Lenders'
reasonable allocation of the aggregate of such increases or
reductions resulting from such event), then, upon demand by such
Lender or Lenders (through the Agent), the Company shall pay
immediately to the Agent for account of such Lender or Lenders,
from time to time as specified by such Lender or Lenders (through
the Agent), such additional amounts as shall be sufficient to
compensate such Lender or Lenders (through the Agent) for such
increased costs or reductions in amount. A statement as to such
increased costs or reductions in amount incurred by any such
Lender or Lenders, submitted by such Lender or Lenders to the
Company shall be conclusive if made in good faith and in the
absence of manifest error as to the amount thereof.
5.07 U.S. Taxes.
(a) The Company agrees to pay to each Lender that is
not a U.S. Person such additional amounts as are necessary in
order that the net payment of any amount due to such
non-U.S. Person hereunder after deduction for or withholding in
respect of any U.S. Taxes (other than U.S. Taxes attributable to
payments that are effectively connected with the conduct of a
trade or business within the United States of America, within the
meaning of Section 864 of the Code as in effect on the date
hereof, provided that the mere participation in the transactions
contemplated hereby by a foreign office of a Lender shall not
alone be deemed to result in income so connected) imposed with
respect to such payment (or, upon the failure of the Company
properly to make any such deduction or withholding required by
applicable law, payment by each Lender that is not a U.S. Person
of such U.S. Taxes that should have been deducted or withheld),
will not be less than the amount stated herein to be then due and
payable, provided that the foregoing obligation to pay such
additional amounts shall not apply:
(i) to any payment to any Lender hereunder (other than
in respect of any Registered Loan) unless such Lender is, on
the date hereof (or on the date it becomes a Lender hereunder
as provided in Section 12.06(b) hereof), on the date of each
payment hereunder and on the day after any change in the
Applicable Lending Office of such Lender, entitled to submit
either a Form 1001 (relating to such Lender and entitling it
to a complete exemption from withholding on all interest to
be received by it hereunder in respect of the Loans) or a
Form 4224 (relating to all interest to be received by such
Lender hereunder in respect of the Loans), unless such
inability is due to a change of law (including but not
limited to any change in any applicable treaty, statute,
regulation or ruling or judicial or administrative
interpretation of any of the foregoing) after the date hereof
(or the date it became a Lender hereunder as provided in
Section 12.06(b) hereof),
(ii) to any payment to any Lender hereunder in respect
of a Registered Loan (a "Registered Holder"), unless such
Registered Holder (or, if such Registered Holder is not the
beneficial owner of such Registered Loan, the beneficial
owner thereof) is, on the date hereof (or on the date such
Registered Holder becomes a Lender as provided in
Section 12.06(b) hereof), on the date of each payment
hereunder and on the day after any change in the Applicable
Lending Office of such Lender, entitled to submit a Form W-8,
together with an annual certificate stating that (x) such
Registered Holder (or beneficial owner, as the case may be)
is not a "bank" within the meaning of
Section 881(c)(3)(A) of the Code, is not a resident in a
foreign country specified in a notice published under
Sections 871(h)(6) or 881(c)(6) of the Code and is not a 10%
shareholder of the Company within the meaning of Section
881(c)(3)(B) of the Code, unless such Registered Holder, or
beneficial owner as the case may be, is not so entitled by
reason of a change of law (including but not limited to any
change in any applicable treaty, statute, regulation or
ruling, or judicial or administrative interpretation of any
of the foregoing) occurring after the date hereof (or the
date the Registered Holder or beneficial owner, as the case
may be, became a Registered Holder or beneficial owner) and
(y) such Registered Holder (or beneficial owner, as the case
may be) shall promptly notify the Company if at any time,
such Registered Holder (or beneficial owner, as the case may
be) determines that it is no longer in a position to provide
such certificate to the Company (or any other form of
certification adopted by the relevant taxing authorities of
the United States of America for such purposes), or
(iii) to any U.S. Taxes imposed solely by reason of the
failure by such non-U.S. Person (or, if such non-U.S. Person
is not the beneficial owner of the relevant Loan, such
beneficial owner) to comply with (x) applicable
certification, information, documentation or other reporting
requirements concerning the nationality, residence, identity
or connections with the United States of America of such non-
U.S. Person (or beneficial owner, as the case may be) if such
compliance is required by statute or regulation of the United
States of America as a precondition to relief or exemption
from such U.S. Taxes and (y) this Section 5.07(a).
For the purposes of this Section 5.07(a), (A) "Form 1001" shall
mean Form 1001 (Ownership, Exemption, or Reduced Rate Certificate)
of the Department of the Treasury of the United States of America,
(B) "Form 4224" shall mean Form 4224 (Exemption from Withholding
of Tax on Income Effectively Connected with the Conduct of a Trade
or Business in the United States) of the Department of the
Treasury of the United States of America and (C) "Form W-8" shall
mean Form W-8 (Certificate of Foreign Status of the Department of
Treasury of the United States of America). Each of the Forms
referred to in the foregoing clauses (A), (B) and (C) shall
include such successor and related forms as may from time to time
be adopted by the relevant taxing authorities of the United States
of America to document a claim to which such Form relates.
(b) Within 30 days after paying any amount to the Agent
or any Lender from which it is required by law to make any
deduction or withholding, and within 30 days after it is required
by law to remit such deduction or withholding to any relevant
taxing or other authority, the Company shall deliver to the Agent
for delivery to such non-U.S. Person evidence reasonably
satisfactory to such Person of such deduction, withholding or
payment (as the case may be).
(c) If any Lender shall be entitled to compensation
under this Section 5.07, such Lender, within a reasonable time
after becoming entitled to such compensation, shall (unless
otherwise required by a governmental authority or as a result of
any law, rule, regulation, order or similar directive applicable
to such Lender) designate a different Applicable Lending Office
from that initially selected by such Lender to which payments are
to be made under the Basic Documents, if such designation would
avoid the need for (or reduce the amount of) such compensation and
would not, in the sole opinion of such Lender, be otherwise
disadvantageous to such Lender.
5.08 Replacement of Lenders. If any Lender defaults in
its obligation to make Loans under Section 2.01 hereof or requests
compensation pursuant to Section 5.01, 5.06 or 5.07 hereof, or any
Lender's obligation to make or Continue, or to Convert Loans of
any Type into, any other Type of Loan shall be suspended pursuant
to Section 5.01 or 5.03 hereof (any such Lender so defaulting or
requesting such compensation or whose obligations are so
suspended, being herein called a "Relevant Lender"), the Company,
upon three Business Days notice given when no Default shall have
occurred and be continuing, may require that such Relevant Lender
transfer all of its right, title and interest under this Agreement
and such Relevant Lender's Notes to any bank or other financial
institution identified by the Company that is satisfactory to the
Agent, in its discretion reasonably exercised (a "Proposed
Lender") if (i) such Proposed Lender
agrees to assume all of the obligations of such Relevant Lender
hereunder, and to purchase all of such Relevant Lender's Loans
hereunder for consideration equal to the aggregate outstanding
principal amount of such Relevant Lender's Loans, together with
interest thereon to the date of such purchase, and satisfactory
arrangements are made for payment to such Relevant Lender of all
other amounts payable hereunder to such Relevant Lender on or
prior to the date of such transfer (including any fees accrued
hereunder and any amounts that would be payable under
Section 5.05 hereof as if all of such Relevant Lender's Loans were
being prepaid in full on such date) and (ii) such Relevant Lender
has requested compensation pursuant to Section 5.01, 5.06 or 5.07
hereof, such Proposed Lender's aggregate requested compensation,
if any, paid pursuant to Section 5.01, 5.06 or 5.07 hereof with
respect to such Relevant Lender's Loans is lower than that of the
Relevant Lender. Subject to the provisions of Section 12.06(b)
hereof, such Proposed Lender shall be a "Lender"
for all purposes hereunder. Without prejudice to the survival of
any other agreement of the Company hereunder, the agreements of
the Company contained in Sections 5.01, 5.06, 5.07 and 12 hereof
(without duplication of any payments made to such Relevant Lender
by the company or the Proposed Lender) shall survive for the
benefit of such Relevant Lender under this Section 5.08 with
respect to the time prior to such replacement.
Section 6. Guarantee.
6.01 The Guarantee. The Guarantor hereby guarantees to
each Lender and the Agent and their respective successors and
assigns the prompt payment in full when due (whether at stated
maturity, by acceleration or otherwise) of the principal of and
interest on the Loans made by the Lenders to, and the Notes held
by each Lender of, the Company and all other amounts from time to
time owing to the Lenders or the Agent by the Company under this
Agreement and under the Notes and by the Company under any of the
other Basic Documents, and all obligations of the Company to any
Lender in respect of any Interest Rate Protection Agreement, in
each case strictly in accordance with the terms thereof (such
obligations being herein collectively called the "Guaranteed
Obligations"). The Guarantor hereby further agrees that if the
Company shall fail to pay in full when due (whether at stated
maturity, by acceleration or otherwise) any of the Guaranteed
Obligations, the Guarantor will promptly pay the same, without any
demand or notice whatsoever, and that in the case of any extension
of time of payment or renewal of any of the Guaranteed
Obligations, the same will be promptly paid in full when due
(whether at extended maturity, by acceleration or otherwise) in
accordance with the terms of such extension or renewal.
6.02 Obligations Unconditional. The obligations of the
Guarantor under Section 6.01 hereof are absolute and unconditional
irrespective of the value, genuineness, validity, regularity or
enforceability of the obligations of the Company under this
Agreement, the Notes or any other agreement or instrument referred
to herein or therein, or any substitution, release or exchange of
any other guarantee of or security for any of the Guaranteed
Obligations, and, to the fullest extent permitted by applicable
law, irrespective of any other circumstance whatsoever that might
otherwise constitute a legal or equitable discharge or defense of
a surety or guarantor, it being the intent of this Section 6.02
that the obligations of the Guarantor hereunder shall be absolute
and unconditional under any and all circumstances. Without
limiting the generality of the foregoing, it is agreed that the
occurrence of any one or more of the following shall not alter or
impair the liability of the
Guarantor hereunder which shall remain absolute and unconditional
as described above:
(i) at any time or from time to time, without notice to
the Guarantor, the time for any performance of or compliance
with any of the Guaranteed Obligations shall be extended, or
such performance or compliance shall be waived;
(ii) any of the acts mentioned in any of the provisions
of this Agreement or the Notes or any other agreement or
instrument referred to herein or therein shall be done or
omitted;
(iii) the maturity of any of the Guaranteed Obligations
shall be accelerated, or any of the Guaranteed Obligations
shall be modified, supplemented or amended in any respect, or
any right under this Agreement or the Notes or any other
agreement or instrument referred to herein or therein shall
be waived or any other guarantee of any of the Guaranteed
Obligations or any security therefor shall be released or
exchanged in whole or in part or otherwise dealt with; or
(iv) any lien or security interest granted to, or in
favor of, the Agent or any Lender or Lenders as security for
any of the Guaranteed Obligations shall fail to be perfected.
The Guarantor hereby expressly waives diligence, presentment,
demand of payment, protest and all notices whatsoever, and any
requirement that the Agent or any Lender exhaust any right, power
or remedy or proceed against the Company under this Agreement or
the Notes or any other agreement or instrument referred to herein
or therein, or against any other Person under any other guarantee
of, or security for, any of the Guaranteed Obligations.
6.03 Reinstatement. The obligations of the Guarantor
under this Section 6 shall be automatically reinstated if and to
the extent that for any reason any payment by or on behalf of any
Obligor in respect of the Guaranteed Obligations is rescinded or
must be otherwise restored by any holder of any of the Guaranteed
Obligations, whether as a result of any proceedings in bankruptcy
or reorganization or otherwise and the Guarantor agrees that it
will indemnify the Agent and each Lender on demand for all
reasonable costs and expenses (including, without limitation, fees
of counsel) incurred by the Agent or such Lender in connection
with such rescission or restoration, including any such costs and
expenses incurred in defending against any claim alleging that
such payment constituted a preference, fraudulent transfer or
similar payment under any bankruptcy, insolvency or similar law.
6.04 Subrogation. The Guarantor hereby waives, until
payment in full of the Guaranteed Obligations, all rights of
subrogation or contribution, whether arising by contract or
operation of law (including, without limitation, any such right
arising under the Bankruptcy Code) or otherwise by reason of any
payment by it pursuant to the provisions of this Section 6.
6.05 Remedies. The Guarantor agrees that, as between
the Guarantor and the Lenders, the obligations of the Company
under this Agreement and the Notes may be declared to be forthwith
due and payable as provided in Section 10 hereof (and shall be
deemed to have become automatically due and payable in the
circumstances provided in said Section 10) for purposes of Section
6.01 hereof notwithstanding any stay, injunction or other
prohibition preventing such declaration (or such obligations from
becoming automatically due and payable) as against the Company and
that, in the event of such declaration (or such obligations being
deemed to have become automatically due and payable), such
obligations (whether or not due and payable by the Company) shall
forthwith become due and payable by the Guarantor for purposes of
said Section 6.01.
6.06 Continuing Guarantee. The guarantee in this
Section 6 is a continuing guarantee, and shall apply to all
Guaranteed Obligations whenever arising.
Section 7. Conditions Precedent.
7.01 Initial Loan . The obligation of each Lender to
make its initial Loan or any other extension of credit hereunder
on the Initial Borrowing Date is subject to the prior or
simultaneous satisfaction of the following conditions: (i) such
extension of credit shall be made on or before the Loan Commitment
Termination Date and (ii) the Agent shall have received the
following documents (with, in the case of clauses (a), (b), (d),
(e), (f), (h), (i), (k), (l), (m), (n), (o), (t), (u) and (y)
below sufficient copies for each Lender) or other evidence, each
of which shall be satisfactory to the Agent (and to the extent
specified below, to the Lenders) in form and substance:
(a) Corporate Documents. The following documents, each
certified as indicated below:
(i) for each of the Company and the
Guarantor, a copy of the charter, as amended and in
effect, prior to the Mergers, of such Person certified
as of a date reasonably close to the Initial Borrowing
Date by the Secretary of State of Delaware or Illinois,
as the case may be, and a certificate from such
Secretary of State dated as of a date reasonably close
to the Initial Borrowing Date as to the good standing of
and charter documents filed by such Person;
(ii) for each of the Company and the
Guarantor, a certificate of the Secretary or an
Assistant Secretary of such Person, dated the Initial
Borrowing Date and certifying (A) that attached thereto
is a true and complete copy of the by-laws of such
Person as amended and in effect at all times from the
date on which the resolutions referred to in clause (B)
were adopted until the Mergers, (B) that attached
thereto is a true and complete copy of resolutions duly
adopted by the board of directors of such Person
authorizing the execution, delivery and performance of
such of the Basic Documents to which such Person is or
is intended to be a party and the extensions of credit
hereunder, and that such resolutions have not been
modified, rescinded or amended and are in full force and
effect, (C) that the charter of such Person had not been
amended since the date of the certification thereto
furnished pursuant to clause (i) above, and (D) as to
the incumbency and specimen signature of each officer of
such Person executing such of the Basic Docu ments to
which such Person is intended to be a party and each
other document to be delivered by such Person from time
to time in connection therewith (and the Agent and each
Lender may conclusively rely on such certificate until
it receives notice in writing from such Person);
(iii) for each of the Company and the
Guarantor, a certificate of another officer of such
Person, dated the Initial Borrowing Date, as to the
incumbency and specimen signature of the Secretary or
Assistant Secretary, as the case may be, of such Person
at the time of execution of the certificate referred to
in clause (ii) above;
(iv) the Articles of Merger relating to the
merger of the Guarantor into United as filed with the
Secretary of State of Delaware certified as of the
Initial Borrowing Date by the Secretary of United;
(v) the Articles of Merger relating to the
merger of the Company with and into Supply as filed with
the Secretary of State of Illinois and Delaware
certified as of the Initial Borrowing Date by the
Secretary of Supply;
(vi) a certificate of the Secretary or
Assistant Secretary of United dated the Initial
Borrowing Date certifying (A) that attached thereto is a
true and complete copy of the Certificate of
Incorporation and by-laws of United, as amended and in
effect on the Initial Borrowing Date after giving effect
to the United Merger, (B) that attached thereto is a
true and complete copy of resolutions duly adopted by
the board of directors of United authorizing the
execution, delivery and performance of such of the
Transaction Documents to which United is or is intended
to be a party, and that such resolutions have not been
modified, rescinded or amended and are in full force and
effect and (C) as to the incumbency and specimen
signature of each officer of United executing such of
the Transaction Documents to which United is or is
intended to be a party and each other document to be
delivered by United from time to time in connection
therewith (and the Agent and each Lender may
conclusively rely on such certificate until it receives
notice in writing from United);
(vii) a certificate of the Secretary or
Assistant Secretary of Supply dated the Initial
Borrowing Date certifying (A) that attached thereto is a
true and complete copy of the Articles of Incorporation
and by-laws of Supply, as amended and in effect on the
Initial Borrowing Date after giving effect to the Supply
Merger, (B) that attached thereto is a true and complete
copy of resolutions duly adopted by the board of
directors of Supply authorizing the execution, delivery
and performance of such of the Transaction Documents to
which Supply is or is intended to be a party, and that
such resolutions have not been modified, rescinded or
amended and are in full force and effect and (C) as to
the incumbency and specimen signature of each officer of
Supply executing such of the Transaction Documents to
which Supply is or is intended to be a party and each
other document to be delivered by Supply from time to
time in connection therewith (and the Agent and each
Lender may conclusively rely on such certificate until
it receives notice in writing from Supply);
(viii) a certificate of another officer of
United, dated the Initial Borrowing Date after giving
effect to the United Merger, as to the incumbency and
specimen signature of the Secretary or Assistant
Secretary of United, as the case may be; and
(ix) a certificate of another officer of
Supply, dated the Initial Borrowing Date after giving
effect to the Supply Merger, as to the incumbency and
specimen signature of the Secretary or Assistant
Secretary of Supply, as the case may be.
(b) Officer's Certificate. A certificate of a senior
officer of the Guarantor, dated the Initial Borrowing Date,
to the effect set forth in clauses (a) and (b) of Section
7.02 hereof.
(c) Notes. The Term Notes, duly completed and executed
for each Term Lender (except that, in the case of a
Registered Holder, Term Loan Notes shall be required only to
the extent that such Registered Holder shall have requested
the execution and delivery of a Note pursuant to
Section 2.08(f) hereof) and the Revolving Credit Notes, duly
completed and executed for each Revolving Credit Lender.
(d) Opinions of Counsel to the Obligors. Opinions,
dated the Initial Borrowing Date, of (i) Weil, Gotshal &
Manges, special New York counsel to the Obligors,
substantially in the form of Exhibit G-1 hereto and covering
such other matters as the Agent or any Lender may reasonably
request (and each Obligor hereby instructs such counsel to
deliver such opinion to the Lenders and the Agent) and (ii)
D'Ancona & Pflaum, special Illinois counsel to the Obligors,
substantially in the form of Exhibit G-2 hereto and covering
such other matters as the Agent or any Lender may reasonably
request (and each Obligor hereby instructs such counsel to
deliver such opinion to the Lenders and the Agent) and (iii)
Prickett, Jones, Elliott, Kristol & Schnee, special Delaware
counsel to the Obligors, substantially in the form of Exhibit
G-3 hereto and covering such other matters as the Agent or
any Lender may reasonably request (and each Obligor hereby
instructs such counsel to deliver such opinion to the Lenders
and the Agent).
(e) Opinions of Local Counsel. Opinions, dated the
Initial Borrowing Date, of local counsel in the respective
states in which the Properties covered by the Mortgages
referred to in clause (m) below are located, substantially in
the form of Exhibit G-4 hereto, and in each case covering
such others matters as the Agent or any Lender may reasonably
request (and each Obligor hereby instructs such counsel to
deliver such opinions to the Lenders and the Agent).
(f) Opinion of Special New York Counsel to the Agent.
An opinion, dated the Initial Borrowing Date, of Milbank,
Tweed, Hadley & McCloy, special New York counsel to the
Agent, substantially in the form of Exhibit H hereto.
(g) Tender of United Shares. Evidence that at least
90% of the issued and outstanding United Shares shall have
been validly tendered to the Guarantor, that the price per
share to be paid by the Guarantor for such United Shares
shall not exceed $15.50 and that such United Shares have been
validly tendered to the Guarantor free and clear of all Liens
and restrictions to purchase imposed by applicable law and
have not been withdrawn and are available for purchase in
accordance with the terms and conditions of the Offer to
Purchase.
(h) Tender Offer Documents and Governmental Approvals.
(i) Certified copies of all Tender Offer Documents (including
the Offer to Purchase), and all Additional Tender Offer
Documents (which Additional Tender Offer Documents shall be
in form and substance acceptable to the Majority Lenders),
(ii) a certified copy of the Notification and Report Form in
respect of the Acquisition furnished to the Department of
Justice and the Federal Trade Commission pursuant to the Hart-
Scott-Rodino Antitrust Improvements Act of 1976, as amended,
(iii) a certificate of a senior officer of the Guarantor
dated the Initial Borrowing Date certifying that all of the
conditions precedent to the purchase of the United Shares
contained in the Offer to Purchase have been satisfied and
not waived except with the consent of the Majority Lenders
and that the Offer to Purchase has been duly authorized and
delivered by the Guarantor and is in full force and effect as
of said date and (iv) evidence that all necessary
governmental and material third party consents and approvals
in connection with the Acquisition have been obtained and
remain in effect and all applicable waiting periods have
expired without any action being taken by any competent
authority that restricts, prevents of imposes materially
adverse conditions upon the making or consummation of the
Acquisition.
(i) Merger Agreement. Evidence that the Merger
Agreement shall have been duly authorized, executed and
delivered by the parties thereto and shall be in full force
and effect (it being understood that by reason of the Merger
Agreement, the Lenders are relying in good faith upon the
assets and cash flow of United and its Subsidiaries to be
available for repayment of the Loans). The Lenders shall
have received a certificate from a senior officer of United
dated the Initial Borrowing Date and certifying that there
has been no amendment to the Merger Agreement except with the
consent of the Majority Lenders and that the representations
and warranties of United set forth in the Merger Agreement
are true and complete in all material respects as if made on
the Initial Borrowing Date, except that any such
representation or warranty stated to relate to a specific
earlier date is true and complete as of such earlier date.
(j) Merger. Evidence that the Guarantor, the Company,
United and Supply shall have consummated the Mergers in
compliance with the Merger Agreement and all applicable laws;
and certified copies of each document or instrument delivered
by the Guarantor, the Company, United and Supply pursuant to
the Merger Agreement.
(k) Other Acquisition Documents. Certified copies of
all other Acquisition Documents each of which shall be in
form and substance satisfactory to the Majority Lenders.
(l) Security Agreement. The Security Agreement, duly
executed and delivered by the Company and the Agent. In
addition, the Company shall have taken such other action
(including, without limitation, delivering to the Agent, for
filing, appropriately completed and duly executed copies of
Uniform Commercial Code financing statements) as the Agent
shall have requested in order to perfect the security
interests created pursuant to the Security Agreement.
(m) Pledge Agreement. The Pledge Agreement, duly
executed and delivered by the Guarantor and the Agent,
together with certificate(s) representing all of the issued
and outstanding capital stock of the Company accompanied by
undated stock powers duly executed in blank.
(n) Mortgages and Title Insurance. The following
documents each of which shall be executed (and, where
appropriate, acknowledged) by Persons satisfactory to the
Agent:
(i) Mortgages covering the real Properties
identified under the heading "Mortgages" in Schedule IV
hereto, in each case duly executed and delivered by the
Company or Supply, as the case may be, in recordable
form (in such number of copies as the Agent shall have
reasonably requested);
(ii) mortgagee policies of title insurance on
forms of and issued by one or more title companies
satisfactory to the Majority Lenders (the "Title
Companies"), insuring the validity and priority of the
Liens created under such Mortgages for and in amounts
satisfactory to the Majority Lenders, subject only to
such exceptions as are satisfactory to the Majority
Lenders and, to the extent necessary under applicable
law, for filing in the appropriate county land offices,
Uniform Commercial Code financing statements covering
fixtures, in each case appropriately completed and duly
executed;
(iii) as-built surveys of recent date of each
of the facilities to be covered by such Mortgages,
showing such matters as may be reasonably required by
the Majority Lenders, which surveys shall be in form and
content acceptable to the Majority Lenders, and
certified to the Agent and to each Lender and the Title
Companies, and shall have been prepared by a registered
surveyor reasonably acceptable to the Majority Lenders;
and
(iv) certified copies of permanent and
unconditional certificates of occupancy for each fee
owned real Property covered by a Mortgage (or, if it is
not the practice to issue certificates of occupancy in
the jurisdiction in which the facilities to be covered
by such Mortgages are located, then such other evidence
reasonably satisfactory to Majority Lenders) permitting
the fully functioning operation and occupancy of each
such facility and of such other permits necessary for
the use and operation of each such facility issued by
the respective governmental authorities having
jurisdiction over each such facility.
In addition, the Company shall have paid to the Title
Companies all expenses and premiums of the Title Companies in
connection with the issuance of such policies and in addition
shall have paid to the Title Companies an amount equal to the
recording and stamp taxes payable in connection with
recording such Mortgages in the appropriate county land
offices.
(o) Assumption Agreement. The Assumption Agreement,
duly executed and delivered by United and Supply.
(p) Amount of Revolving Credit Loans. Evidence
satisfactory to the Lenders that after giving effect to the
borrowings of the Term Loans on the Initial Borrowing Date
and the borrowings of the Revolving Credit Loans contemplated
to occur on the Initial Borrowing Date, the aggregate
outstanding principal amount of Revolving Credit Loans as of
the Initial Borrowing Date will not exceed $245,000,000.
(q) Guarantor Note. A promissory note duly executed
and delivered by the Guarantor to the Company evidencing the
loan by the Company to the Guarantor contemplated by clause
(i) of Section 9.19(a) hereof (the "Guarantor Note").
(r) UCC, Tax Lien, Judgment and Litigation Searches.
Reports satisfactory to the Lenders listing the results of
Uniform Commercial Code filing, tax lien, judgement and
litigation searches prepared by one or more firms
satisfactory to the Agent with respect to the Company, United
and Supply in each of the jurisdictions deemed relevant by
the Agent.
(s) Insurance. Certificates of insurance evidencing
the existence of insurance covering risks and issued by such
insurers and on such terms as shall be satisfactory to the
Majority Lenders in their reasonable discretion and
evidencing the designation of the Agent as the loss payee or
additional named insured, as the case may be, thereunder to
the extent required by Section 9.04 hereof, such certificates
to be in such form and contain such information as is
specified in said Section 9.04. In addition, the Company
shall have delivered a certificate of a Responsible Officer
setting forth the insurance obtained by it in accordance with
the requirements of Section 9.04 and stating that such
insurance is in full force and effect and that all premiums
then due and payable thereon have been paid.
(t) Environmental Survey and Questionnaire. An
environmental assessment of all real Property owned by United
or Supply by Law Engineering in form and substance reasonably
satisfactory to the Majority Lenders, which assessment shall
be based on physical site inspections as well as a review of
historical operations on such site. Further, the Company
shall provide the Agent with an update, prepared by the
Company, of the Phase I Environmental Assessments prepared by
Law Engineering in December 1991 (the "Associated Reports"),
which update shall provide the status and, if applicable, the
results of any additional investigatory work taken to
implement the recommendations set forth in the Associated
Reports. In addition, if requested by the Majority Lenders
(through the Agent), the Company and United shall have
completed (and delivered to each Lender) an environmental
risk questionnaire in a form provided thereto by the Agent
(and containing such inquiries with respect to environmental
matters as shall have been requested by any Lender, through
the Agent, to be included in such questionnaire), and the
responses to such questionnaire (and the underlying facts and
circumstances shown thereby) shall be in form and substance
satisfactory to Majority Lenders.
(u) Solvency Analysis. Analyses from Valuation
Research Inc., or any other firm of independent solvency
analysts of nationally recognized standing, to the effect
that, as of the Initial Borrowing Date and after giving
effect to the Mergers, the borrowings contemplated hereunder
in the full amount of the Commitments, the borrowing of the
full amount of the commitments under the Senior Subordinated
Debt Documents, and the other transactions contemplated by
the Transaction Documents, neither Obligor, on a stand-alone
or consolidated basis, (i) will be insolvent or will be
rendered insolvent by the Indebtedness incurred in connection
therewith, (ii) will be left with unreasonably small capital
with which to conduct its business operations as heretofore
conducted and (iii) will have incurred debts beyond its
ability to pay such debts as they mature. The Agent shall
have also received (x) a certificate from a Responsible
Officer of each Obligor certifying the conclusions specified
in clauses (i), (ii) and (iii) above and that the financial
projections and underlying assumptions contained in such
analyses were at the time made, and on the Initial Borrowing
Date are, fair and reasonable and accurately computed and (y)
opinions of value and other appropriate factual information
supporting the conclusions of the solvency analyses and the
financial condition certificate required to be delivered as
provided above (which opinions of value shall not have been
amended, modified or revoked).
(v) Senior Subordinated Debt. Evidence that the
Senior Subordinated Loan Agreement shall have been duly
authorized, executed and delivered, and that the notes
evidencing the Senior Subordinated Bridge Loans shall have
been duly executed and delivered, in each case containing
terms in form and substance satisfactory to each Lender, and
the Agent shall have received copies of each of the Senior
Subordinated Debt Documents certified by a Responsible
Officer of the Company. In addition, the Agent shall have
received a certificate of a Responsible Officer of the
Company to the effect that the Company shall have received
net cash proceeds (prior to the payment of any transaction
expenses) from the Senior Subordinated Bridge Loans, which,
together with the proceeds of the Term Loans and the
Revolving Credit Loans and the issuance by the Guarantor of
common stock of the Guarantor, are sufficient to consummate
the Tender Offer and the Mergers.
(w) Equity. Evidence that the Guarantor shall have
received net cash consideration (prior to the payment of any
transaction expenses) of not less than $12,000,000,
representing proceeds of the issuance of common stock of the
Guarantor.
(x) Repayment of Existing Indebtedness. Evidence that
the principal of and interest on, and all other amounts owing
in respect of, the Indebtedness of the Company and United and
Supply (including, without limitation, any contingent or
other amounts payable in respect of letters of credit)
indicated on Parts A and B, respectively, of Schedule I
hereto that is to be repaid on the Initial Borrowing Date
shall have been (or shall be simultaneously) paid in full,
that any commitments to extend credit under the agreements or
instruments relating to such Indebtedness shall have been
canceled or terminated and that all Guarantees in respect of,
and all Liens securing, any such Indebtedness shall have been
released (or arrangements for such release satisfactory to
the Majority Lenders shall have been made); in addition, the
Agent shall have received from any Person holding any Lien
securing any such Indebtedness, such Uniform Commercial Code
termination statements, mortgage releases and other
instruments, in each case in proper form for recording, as
the Agent shall have requested to release and terminate of
record the Liens securing such Indebtedness (or arrangements
for such release and
termination satisfactory to the Majority Lenders shall have
been made).
(y) Litigation. A certificate of a senior officer of
each of the Company, the Guarantor and United to the effect
that there exists (i) no judgment, order, injunction or other
restraint issued or filed which prohibits the making of the
Loans or the consummation of the Acquisition, (ii) no action,
suit, litigation, or similar proceeding at law or in equity
or by or before any court or governmental or regulatory
authority with respect to the Acquisition or the financing
thereof other than actions, suits, litigation or proceedings
which have been disclosed in the Offer to Purchase and which
are acceptable to the Majority Lenders and (iii) no actions,
suits or proceedings pending or threatened with respect to
any such party that could reasonably be expected to have a
Material Adverse Effect.
(z) Margin Regulations. Evidence satisfactory to the
Lenders that neither the making of Loans hereunder nor the
use of the proceeds thereof will violate Regulation G, U or
X.
(aa) Contracts. Copies of all material contracts of
United and Supply including, without limitation, all material
supply and purchase contracts of United or Supply involving
more than 5% of the supplies to or purchases of United or
Supply.
(bb) Borrowing Base Report. A Borrowing Base
Certificate dated as of a date not more than five days prior
to the date of the making of the initial Loans.
(cc) Other Documents. Such other documents as the
Agent or any Lender or special New York counsel to the Agent
reasonably request.
The obligation of any Lender to make its initial extension of
credit hereunder is also subject to the payment by the Obligors of
such fees as the Obligors shall have agreed to pay or deliver to
any Lender or the Agent in connection herewith, including, without
limitation, the reasonable fees and expenses of Milbank, Tweed,
Hadley & McCloy, special New York counsel to the Agent in
connection with the negotiation, preparation, execution and
delivery of this Agreement and the Notes and the other Basic
Documents and the extensions of credit hereunder (to the extent
that statements for such fees and expenses have been delivered to
the Obligors).
7.02 Initial and Subsequent Extensions of Credit. The
obligation of the Lenders to make any Loan or otherwise extend any
credit to either Obligor upon the occasion of each borrowing or
other extension of credit hereunder (including the initial
borrowings of the Term Loans and the Revolving Credit Loans) is
subject to the further conditions precedent that, both immediately
prior to the making of such Loan or other extension of credit and
also after giving effect thereto and to the intended use thereof:
(a) no Default shall have occurred and be continuing;
(b) the representations and warranties made by each
Obligor in Section 8 hereof and in each other Basic Document
to which such Obligor is a party, shall be true and complete
in all material respects on and as of the date of the making
of such Loan or other extension of credit (and after giving
effect thereto) with the same force and effect as if made on
and as of such date (or, if any such representation or
warranty is expressly stated to have been made as of a
specific date, as of such specific date); and
(c) to the extent there are Revolving Credit Loans
outstanding, the aggregate principal amount of the Revolving
Credit Loans together with the aggregate amount of all Letter
of Credit Liabilities shall not exceed the Borrowing Base
reflected on the most recent Borrowing Base Certificate
delivered pursuant to Section 7.01(bb) or 9.01(g) hereof.
Each notice of borrowing or request for the issuance of a Letter
of Credit by the Company hereunder shall constitute a
certification by the Company to the effect set forth in the
preceding sentence (both as of the date of such notice or request
and, unless the Company otherwise notifies the Agent prior to the
date of such borrowing or issuance, as of the date of such
borrowing or issuance).
Section 8. Representations and Warranties. Each
Obligor represents and warrants to the Agent and the Lenders that:
8.01 Corporate Existence. Each Obligor and its
Subsidiaries (including, for purposes of this Section 8.01, United
and its Subsidiaries): (a) is a corporation, partnership or other
entity duly organized, validly existing and in good standing under
the laws of the jurisdiction of its organization; (b) has all
requisite corporate or other power, and has all material
governmental licenses, authorizations, consents and approvals
necessary to own its assets and carry on its business as now being
or as proposed to be conducted; and (c) is qualified to do
business and is in good standing in all jurisdictions in which the
nature of the business conducted by it makes such qualification
necessary and where failure so to qualify could (either
individually or in the aggregate) reasonably be expected to have a
Material Adverse Effect.
8.02 Financial Condition. (a) The Guarantor has
heretofore furnished to each of the Lenders the following:
(i) the consolidated balance sheet of the Guarantor and
its Subsidiaries as at December 31, 1994 and the related
consolidated statements of income, retained earnings and cash
flows of the Guarantor and its Subsidiaries for the fiscal
year ended on said date, with the opinion thereon of Arthur
Andersen LLP; and
(ii) the consolidated balance sheet of United and its
Subsidiaries as at August 31, 1994 and the related
consolidated statements of income, changes in stockholders'
investment and cash flows of United and its Subsidiaries for
the fiscal year ended on said date, with the opinion thereon
of Arthur Andersen LLP, and the unaudited consolidated
balance sheet of United and its Subsidiaries as at November
30, 1994 and the related consolidated statements of income,
changes in stockholders' investment and cash flows of United
and its Subsidiaries for the three-month period ended on such
date.
(b) The financial statements referred to in clause (a)
above fairly present, in all material respects, the consolidated
financial position of the Guarantor and its Subsidiaries and of
United and its Subsidiaries, as the case may be, as at said dates
and the consolidated results of their respective operations for
the fiscal years and periods ended on said dates (subject, in the
case of such financial statements (other than as at the end of,
and for, fiscal years) to normal year-end audit adjustments), in
accordance with generally accepted accounting principles and
practices applied on a consistent basis. None of the Guarantor or
United or any of their respective Subsidiaries has on the date
hereof any material contingent liabilities, liabilities for taxes,
unusual forward or long-term commitments or unrealized or
anticipated losses from any unfavorable commitments, except as
referred to or reflected or provided for in said balance sheets as
at said dates. Since December 31, 1994 in the case of the
Guarantor and November 30, 1994 in the case of United, there has
been no material adverse change in the consolidated financial
condition, operations, business or prospects taken as a whole of
the Guarantor and its Subsidiaries or United and its Subsidiaries
from that set forth in said financial statements as at said
respective dates.
8.03 Litigation. Except as disclosed to the Lenders in
Schedule V hereto, there are no legal or arbitral proceedings, or
any proceedings by or before any governmental or regulatory
authority or agency, now pending or (to the knowledge of any
Obligor) threatened against either Obligor or any of its
Subsidiaries (including, for purposes of this Section 8.03, United
and its Subsidiaries) that, if adversely determined, could (either
individually or in the aggregate) reasonably be expected to have a
Material Adverse Effect.
8.04 No Breach. None of the making or performance of
this Agreement and the Notes and the other Transaction Documents,
the consummation of the transactions herein and therein
contemplated or compliance with the terms and provisions hereof
and thereof will conflict with or result in a breach of, or
require any consent not already obtained under, the charter or by-
laws of either Obligor or any of its Subsidiaries (including, for
purposes of this Section 8.04, United and its Subsidiaries), or
any applicable law or regulation, or any order, writ, injunction
or decree of any court or governmental authority or agency, or any
material agreement or instrument to which either Obligor or any
such Subsidiary is a party or by which any of them or any of their
Property is bound or to which any of them is subject, or
constitute a default under any such agreement or instrument, or
(except for the Liens created pursuant to the Security Documents)
result in the creation or imposition of any Lien upon any Property
of either Obligor or any such Subsidiary pursuant to the terms of
any such agreement or instrument.
8.05 Action. Each Obligor and each of its Subsidiaries
(including, for purposes of this Section 8.05, United and its
Subsidiaries) has all necessary corporate power, authority and
legal right to execute, deliver and perform its obligations under
each of the Transaction Documents to which it is a party; the
execution, delivery and performance by each Obligor and each such
Subsidiary of each of the Transaction Documents to which it is a
party have been duly authorized by all necessary corporate action
on its part (including, without limitation, any required
shareholder approvals); and this Agreement has been duly and
validly executed and delivered by such Obligor and (assuming the
due authorization, execution and delivery thereof by the Agent,
the Lenders and the other parties (other than an Obligor) thereto)
constitutes, and each of the Notes and the other Transaction
Documents to which it is a party when executed and delivered by
such Obligor or such Subsidiary (in the case of the Notes, for
value) will constitute, its legal, valid and binding obligation,
enforceable against such Obligor
and/or such Subsidiary, as the case may be, in accordance with its
terms, except as may be limited by bankruptcy, insolvency,
reorganization, moratorium or similar laws relating to or
affecting the rights of creditors generally and except as such
enforceability may be limited by the application of general
principles of equity (regardless of whether such enforceability is
considered in a proceeding in equity or at law).
8.06 Approvals. Other than the Notification and Report
Form in respect of the Acquisition furnished to the Department of
Justice and the Federal Trade Commission pursuant to the Hart-
Scott-Rodino Antitrust Improvements Act of 1976 (which
Notification and Report Form has been duly given and all
applicable waiting periods thereunder have expired or have been
terminated without any action having been taken by any competent
authority that restricts, prevents or imposes conditions upon the
Acquisition), no authorizations, approvals or consents not already
duly obtained of, and no filings or registrations with, any
governmental or regulatory authority or agency, or any securities
exchange, are necessary for the execution, delivery or performance
by either Obligor or any of its Subsidiaries (including, for
purposes of this Section 8.06, United and its Subsidiaries) of the
Transaction Documents to which it is a party or for the legality,
validity or enforceability hereof or thereof, except for (i)
filings and recordings in respect of the Liens created pursuant to
the Security Documents, (ii) filings under applicable Federal or
state securities laws which have been made or will have been made
prior to the time required,
(iii) immaterial state and municipal licenses such as business
licenses, food sales establishment licenses, required
registrations with state revenue departments and other similar
ministerial licenses and (iv) certificates relating to the
Mergers.
8.07 Use of Credit. Neither Obligor nor any of its
Subsidiaries (including, for purposes of this Section 8.07, United
and its Subsidiaries) is engaged principally, or as one of its
important activities, in the business of extending credit for the
purpose, whether immediate, incidental or ultimate, of buying or
carrying Margin Stock. At the time of the making of any of the
Term Loans or Revolving Credit Loans, not more than 25% of the
value of the assets of either Obligor is represented by Margin
Stock. Neither the making of any of the Loans hereunder nor the
use of the proceeds thereof will violate or be inconsistent with
the provisions of Regulation G, U, or X.
8.08 ERISA. Each Plan and, to the knowledge of the
Company, each Multiemployer Plan, is in compliance in all material
respects with, and has been administered in all material respects
in compliance with, the applicable provisions of ERISA, the Code
and any other Federal or State law, and no event or condition has
occurred and is continuing as to which either Obligor or, prior to
the Mergers, United or Supply, would be under an obligation to
furnish a report to the Lenders under Section 9.01(f) hereof. As
of the date of this Agreement, and for the year preceding the date
of this Agreement, neither Obligor nor, prior to the Mergers,
United or Supply, has contributed to any Multiemployer Plan.
8.09 Taxes. Except as set forth on Schedule VIII, the
Guarantor and its Subsidiaries are members of an affiliated group
of corporations filing consolidated returns for Federal income tax
purposes, of which the Guarantor is the "common parent" (within
the meaning of Section 1504 of the Code) of such group. Except as
set forth on Schedule VIII hereto, the Guarantor and its
Subsidiaries (including, for all purposes of this Section
8.09 other than the first sentence hereof, United and its
Subsidiaries) have filed all Federal income tax returns and all
other material tax returns that are required to be filed by them
and have paid all taxes due pursuant to such returns or pursuant
to any assessment received by the Guarantor or any such
Subsidiary, except for any such tax the payment of which is being
contested in good faith and by proper proceedings and against
which adequate reserves are being maintained, provided that no
such tax is being contested on the Initial Borrowing Date. The
charges, accruals and reserves on the books of the Guarantor and
its Subsidiaries in respect of taxes and other governmental
charges are, in the opinion of the Guarantors, adequate. Except
as set forth in Schedule VIII hereto, neither the Guarantor nor
any of its Subsidiaries has given or been requested to give a
waiver of the statute of limitations relating to the payment of
any Federal, state, local and foreign taxes or other impositions.
8.10 Investment Company Act. Neither the Guarantor nor
any of its Subsidiaries (including, for purposes of this Section
8.10, United and its Subsidiaries) is an "investment company", or
a company "controlled" by an "investment company", within the
meaning of the Investment Company Act of 1940, as amended.
8.11 Public Utility Holding Company Act. Neither the
Guarantor nor any of its Subsidiaries (including, for purposes of
this Section 8.11, United and its Subsidiaries) is a "holding
company", or an "affiliate" of a "holding company" or a
"subsidiary company" of a "holding company", within the meaning of
the Public Utility Holding Company Act of 1935, as amended.
8.12 Material Agreements and Liens.
(a) Parts A and C of Schedule I hereto are a complete
and correct list of each credit agreement, loan agreement,
indenture, purchase agreement, guarantee, letter of credit or
other arrangement providing for or otherwise relating to
Indebtedness of the Guarantor and its Subsidiaries outstanding on
the date hereof, or that (after giving effect to the transactions
contemplated to occur on or before the Initial Borrowing Date)
will be outstanding on the Initial Borrowing Date, and the
aggregate principal or face amount outstanding or that may become
outstanding under each such arrangement is correctly described in
Parts A and C of said Schedule I.
(b) Parts B and D of Schedule I hereto are a complete
and correct list of each credit agreement, loan agreement,
indenture, purchase agreement, guarantee, letter of credit or
other arrangement providing for or otherwise relating to
Indebtedness of United and its Subsidiaries outstanding on the
date hereof, or that (after giving effect to the transactions
contemplated to occur on or before the Initial Borrowing Date)
will be outstanding on the Initial Borrowing Date, and the
aggregate principal or face amount outstanding or that may become
outstanding under each such arrangement is correctly described in
Parts B and D of said Schedule I.
(c) Part E of Schedule I hereto is a complete and
correct list of each Lien securing Indebtedness of any Person
outstanding on the date hereof, or that (after giving effect to
the transactions contemplated to occur on or before the Initial
Borrowing Date) will be outstanding on the Initial Borrowing Date,
the aggregate principal or face amount of which equals or exceeds
(or may equal or exceed) $10,000 and covering any Property of the
Guarantor or any of its Subsidiaries, and the aggregate
Indebtedness secured (or which may be secured) by each
such Lien and the Property covered by each such Lien is correctly
described in Part E of said Schedule I.
(d) Part F of Schedule I hereto is a complete and
correct list of each Lien securing Indebtedness of any Person
outstanding on the date hereof, or that (after giving effect to
the transactions contemplated to occur on or before the Initial
Borrowing Date) will be outstanding on the Initial Borrowing Date,
the aggregate principal or face amount of which equals or exceeds
(or may equal or exceed) $10,000 and covering any Property of
United or any of its Subsidiaries, and the aggregate Indebtedness
secured (or which may be secured) by each such Lien and the
Property covered by each such Lien is correctly described in Part
F of said Schedule I.
8.13 Environmental Matters. Except as set forth on
Schedule II hereto,
(a) each of the Guarantor and its Subsidiaries
(including for all purposes of this Section 8.13, United and
its Subsidiaries) has obtained all environmental, health and
safety permits, licenses and other authorizations required
under all Environmental Laws (collectively, "Environmental
Permits") to carry on its business as now being or as
proposed to be conducted, except to the extent failure to
have any such Environmental Permit would not (either
individually or in the aggregate) have a Material Adverse
Effect. Each of such Environmental Permits is in full force
and effect and each of the Guarantor and its Subsidiaries is
in compliance with the terms and conditions thereof, and is
also in compliance with all other applicable Environmental
Laws, decrees, judgments, and injunctions, except to the
extent failure to comply therewith would not (either
individually or in the aggregate) have a Material Adverse
Effect.
(b) No notice, notification, demand, request for
information, citation, summons or order is pending, no
complaint is pending, no penalty has been assessed and is
outstanding and no investigation or review is pending or, to
the Guarantor's knowledge, threatened by any governmental or
other entity with respect to any alleged failure by the
Guarantor or any of its Subsidiaries to have any
Environmental Permit or with respect to any generation,
treatment, storage, recycling, transportation or any Release
of any Hazardous Materials generated by the Guarantor or any
of its Subsidiaries that could reasonably be expected to
result in a liability in excess of $10,000.
(c) Neither the Guarantor nor any of its respective
Subsidiaries owns, operates or leases a treatment, storage or
disposal facility requiring a permit under the Resource
Conservation and Recovery Act of 1976, as amended, or under
any comparable state or local statute.
(d) There is not now nor, to the Guarantor's knowledge,
has there been in the past any PCBs, asbestos containing
materials ("ACMs"), surface impoundments or underground
storage tanks at any real Property now or, to the Guarantor's
knowledged, previously owned, operated or leased by the
Guarantor or any of its Subsidiaries, the presence of which
could reasonably be expected to result in a liability in
excess of $10,000.
(e) no Hazardous Materials have been otherwise
Released at, on or under any site or facility now or
previously owned, operated or leased by the Guarantor or any
of its Subsidiaries that would (either individually or in the
aggregate) have a Material Adverse Effect.
(f) Neither the Guarantor nor any of its Subsidiaries
has received a notice alleging that it is a potentially
responsible party under the Comprehensive Environmental
Response, Compensation and Liability Act of 1980, as amended
("CERCLA"), listed for possible inclusion on the National
Priorities List ("NPL") by the Environmental Protection
Agency in the Comprehensive Environmental Response and
Liability Information System, as provided for by 40 C.F.R.
300.5 ("CERCLIS"), or on any similar state or local list.
(g) No written notification of a Release of a Hazardous
Material has been filed by or on behalf of the Guarantor or
any of its Subsidiaries and no site or facility now or, to
the Guarantor's knowledge, previously owned, operated or
leased by the Guarantor or any of its Subsidiaries is listed
or proposed for listing on the NPL, CERCLIS or any similar
state list of sites requiring investigation or clean-up.
(h) No Liens exist under or pursuant to any
Environmental Laws on any real Property owned or operated by
the Guarantor or any of its Subsidiaries, and no government
action has been taken or is in process that could subject any
such site or facility to such Liens and, to the best
knowledge of the Guarantor, neither the Guarantor nor any of
its Subsidiaries would be required to place any notice or
restriction relating to the presence of Hazardous Materials
at any site or facility owned by it in any deed to the real
Property on which such site or facility is located.
(i) All environmental investigations, studies, audits,
tests, reviews or other analyses conducted by or that are in
the possession of the Guarantor or any of its Subsidiaries in
relation to facts, circumstances or conditions at or
affecting any site or facility now or previously owned,
operated or leased by the Guarantor or any of its
Subsidiaries and that could result in a Material Adverse
Effect have been made available to the Lenders.
8.14 Capitalization.
(a) Part A of Schedule VI hereto correctly sets forth
the authorized capital stock of the Guarantor, the capital stock
and equity securities of the Guarantor owned of record and the
names of the owners of record, in each case as of the date hereof.
All of the issued and outstanding shares of the Class A Common
Stock of the Guarantor on the date hereof are duly and validly
issued, fully paid and nonassessable, other than with respect to
46,258 shares of such Class A Common Stock (23,129 of which have
been issued to Cumberland Capital Corporation and 23,129 of which
have been issued to Good Capital Co., Inc.) which on the date
hereof are partly-paid shares which are assessable under the
General Corporation Law of the State of Delaware. On the date
hereof, (x) except for (1) the warrants issued by the Guarantor
pursuant to the Warrant Agreement, (2) the rights arising under
the Registration Rights Agreement dated as of January 31, 1992,
between the Guarantor and Chase Manhattan Investment Holdings,
Inc., as amended, modified and supplemented and in effect from
time to time, (3) the warrant issued to Boise pursuant to the
Warrant Agreement dated as of January 31, 1992 between the
Guarantor and Boise, as amended, modified and supplemented and in
effect from time to time, (4) options
exercisable for an aggregate of 31,528 shares of Class A Common
Stock of the Guarantor issued to certain executive officers of the
Company, (5) options exercisable for an aggregate of 21,684 shares
of Class A Common Stock of the Guarantor to be issued to certain
executive officers of the Company on or prior to January 31, 1996
pursuant to several Executive Stock Purchase Agreements, dated as
of January 31, 1992, between the Guarantor and such executive
officers, (6) an option exercisable for 5,681 shares of Class A
Common Stock of the Guarantor to be issued to Daniel H. Bushell
after the date hereof, (7) the Registration Rights Agreement dated
as of January 31, 1992 among the Guarantor, Wingate Partners, L.P.
and the other parties thereto, as amended, modified and
supplemented and in effect from time to time, and (8) the Voting
Trust Agreement dated as January 31, 1992 among the Guarantor, the
voting trustees named therein, and the beneficiaries named
therein, there are no outstanding Equity Rights with respect to
the Guarantor and (y) except for the warrants referred to in
clauses (1) and (3) above and redemption and exchange rights in
respect of the preferred stock described in Part A of Schedule VI
hereto, there are no outstanding obligations of the Company or the
Guarantor or any of their Subsidiaries to repurchase, redeem, or
otherwise acquire any shares of capital stock of the Guarantor nor
are there any outstanding obligations of the Guarantor or any of
its Subsidiaries (including, without limitation, the Company) to
make payments to any Person, such as "phantom stock" payments,
where the amount thereof is calculated with reference to the fair
market value or equity value of the Guarantor or any of its
Subsidiaries (including, without limitation, the Company).
(b) On the date hereof, the authorized capital stock of
the Company consists of an aggregate of 3,000 shares of common
stock, par value $0.01 per share, of which 1,000 shares are duly
and validly issued and outstanding, each of which shares are fully
paid and nonassessable. On the date hereof all of such issued and
outstanding shares of common stock are owned beneficially and of
record by the Guarantor. On the date hereof, (x) there are no
outstanding Equity Rights issued by the Company and (y) there are
no outstanding obligations of the Company or the Guarantor or any
of their Subsidiaries to repurchase, redeem, or otherwise acquire
any shares of capital stock of the Company nor are there any
outstanding obligations of the Company or the Guarantor or any of
their Subsidiaries to make payments to any Person, such as
"phantom stock" payments, where the amount thereof is calculated
with reference to the fair market value or equity value of the
Company or any of its Subsidiaries.
(c) Part B of Schedule VI hereto correctly sets forth
the authorized capital stock of the Guarantor on the Initial
Borrowing Date after giving effect to the Mergers. All of the
issued and outstanding shares of the Guarantor on such date and at
such time will be duly and validly issued, fully paid and
nonassessable. On the Initial Borrowing Date and after giving
effect to the Mergers, (x) except for the Equity Rights described
in paragraph (a) above and except as set forth in Part B of
Schedule VI hereto, there will be no outstanding Equity Rights
with respect to the Guarantor and (y) except for the warrants
referred to in clauses (1) and (3) of paragraph (a) above, the
redemption and exchange rights in respect of the preferred stock
described in Part B of Schedule VI hereto and as otherwise set
forth in Part B of Schedule VI hereto, there will be no
outstanding obligations of the Company or the Guarantor or any of
their Subsidiaries to repurchase, redeem, or otherwise acquire any
shares of capital stock of the Guarantor nor are there any
outstanding obligations of the Guarantor or any of its
Subsidiaries (including, without limitation, the Company) to make
payments to any Person, such as "phantom stock" payments, where
the amount thereof is calculated with reference to the fair market
value or equity value of the Guarantor or any of its Subsidiaries
(including, without limitation, the Company).
(d) On the Initial Borrowing Date and after giving
effect to the Mergers, the authorized capital stock of the Company
will consist of an aggregate of 890,000 shares of common stock.
All of the issued and outstanding shares of the Company on such
date and at such time will be duly and validly issued, fully paid
and nonassessable. As of such date and time, all of such shares
will be owned beneficially and of record by the Guarantor and (x)
there will be no outstanding Equity Rights with respect to the
Company and (y) there will be no outstanding obligations of the
Company or the Guarantor or any of their Subsidiaries to
repurchase, redeem, or otherwise acquire any shares of capital
stock of the Company nor will there be any outstanding obligations
of the Company or the Guarantor or any of their Subsidiaries to
make payments to any Person, such as "phantom stock" payments,
where the amount thereof is calculated with reference to the fair
market value or equity value of the Company or any of its
Subsidiaries.
8.15 Subsidiaries, Etc.
(a) Prior to the Initial Borrowing Date, the Guarantor
does not have any Subsidiaries other than the Company. Part A of
Schedule III hereto sets forth all Subsidiaries of the Guarantor
after giving effect to the Acquisition.
(b) Set forth in Part B of Schedule III hereto is a
complete and correct list of all Investments held by the
Guarantor, United or any of their respective Subsidiaries on the
date hereof, and, for each such Investment, (x) the identity of
the Person or Persons holding such Investment and (y) the nature
of such Investment. Except as disclosed in Schedule III hereto,
each of the Guarantor, United and such Subsidiaries owns on the
date hereof, free and clear of all Liens (other than Liens created
pursuant to the Security Documents), all such Investments.
8.16 Title to Assets. Except as disclosed in the
footnote under the heading "Real Property Interests" in Schedule
IV hereto, each of the Guarantor, United and their respective
Subsidiaries owns and has on the date hereof good and marketable
title (subject only to Liens permitted by Section 9.06 hereof) to
the Properties shown to be owned in the most recent financial
statements referred to in Section 8.02 hereof (other than
Properties disposed of in the ordinary course of business or
otherwise permitted to be disposed of pursuant to Section 9.05
hereof). Each of the Guarantor, United and their respective
Subsidiaries owns and has on the date hereof, good and marketable
title to, and enjoys peaceful and undisturbed possession of, all
Properties (subject only to Liens permitted by Section 9.06
hereof) that are necessary for the operation and conduct of its
businesses.
8.17 True and Complete Disclosure. The information,
reports, financial statements, exhibits and schedules furnished in
writing by or on behalf of the Obligors to the Agent or any Lender
in connection with the negotiation, preparation or delivery of
this Agreement and the other Basic Documents or included herein or
therein or delivered pursuant hereto or thereto, including,
without limitation, the Acquisition Documents, when taken as a
whole, do not contain any untrue statement of material fact or
omit to state any material fact
necessary to make the statements herein or therein, in light of
the circumstances under which they were made, not misleading. All
written information furnished after the date hereof by the
Guarantor or any of its Subsidiaries to the Agent and the Lenders
in connection with this Agreement and the other Basic Documents
and the transactions contemplated hereby and thereby will be true,
complete and accurate in every material respect, or (in the case
of projections) based on estimates deemed in good faith to be
reasonable, on the date as of which such information is stated or
certified. There is no fact known to either Obligor that could
reasonably be expected to have a Material Adverse Effect that has
not been disclosed herein, in the other Basic Documents or in a
report, financial statement, exhibit, schedule, disclosure letter
or other writing furnished to the Lenders for use in connection
with the transactions contemplated hereby or thereby.
8.18 Real Property. Set forth on Schedule IV hereto
under the heading "Real Property Interests" is a list, as of the
date hereof and after giving effect to the Mergers, of all of the
real Property interests held by the Company, indicating in each
case whether the respective Property is owned or leased, the
identity of the owner or lessee and the location of the respective
Property.
8.19 Security Documents. The Security Documents
create, as security for the obligations purported to be secured
thereby, a valid and enforceable perfected interest in and Lien on
all of the Properties covered thereby in favor of the Agent,
superior to and prior to the right of all third Persons and
subject to no other Liens (other than Permitted Liens).
8.20 Acquisition Costs. The Acquisition Costs will not
exceed $35,000,000.
Section 9. Covenants of the Obligors. Each Obligor
covenants and agrees with the Lenders and the Agent that, so long
as any Commitment, Loan or Letter of Credit Liability is
outstanding and until payment in full of all amounts payable by
the Obligors hereunder:
9.01 Financial Statements, Etc. The Company (for
itself and on behalf of the Guarantor) shall deliver to each of
the Lenders:
(a) as soon as available and in any event within 30
days after the end of each month (other than March, June,
September and December), beginning with July 1995,
consolidated statements of income, retained earnings and cash
flows of the Guarantor and its Subsidiaries for such period
and for the period from the beginning of the respective
fiscal year to the end of such period, and the related
consolidated balance sheet as at the end of such period,
setting forth in each case in comparative form the
corresponding consolidated figures for the corresponding
periods in the preceding fiscal year (provided that until 12
full months of the Guarantor have elapsed since the Initial
Borrowing Date, such corresponding figures shall be the pro
forma consolidated figures furnished to the Agent prior to
the Initial Borrowing Date);
(b) as soon as available and in any event within
45 days after the end of the first three quarterly
fiscal periods of each fiscal year of the Guarantor,
consolidated statements of income, retained earnings and
cash flows of
the Guarantor and its Subsidiaries for such period and for
the period from the beginning of the respective fiscal year
to the end of such period, and the related consolidated
balance sheet as at the end of such period, setting forth in
each case in comparative form (i) the corresponding
consolidated figures for the corresponding periods in the
preceding fiscal year (provided that until four full fiscal
quarters of the Guarantor have elapsed since the Initial
Borrowing Date, such corresponding figures shall be the pro
forma consolidated figures furnished to the Agent prior to
the Initial Borrowing Date) and (ii) the corresponding
consolidated projected figures contained in the business plan
furnished under Section 9.01(h) hereof in respect of such
fiscal period (or in the quarterly business plan of the
Guarantor heretofore delivered to the Agent), accompanied by
a certificate of a Responsible Officer of the Guarantor,
which certificate shall (A) state that said consolidated
financial statements present fairly, in all material
respects, the consolidated financial position and results of
operations of the Guarantor and its Subsidiaries, in each
case in accordance with generally accepted accounting
principles, consistently applied, as at the end of, and for,
such period (subject to normal year-end audit adjustments and
excluding any footnotes thereto) and (B) contain an
explanation of any deviations in the results of operations
shown on such financial statements from the projected figures
contained in such business plan along with a description of
the action that either Obligor has taken or proposes to take
with respect to any adverse deviations, if any;
(c) as soon as available and in any event within
90 days after the end of each fiscal year of the Guarantor,
consolidated statements of income, retained earnings and cash
flows of the Guarantor and its Subsidiaries, for such fiscal
year and the related consolidated balance sheet as at the end
of such fiscal year, setting forth in each case in
comparative form (i) the corresponding consolidated figures
for the preceding fiscal year (provided that until a full
fiscal year of the Guarantor has elapsed since the Initial
Borrowing Date, such previous period corresponding figures
shall be the pro forma consolidated figures furnished to the
Agent prior to the Initial Borrowing Date) and (ii) the
corresponding consolidated projected figures contained in the
business plan furnished under Section 9.01(h) hereof in
respect of such fiscal year (or in the quarterly business
plan of the Guarantor heretofore delivered to the Agent) and
accompanied by an opinion thereon of independent certified
public accountants of recognized national standing, which
opinion shall state that said consolidated financial
statements present fairly, in all material respects, the
consolidated financial position and results of operations of
the Guarantor and its Subsidiaries as at the end of, and for,
such fiscal year in accordance with generally accepted
accounting principles, and a certificate of such accountants
stating that, in making the examination necessary for their
opinion, they obtained no knowledge, except as specifically
stated, of any Default under any of Sections 9.09 through
9.14 hereof;
(d) promptly upon their becoming available, copies of
all registration statements and regular periodic reports and
other material reports, if any, which either Obligor shall
have filed with the Commission (or any governmental agency
substituted therefor) or any national securities exchange;
(e) promptly upon the mailing thereof to the
shareholders of either Obligor generally, copies of all
financial statements, reports and proxy statements so mailed;
(f) as soon as possible, and in any event within
21 days after either Obligor knows or has reason to believe
that any of the events or conditions specified below with
respect to any Plan or Multiemployer Plan has occurred or
exists, a statement signed by a Responsible Officer of the
Company setting forth details respecting such event or
condition and the action, if any, that such Obligor or its
ERISA Affiliate proposes to take with respect thereto (and a
copy of any report or notice required to be filed with or
given to PBGC by such Obligor or an ERISA Affiliate with
respect to such event or condition):
(i) any reportable event, as defined in
Section 4043(b) of ERISA and the regulations issued
thereunder, with respect to a Plan, as to which PBGC has
not by regulation waived the requirement of Section
4043(a) of ERISA that it be notified within 30 days of
the occurrence of such event (provided that a failure to
meet the minimum funding standard of Section 412 of the
Code or Section 302 of ERISA, including, without
limitation, the failure to make on or before its due
date a required installment under Section 412(m) of the
Code or Section 302(e) of ERISA, shall be a reportable
event regardless of the issuance of any waivers in
accordance with Section 412(d) of the Code); and any
request for a waiver under
Section 412(d) of the Code for any Plan;
(ii) the distribution under Section 4041 of
ERISA of a notice of intent to terminate any Plan or any
action taken by either Obligor or an ERISA Affiliate to
terminate any Plan if the assets of such Plan are
insufficient to provide in full for all of the benefit
liabilities under such Plan as contemplated by Section
4041(b) of ERISA;
(iii) the institution by PBGC of proceedings
under Section 4042 of ERISA for the termination of, or
the appointment of a trustee to administer, any Plan, or
the receipt by either Obligor or any ERISA Affiliate of
a notice from a Multiemployer Plan that such action has
been taken by PBGC with respect to such Multiemployer
Plan;
(iv) the complete or partial withdrawal from a
Multiemployer Plan by either Obligor or any ERISA
Affiliate that results in liability under Section 4201
or 4204 of ERISA (including the obligation to satisfy
secondary liability as a result of a purchaser default)
or the receipt by either Obligor or any ERISA Affiliate
of notice from a Multiemployer Plan that it is in
reorganization or insolvency pursuant to Section 4241 or
4245 of ERISA or that it intends to terminate or has
terminated under Section 4041A of ERISA;
(v) the institution of a proceeding by a
fiduciary of any Multiemployer Plan against either
Obligor or any ERISA Affiliate to enforce Section 515 of
ERISA, which proceeding is not dismissed within
30 days;
(vi) the adoption of an amendment to any Plan
that, pursuant to Section 401(a)(29) of the Code or
Section 307 of ERISA, would result in the loss of tax-
exempt status of the trust of which such Plan is a part
if either Obligor or an ERISA Affiliate fails to timely
provide security to the Plan in accordance with the
provisions of said Sections; and
(vii) the existence of any event or
circumstance which may reasonably be expected to
constitute grounds for either Obligor Company or any
ERISA Affiliate to incur liability under Section 4062,
4063, 4064 or 4069 of ERISA;
(g) as soon as available and in any event within five
Business Days after the end of each month, a Borrowing Base
Certificate as at the last day of such month;
(h) no later than 15 days prior to the end of the
fiscal year of the Company, a quarterly business plan
covering the next succeeding year, in form and substance
satisfactory to the Majority Lenders (and, if requested by
the Majority Lenders prior to such date, an annual business
plan for the succeeding five-year period);
(i) as soon as available after the end of the first
and second six-month period in any fiscal year of the
Company, and at such other times as the Agent or the Majority
Revolving Credit Lenders may request, a report of an
independent collateral auditing agent ("Collateral Auditing
Agent") (which shall be satisfactory to the Majority
Revolving Credit Lenders in their reasonable determination
and which may be, or be affiliated with, one of the Lenders
and whose annual fees and expenses will not exceed $40,000
plus reasonable out-of-pocket expenses) with respect to, but
not restricted to, the Receivables and Inventory components
included in the Borrowing Base as at the end of such six-
month period which report shall indicate that, based upon a
review by the Collateral Auditing Agent of the Receivables
(including, without limitation, verification with respect to
the amount, aging, identity and credit of the respective
account debtors and the billing practices of the Company) and
Inventory (including, without limitation, verification as to
the value, location and respective types), the information
set forth in the Borrowing Base Certificate delivered by the
Company as at the end of such six-month period is accurate
and complete in all material respects and in addition, as
soon as available and in any event within 90 days after the
end of each fiscal year of the Company, a like report of
independent certified public accountants with respect to the
Receivables and Inventory components included in the
Borrowing Base of the Company as at the end of such fiscal
year;
(j) promptly after becoming aware thereof, written
notice of (i) the assertion of any Environmental Claim by any
Person against, or with respect to the activities of, the
Guarantor or any of its Subsidiaries and notice of any
alleged violation of or non-compliance with any Environmental
Laws or any permits, licenses or authorizations, other than
any Environmental Claims or alleged violations which, if
adversely determined, would not have a Material Adverse
Effect, (ii) any Environmental Claim, inquiry, proceeding,
investigation, or other action, including a notice from any
governmental authority of potential environmental liability,
or any Federal, state or
local environmental agency or board, that involves any
collateral security for the Loans or the Lenders' rights with
respect to any such collateral security, and (iii) any
Release of a non-de minimus quantity of Hazardous Materials
at any site or facility of the Guarantor or any Subsidiary;
(k) promptly after either Obligor knows or has reason
to believe that any Default has occurred, a notice of such
Default describing the same in reasonable detail and,
together with such notice or as soon thereafter as reasonably
possible, a description of any action that either Obligor has
taken or proposes to take with respect thereto; and
(l) from time to time such other information regarding
the financial condition, operations, business or prospects of
the Guarantor or any of its Subsidiaries (including, without
limitation, any Plan or Multiemployer Plan and any reports or
other information required to be filed under ERISA) as any
Lender or the Agent may reasonably request.
The Company will furnish to each Lender, at the time it furnishes
each set of financial statements pursuant to paragraph (b) or (c)
above, a certificate of a Responsible Officer of the Company (i)
to the effect that, to the best of such Responsible Officer's
knowledge, no Default has occurred and is continuing (or, if any
Default has occurred and is continuing, describing the same in
reasonable detail and describing any action that either Obligor
has taken or proposes to take with respect thereto) and
(ii) setting forth in reasonable detail the computations necessary
to determine whether the Obligors are in compliance with Sections
9.09 through 9.14 (inclusive) and 9.22 hereof as of the end of the
respective quarterly fiscal period or fiscal year.
9.02 Litigation. Promptly upon becoming aware thereof,
the Company (for itself and on behalf of the Guarantor and its
Subsidiaries) will promptly give to each Lender notice of all
legal or arbitral proceedings, and of all proceedings by or before
any governmental or regulatory authority or agency, and any
material development in respect of such legal or other
proceedings, affecting the Guarantor or any of its Subsidiaries,
except proceedings that, if adversely determined, could not
(either individually or in the aggregate) reasonably be expected
to have a Material Adverse Effect.
9.03 Existence, Etc. The Guarantor will, and will
cause each of its Subsidiaries to:
(a) preserve and maintain its legal existence and all
of its material rights, privileges, licenses and franchises
(provided that nothing in this Section 9.03 shall prohibit
any transaction expressly permitted under Section 9.05
hereof);
(b) comply with the requirements of all applicable
laws, rules, regulations and orders of governmental or
regulatory authorities if failure to comply with such
requirements could (either individually or in the aggregate)
reasonably be expected to have a Material Adverse Effect;
(c) pay and discharge all material taxes, assessments
and governmental charges or levies imposed on it or on its
income or profits or on any of its Property prior to the date
on which penalties attach thereto, except for any such tax,
assessment, charge or levy the payment of which is being
contested in good faith and by proper proceedings and
against which adequate reserves are being maintained;
(d) maintain all of its Properties used or useful in
its business in good working order and condition, ordinary
wear and tear excepted;
(e) keep adequate records and books of account, in
which complete entries will be made in accordance with
generally accepted accounting principles consistently
applied; and
(f) permit representatives of any Lender or the Agent,
during normal business hours, to examine, copy and make
extracts from its books and records, to inspect any of its
Properties, and to discuss its business and affairs with its
officers and independent certified public accountants, all to
the extent reasonably requested by such Lender or the Agent
(as the case may be).
9.04 Insurance. The Guarantor will, and will cause
each of its Subsidiaries to, keep insured by financially sound and
reputable insurers all Property of a character usually insured by
corporations engaged in the same or similar business similarly
situated against loss, damage and liability of the kinds and in
the amounts customarily insured against by such corporations,
provided that in any event the Company will maintain (with respect
to itself and each of its Subsidiaries) insurance against such
risks and on such terms as the insurance evidenced by the
certificates delivered pursuant to Section 7.01(s) hereof and such
other insurance as may be reasonably requested by the Majority
Lenders.
Such insurance shall be written by financially
responsible companies selected by the Company, duly licensed to do
business in the states in which the relevant facilities are
located and having an A. M. Best rating of "A-" or better and
being in a financial size category of VIII or larger, or by other
companies acceptable to the Agent. The policies for any casualty
insurance required hereunder shall either name or contain an
endorsement naming the Agent as first mortgagee and loss payee
under a first mortgage clause or endorsement without contribution
substantially equivalent to the New York standard first mortgage
clause of endorsement. Each policy referred to in this
Section 9.04 shall provide that it will not be canceled or
reduced, or allowed to lapse without renewal, except after not
less than 30 days' notice to the Agent and shall also provide that
the interests of the Agent and the Lenders shall not be
invalidated by any act or negligence of the Obligor or any Person
having an interest in any Property covered by the Mortgage nor by
occupancy or use of any such Property for purposes more hazardous
than permitted by such policy nor by any foreclosure or other
proceedings relating to such Property and shall otherwise be in
form and substance satisfactory to each Lender. The Company will
advise the Agent promptly of any policy cancellation, reduction or
amendment.
By the last Business Day in each year, the Company will
deliver to the Agent the certificates of insurance evidencing that
all insurance required to be maintained by the Company hereunder
will be in effect for the 12 months beginning after the
immediately succeeding January 1, subject only to the payment of
premiums as they become due. The Company will not obtain or carry
separate insurance concurrent in form or contributing in the event
of loss with that required by this Section 9.04 unless the Agent
is named as first mortgagee and loss payee as provided herein.
The Company will immediately notify the Agent whenever
any such separate insurance is obtained and shall deliver to the
Agent the certificates evidencing the same.
Without limiting the obligations of the Company under
the foregoing provisions of this Section 9.04, in the event the
Company shall fail to maintain in full force and effect insurance
as required by the foregoing provisions of this Section 9.04, then
the Agent may, but shall have no obligation so to do, procure
insurance covering the interests of the Lenders and the Agent in
such amounts and against such risks as the Agent (or the Majority
Lenders) shall deem appropriate, and the Company shall reimburse
the Agent in respect of any premiums paid by the Agent in respect
thereof.
9.05 Prohibition of Fundamental Changes. The Guarantor
will not, nor will it permit any of its Subsidiaries to, enter
into any transaction of merger or consolidation or amalgamation,
or liquidate, wind up or dissolve itself (or suffer any
liquidation or dissolution), except for the Mergers.
The Guarantor will not, nor will it permit any of its
Subsidiaries to, acquire any business or Property from, or capital
stock of, or be a party to any acquisition of, any Person except
for (i) the Acquisition, (ii) purchases of inventory and other
Property to be sold or used in the ordinary course of business,
(iii) Investments permitted under Section 9.08 hereof, (iv)
Capital Expenditures permitted under Section 9.14 hereof and (v)
the acquisition by the Company of Guarantor Preferred Stock in
exchange for the Guarantor Note.
The Guarantor will not, nor will it permit any of its
Subsidiaries to, convey, sell, lease, transfer or otherwise
dispose of, in one transaction or a series of transactions, any
part of its business or Property, whether now owned or hereafter
acquired, including, without limitation, receivables and leasehold
interests, but excluding (i) obsolete or worn-out Property, tools
or equipment no longer used or useful in its business, (ii) any
inventory or other Property sold or disposed of in the ordinary
course of business and on ordinary business terms, (iii) any Part
A Property sold or disposed of for fair value, (iv) any Part B
Property sold or disposed of within one year prior to or after the
Disposition of any Part A Property located in the same
geographical area if the proceeds thereof are applied as provided
in Section 2.10(e) hereof, (v) prior to the Initial Borrowing
Date, the United Shares purchased by the Guarantor in connection
with the Acquisition to the extent sold for fair value in cash and
such cash proceeds are deposited in the Collateral Account are
held therein until payment in full of the Loans, (vi) shares in
United Business Computers, Inc. to be transferred as described in
Schedule III hereto and (vii) other Properties sold for fair value
provided that at least 85% of the proceeds of each such sale shall
be received in cash and the aggregate Net Available Proceeds
received from the sale of such Properties and all other Properties
sold pursuant to this clause (vii) shall not exceed $10,000,000.
Notwithstanding the foregoing provisions of this Section 9.05:
(a) any Subsidiary of the Company may be merged or
consolidated with or into: (i) the Company if the Company
shall be the continuing or surviving corporation or (ii) any
other such Subsidiary; provided that (x) if any such
transaction shall be between a Subsidiary and a Wholly-Owned
Subsidiary, the Wholly-Owned Subsidiary shall be the
continuing or surviving corporation;
(b) any Subsidiary of the Company may sell, lease,
transfer or otherwise dispose of any or all of its Property
(upon voluntary liquidation or otherwise) to the Company or a
Wholly-Owned Subsidiary of the Company;
(c) the Company and its Subsidiaries may sell or
discount, in each case without recourse and in the ordinary
course of business, receivables more than 90 days overdue and
arising in the ordinary course of business, but only in
connection with the compromise or collection thereof
consistent with customary industry practice (and not as part
of any bulk sale or financing of receivables);
(d) the Company and its Subsidiaries may transfer
condemned Property to the respective governmental authority
or agency that has condemned the same (whether by deed in
lieu of condemnation or otherwise), and may transfer
Properties that have been subject to a casualty to the
respective insurer (or its designee) of such Property as part
of an insurance settlement;
(e) the Company and its Subsidiaries may license or
sublicense software, trademarks, and other intellectual
property in the ordinary course of business which do not
materially interfere with the business of the Company or any
Subsidiary; and
(f) the Company and its Subsidiaries may enter into
consignment arrangements (as consignor or consignee) or
similar arrangements for the sale of goods in the ordinary
course of business and consistent with the past practices of
the Company and its Subsidiaries.
9.06 Limitation on Liens. The Guarantor will not, nor
will it permit any of its Subsidiaries to, create, incur, assume
or suffer to exist any Lien upon any of its Property, whether now
owned or hereafter acquired, except:
(a) Liens created pursuant to the Security Documents;
(b) Liens in existence on the date hereof and (i)
listed in Part E or F of Schedule I hereto or (ii) listed on
any policy of title insurance delivered pursuant to Section
7.01(n)(ii) hereof;
(c) Liens imposed by any governmental authority for
taxes, assessments or charges not yet due or that are being
contested in good faith and by appropriate proceedings if,
unless the amount thereof is not material with respect to it
or its financial condition, adequate reserves with respect
thereto are maintained on the books of the Guarantor or the
affected Subsidiaries, as the case may be, in accordance with
GAAP;
(d) carriers', warehousemen's, mechanics',
materialmen's, repairmen's, landlord's or other like Liens
arising in the ordinary course of business that are not
overdue for a period of more than 30 days or that are being
contested in good faith and by appropriate proceedings and
Liens securing judgments but only to the extent for an amount
and for a period not resulting in an Event of Default under
Section 10(h) hereof;
(e) pledges or deposits under worker's compensation,
unemployment insurance and other social security legislation;
(f) deposits to secure the performance of bids, trade
contracts (other than for Indebtedness), leases, statutory
obligations, surety and appeal bonds, performance bonds and
other obligations of a like nature incurred in the ordinary
course of business;
(g) easements, rights-of-way, restrictions and other
similar encumbrances incurred in the ordinary course of
business and encumbrances consisting of zoning restrictions,
easements, licenses, restrictions on the use of Property,
encroachments, protrusions or minor imperfections in title
thereto that, in the aggregate, are not material in amount,
and that do not in any case materially detract from the value
of the Property subject thereto or materially interfere with
the ordinary conduct of the business of the Company or any of
its Subsidiaries;
(h) Liens on Property of any corporation that becomes a
Subsidiary of the Guarantor after the Tender Offer Closing
Date; provided that such Liens are in existence at the time
such corporation becomes a Subsidiary of the Guarantor and
were not created in anticipation thereof;
(i) Liens upon Property acquired after the date hereof
(by purchase, construction or otherwise) by the Company or
any of its Subsidiaries, each of which Liens either
(A) existed on such Property before the time of its
acquisition and was not created in anticipation thereof or
(B) was created within 120 days of the acquisition or
completion of construction of such Property solely for the
purpose of securing Indebtedness representing, or incurred to
finance, refinance or refund, the cost (including the cost of
construction) of such Property; provided that (i) no such
Lien shall extend to or cover any Property of the Company or
such Subsidiary other than the Property so acquired and
improvements thereon and (ii) the principal amount of
Indebtedness secured by any such Lien shall at no time exceed
80% of the fair market value (as determined in good faith by
a Responsible Officer of the Company) of such Property at the
time it was acquired (by purchase, construction or
otherwise);
(j) Liens in respect of Capital Lease Obligations to
the extent permitted by Sections 9.07 and 9.14 hereof;
(k) Liens securing the obligations of the Company
under Interest Rate Protection Agreements permitted by
Section 9.08(i) hereof;
(l) licenses, leases or subleases granted to others in
the ordinary course of business not materially interfering
with the conduct of the business of the Company and its
Subsidiaries taken as a whole;
(m) statutory and contractual landlords' liens under
leases to which the Company or any of its Subsidiaries is a
party;
(n) any interest or title of a lessor, sublessor,
licensee or licensor under any lease or license agreement
permitted by this Agreement;
(o) Liens in favor of a banking institution arising as
a matter of law encumbering deposits (including the right of
set-off) held by such banking institutions incurred in the
ordinary course of business and which are within the general
parameters customary in the banking industry;
(p) Liens in favor of customs and revenue authorities
arising as a matter of law to secure the payment of customs'
duties in connection with the importation of goods;
(q) any extension, renewal or replacement of the
foregoing, provided, however, that the Liens permitted
hereunder shall not be spread to cover any additional
Indebtedness or Property (other than a substitution of like
Property); and
(r) prior to the Initial Borrowing Date, Liens on the
United Shares purchased by the Guarantor in connection with
the Acquisition.
9.07 Indebtedness. The Guarantor will not, nor will it
permit any of its Subsidiaries to, create, incur or suffer to
exist any Indebtedness except:
(a) Indebtedness to the Lenders hereunder and under the
other Basic Documents;
(b) Indebtedness outstanding on the date hereof and
listed in item 9 of Part B of Schedule I hereto or Parts C or
D of Schedule I hereto;
(c) the Senior Subordinated Debt;
(d) the Guarantor Note;
(e) Indebtedness of any Wholly-Owned Subsidiary of the
Company (i) to the Company in an aggregate unpaid principal
amount of not more than $1,500,000 or (ii) to any other
Wholly-Owned Subsidiary of the Company;
(f) Indebtedness of the Company to any Wholly-Owned
Subsidiary of the Guarantor provided that all such
Indebtedness is subordinate on terms satisfactory to the
Majority Lenders to the Indebtedness to the Lenders hereunder
and under the other Basic Documents and is evidenced by an
intercompany promissory note which is pledged to the Agent as
collateral;
(g) Indebtedness of the Company or any Subsidiary as a
guarantor of the lessee under any lease pursuant to which the
Company or any Subsidiary of the Company is a lessee so long
as such lease is otherwise permitted hereunder;
(h) Indebtedness incurred on or after the Revolving
Credit Commitment Termination Date and after the payment in
full of all Revolving Credit Loans and all Letter of Credit
Liabilities for working capital or other general corporate
purposes of the Company and/or its Subsidiaries not to exceed
$300,000,000 in the aggregate and on terms satisfactory to
the Majority Lenders in their reasonable discretion; and
(i) Indebtedness of the Company and its Subsidiaries
incurred after the Initial Borrowing Date (including, without
limitation, Capital Lease Obligations and other Indebtedness
secured by Liens permitted under Sections 9.06(i) or 9.06(j)
hereof) up to but not exceeding $20,000,000 at any one time
outstanding.
9.08 Investments. The Guarantor will not, nor will it
permit any of its Subsidiaries to, make or permit to remain
outstanding any Investments except:
(a) Investments outstanding on the date hereof and
identified in Schedule III hereto;
(b) operating deposit accounts with banks;
(c) Permitted Investments;
(d) Investments by the Guarantor in the Company; (e)
Customer advances not to exceed $250,000 in the
aggregate at any one time outstanding;
(f) travel and relocation loans and advances to
employees in the ordinary course of business not to exceed
$1,000,000 in the aggregate at any one time outstanding;
(g) deposits permitted by Section 9.06(f) hereof;
(h) Investments received in settlement of defaulted
Receivables or in connection with the bankruptcy or
reorganization of suppliers and customers and in connection
with the settlement of other disputes with customers and
suppliers arising in the ordinary course of business;
(i) Interest Rate Protection Agreements, required by
Section 9.15 hereof;
(j) intercompany loans to the extent permitted by
Section 9.07(e) or (f) hereof;
(k) the Guarantor Note; and
(l) additional Investments up to but not exceeding
$1,000,000 in the aggregate.
9.09 Dividend Payments. (a) The Company will not, nor
will it permit any of its Subsidiaries to, declare or make any
Dividend Payment at any time; provided, however, that (1) any
Subsidiary of the Company may make any Dividend Payment to the
Company or any Wholly-Owned Subsidiary of the Company and (2) the
Company may declare and make Dividend Payments in cash in respect
of its common stock (i) to enable the Guarantor to pay any income,
franchise or like taxes to the extent permitted by the Tax Sharing
Agreement, (ii) to enable the Guarantor to pay its operating
expenses incurred in the ordinary course of business and other
corporate overhead costs and expenses (including, without
limitation, legal, accounting, reporting, listing and similar
expenses) in an aggregate amount not in excess of $750,000 in any
fiscal year, (iii) to enable the Guarantor to acquire shares of
capital stock to distribute to directors, officers and other
employees pursuant to employee benefit plans, (iv) to enable the
Guarantor to make cash payments of dividends in respect of the
Guarantor Preferred Stock or to pay Accrued Warrant Liabilities,
and (v) to enable the Guarantor to repurchase its common stock
from former employees of the Company for an aggregate purchase
price of no more than $600,000 in any 12-month period, subject, in
the case of clauses (iii), (iv) and (v) above, to the satisfaction
of the following conditions on the date of such Dividend Payment
and after giving effect thereto and to the application of any
Excess Cash Flow then required to be applied pursuant to Section
2.10(c) hereof:
(1) no Default shall have occurred and be
continuing;
(2) the Fixed Charges Ratio as at the last
day of the fiscal quarter of the Company most recently
ended prior to the date of such Dividend Payment shall
not be less than 1.2 to 1;
(3) the aggregate amount of such Dividend
Payments made in cash in any fiscal year of the Company
shall not exceed an amount equal to 25% of the Excess
Cash Flow for the fiscal year of the Company most
recently ended prior to the date of such Dividend
Payment;
(4) the average, for the immediately
preceding 90 days, of the excess of (i) the lesser of
(x) the Borrowing Base and (y) the aggregate Revolving
Credit Commitments over (ii) the sum of the outstanding
principal amount of Revolving Credit Loans and the
aggregate amount of Letter of Credit Liabilities shall
be an amount at least equal to $50,000,000; and
(5) at least 10 Business Days (but not more
than 20 Business Days) prior to the date of each such
Dividend Payment, the Company shall have delivered to
each Lender a certificate of a Responsible Officer of
the Company stating that, both before and after giving
effect to the Dividend Payment to be made, no Default
exists and demonstrating compliance with the conditions
set forth in clauses (2), (3) and (4) of this
Section 9.09(a).
(b) The Guarantor will not declare or make any
Dividend Payment except (i) (subject to paragraph (c) below)
regularly scheduled Dividend Payments in respect of Guarantor
Preferred Stock and payments of Accrued Warrant Liabilities, (ii)
repurchases of common stock of the Guarantor from former employees
of the Company for an aggregate purchase price of no more than
$600,000 in any 12-month period and (iii) repurchases of common
stock of the Guarantor to distribute to directors, officers and
other employees pursuant to employee benefit plans.
(c) The Guarantor will not make any Dividend Payment in
respect of Guarantor Preferred Stock in cash, except to the extent
that the Company would then be permitted under
Section 9.09(a) hereof to make Dividend Payments in cash to the
Guarantor to fund the same.
9.10 Net Worth. The Guarantor will not permit Net
Worth to be less than the sum of (a) $70,000,000 plus (b) 75% of
the sum of Net Income (if positive) for each fiscal quarter of the
Guarantor commencing with the first full fiscal quarter occurring
after the Initial Borrowing Date.
9.11 Debt to Cash Flow Ratio. The Guarantor will not
permit the Debt to Cash Flow Ratio to exceed the following
respective amounts at any time during the following respective
periods:
Period Ratio
From December 31, 1995 6.00 to 1
through June 29, 1996
From June 30, 1996 5.25 to 1
through December 30, 1996
From December 31, 1996 4.75 to 1
through June 29, 1997
From June 30, 1997 4.50 to 1
through December 30, 1997
From December 31, 1997 4.00 to 1
through December 30, 1998
From December 31, 1998 3.50 to 1
through December 30, 1999
From December 31, 1999 3.00 to 1
and thereafter
9.12 Fixed Charges Ratio. The Guarantor will not
permit the Fixed Charges Ratio to be less than the following
respective amounts at any time during the following respective
periods:
Period Ratio
From December 31, 1995 1.05 to 1
through December 30, 1998
From December 31, 1998 1.10 to 1
and thereafter
9.13 Interest Coverage Ratio. The Guarantor will not
permit the Interest Coverage Ratio to be less than the following
respective amounts at any time during the following respective
periods:
Period Ratio
From the date hereof
through December 30, 1995 1.30 to 1
From December 31, 1995
through June 29, 1996 1.70 to 1
From June 30, 1996
through December 30, 1998 2.00 to 1
From December 31, 1998
and thereafter 2.50 to 1
9.14 Capital Expenditures. (a) The Company will not
permit the aggregate amount of Capital Expenditures by the Company
and its Subsidiaries to exceed $12,000,000 in any fiscal year.
(b) Notwithstanding anything to the contrary contained
in paragraph (a) above, to the extent that the aggregate amount of
Capital Expenditures made by the Company and its Subsidiaries in
any fiscal year are less than $12,000,000, the amount of such
difference may be carried forward to the next succeeding fiscal
year and used to make Capital Expenditures in such immediately
succeeding fiscal year of the Company; provided that in no event
may any such amount carried forward from a fiscal year exceed
$12,000,000 minus the amount of Capital Expenditures made by the
Company and its Subsidiaries in such fiscal year.
(c) In addition to the Capital Expenditures permitted
pursuant to the preceding paragraphs (a) and (b), the Company and
its Subsidiaries may make additional Capital Expenditures as
follows: (i) Capital Expenditures consisting of a reinvestment of
the Net Available Proceeds of any asset sales not required to be
applied to prepay the Loans pursuant to Section 2.10(e) hereof;
(ii) Capital Expenditures consisting of the reinvestment of that
portion of Excess Cash Flow generated during the priorfiscal year
and not required to be applied to prepay the Loans pursuant to
Section 2.01(c) hereof; and (iii) the reinvestment of insurance or
condemnation proceeds payable by reason of theft, loss, physical
destruction or damage or any similar event or as a result of
condemnation or deed in lieu thereof.
9.15 Interest Rate Protection Agreements. The Company
will within forty-five days after the Initial Borrowing Date
effect one or more Interest Rate Protection Agreements with one or
more of the Lenders that effectively enables the Company (in a
manner satisfactory to the Agent), as at any date, to protect
itself against three-month London interbank offered rates
exceeding 8% per annum as to a notional principal amount at least
equal to $150,000,000 for a period of at least three years after
the Initial Borrowing Date and shall maintain such Interest Rate
Protection Agreements in full force and effect throughout such
period.
9.16 Subordinated Indebtedness. The Guarantor will
not, nor will it permit any of its Subsidiaries to purchase,
redeem, retire or otherwise acquire for value, or set apart any
money for a sinking, defeasance or other analogous fund for the
purchase, redemption, retirement or other acquisition of, or make
any voluntary payment or prepayment of the principal of or
interest on, or any other amount owing in respect of, any
Subordinated Indebtedness, except for (i) regularly scheduled
payments or prepayments of principal and interest in respect
thereof required pursuant to the instruments evidencing such
Subordinated Indebtedness, (ii) repayments of the Senior
Subordinated Loans from the proceeds of any issuance of the Take
Out Notes and (iii) repayments of the Senior Subordinated Bridge
Loans from the proceeds of any Equity Issuance.
9.17 Lines of Business. The Guarantor will not, nor
will it permit any of its Subsidiaries (including, without
limitation, the Company) to, engage to any substantial extent in
any line or lines of business activity other than the business of
the wholesale distribution and selling of office products,
computers, computer products, janitorial supplies and similar
products.
9.18 Transactions with Affiliates. Except as expressly
permitted by this Agreement, the Guarantor will not, nor will it
permit any of its Subsidiaries to, directly or indirectly: (a)
make any Investment in an Affiliate;
(b) transfer, sell, lease, assign or otherwise dispose of any
Property to an Affiliate; (c) merge into or consolidate with or
purchase or acquire Property from an Affiliate; or (d) enter into
any other transaction (other than the payment of Sponsor
Management Fees permitted by Section 9.22 hereof) directly or
indirectly with or for the benefit of an Affiliate (including,
without limitation, Guarantees and assumptions of obligations of
an Affiliate); provided that (x) any Affiliate who is an
individual may serve as a director, officer, employee or
consultant of the Guarantor or any of its Subsidiaries and receive
reasonable compensation for his or her services in such capacity
and (y) the Company and its Subsidiaries may enter into
transactions (other than extensions of credit by the Company or
any of its Subsidiaries to an Affiliate) providing for the leasing
of Property, the rendering or receipt of services or the
purchase or sale of inventory and other Property in the ordinary
course of business if the monetary or business consideration
arising therefrom would be substantially as advantageous to the
Company and its Subsidiaries as the monetary or business
consideration that would obtain in a comparable transaction with a
Person not an Affiliate.
9.19 Use of Proceeds.
(a) The Company will use the proceeds of the Term Loans
and the Revolving Credit Loans solely to (i) make a loan to the
Guarantor to consummate the Acquisition and (ii) to refinance
existing Indebtedness of the Company listed in Parts A and B of
Schedule I hereto and (iii) and for general corporate purposes of
the Company and its Subsidiaries.
(b) The use of the proceeds of the Loans by the Company
shall be in compliance with all applicable legal and regulatory
requirements, including, without limitation, Regulations G, U and
X, the Securities Act of 1933, as amended, and the Exchange Act
and the regulations thereunder; provided that neither the Agent
nor any Lender shall have any responsibility as to the use of any
of such proceeds.
9.20 Modifications of Certain Documents. (a) Neither
Obligor will consent to any modification, supplement or waiver of
any of the provisions of the Acquisition Documents or the Senior
Subordinated Debt Documents or terminate the Merger Agreement
without the prior consent of the Agent (with the approval of the
Majority Lenders).
(b) The Guarantor will not take any action to modify or
supplement the Articles of Incorporation of the Company after the
Mergers have occurred, other than modifications that do not
adversely affect the interests of the Lenders, without the prior
approval of the Majority Lenders.
9.21 Ownership of the Company. The Guarantor will at
all times hold not less than 100% of the issued and outstanding
capital stock of the Company.
9.22 Management Fees, Etc. (a) Except for Acquisition
Costs, neither Obligor will pay to any Sponsor any management,
consultant, financial advisor, director or similar fees ("Sponsor
Management Fees"), except that the Obligors may pay (1) Sponsor
Management Fees of not more than $70,834 in any month (the
"Monthly Management Fees") plus (2) up to an additional $150,000
of Sponsor Management Fees for any fiscal year (the "Annual
Management Fee") if, giving effect to the payment of all Monthly
Management Fees and to the payment of such Annual Management Fee
(solely for which purpose such Annual Management Fee shall be
deemed to have been paid in such fiscal year), EBITDA of the
Company for such fiscal year is not less than EBITDA of the
Company as set forth opposite such fiscal year in Schedule VII
hereto; provided that no Annual Management Fee for any fiscal year
shall be paid until each Lender has received the financial
statements of the Company for such fiscal year required to be
delivered to such Lender pursuant to Section 9.01(c) hereof; and
provided, further, that, in any event, no Annual Management Fee
shall be paid if, at the time of such payment and after giving
effect thereto, any Event of Default shall have occurred and be
continuing; and provided, further, that any Annual Management Fees
that shall not be paid because of the occurrence and continuance
of any Event of Default shall continue to accrue.
(b) Neither Obligor nor any of its Subsidiaries shall
pay any severance payments or fees or other amounts to any officer
or director of United in connection with or as a result, directly
or indirectly, of the Acquisition except pursuant to a schedule
delivered to the Agent prior to the Initial Borrowing Date and in
form and substance satisfactory to the Agent.
9.23 Taxes; Tax Sharing Agreement. The Guarantor and
its Subsidiaries will file consolidated Federal income tax
returns. Prior to filing any Federal income tax returns or paying
any Federal income tax after the Tender Offer Closing Date, the
Guarantor and its Subsidiaries will enter into a tax allocation
agreement (the "Tax Sharing Agreement") in form and substance
reasonably satisfactory to the Majority Lenders.
9.24 Subsidiary Guarantors; Repayment of Indebtedness;
Additional Mortgaged Property.
(a) In the event that the Guarantor shall, after the
Initial Borrowing Date, hold or acquire any Domestic Subsidiary,
the Company will notify the Lenders (through the Agent) and will,
and will cause each of its other Subsidiaries to, cause such
Domestic Subsidiary (i) to execute and deliver a written guarantee
of the Guaranteed Obligations in form and substance satisfactory
to the Majority Lenders in their reasonable discretion, (ii) to
execute and deliver a security agreement in substantially the form
of Exhibit C hereto, mutatis mutandis, (iii) at the request of the
Majority Lenders, to enter into a Mortgage covering all of the
interests in material real Property owned by such Domestic
Subsidiary and (iv) to deliver such proof of corporate action,
incumbency of officers, opinions of counsel and other documents as
are consistent with those delivered by the Company pursuant to
Section 7.01 hereof on the Initial Borrowing Date or as the Agent
shall have reasonably requested.
(b) On or before July 31, 1995, the Company shall repay
in full all Indebtedness identified in Schedule I hereto to be
repaid on or before such date.
(c) If (x) the Company repays any Indebtedness
described in any of items 1 and 3 of Part F of Schedule I hereto
or (y) the Company or any of its Subsidiaries acquires or leases
any material real Property after the Initial Borrowing Date, other
than any real Property encumbered by Liens permitted by Section
9.06(i) hereof, the Company or such Subsidiary will promptly
execute a Mortgage covering the Property securing such repaid
Indebtedness or such newly-acquired Property, as the case may be,
together with such surveys, title insurance policies and
endorsements, certificates of occupancy and such other agreements,
estoppels and consents (including agreements with lessors) as the
Agent may reasonably require.
(d) The Company will, prior to July 31, 1995, execute
and deliver a Mortgage covering the Property of the Company
located in Twinsburg, Ohio and deliver such surveys, title
insurance policies and endorsements, certificates of occupancy and
such other agreements as the Agent may reasonably require.
9.25 Termination of ERISA Plans. The Company will not
and will not permit any Subsidiary to withdraw from any Multi
employer Plan or permit any employee benefit plan maintained by it
to be terminated if such withdrawal or termination could result in
withdrawal liability (as described in Part 1 of Subtitle E of
Title IV of ERISA) or the imposition of a Lien on any Property of
the Company or any Subsidiary pursuant to Section 4068 of ERISA.
9.26 Consummation of the Mergers. The Guarantor will
cause the Mergers to be consummated on the Tender Offer Closing
Date.
Section 10. Events of Default. If one or more of the
following events (herein called "Events of Default") shall occur
and be continuing:
(a) Either Obligor shall (i) default in the payment
when due (whether at stated maturity or upon mandatory or
optional prepayment) of any principal of any Loan or any
Reimbursement Obligation or (ii) default in the payment when
due of any interest on any Loan or any Reimbursement
Obligation or any fee or any other amount payable by it
hereunder or under any other Basic Document and such default
shall continue unremedied for three or more Business Days; or
(b) Either Obligor, United or Supply or any of their
respective Subsidiaries (the Obligors, United, Supply and
such Subsidiaries herein collectively called the "Relevant
Parties") shall default in the payment when due of any
principal of or interest on any of its Indebtedness
aggregating $5,000,000 or more, or in the payment when due of
any amount under any Interest Rate Protection Agreement for a
notional principal amount exceeding $5,000,000; or any event
specified in any note, agreement, indenture or other document
evidencing or relating to any such Indebtedness or any event
specified in any Interest Rate Protection Agreement shall
occur if the effect of such event is to cause, or (with the
giving of any notice or the lapse of time or both) to permit
the holder or holders Indebtedness (or a trustee or agent on
behalf of such holder or holders) to cause, Indebtedness to
become due, or to be prepaid in full (whether by redemption,
purchase, offer to purchase or otherwise), prior to its
stated maturity or to have the interest rate thereon reset to
a level so that securities evidencing such Indebtedness trade
at a level specified in relation to the par value thereof or,
in the case of an Interest Rate Protection Agreement, to
permit the payments owing under such Interest Rate Protection
Agreement to be liquidated; or the Company shall have failed
to convert outstanding Senior Subordinated Bridge Loans into
Rollover Loans on the Bridge Loan Maturity Date (as defined
in the Senior Subordinated Loan Agreement); or
(c) Any representation, warranty or certification made
or deemed made herein or in any Transaction Document (or in
any modification or supplement hereto or thereto) by any
party thereto, or any certificate furnished to any Lender or
the Agent pursuant to the provisions of any Basic Document,
shall prove to have been false or misleading as of the time
made or furnished in any material respect; or
(d) The Company or the Guarantor (as applicable) shall
default in the performance of any of its obligations under
any of Sections 9.01(g), 9.01(k), 9.05 through 9.16,
inclusive, 9.18 through 9.22, inclusive, and 9.26 hereof or
either the Company or the Guarantor shall default in the
performance of any of its obligations under Section 4.02,
5.02 or 5.07 of the Security Agreement, Section 4.02 or 4.07
of the Pledge Agreement or any provisions of any Mortgage; or
any Obligor shall default in the performance of any of its
other obligations in this Agreement or any other Basic
Document and such default shall continue unremedied for a
period of ten or more days after notice thereof to the
Company by the Agent or any Lender (through the Agent); or
(e) Any Relevant Party shall admit in writing its
inability to, or be generally unable to, pay its debts as
such debts become due; or
(f) Any Relevant Party shall (i) apply for or consent
to the appointment of, or the taking of possession by, a
receiver, custodian, trustee, examiner or liquidator of
itself or of all or a substantial part of its Property, (ii)
make a general assignment for the benefit of its creditors,
(iii) commence a voluntary case under the Bankruptcy Code,
(iv) file a petition seeking to take advantage of any other
law relating to bankruptcy, insolvency, reorganization,
liquidation, dissolution,
arrangement or winding-up, or composition or readjustment of
debts, (v) fail to controvert in a timely and appropriate
manner, or acquiesce in writing to, any petition filed
against it in an involuntary case under the Bankruptcy Code
or (vi) take any corporate action for the purpose of
effecting any of the foregoing; or
(g) A proceeding or case shall be commenced, without
the application or consent of the affected Relevant Party, in
any court of competent jurisdiction, seeking (i) its
reorganization, liquidation, dissolution, arrangement or
winding-up, or the composition or readjustment of its debts,
(ii) the appointment of a receiver, custodian, trustee,
examiner, liquidator or the like of such Relevant Party or of
all or any substantial part of its Property or
(iii) similar relief in respect of such Relevant Party under
any law relating to bankruptcy, insolvency, reorganization,
winding-up, or composition or adjustment of debts, and such
proceeding or case shall continue undismissed, or an order,
judgment or decree approving or ordering any of the foregoing
shall be entered and continue unstayed and in effect, for a
period of 60 or more days; or an order for relief against any
Relevant Party shall be entered in an involuntary case under
the Bankruptcy Code; or
(h) A final judgment or judgments for the payment of
money in excess of $5,000,000 in the aggregate (exclusive of
judgment amounts fully covered by insurance where the insurer
has admitted liability in respect of such judgment) shall be
rendered by one or more courts, administrative tribunals or
other bodies having jurisdiction against any Relevant Party
and the same shall not be discharged (or provision shall not
be made for such discharge), or a stay of execution thereof
shall not be procured, within 30 days from the date of entry
thereof and such Relevant Party shall not, within said period
of 30 days, or such longer period during which execution of
the same shall have been stayed, appeal therefrom and cause
the execution thereof to be stayed during such appeal; or
(i) An event or condition specified in Section 9.01(f)
hereof shall occur or exist with respect to any Plan or
Multiemployer Plan and, as a result of such event or
condition, together with all other such events or conditions,
the Company or any ERISA Affiliate shall incur or in the
reasonable opinion of the Majority Lenders shall be
reasonably likely to incur a liability to a Plan, a
Multiemployer Plan or the PBGC (or any combination of the
foregoing) that, in the determination of the Majority
Lenders, could (either individually or in the aggregate)
reasonably be expected to have a Material Adverse Effect; or
(j) A reasonable basis shall exist for the assertion
against the Company or any of its Subsidiaries, or any
predecessor in interest of the Company or any of its
Subsidiaries or Affiliates, of (or there shall have been
asserted against the Company or any of its Subsidiaries) an
Environmental Claim that, in the judgment of the Majority
Lenders is reasonably likely to be determined adversely to
the Company or any of its Subsidiaries, and the amount
thereof (either individually or in the aggregate) is
reasonably likely to have a Material Adverse Effect (insofar
as such amount is payable by the Company or any of its
Subsidiaries but after deducting any portion thereof that is
reasonably expected to be paid by other creditworthy Persons
jointly and severally liable therefor); or
(k) Any Change of Control shall have occurred; or
(l) Except for expiration in accordance with its terms
or a voluntary release by the Agent on behalf of the Agent
and the Lenders, the Liens created by the Security Documents
shall at any time not constitute a valid and perfected Lien
on the collateral intended to be covered thereby (to the
extent perfection by filing, registration, recordation or
possession is required herein or therein) in favor of the
Agent, free and clear of all other Liens (other than Liens
permitted under Section 9.06 hereof or under the respective
Security Documents), or, except for expiration in accordance
with its terms, any of the Security Documents shall for
whatever reason be terminated or cease to be in full force
and effect, or the enforceability thereof shall be contested
by either Obligor, United or Supply, as the case may be;
THEREUPON: (1) in the case of an Event of Default other than one
referred to in clause (f) or (g) of this Section 10 with respect
to any Obligor, the Agent shall, at the direction of the Majority
Lenders, by notice to the Obligors, terminate the Commitments
and/or declare the principal amount then outstanding of, and the
accrued interest on, the Loans, the Reimbursement Obligations and
all other amounts payable by the Obligors hereunder and under the
Notes (including, without limitation, any amounts payable under
Section 5.05 or 5.06 hereof) to be forthwith due and payable
(provided that if so requested by the Majority Revolving Credit
Lenders, the Agent shall terminate the Revolving Credit
Commitments), whereupon such amounts shall be immediately due and
payable without presentment, demand, protest or other formalities
of any kind, all of which are hereby expressly waived by each
Obligor; and (2) in the case of the occurrence of an Event of
Default referred to in clause (f) or (g) of this Section 10 with
respect to any Obligor, the Commitments shall automatically be
terminated and the principal amount then outstanding of, and the
accrued interest on, the Loans, the Reimbursement Obligations and
all other amounts payable by the Obligors hereunder and under the
Notes (including, without limitation, any amounts payable under
Section 5.05 or 5.06 hereof) shall automatically become
immediately due and payable without presentment, demand, protest
or other formalities of any kind, all of which are hereby
expressly waived by each Obligor.
In addition, upon the occurrence and during the
continuance of any Event of Default (if the Agent has declared the
principal amount then outstanding of, and accrued interest on, the
Revolving Credit Loans and all other amounts payable by the
Company hereunder and under the Notes to be due and payable), the
Company agrees that it shall, if requested by the Agent or the
Majority Revolving Credit Lenders through the Agent (and, in
the case of any Event of Default referred to in clause (f) or (g)
of this Section 10 with respect to either Obligor, forthwith,
without any demand or the taking of any other action by the Agent
or such Lenders) provide cover for the Letter of Credit
Liabilities by paying to the Agent immediately available funds in
an amount equal to the then aggregate undrawn face amount of all
Letters of Credit, which funds shall be held by the Agent in the
Collateral Account as collateral security in the first instance
for the Letter of Credit Liabilities and be subject to withdrawal
only as therein provided.
Section 11. The Agent.
11.01 Appointment, Powers and Immunities. Each Lender
hereby appoints and authorizes the Agent to act as its agent
hereunder and under the other Basic Documents with such powers as
are specifically delegated to the Agent by the terms of this
Agreement and of the other Basic Documents, together with such
other powers as are reasonably incidental thereto. The Agent
(which term as used in this sentence and in Section 11.05 and the
first sentence of Section 11.06 hereof shall include reference to
its affiliates and its own and its affiliates' officers,
directors, employees and agents):
(a) shall have no duties or responsibilities except
those expressly set forth in this Agreement and in the other
Basic Documents, and shall not by reason of this Agreement or
any other Basic Document be a trustee for any Lender;
(b) shall not be responsible to the Lenders for any
recitals, statements, representations or warranties contained
in this Agreement or in any other Basic Document, or in any
certificate or other document referred to or provided for in,
or received by any of them under, this Agreement or any other
Basic Document, or for the value, validity, effectiveness,
genuineness, enforceability or sufficiency of this Agreement,
any Note or any other Basic Document or any other document
referred to or provided for herein or therein or for any
failure by the Company or any other Person to perform any of
its obligations hereunder or thereunder;
(c) shall not, except to the extent expressly
instructed by the Majority Lenders with respect to collateral
security under the Security Documents, be required to
initiate or conduct any litigation or collection proceedings
hereunder or under any other Basic Document; and
(d) shall not be responsible for any action taken or
omitted to be taken by it hereunder or under any other Basic
Document or under any other document or instrument referred
to or provided for herein or therein or in connection
herewith or therewith, except for its own gross negligence or
willful misconduct.
The Agent may employ agents and attorneys-in-fact and shall not be
responsible for the negligence or misconduct of any such agents or
attorneys-in-fact selected by it in good faith. The Agent may
deem and treat the payee (or Registered Holder, as the case may
be) of a Note as the holder thereof for all purposes hereof unless
and until a notice of the assignment or transfer thereof shall
have been filed with the Agent, together with the consent of the
Company to such assignment or transfer (to the extent provided in
Section 12.06(b) hereof).
11.02 Reliance by Agent. The Agent shall be entitled
to rely upon any certification, notice or other communication
(including, without limitation, any thereof by telephone,
telecopy, telegram or cable) believed by it to be genuine and
correct and to have been signed or sent by or on behalf of the
proper Person or Persons, and upon advice and statements of legal
counsel, independent accountants and other experts selected by the
Agent. As to any matters not expressly provided for by this
Agreement or any other Basic Document, the Agent shall in all
cases be fully protected in acting, or in refraining from acting,
hereunder or thereunder in accordance with instructions given by
the Majority Lenders or, if provided herein, in accordance with
the instructions given by the Majority Revolving Credit Lenders,
the Majority Term Lenders or all of the Lenders as is required in
such circumstance, and such instructions of such Lenders and any
action taken or failure to act pursuant thereto shall be binding
on all of the Lenders.
11.03 Defaults. The Agent shall not be deemed to have
knowledge or notice of the occurrence of a Default unless the
Agent has received notice from a Lender or the Company specifying
such Default and stating that such notice is a "Notice of
Default". In the event that the Agent receives such a notice of
the occurrence of a Default, the Agent shall give prompt notice
thereof to the Lenders. The Agent shall (subject to
Section 11.07 hereof) take such action with respect to such
Default as shall be directed by the Majority Lenders or, if
provided herein, the Majority Revolving Credit Lenders or the
Majority Term Lenders, provided that, unless and until the Agent
shall have received such directions, the Agent may (but shall not
be obligated to) take such action, or refrain from taking such
action, with respect to such Default as it shall deem advisable in
the best interest of the Lenders except to the extent that this
Agreement expressly requires that such action be taken, or not be
taken, only with the consent or upon the authorization of the
Majority Lenders, the Majority Revolving Credit Lenders, the
Majority Term Lenders or all of the Lenders.
11.04 Rights as a Lender. With respect to its
Commitments and the Loans made by it, Chase (and any successor
acting as Agent) in its capacity as a Lender hereunder shall have
the same rights and powers hereunder as any other Lender and may
exercise the same as though it were not acting as the Agent, and
the term "Lender" or "Lenders" shall, unless the context otherwise
indicates, include the Agent in its individual capacity. Chase
(and any successor acting as Agent) and its affiliates may
(without having to account therefor to any Lender) accept deposits
from, lend money to (including, without limitation, under the
Senior Subordinated Loan Agreement) make investments in and
generally engage in any kind of banking, trust or other business
with the Obligors (and any of their Subsidiaries or Affiliates) as
if it were not acting as the Agent, and Chase (and any such
successor) and its affiliates may accept fees and other
consideration from the Obligors for services in connection with
this Agreement or otherwise without having to account for the same
to the Lenders.
11.05 Indemnification. The Lenders agree to indemnify
the Agent (to the extent not reimbursed under Section 12.03
hereof, but without limiting the obligations of the Obligors under
said Section 12.03, and including in any event any payments under
any indemnity that the Agent is required to issue to any bank
referred to in Section 4.02 of the Security Agreement to which
remittances in respect of Accounts, as defined therein, are to be
made) ratably in accordance with the aggregate principal amount of
the Loans and Reimbursement Obligations held by the
Lenders (or, if no Loans or Reimbursement Obligations are at the
time outstanding, ratably in accordance with their respective
Commitments), for any and all liabilities, obligations, losses,
damages, penalties, actions, judgments, suits, costs, expenses or
disbursements of any kind and nature whatsoever that may be
imposed on, incurred by or asserted against the Agent (including
by any Lender) arising out of or by reason of any investigation in
or in any way relating to or arising out of this Agreement or any
other Basic Document or any other documents contemplated by or
referred to herein or therein or the transactions contemplated
hereby or thereby (including, without limitation, the costs and
expenses that the Obligors are obligated to pay under
Section 12.03 hereof, and including also any payments under any
indemnity that the Agent is required to issue to any bank referred
to in Section 4.02 of the Security Agreement to which remittances
in respect of Accounts, as defined therein, are to be made, but
excluding, unless a Default has occurred and is continuing, normal
administrative costs and expenses incident to the performance of
its agency duties hereunder) or the enforcement of any of the
terms hereof or thereof or of any such other documents, provided
that no Lender shall be liable for any of the foregoing to the
extent they arise from the gross negligence or willful misconduct
of the party to be indemnified.
11.06 Non-Reliance on Agent and Other Lenders. Each
Lender agrees that it has, independently and without reliance on
the Agent or any other Lender, and based on such documents and
information as it has deemed appropriate, made its own credit
analysis of the Guarantor and its Subsidiaries and decision to
enter into this Agreement and that it will, independently and
without reliance upon the Agent or any other Lender, and based on
such documents and information as it shall deem appropriate at the
time, continue to make its own analysis and decisions in taking or
not taking action under this Agreement or under any other Basic
Document. The Agent shall not be required to keep itself informed
as to the performance or observance by any Obligor of this
Agreement or any of the other Basic Documents or any other
document referred to or provided for herein or therein or to
inspect the Properties or books of the Guarantor or any of its
Subsidiaries. Except for notices, reports and other documents and
information expressly required to be furnished to the Lenders by
the Agent hereunder or under the Security Documents, the Agent
shall not have any duty or responsibility to provide any Lender
with any credit or other information concerning the affairs,
financial condition or business of the Guarantor or any of its
Subsidiaries (or any of their affiliates) that may come into the
possession of the Agent or any of its affiliates.
11.07 Failure to Act. Except for action expressly
required of the Agent hereunder and under the other Basic
Documents, the Agent shall in all cases be fully justified in
failing or refusing to act hereunder and thereunder unless it
shall receive further assurances to its satisfaction from the
Lenders of their indemnification obligations under Section 11.05
hereof against any and all liability and expense that may be
incurred by it by reason of taking or continuing to take any such
action.
11.08 Resignation or Removal of Agent. Subject to the
appointment and acceptance of a successor Agent as provided below,
the Agent may resign at any time by giving notice thereof to the
Lenders and the Obligors, and the Agent may be removed at any time
with or without cause by the Majority Lenders. Upon any such
resignation or removal, the Majority Lenders shall have the right
to appoint a successor Agent. If no successor Agent shall
have been so appointed by the Majority Lenders and shall have
accepted such appointment within 30 days after the retiring
Agent's giving of notice of resignation or the Majority Lenders'
removal of the retiring Agent, then the retiring Agent may, on
behalf of the Lenders, appoint a successor Agent, that shall be a
bank with a combined capital and surplus and undivided profits of
at least $300,000,000. Upon the acceptance of any appointment as
Agent hereunder by a successor Agent, such successor Agent shall
thereupon succeed to and become vested with all the rights,
powers, privileges and duties of the retiring Agent, and the
retiring Agent shall be discharged from its duties and obligations
hereunder. After any retiring Agent's resignation or removal
hereunder as Agent, the provisions of this Section 11 shall
continue in effect for its benefit in respect of any actions taken
or omitted to be taken by it while it was acting as the Agent.
11.09 Consents under Other Basic Documents. Except as
otherwise provided in Section 12.04 hereof with respect to this
Agreement, the Agent may, with the prior consent of the Majority
Lenders (but not otherwise), consent to any modification,
supplement or waiver under any of the Basic Documents, provided
that, without the prior consent of each Lender, the Agent shall
not (except as provided herein or in the Security Documents)
release any collateral or otherwise terminate any Lien under any
Basic Document providing for collateral security, or agree to
additional obligations being secured by such collateral security,
except that no such consent shall be required, and the Agent is
hereby authorized, to release any Lien covering (i) Property that
is the subject of a disposition of Property permitted hereunder or
(ii) Receivables to the extent such Receivables secure other
Indebtedness expressly permitted by the Majority Revolving Credit
Lenders, Majority Tranche A Term Loan Lenders and Majority Tranche
B Term Loan Lenders.
11.10 Collateral Sub-Agents. Each Lender by its
execution and delivery of this Agreement agrees, as contemplated
by Section 4.03 of the Security Agreement, that, in the event it
shall hold any Permitted Investments referred to therein, such
Permitted Investments shall be held in the name and under the
control of such Lender, and such Lender shall hold such Permitted
Investments as a collateral sub-agent for the Agent thereunder.
The Obligors by their execution and delivery of this Agreement
hereby consent to the foregoing.
Section 12. Miscellaneous.
12.01 Waiver. No failure on the part of the Agent or
any Lender to exercise and no delay in exercising, and no course
of dealing with respect to, any right, power or privilege under
this Agreement or any Note shall operate as a waiver thereof, nor
shall any single or partial exercise of any right, power or
privilege under this Agreement or any Note preclude any other or
further exercise thereof or the exercise of any other right, power
or privilege. The remedies provided herein are cumulative and not
exclusive of any remedies provided by law.
12.02 Notices. Except as otherwise expressly provided
herein or in the Security Documents, all notices, requests and
other communications provided for herein and under the Security
Documents (including, without limitation, any modifications of, or
waivers, requests or consents under, this Agreement) shall be
given or made in writing (including, without limitation, by
telecopy) delivered to the intended recipient at the "Address for
Notices" specified below its name on the signature pages hereof
(below the name of the Company, in the case of the Guarantor);
or, as to any party, at such other address as shall be designated
by such party in a notice to each other party. Except as
otherwise provided in this Agreement, all such communications
shall be deemed to have been duly given when transmitted by
telecopier or personally delivered or, in the case of a mailed
notice, upon receipt, in each case given or addressed as
aforesaid.
12.03 Expenses, Etc. The Obligors agree, jointly and
severally, to pay or reimburse each of the Lenders and the Agent
for: (a) all reasonable out-of-pocket costs and expenses of the
Agent (including, without limitation, the reasonable fees and
expenses of Milbank, Tweed, Hadley & McCloy, special New York
counsel to Chase) in connection with (i) the negotiation,
preparation, execution and delivery of this Agreement and the
other Basic Documents and the extension of credit hereunder and
(ii) the negotiation or preparation of any modification,
supplement or waiver of any of the terms of this Agreement or any
of the other Basic Documents (whether or not consummated);
(b) all reasonable out-of-pocket costs and expenses of the Lenders
and the Agent (including, without limitation, the reasonable fees
and expenses of legal counsel for the Agent and one legal counsel
for the Lenders) in connection with (i) any Default and any
enforcement or collection proceedings resulting therefrom,
including, without limitation, all manner of participation in or
other involvement with (x) bankruptcy, insolvency, receivership,
foreclosure, winding up or liquidation proceedings, (y) judicial
or regulatory proceedings and (z) workout, restructuring or other
negotiations or proceedings (whether or not the workout,
restructuring or transaction contemplated thereby is consummated)
and (ii) the enforcement of this Section 12.03; (c) all transfer,
stamp, documentary or other similar taxes, assessments or charges
levied by any governmental or revenue authority in respect of this
Agreement or any of the other Basic Documents or any other
document referred to herein or therein and all costs, expenses,
taxes, assessments and other charges incurred in connection with
any filing, registration, recording or perfection of any security
interest contemplated by any Basic Document or any other document
referred to therein; and (d) all costs, expenses and other charges
in respect of title insurance procured with respect to the Liens
created pursuant to the Mortgages.
The Obligors hereby agree, jointly and severally, to
indemnify the Agent and each Lender and their respective
directors, officers, employees, attorneys and agents from, and
hold each of them harmless against, any and all losses,
liabilities, claims, damages or expenses incurred by any of them
(including, without limitation, any and all losses, liabilities,
claims, damages or expenses incurred by the Agent to any Lender,
whether or not the Agent or any Lender is a party thereto) arising
out of or by reason of any investigation or litigation or other
proceedings (including any threatened investigation or litigation
or other proceedings) relating to the extensions of credit
hereunder or any actual or proposed use by the Guarantor or any of
its Subsidiaries of the proceeds of any of the extensions of
credit hereunder, including, without limitation, the reasonable
fees and disbursements of counsel incurred in connection with any
such investigation or litigation or other proceedings (but
excluding any such losses, liabilities, claims, damages or
expenses incurred by reason of the gross negligence or willful
misconduct of the Person to be indemnified or solely by reason of
a breach of this Agreement by such Person). Without limiting the
generality of the foregoing, the Obligors will (x) indemnify the
Agent for any payments that the Agent is required to make under
any indemnity issued to any bank referred to in
Section 4.02 of the Security Agreement to which remittances in
respect to Accounts, as defined therein, are to be made and (y)
indemnify the Agent and each Lender from, and hold the Agent and
each Lender harmless against, any losses, liabilities, claims,
damages or expenses described in the preceding sentence (including
any Lien filed against any Property covered by the Mortgages or
any part of the thereunder in favor of any governmental entity,
but excluding, as provided in the preceding sentence, any loss,
liability, claim, damage or expense incurred by reason of the
gross negligence or willful misconduct of the Person to be
indemnified) arising under any Environmental Law as a result of
the past, present or future operations of the Company or any of
its Subsidiaries (or any predecessor in interest to the Company or
any of its Subsidiaries), or the past, present or future condition
of any site or facility owned, operated or leased at any time by
the Company or any of its Subsidiaries (or any such predecessor in
interest), or any Release or threatened Release of any Hazardous
Materials at or from any such site or facility, including any such
Release or threatened Release that shall occur during any period
when the Agent or any Lender shall be in possession of any such
site or facility following the exercise by the Agent or any Lender
of any of its rights and remedies hereunder or under any of the
Security Documents.
12.04 Amendments, Etc. Except as otherwise expressly
provided in this Agreement, any provision of this Agreement may be
modified or supplemented only by an instrument in writing signed
by the Guarantor, the Company and the Majority Lenders, or by the
Guarantor, the Company and the Agent acting with the consent of
the Majority Lenders, and any provision of this Agreement may be
waived by the Majority Lenders or by the Agent acting with the
consent of the Majority Lenders; provided that (a) no
modification, supplement or waiver shall, unless by an instrument
signed by all of the Lenders or by the Agent acting with the
consent of all of the Lenders: (i) increase, or extend the term
of any of the Commitments, or extend the time or waive any
requirement for the reduction or termination of any of the
Commitments, (ii) extend the date fixed for the payment of
principal of or interest on any Loan, the Reimbursement
Obligations or any fee hereunder, (iii) reduce the amount of any
such payment of principal, (iv) reduce the rate at which interest
is payable thereon or any fee is payable hereunder, (v) alter the
rights or obligations of the Company to prepay Loans (except in
connection with any transaction contemplated by clause (ii) to the
proviso to Section 11.09 hereof), (vi) alter the terms of this
Section 12.04, (vii) modify the definition of the term "Majority
Lenders", "Majority Revolving Credit Lenders" or "Majority Term
Lenders", or modify in any other manner the number or percentage
of the Lenders required to make any determinations or waive any
rights hereunder or to modify any provision hereof, (viii) waive
any of the conditions precedent set forth in Section 7.01 or 7.02
hereof or (ix) release the Guarantor from any of its obligations
under Section 6 hereof; (b) no modification, supplement or waiver
shall (i) modify in any manner any of Sections 2.01(a), 2.03,
9.01(g), 9.01(i), and 9.01(l) hereof or (ii) modify the definition
of the term "Borrowing Base", "Borrowing Base Certificate",
"Eligible Inventory", "Ineligible Receivable", "Inventory",
"Letter of Credit Documents", "Letter of Credit Interest", "Letter
of Credit Liability", "Receivable Adjustments" or "Receivables",
without the consent of the Majority Revolving Credit Lenders; (c)
no waiver or modification with respect to clause (i) of Section
11.03 of the Senior Subordinated Loan Agreement or any similar
provision in any agreement or instrument evidencing Subordinated
Indebtedness shall be effective without the consent of the Lenders
holding at least 66 2/3% of the sum of (i) the aggregate
unused Commitments, (ii) the aggregate unpaid principal amount of
the Loans and (iii) the aggregate amount of all Letter of Credit
Liabilities (the "Supermajority Lenders"); and (d) any
modification of any of the rights or obligations of the Agent or
the Issuing Bank hereunder (including, without limitation, any of
the provisions of Section 11.08 hereof) shall require the consent
of the Agent or the Issuing Bank (as the case may be).
12.05 Successors and Assigns. This Agreement shall be
binding upon and inure to the benefit of the parties hereto and
their respective successors and permitted assigns.
12.06 Assignments and Participations.
(a) No Obligor may assign any of its rights or
obligations hereunder or under the Notes without the prior consent
of all of the Lenders and the Agent.
(b) Each Lender may assign any of its Loans, its Notes,
its Commitments, and, if such Lender is a Revolving Credit Lender,
its Letter of Credit Interest (but only with the consent of, in
the case of its outstanding Commitments, the Company and the Agent
and, in the case of the Revolving Credit Commitment or a Letter of
Credit Interest, the Issuing Bank); provided that
(i) no such consent by the Company or the Agent shall
be required in the case of any assignment to another Lender;
(ii) except to the extent the Company and the Agent
shall otherwise consent, any such partial assignment (other
than to another Lender) shall be in an amount at least equal
to $5,000,000 (or, if less, the aggregate unpaid principal
amount of the Loans and the aggregate Commitments of such
Lender);
(iii) each such assignment by a Lender of its Revolving
Credit Loans, Revolving Credit Note, Revolving Credit
Commitment or Letter of Credit Interest shall be made in such
manner so that the same portion of its Revolving Credit
Loans, Revolving Credit Note, Revolving Credit Commitment and
Letter of Credit Interest is assigned to the respective
assignee;
(iv) each such assignment by a Lender of its Term Loans
or Term Loan Commitment shall be made in such manner so that
the same portion of its Term Loans and Term Loan Commitment,
as the case may be, is assigned to the respective assignee;
(v) upon each such assignment, the assignor and
assignee shall deliver to the Company, the Agent and the
Issuing Bank a Notice of Assignment in the form of Exhibit J
hereto; and
(vi) no consent required of the Company or the Agent
under this Section 12.06(b) shall be unreasonably withheld or
delayed.
Upon execution and delivery by the assignor and the assignee to
the Company, the Agent and the Issuing Bank of such Notice of
Assignment, and upon consent thereto by the Company, the Agent and
the Issuing Bank to the extent required above, the assignee shall
have, to the extent of such assignment (unless otherwise consented
to by the Company, the Agent and the Issuing Bank), the
obligations, rights and benefits of a Lender hereunder holding the
Commitment(s), Loans and, if applicable, Letter of Credit Interest
(or portions thereof) assigned to it and specified in
such Notice of Assignment (in addition to the Commitment(s), Loans
and Letter of Credit Interest, if any, theretofore held by such
assignee) and the assigning Lender shall, to the extent of such
assignment, be released from the Commitment(s) (or portion(s)
thereof) so assigned. Upon each such assignment the assigning
Lender shall pay the Agent an assignment fee of $3,000; provided
that in the case of any such assignment to a Proposed Lender (as
defined in Section 5.08 hereof), such assignment fee shall be paid
by the Company.
(c) A Lender may sell or agree to sell to one or more
other Persons a participation in all or any part of any Loans or
Letter of Credit Interest held by it, or in its Commitments, in
which event each purchaser of a participation (a "Participant")
shall be entitled to the rights and benefits of the provisions of
Section 9.01(m) hereof with respect to its participation in such
Loans, Letter of Credit Interest and Commitments as if (and the
Company shall be directly obligated to such Participant under such
provisions as if) such Participant were a "Lender" for purposes of
said Section, but, except as otherwise provided in Section 4.07(c)
hereof, shall not have any other rights or benefits under this
Agreement or any Note or any other Basic Document (the
Participant's rights against such Lender in respect of such
participation to be those set forth in the agreements executed by
such Lender in favor of the Participant). All amounts payable by
the Company to any Lender under Section 5 hereof in respect of
Loans, Letter of Credit Interest held by it, and its Commitments,
shall be determined as if such Lender had not sold or agreed to
sell any participations in such Loans, Letter of Credit Interest
and Commitments, and as if such Lender were funding each of such
Loan, Letter of Credit Interest and Commitments in the same way
that it is funding the portion of such Loan, Letter of Credit
Interest and Commitments in which no participations have been
sold. In no event shall a Lender that sells a participation agree
with the Participant to take or refrain from taking any action
hereunder or under any other Basic Document except that such
Lender may agree with the Participant that it will not, without
the consent of the Participant, agree to (i) increase or extend
the term, or extend the time or waive any requirement for the
reduction or termination, of such Lender's related Commitment,
(ii) extend the date fixed for the payment of principal of or
interest on the related Loan or Loans, Reimbursement Obligations
or any portion of any fee hereunder payable to the Participant,
(iii) reduce the amount of any such payment of principal, (iv)
reduce the rate at which interest is payable thereon, or any fee
hereunder payable to the Participant, to a level below the rate at
which the Participant is entitled to receive such interest or fee,
(v) alter the rights or obligations of the Company to prepay the
related Loans or (vi) consent to any modification, supplement or
waiver hereof or of any of the other Basic Documents to the extent
that the same, under Section 11.09 or 12.04 hereof, requires the
consent of each Lender.
(d) In addition to the assignments and participations
permitted under the foregoing provisions of this Section 12.06,
any Lender may (without notice to the Company, the Agent or any
other Lender and without payment of any fee) (i) assign and pledge
all or any portion of its Loans and its Notes to any Federal
Reserve Bank as collateral security pursuant to Regulation A and
any Operating Circular issued by such Federal Reserve Bank and
(ii) assign all or any portion of its rights under this Agreement
and its Loans and its Notes to an affiliate. No such assignment
shall release the assigning Lender from its obligations hereunder.
(e) A Lender may furnish any information concerning
the Obligors or any of their respective Subsidiaries in the
possession of such Lender from time to time to assignees and
participants (including prospective assignees and participants),
subject, however, to the provisions of Section 12.12(b) hereof.
(f) Anything in this Section 12.06 to the contrary
notwithstanding, no Lender may assign or participate any interest
in any Loan or Reimbursement Obligation held by it hereunder to
the Company or any of its Affiliates or Subsidiaries without the
prior consent of each Lender.
(g) At the request of any Lender that is not a
U.S. Person and is not a "bank" within the meaning of
Section 881(c)(3)(A) of the Code, the Company shall maintain, or
cause to be maintained, a register (the "Register") that, at the
request of the Company, shall be kept by the Agent on behalf of
the Company at no charge to the Company at the address to which
notices to the Agent are to be sent hereunder, on which it enters
the name of such Lender as the registered owner of each Registered
Loan held by such Lender. A Registered Loan (and the Registered
Note, if any, evidencing the same) may only be assigned or
otherwise transferred in whole or in part by registration of such
assignment or transfer on the Register (and each Registered Note
shall expressly so provide). Any assignment or transfer of all or
part of such Loan (and the Registered Note, if any, evidencing the
same) shall be effected by registration of such assignment or
transfer on the Register, together with the surrender of the
Registered Note, if any, evidencing the same duly endorsed by (or
accompanied by a written instrument of assignment or transfer duly
executed by) the holder of such Registered Note, whereupon, at the
request of the designated assignee(s) or transferee(s), one or
more new Registered Notes in the same aggregate principal amount
shall be issued to the designated assignee(s) or transferee(s).
Prior to the registration of assignment or transfer of any
Registered Loan (and the Registered Note, if any, evidencing the
same), the Company shall treat the Person in whose name such Loan
(and the Registered Note, if any, evidencing the same) is
registered as the owner thereof for the purpose of receiving all
payments thereon and for all other purposes, notwithstanding
notice to the contrary.
(h) The Register shall be available for inspection by
the Company and any Lender that is a Registered Holder at any
reasonable time upon reasonable prior notice.
12.07 Survival. The obligations of the Obligors under
the last paragraph of Section 2.03 hereof and under Sections 5.01,
5.05, 5.06, 5.07 and 12.03 hereof and under Section 6.03 of the
Security Agreement and Section 4.13 of the Pledge Agreement, the
obligations of the Guarantor under Section 6.03 hereof, and the
obligations of the Lenders under Section 11.05 hereof, shall
survive the repayment of the Loans and Reimbursement Obligations
and the termination of the Commitments and, in the case of any
Lender that may assign any interest in its Commitments, Loans or
Letter of Credit Interest hereunder, shall survive the making of
such assignment, notwithstanding that such assigning Lender may
cease to be a "Lender" hereunder. In addition, each
representation and warranty made, or deemed to be made by a notice
of any extension of credit (whether by means of a Loan or a Letter
of Credit), herein or pursuant hereto shall survive the making of
such representation and warranty, and no Lender shall be deemed to
have waived, by reason of making any extension of credit hereunder
(whether by means of a Loan or a Letter of Credit), any Default
that may arise by reason of such representation or warranty
proving to have been false or
misleading, notwithstanding that such Lender or the Agent may have
had notice or knowledge or reason to believe that such
representation or warranty was false or misleading at the time
such extension of credit was made.
12.08 Captions. The table of contents and captions and
section headings appearing herein are included solely for
convenience of reference and are not intended to affect the
interpretation of any provision of this Agreement.
12.09 Counterparts. This Agreement may be executed in
any number of counterparts, all of which taken together shall
constitute one and the same instrument and any of the parties
hereto may execute this Agreement by signing any such counterpart.
12.10 Governing Law; Submission to Jurisdiction. This
Agreement and the Notes shall be governed by, and construed in
accordance with, the law of the State of New York. Each Obligor
hereby submits to the nonexclusive jurisdiction of the United
States District Court for the Southern District of New York and of
the Supreme Court of the State of New York sitting in New York
County (including its Appellate Division), and of any other
appellate court in the State of New York, for the purposes of all
legal proceedings arising out of or relating to the Basic
Documents or the transactions contemplated hereby. Each Obligor
hereby irrevocably waives, to the fullest extent permitted by
applicable law, any objection that it may now or hereafter have to
the laying of the venue of any such proceeding brought in such a
court and any claim that any such proceeding brought in such a
court has been brought in an inconvenient forum.
12.11 Waiver of Jury Trial. EACH OF THE OBLIGORS, THE
AGENT AND THE LENDERS HEREBY IRREVOCABLY WAIVES, TO THE FULLEST
EXTENT PERMITTED BY APPLICABLE LAW, ANY AND ALL RIGHT TO TRIAL BY
JURY IN ANY LEGAL PROCEEDING ARISING OUT OF OR RELATING TO THE
BASIC DOCUMENTS, THE NOTES OR THE TRANSACTIONS CONTEMPLATED HEREBY
OR THEREBY.
12.12 Treatment of Certain Information;
Confidentiality.
(a) Each Obligor acknowledges that from time to time
financial advisory, investment banking and other services may be
offered or provided to such Obligor or one or more of its
Subsidiaries (in connection with this Agreement or otherwise) by
any Lender or by one or more subsidiaries or affiliates of such
Lender and each Obligor hereby authorizes each Lender to share any
information delivered to such Lender by such Obligor and its
Subsidiaries pursuant to this Agreement, or in connection with the
decision of such Lender to enter into this Agreement, with any
such subsidiary or affiliate, it being understood that any such
subsidiary or affiliate receiving such information shall be bound
by the provisions of paragraph (b) below as if it were a Lender
hereunder. Such authorization shall survive the repayment of the
Loans and Reimbursement Obligations and the termination of the
Commitments.
(b) Each Lender and the Agent agrees (on behalf of
itself and each of its affiliates, directors, officers, employees
and representatives) to use reasonable precautions to keep
confidential, in accordance with their customary procedures for
handling confidential information of the same nature and in
accordance with safe and sound banking practices, any non-public
information supplied to it by any Obligor pursuant to this
Agreement that is identified by such Person as being confidential
at the time the same is delivered to the Lenders or the Agent,
provided that nothing herein shall limit the disclosure of any
such information (i) to the extent required by statute, rule,
regulation or judicial process, (ii) to counsel for any of the
Lenders or the Agent, (iii) to regulatory personnel, auditors or
accountants, (iv) to the Agent or any other Lender (or to Chase
Securities, Inc.), (v) in connection with any litigation related
to the Acquisition or the transactions contemplated by the Credit
Agreement or the other Basic Documents to which the Agent or any
of the Lenders is a party, (vi) to a subsidiary or affiliate of
such Lender as provided in paragraph (a) above or (vii) to any
assignee or participant (or prospective assignee or participant)
so long as such assignee or participant (or prospective assignee
or participant) first executes and delivers to the respective
Lender a Confidentiality Agreement substantially in the form of
Exhibit I hereto (or executes and delivers to such Lender an
acknowledgement to the effect that it is bound by the provisions
of this Section 12.12(b), which acknowledgement may be included as
part of the respective assignment or participation agreement
pursuant to which such assignee or participant acquires an
interest in the Loans or Letter of Credit Interest hereunder);
provided, further, that in no event shall any Lender or the Agent
be obligated or required to return any materials furnished by any
Obligor. The obligations of any assignee that has executed a
Confidentiality Agreement in the form of Exhibit I hereto shall be
superseded by this Section 12.12 upon the date upon which such
assignee becomes a Lender hereunder pursuant to Section 12.06(b)
hereof.
12.13 Certain Tax Information. The Company shall
provide in writing to the Lenders on a timely basis such
information, if any, required by Treasury Regulation Section
1.1275-2(e).
IN WITNESS WHEREOF, the parties hereto have caused this
Agreement to be duly executed and delivered as of the day and year
first above written.
ASSOCIATED STATIONERS, INC.
By_________________________ Title:
Address for Notices:
1075 Hawthorn Drive
Itasca, IL 60143
Attention: Daniel H. Bushell
Telecopier No.: (708) 775-7509
Telephone No.: (708) 775-7575
ASSOCIATED HOLDINGS, INC.
By_________________________
Title:
Address for Notices:
1075 Hawthorn Drive
Itasca, IL 60143
Attention: Daniel H. Bushell
Telecopier No.: (708) 775-7509
Telephone No.: (708) 775-7575
LENDERS
THE CHASE MANHATTAN BANK (NATIONAL
ASSOCIATION)
By_________________________
Revolving Credit Commitment Title: Vice President
$24,968,750.00
Tranche A Term
Loan Commitment
$15,280,000.00 Lending Office for
all Loans:
The Chase Manhattan Bank Tranche
B Term (National Association)
Loan Commitment 1 Chase Manhattan Plaza
$42,500,000.00 New York, New York 10081
Address for Notices:
The Chase Manhattan Bank
(National Association)
1 Chase Manhattan Plaza
New York, New York 10081
Attention: John Coyle
Telecopier No.: (212) 552-7075
Telephone No.: (212) 552-5878
ARAB BANKING CORPORATION
(B.S.C.)
Revolving Credit Commitment By_____________________________
$15,268,750.00 Title:
Tranche A Term
Loan Commitment Lending Office for Base Rate
$6,370,000.00 Loans:
Tranche B Term Arab Banking Corp.
Loan Commitment 245 Park Avenue
$5,000,000.00 31st Floor
New York, NY 10167
Lending Office for Eurodollar
Loans:
Arab Banking Corp. (Grand
Cayman)
245 Park Avenue
31st Floor
New York, NY 10167
Address for Notices:
Arab Banking Corp.
245 Park Avenue
31st Floor
New York, NY 10167
Attention: Mr. Grant E.
McDonald
Telecopier No.: (212) 599-8385
Telephone No.: (212) 850-0813
BANK OF AMERICA ILLINOIS
Revolving Credit Commitment By_____________________________
$15,268,750.00 Title:
Tranche A Term Lending Office for Base Rate
Loan Commitment Loans:
$6,370,000.00
Bank of America Illinois
Tranche B Term 2850 W. Golf Road
Loan Commitment Suite 308
N/A Rolling Meadows, IL 60008
Lending Office for Eurodollar
Loans:
Bank of America Illinois
2850 W. Golf Road
Suite 308
Rolling Meadows, IL 60008
Address for Notices:
Bank of America Illinois
2850 W. Golf Road
Suite 308
Rolling Meadows, IL 60008
Attention: Richard J. Kerbis
Telecopier No.: (708) 952-1136
Telephone No.: (708) 952-1110
Revolving Credit Commitment$15,268,750.00
Tranche A Term
Loan Commitment$6,370,000.00
Tranche B Term
Loan CommitmentN/A
THE BANK OF NEW YORK
By_____________________________
Title:
Lending Office for Base Rate
Loans:
The Bank of New York
101 Barclay Street
New York, NY 10007
Lending Office for Eurodollar
Loans:
The Bank of New York
101 Barclay Street
New York, NY 10007
Address for Notices:
The Bank of New York
One Wall Street
19th Floor
New York, NY 10286
Attention: Yvonne Forbes
Assistant Treasurer
Telecopier No.: (212) 635-1208/
1209
Telephone No.: (212) 635-6691
Revolving Credit Commitment$15,268,750.00
Tranche A Term
Loan Commitment$6,370,000.00
Tranche B Term
Loan Commitment$5,000,000.00
THE FIRST NATIONAL BANK OF
CHICAGO
By_____________________________
Title:
Lending Office for Base Rate
Loans:
The First National Bank of
Chicago
One First National Plaza
Chicago, IL 60670
Lending Office for Eurodollar
Loans:
The First National Bank of
Chicago
One First National Plaza
Chicago, IL 60670
Address for Notices:
The First National Bank of
Chicago
One First National Plaza
Suite 0173
Chicago, IL 60670
Attention: Julia A. Bristow
Telecopier No.: (312) 732-2715
Telephone No.: (312) 732-4116
Revolving Credit Commitment$15,268,750.00
Tranche A Term
Loan Commitment$6,370,000.00
Tranche B Term
Loan CommitmentN/A
THE LONG-TERM CREDIT BANK OF
JAPAN, LTD., CHICAGO BRANCH
By_____________________________
Title:
Lending Office for Base Rate
Loans:
The Long-Term Bank of Japan,
Chicago Branch
190 South LaSalle Street
Suite 800
Chicago, IL 60603
Lending Office for Eurodollar
Loans:
The Long-Term Bank of Japan,
Chicago Branch
190 South LaSalle Street
Suite 800
Chicago, IL 60603
Address for Notices:
The Long-Term Bank of Japan,
Chicago Branch
190 South LaSalle Street
Suite 800
Chicago, IL 60603
Attention: Kevin Murata
Telecopier No.: (312) 704-8505
Telephone No.: (312) 704-5485
Revolving Credit Commitment$15,268,750.00
Tranche A Term
Loan Commitment$6,370,000.00
Tranche B Term
Loan CommitmentN/A
NATIONSBANK, N.A. (CAROLINAS)
By_____________________________
Title:
Lending Office for Base Rate
Loans:
NationsBank, N.A. (Carolinas)
One Independence Center
101 N. Tryon Street
Charlotte, NC 28255
Lending Office for Eurodollar
Loans:
NationsBank, N.A. (Carolinas)
One Independence Center
101 N. Tryon Street
Charlotte, NC 28255
Address for Notices:
NationsBank, N.A. (Carolinas)
One Independence Center
101 N. Tryon Street
Charlotte, NC 28255
Attention: Kathy Mumpower
Telecopier No.: (704) 386-8694
Telephone No.: (704) 386-7429
Revolving Credit Commitment$15,268,750.00
Tranche A Term
Loan Commitment$6,370,000.00
Tranche B Term
Loan CommitmentN/A
PNC BANK, NATIONAL ASSOCIATION
By_____________________________
Title:
Lending Office for Base Rate
Loans:
PNC Bank, N.A.
500 W. Madison St.
Suite 3140
Chicago, IL 60661
Lending Office for Eurodollar
Loans:
PNC Bank, N.A.
500 W. Madison St.
Suite 3140
Chicago, IL 60661
Address for Notices:
PNC Bank, N.A.
500 W. Madison St.
Suite 3140
Chicago, IL 60661
Attention: Tammy Dunn
Telecopier No.: (312) 906-3420
Telephone No.: (312) 906-3403
Revolving Credit Commitment
N/A
Tranche A Term Loan Commitment
N/A
Tranche B Term Loan Commitment
$20,000,000.00VAN KAMPEN MERRITT PRIME RATE INCOME TRUST
By_____________________________
Title:
Lending Office for all Loans:
State Street Bank and Trust Company
2 International Place Boston, MA 02110
Address for Notices:
Van Kampen Merritt Prime Rate
Income Trust One Parkview Plaza
Oakbrook Terrace, IL 60181
Attention: Brian Murphy
Telecopier No.: (708) 684- 6740
Telephone No.: (708) 684
6479
With a copy to:
State Street Bank and Trust Company
2 International Place Boston, MA 02110
Attention: Laura Magazu
Telecopier No.: (617) 664-
5366
Telephone No.: (617) 664- 5478
Revolving Credit Commitment$11,730,000.00
Tranche A Term
Loan Commitment$4,804,600.00
Tranche B Term
Loan CommitmentN/A
BANK ONE, MILWAUKEE, NA
By_____________________________
Title:
Lending Office for Base Rate
Loans:
Bank One, Milwaukee, NA
111 East Wisconsin Avenue
Milwaukee, WI 53202
Lending Office for Eurodollar
Loans:
Bank One, Milwaukee, NA
111 East Wisconsin Avenue
Milwaukee, WI 53202
Address for Notices:
Bank One, Milwaukee, NA
111 East Wisconsin Avenue
Milwaukee, WI 53202
Attention: Kathy Wadsworth
Telecopier No.: (414) 765-2176
Telephone No.: (414) 765-2135
Revolving Credit Commitment
$11,730,000.00
Tranche A Term Loan Commitment $4,804,600.00
Tranche B Term Loan Commitment
N/ATHE CIT GROUP/BUSINESS CREDIT, INC.
By_____________________________
Title:
Lending Office for Base Rate Loans:
The CIT Group/Business Credit,
Inc. 2110 Walnut Hill Lane #220
Irving, TX 75038
Lending Office for Eurodollar Loans:
The CIT Group/Business Credit,
Inc. 2110 Walnut Hill Lane #220
Irving, TX 75038
Address for Notices:
The CIT Group/Business Credit, Inc.
2110 Walnut Hill Lane #220 Irving, TX 75038
Attention: Carolyn Hawkins
Telecopier No.: (214) 550-9035
Telephone No.: (214) 580-2773
Revolving Credit Commitment$11,730,000.00
Tranche A Term
Loan Commitment$4,804,600.00
Tranche B Term
Loan CommitmentN/A
NATIONAL CANADA FINANCE
CORPORATION
By_____________________________
Title:
By_____________________________
Title:
Lending Office for Base Rate
Loans:
National Bank of Canada
225 W. Washington, Suite 1100
Chicago, IL 60606
Lending Office for Eurodollar
Loans:
National Bank of Canada
225 W. Washington, Suite 1100
Chicago, IL 60606
Address for Notices:
National Bank of Canada
225 W. Washington, Suite 1100
Chicago, IL 60606
Attention: Bradley Crawford
Telecopier No.: (312) 558-8888
Telephone No.: (312) 558-8879
Revolving Credit Commitment$11,730,000.00
Tranche A Term
Loan Commitment$4,804,600.00
Tranche B Term
Loan CommitmentN/A
SANWA BUSINESS CREDIT
CORPORATION
By_____________________________
Title:
Lending Office for Base Rate
Loans:
Sanwa Business Credit
Corporation
One South Wacker Drive
Suite 2800
Chicago, IL 60606
Lending Office for Eurodollar
Loans:
Sanwa Business Credit
Corporation
One South Wacker Drive
Suite 2800
Chicago, IL 60606
Address for Notices:
Sanwa Business Credit
Corporation
One South Wacker Drive
Suite 2800
Chicago, IL 60606
Attention: Andrew J. Heinz
Telecopier No.: (312) 782-6035
Telephone No.: (312) 853-1327
Revolving Credit Commitment
$11,730,000.00
Tranche A Term Loan Commitment
$4,804,600.00
Tranche B Term Loan Commitment
N/ATRANSAMERICA BUSINESS CREDIT CORPORATION
By_____________________________
Title:
Lending Office for Base Rate Loans:
TransAmerica Business Credit
Corporation
Lending Office for Eurodollar Loans:
TransAmerica Business Credit
Corporation
Address for Notices:
TransAmerica Business Credit Corporation
Attention:
Telecopier No.:
Telephone No.:
Revolving Credit Commitment$9,500,000.00
Tranche A Term
Loan Commitment$3,950,000.00
Tranche B Term
Loan Commitment$2,500,000.00
BANK OF SCOTLAND
By_____________________________
Title:
Lending Office for Base Rate
Loans:
Bank of Scotland
565 Fifth Avenue
New York, NY 10017
Lending Office for Eurodollar
Loans:
Bank of Scotland
565 Fifth Avenue
New York, NY 10017
Address for Notices:
Bank of Scotland
565 Fifth Avenue
New York, NY 10017
Attention: Janet Taffe
Assistant Vice
President
Telecopier No.: (212) 557-9460
Telephone No.: (212) 557-0872
Revolving Credit Commitment$9,500,000.00
Tranche A Term
Loan Commitment$3,950,000.00
Tranche B Term Loan
CommitmentN/A
THE NORTHERN TRUST COMPANY
By_____________________________
Title: Vice President
Lending Office for Base Rate
Loans:
The Northern Trust Company
50 LaSalle Street
Chicago, Illinois 60675
Lending Office for Eurodollar
Loans:
The Northern Trust Company
50 LaSalle Street
Chicago, Illinois 60675
Address for Notices:
The Northern Trust Company
Chicago Division, B-11
Chicago, Illinois 60675
Attention: Stephanie Taylor
Telecopier No.: (312) 630-1566
Telephone No.: (312) 444-7669
Revolving Credit Commitment$8,500,000.00
Tranche A Term
Loan Commitment$3,023,000.00
Tranche B Term
Loan CommitmentN/A
CORESTATES BANK, N.A.
By_____________________________
Title:
Lending Office for Base Rate
Loans:
CoreStates Bank, N.A.
1345 Chestnut St.
FC 1-8-3-12
Philadelphia, PA 19101-7618
Lending Office for Eurodollar
Loans:
CoreStates Bank, N.A.
1345 Chestnut St.
FC 1-8-3-12
Philadelphia, PA 19101-7618
Address for Notices:
CoreStates Bank, N.A.
1345 Chestnut St.
FC 1-8-3-12
Philadelphia, PA 19101-7618
Attention: Louise Clair
Telecopier No.: (215) 973-2045
Telephone No.: (215) 786-7454
Revolving Credit Commitment$8,500,000.00
Tranche A Term
Loan Commitment$3,023,000.00
Tranche B Term
Loan CommitmentN/A
COMERICA BANK
By_____________________________
Title:
Lending Office for Base Rate
Loans:
Comerica Bank
500 Woodward Ave., MC 3279
Detroit, MI 48226
Lending Office for Eurodollar
Loans:
Comerica Bank
500 Woodward Ave., MC 3279
Detroit, MI 48226
Address for Notices:
Comerica Bank
500 Woodward Ave., MC 3279
Detroit, MI 48226
Attention: David L. Morrison
Telecopier No.: (313) 222-3330
Telephone No.: (313) 222-3808
Revolving Credit Commitment$8,500,000.00
Tranche A Term
Loan Commitment$3,023,000.00
Tranche B Term
Loan CommitmentN/A
THE FIRST NATIONAL BANK OF
MARYLAND
By_____________________________
Title:
Lending Office for Base Rate
Loans:
The First National Bank of
Maryland
25 South Charles Street
Baltimore, MD 21201
Lending Office for Eurodollar
Loans:
The First National Bank of
Maryland
25 South Charles Street
Baltimore, MD 21201
Address for Notices:
The First National Bank of
Maryland
18th Floor
25 South Charles Street
Baltimore, MD 21201
Attention: Andrew W. Fish
Telecopier No.: (410) 244-4295
Telephone No.: (410) 244-4217
Revolving Credit Commitment
$8,500,000.00
Tranche A Term Loan Commitment
$3,023,000.00
Tranche B Term Loan Commitment
N/ATHE MITSUBISHI TRUST AND BANKING CORPORATION CHICAGO BRANCH
By_____________________________
Title:
Lending Office for Base Rate Loans:
The Mitsubishi Trust & Banking
Corp., Chicago Branch 440 S. LaSalle, Suite 3100
Chicago, IL 60610
Lending Office for Eurodollar Loans:
The Mitsubishi Trust & Banking
Corp., Chicago Branch 440 S. LaSalle, Suite 3100
Chicago, IL 60610
Address for Notices:
The Mitsubishi Trust & Banking Corp., Chicago Branch
440 S. LaSalle, Suite 3100 Chicago, IL 60610
Attention: Violetta Smith
David Miller
Telecopier No.: (312) 663-0863
Telephone No.: (312) 408-6035
Revolving Credit Commitment$8,500,000.00
Tranche A Term
Loan Commitment$3,023,000.00
Tranche B Term
Loan CommitmentN/A
NBD BANK
By_____________________________
Title:
Lending Office for Base Rate
Loans:
NBD Bank
611 Woodward Avenue
Detroit, MI 48226
Lending Office for Eurodollar
Loans:
NBD Bank
611 Woodward Avenue
Detroit, MI 48226
Address for Notices:
NBD Bank
611 Woodward Avenue
Detroit, MI 48226
Attention: Jenny Gilpin
Telecopier No.: (313) 225-3269
Telephone No.: (313) 225-4247
Revolving Credit Commitment$8,500,000.00
Tranche A Term
Loan Commitment$3,023,000.00
Tranche B Term
Loan CommitmentN/A
BANQUE PARIBAS
By_____________________________
Title:
By_____________________________
Title:
Lending Office for Base Rate
Loans:
Banque Paribas
1200 Smith Street
Suite 3100
Houston, TX 77002
Lending Office for Eurodollar
Loans:
Banque Paribas
1200 Smith Street
Suite 3100
Houston, TX 77002
Address for Notices:
Banque Paribas
1200 Smith Street
Suite 3100
Houston, TX 77002
Attention: Leah Hughes
Telecopier No.: (713) 659-3832
Telephone No.: (713) 659-4811
Revolving Credit Commitment$8,500,000.00
Tranche A Term
Loan Commitment$3,023,000.00
Tranche B Term
Loan CommitmentN/A
SOCIETY NATIONAL BANK
By_____________________________
Title:
Lending Office for Base Rate
Loans:
Society National Bank
127 Public Square
Cleveland, OH 44114
Lending Office for Eurodollar
Loans:
Society National Bank
127 Public Square
Cleveland, OH 44114
Address for Notices:
Society National Bank
127 Public Square
Cleveland, OH 44114
Attention: Rita Moenich
Telecopier No.: (216) 689-3298
Telephone No.: (216) 689-4401
Revolving Credit Commitment$8,500,000.00
Tranche A Term
Loan Commitment$3,023,000.00
Tranche B Term
Loan CommitmentN/A
THE BANK OF TOKYO TRUST COMPANY
By_____________________________
Title:
Lending Office for Base Rate
Loans:
The Bank of Tokyo Trust Co.
1251 Avenue of the Americas
New York, NY 10116-3138
Lending Office for Eurodollar
Loans:
The Bank of Tokyo Trust Co.
1251 Avenue of the Americas
New York, NY 10116-3138
Address for Notices:
The Bank of Tokyo Trust Co.
1251 Avenue of the Americas
New York, NY 10116-3138
Attention: Mr. Roland Uy
The Bank of Tokyo
Trust
Co.
12th Floor
1251 Avenue of the
Americas
New York, NY 10116-
3138
Telecopier No.: (212) 732-1678
Telephone No.: (212) 766-5461
Revolving Credit Commitment$8,500,000.00
Tranche A Term
Loan Commitment$3,023,000.00
Tranche B Term
Loan CommitmentN/A
UNION BANK
By_____________________________
Title:
Lending Office for Base Rate
Loans:
Union Bank
70 South Lake Street
Suite 900
Pasadena, CA 91101
Lending Office for Eurodollar
Loans:
Union Bank
70 South Lake Street
Suite 900
Pasadena, CA 91101
Address for Notices:
Union Bank
70 South Lake Street
Suite 900
Pasadena, CA 91101
Attention: Corrina Lu
Telecopier No.: (818) 304-1846
1845
Telephone No.: (818) 304-1915
Revolving Credit Commitment$7,000,000.00
Tranche A Term
Loan Commitment$3,000,000.00
Tranche B Term
Loan CommitmentN/A
MICHIGAN NATIONAL BANK
By_____________________________
Title:
Lending Office for Base Rate
Loans:
Michigan National Bank
27777 Inkster Road 10-36
Farmington Hills, MI 48333-
9065
Lending Office for Eurodollar
Loans:
Michigan National Bank
27777 Inkster Road 10-36
Farmington Hills, MI 48333-
9065
Address for Notices:
Michigan National Bank
27777 Inkster Road 10-36
Farmington Hills, MI 48333-
9065
Attention: Thomas R. Kuslits
Telecopier No.: (810) 473-4345
Telephone No.: (810) 473-4380
Revolving Credit Commitment
$7,000,000.00
Tranche A Term Loan Commitment $3,000,000.00
Tranche B Term Loan Commitment
N/ACREDITANSTALT CORPORATE FINANCE, INC.
By_____________________________
Title:
By_____________________________ Title:
Lending Office for Base Rate
Loans:
CREDITANSTALT CORPORATE FINANCE, INC.
245 Park Avenue 27th Floor
New York, New York 10167
Lending Office for Eurodollar Loans:
CREDITANSTALT CORPORATE FINANCE,
INC. 245 Park Avenue
27th Floor New York, New York 10167
Address for Notices:
Creditanstalt Corporate
Finance, Inc.
2 Greenwich Plaza Greenwich, CT 06830
Attention: Catherine MacDonald
Telecopier No.: (203) 861-6594
Telephone No.: (203) 861-6592
THE CHASE MANHATTAN BANK (NATIONAL
ASSOCIATION),
as Agent
By____________________________
Title: Vice President
Address for Notices to
Chase as Agent:
The Chase Manhattan Bank
(National Association)
New York Agency
4 Metrotech Center -- 13th
Floor
Brooklyn, New York 11245
Attention: New York Agency
Telex No.: 6720516
(Answerback: CMBNYAUW)
Telecopier No.: (718) 242
6910
Telephone No.: (718) 2427979
EXHIBIT A-1
[Form of Revolving Credit Note]
PROMISSORY NOTE
$_______________ March __, 1995
New York, New York
FOR VALUE RECEIVED, UNITED STATIONERS SUPPLY CO., an
Illinois corporation (the "Company"), hereby promises to pay to
__________________ (the "Lender") for account of its respective
Applicable Lending Offices provided for by the Credit Agreement
referred to below, at the principal office of The Chase Manhattan
Bank (National Association) at 1 Chase Manhattan Plaza, New York,
New York 10081, the principal sum of _______________ Dollars (or
such lesser amount as shall equal the aggregate unpaid principal
amount of the Revolving Credit Loans made by the Lender to the
Company under the Credit Agreement), in lawful money of the United
States of America and in immediately available funds, on the dates
and in the principal amounts provided in the Credit Agreement, and
to pay interest on the unpaid principal amount of each such
Revolving Credit Loan, at such office, in like money and funds,
for the period commencing on the date of such Revolving Credit
Loan until such Revolving Credit Loan shall be paid in full, at
the rates per annum and on the dates provided in the Credit
Agreement.
The date, amount, Type, interest rate and duration of
Interest Period (if applicable) of each Revolving Credit Loan made
by the Lender to the Company, and each payment made on account of
the principal thereof, shall be recorded by the Lender on its
books and, prior to any transfer of this Note, endorsed by the
Lender on the schedule attached hereto or any continuation
thereof, provided that the failure of the Lender to make any such
recordation or endorsement shall not affect the obligations of the
Company to make a payment when due of any amount owing under the
Credit Agreement or hereunder in respect of the Revolving Credit
Loans made by the Lender.
This Note is one of the Revolving Credit Notes referred
to in the Credit Agreement dated as of March 30, 1995 (as modified
and supplemented and in effect from time to time, the "Credit
Agreement") between the Company (as successor by merger to
Associated Stationers, Inc.), Associated Holdings, Inc. (and its
successor by merger, United Stationers Inc.), as parent guarantor,
the lenders named therein and The Chase Manhattan Bank (National
Association), as Agent, and evidences Revolving Credit Loans made
by the Lender thereunder. Terms used but not defined in this Note
have the respective meanings assigned to them in the Credit
Agreement.
The Credit Agreement provides for the acceleration of
the maturity of this Note upon the occurrence of certain events
and for prepayments of Loans upon the terms and conditions
specified therein.
Except as permitted by Section 12.06 of the Credit
Agreement, this Note may not be assigned by the Lender to any
other Person.
This Note shall be governed by, and construed in
accordance with, the law of the State of New York.
UNITED STATIONERS SUPPLY CO.
By_________________________ Title:
SCHEDULE OF REVOLVING CREDIT LOANS
This Note evidences Revolving Credit Loans made,
Continued or Converted under the within-described Credit Agreement
to the Company, on the dates, in the principal amounts, of the
Types, bearing interest at the rates and having Interest Periods
(if applicable) of the durations set forth below, subject to the
payments, Continuations, Conversions and prepayments of principal
set forth below:
Amount
Date Prin- Paid,
Made, cipal Duration Prepaid, Unpaid
Continued Amount Type of Continued Prin-
or of of Interest Interest or cipal Notation
Converted Loan Loan Rate Period Converted Amount Made by
EXHIBIT A-2
[Form of Tranche A Term Loan Note]
PROMISSORY NOTE
$_______________ March __, 1995
New York, New York
FOR VALUE RECEIVED, UNITED STATIONERS SUPPLY CO., an
Illinois corporation (the "Company"), hereby promises to pay to
__________________ (the "Lender") [or registered assigns]1 for
account of its respective Applicable Lending Offices provided for
by the Credit Agreement referred to below, at the principal office
of The Chase Manhattan Bank (National Association) at 1 Chase
Manhattan Plaza, New York, New York 10081, the principal sum of
_______________ Dollars (or such lesser amount as shall equal the
aggregate unpaid principal amount of the Tranche A Term Loans made
by the Lender to the Company under the Credit Agreement), in
lawful money of the United States of America and in immediately
available funds, on the dates and in the principal amounts
provided in the Credit Agreement, and to pay interest on the
unpaid principal amount of each such Tranche A Term Loan, at such
office, in like money and funds, for the period commencing on the
date of such Tranche A Term Loan until such Tranche A Term Loan
shall be paid in full, at the rates per annum and on the dates
provided in the Credit Agreement.
[This Note and the Loans evidenced hereby may be
transferred in whole or in part only by registration of such
transfer on the register maintained for such purpose by or on
behalf of the Company as provided in Section 12.06(g) of the
Credit Agreement.]
The date, amount, Type, interest rate and duration of
Interest Period (if applicable) of each Tranche A Term Loan made
by the Lender to the Company, and each payment made on account of
the principal thereof, shall be recorded by the Lender on its
books and, prior to any transfer of this Note, endorsed by the
Lender on the schedule attached hereto or any continuation
thereof, provided that the failure of the Lender to make any such
recordation or endorsement shall not affect the obligations of the
Company to make a payment when due of any amount owing under the
Credit Agreement or hereunder in respect of the Tranche A Term
Loans made by the Lender.
This Note is one of the Tranche A Term Loan Notes
[(constituting a Registered Note)] referred to in the Credit
Agreement dated as of March 30, 1995 (as modified and supplemented
and in effect from time to time, the "Credit Agreement") between
the Company (as successor by merger to Associated Stationers,
Inc.), Associated Holdings, Inc. (and its successor by merger,
United Stationers, Inc.), as parent guarantor, the lenders named
therein and The Chase Manhattan Bank (National Association), as
Agent, and evidences Tranche A Term Loans made by the Lender
thereunder. Terms used but not defined in this Note have the
respective meanings assigned to them in the Credit Agreement.
The Credit Agreement provides for the acceleration of
the maturity of this Note upon the occurrence of certain events
and for prepayments of Tranche A Term Loans upon the terms and
conditions specified therein.
Except as permitted by Section 12.06 of the Credit
Agreement, this Note may not be assigned by the Lender to any
other Person.
This Note shall be governed by, and construed in
accordance with, the law of the State of New York.
UNITED STATIONERS SUPPLY CO.
By__________________________ Title:
SCHEDULE OF TRANCHE A TERM LOANS
This Note evidences Tranche A Term Loans made,
Continued or Converted under the within-described Credit Agreement
to the Company, on the dates, in the principal amounts, of the
Types, bearing interest at the rates and having Interest Periods
(if applicable) of the durations set forth below, subject to the
payments, Continuations, Conversions and prepayments of principal
set forth below:
Amount
Date Prin- Paid,
Made, cipal Duration Prepaid, Unpaid
Continued Amount Type of Continued Prin-
or of of Interest Interest or cipal Notation
Converted Loan Loan Rate Period Converted Amount Made by
EXHIBIT A-3
[Form of Tranche B Term Loan Note]
PROMISSORY NOTE
$_______________ ____________
New York, New York
FOR VALUE RECEIVED, UNITED STATIONERS SUPPLY CO.,
an Illinois corporation (the "Company"), hereby promises to
pay to __________________ (the "Lender") [or registered
assigns]2, for account of its respective Applicable Lending
Offices provided for by the Credit Agreement referred to
below, at the principal office of The Chase Manhattan Bank
(National Association) at 1 Chase Manhattan Plaza, New York,
New York 10081, the principal sum of _______________ Dollars
(or such lesser amount as shall equal the aggregate unpaid
principal amount of the Tranche B Term Loans made by the
Lender to the Company under the Credit Agreement), in lawful
money of the United States of America and in immediately
available funds, on the dates and in the principal amounts
provided in the Credit Agreement, and to pay interest on the
unpaid principal amount of each such Tranche B Term Loan, at
such office, in like money and funds, for the period
commencing on the date of such Tranche B Term Loan until such
Tranche B Term Loan shall be paid in full, at the rates per
annum and on the dates provided in the Credit Agreement.
[This Note and the Loans evidenced hereby may be
transferred in whole or in part only by registration of such
transfer on the register maintained for such purpose by or on
behalf of the Company as provided in Section 12.06(g) of the
Credit Agreement.]
The date, amount, Type, interest rate and duration
of Interest Period (if applicable) of each Tranche B Term
Loan made by the Lender to the Company, and each payment made
on account of the principal thereof, shall be recorded by the
Lender on its books and, prior to any transfer of this Note,
endorsed by the Lender on the schedule attached hereto or any
continuation thereof, provided that the failure of the Lender
to make any such recordation or endorsement shall not affect
the obligations of the Company to make a payment when due of
any amount owing under the Credit Agreement or hereunder in
respect of the Tranche B Term Loans made by the Lender.
This Note is one of the Tranche B Term Loan Notes
[(constituting a Registered Note)] referred to in the Credit
Agreement dated as of March 30, 1995 (as modified and
supplemented and in effect from time to time, the "Credit
Agreement") between the Company (as successor by merger to
Associated Stationers, Inc.), Associated Holdings, Inc. (and
its successor by merger, United Stationers, Inc.), as parent
guarantor, the lenders named therein and The Chase Manhattan
Bank (National Association), as Agent, and evidences Tranche
B Term Loans made by the Lender thereunder. Terms used but
not defined in this Note have the respective meanings
assigned to them in the Credit Agreement.
The Credit Agreement provides for the acceleration
of the maturity of this Note upon the occurrence of certain
events and for prepayments of Tranche B Term Loans upon the
terms and conditions specified therein.
Except as permitted by Section 12.06 of the Credit
Agreement, this Note may not be assigned by the Lender to any
other Person.
This Note shall be governed by, and construed in
accordance with, the law of the State of New York.
UNITED STATIONERS SUPPLY CO.
By_________________________
Title:
SCHEDULE OF TRANCHE B TERM LOANS
This Note evidences Tranche B Term Loans made,
Continued or Converted under the within-described Credit
Agreement to the Company, on the dates, in the principal
amounts, of the Types, bearing interest at the rates and
having Interest Periods (if applicable) of the durations set
forth below, subject to the payments, Continuations,
Conversions and prepayments of principal set forth below:
Amount
Date Prin- Paid,
Made, cipal Duration Prepaid, Unpaid
Continued Amount Type of Continued Prin-
or of of Interest Interest or cipal
Notation
Converted Loan Loan Rate Period Converted Amount Made
by
EXHIBIT B
[Form of Borrowing Base Certificate]
BORROWING BASE CERTIFICATE
Monthly Accounting Period ended ____________, _____
Reference is made to the Credit Agreement dated as
of March 30, 1995 (as modified and supplemented and in
effect from time to time, the "Credit Agreement"), between
Associated Stationers, Inc. (together with its successors and
assigns, including United Stationers Supply Co. from and
after the effectiveness of the Supply Merger (as defined in
the Credit Agreement), the "Company"), Associated Holdings,
Inc., as parent guarantor (together with its successors and
assigns, including United Stationers Inc. from and after the
effectiveness of the United Merger (as defined in the Credit
Agreement)), the lenders named therein, and The Chase
Manhattan Bank (National Association), as Agent. Terms
defined in the Credit Agreement are used herein as defined
therein.
Pursuant to Section 9.01(f) of the Credit
Agreement, the undersigned, a Responsible Officer of the
Company, hereby certifies that, to the best of [his/her]
knowledge, attached hereto as Annex 1 is a true and accurate
calculation of the Borrowing Base as at the end of the
monthly accounting period ended ____________, _____
determined in accordance with the requirements of the Credit
Agreement.
To the best of my knowledge, all Inventory covered
by this Certificate has been produced in compliance with all
applicable laws, including, without limitation, the minimum
wage and overtime requirements of the Fair Labor Standards
Act of 1938, as amended.
IN WITNESS WHEREOF, the undersigned has caused this
certificate to be duly executed on behalf of the Company and
not individually as of the __________ day of ____________,
______.
By:____________________________
Name
Title:
Annex 1
UNITED STATIONERS SUPPLY CO.
Borrowing Base Certificate
(000's omitted)
************************************************************
Receivables as of the last day of the
immediately preceding month ______
Less: Receivable Adjustments as of the
last day of the preceding Monthly
Accounting Period (______)
Subtotal: ______
Less: Ineligible Receivables as of the
last day of the preceding Monthly
Accounting Period (determined without duplication):
Receivables not payable in Dollars (______)
(other than up to $5,000,000 Canadian
dollars)
Receivables (other than in connection
with a published promotional program)
payable more than 60 days after the
issuance of the billing statement
therefor (______)
Receivables due from Subsidiaries and
Affiliates (other than Boise or BCOP) (______)
Export Receivables (______)
Receivables from creditors with
unsatisfactory credit standing (as
determined by the Majority Lenders)
or with respect to which, subsequent
to the creation of such Receivable,
an event described in Section 10(f)
or (g) of the Credit Agreement shall
have occurred (______)
Receivables over 90 days from issuance
of original billing statement
date (______)
Receivables with excess of 50% of
balances past 90 days from
invoice date (______)
Receivables exceeding concentration of
10% of aggregate Receivables (______)
Receivables subject to dispute (______)
Receivables evidenced by Instruments (______)
Receivables arising out of sale or
return transactions (______)
Catalogue Receivables3 (______)
Government Receivables including
state and local public universities (______)
Receivables from employees (______)
Receivables payable on COD basis (______)
Total Ineligible Receivables (______)
Total Eligible Receivables ______
Annex 1 to
Borrowing Base
Certificate of the Company
UNITED STATIONERS SUPPLY CO.
Borrowing Base Certificate
(000's omitted)
ELIGIBLE INVENTORY
Inventory at lower of cost or market
covered by appropriate filings: ______
[Less: Calendars4 (______)
Catalogs (______)
In excess of 100% of prior
12 months' sales (______)
New Inventory (to extent
value exceeds $25,000,000) (______)
Inventory for internal use] (______)
Less: (______)
Total Eligible Inventory ______
Annex 1 to
Borrowing Base
Certificate of the Company
UNITED STATIONERS SUPPLY CO.
Borrowing Base Certificate (000's
omitted)
BORROWING BASE
Borrowing Base:
80% of Eligible Receivables ______
Plus: 50% of Eligible Inventory ______
Plus: Cover for Letter of Credit
Liabilities
______
Subtotal ______
Less: Eligible Inventory in excess
of [65]%5 of Borrowing Base: (______)
Borrowing Base:
______
Revolving Credit Loans and Letter of
Credit Liabilities
(______)
Unused Borrowing Base:
______
EXHIBIT C
[Form of Security Agreement]
SECURITY AGREEMENT
SECURITY AGREEMENT dated as of March 30, 1995 between
UNITED STATIONERS SUPPLY CO., a corporation duly organized and
validly existing under the laws of the State of Illinois (together
with its successors and assigns, the "Company"); and THE CHASE
MANHATTAN BANK (NATIONAL ASSOCIATION), as agent for the lenders
party to the Credit Agreement referred to below (in such
capacity, together with its successors in such capacity, the
"Agent").
The Company (as successor by merger to Associated
Stationers, Inc.), United Stationers Inc. (as successor by merger
to Associated Holdings, Inc.), the parent corporation of the
Company and a corporation duly organized and validly existing
under the laws of the State of Delaware (together with its
successors and assigns, the "Guarantor"); certain lenders; and the
Agent are parties to a Credit Agreement dated as of March 30, 1995
(as modified and supplemented and in effect from time to time, the
"Credit Agreement"), providing, subject to the terms and
conditions thereof, for extensions of credit (by making of loans
and issuing letters of credit) to be made by said lenders to the
Company in an aggregate principal amount not exceeding
$500,000,000.
To induce said lenders to enter into the Credit
Agreement and to extend credit thereunder, and for other good and
valuable consideration, the receipt and sufficiency of which are
hereby acknowledged, the Company has agreed to pledge and grant a
security interest in the Collateral (as hereinafter defined) as
security for the Secured Obligations (as hereinafter defined).
Accordingly, the parties hereto agree as follows:
Section 1. Definitions. Terms defined in the Credit
Agreement are used herein as defined therein. In addition, as
used herein:
"Accounts" shall have the meaning ascribed thereto in
Section 3(c) hereof.
"Collateral" shall have the meaning ascribed thereto in
Section 3 hereof.
"Collateral Account" shall have the meaning ascribed
thereto in Section 4.01 hereof.
"Copyright Collateral" shall mean all Copyrights,
whether now owned or hereafter acquired by the Company,
including each Copyright identified in Annex 2 hereto.
"Copyrights" shall mean all copyrights, copyright
registrations and applications for copyright registrations,
including, without limitation, all renewals and extensions
thereof, the right to recover for all past, present and
future infringements thereof, and all other rights of any
kind whatsoever accruing thereunder or pertaining thereto.
"Documents" shall have the meaning ascribed thereto in
Section 3(i) hereof.
"Equipment" shall have the meaning ascribed thereto in
Section 3(g) hereof.
"Foreign Subsidiary" shall mean any Subsidiary of the
Company that is not organized or created under the laws of
the United States of America, any State thereof or the
District of Columbia.
"Instruments" shall have the meaning ascribed thereto in
Section 3(d) hereof.
"Intellectual Property" shall mean, collectively, all
Copyright Collateral, all Patent Collateral and all Trademark
Collateral, together with (a) all inventions,
processes, production methods, proprietary information, know-
how and trade secrets; (b) all licenses or user or other
agreements granted to the Company with respect to any of the
foregoing, in each case whether now or hereafter owned or
used including, without limitation, the licenses or other
agreements with respect to the Copyright Collateral, the
Patent Collateral or the Trademark Collateral, listed in
Annex 4 hereto, except to the extent that a security interest
therein may not be granted without the consent of a licensor;
(c) all information, customer lists, identification of
suppliers, data, plans, blueprints, specifications, designs,
drawings, recorded knowledge, surveys, engineering reports,
test reports, manuals, materials standards, processing
standards, performance standards, catalogs, computer and
automatic machinery software and programs; (d) all field
repair data, sales data and other information relating to
sales or service of products now or hereafter manufactured;
(e) all accounting information and all media in which or on
which any information or knowledge or data or records may be
recorded or stored and all computer programs used for the
compilation or printout of such information, knowledge,
records or data; (f) all licenses, consents, permits,
variances, certifications and approvals of governmental
agencies now or hereafter held by the Company, except to the
extent that a security interest therein may not be granted
without the consent of a licensor; and (g) all causes of
action, claims or warranties now or hereafter owned or
acquired by the Company in respect of any of the items listed
above.
"Inventory" shall have the meaning ascribed thereto in
Section 3(e) hereof.
"Motor Vehicles" shall mean motor vehicles, tractors,
trailers and other like property, whether or not the title
thereto is governed by a certificate of title or ownership.
"Patent Collateral" shall mean all Patents, whether now
owned or hereafter acquired by the Company, including each
Patent identified in Annex 3 hereto.
"Patents" shall mean all patents and patent
applications, including, without limitation, the inventions
and improvements described and claimed therein together with
the reissues, divisions, continuations, renewals, extensions
and continuations-in-part thereof, all income, royalties,
damages and payments now or hereafter due and/or payable
under and with respect thereto, including, without
limitation, damages and payments for past or future
infringements thereof, the right to sue for past, present and
future infringements thereof, and all rights corresponding
thereto throughout the world.
"Pledged Stock" shall have the meaning ascribed thereto
in Section 3(a) hereof.
"Secured Obligations" shall mean, collectively, (a) the
principal of and interest on the Loans made by the Lenders
to, and the Note(s) held by each Lender of, the Company and
all other amounts from time to time owing to the Lenders or
the Agent by the Company under the Basic Documents including,
without limitation, all Reimbursement Obligations and
interest thereon, (b) the Interest Rate Protection
Obligations required by Section 9.15 of the Credit Agreement
and (c) all obligations of the Company to the Lenders and the
Agent hereunder.
"Trademark Collateral" shall mean all Trademarks,
whether now owned or hereafter acquired by the Company,
including each Trademark identified in Annex 4 hereto.
Notwithstanding the foregoing, the Trademark Collateral does
not and shall not include any Trademark that would be
rendered invalid, abandoned, void or unenforceable by reason
of its being included as part of the Trademark Collateral.
"Trademarks" shall mean all trade names, trademarks and
service marks, logos, trademark and service mark
registrations, and applications for trademark and service
mark registrations, including, without limitation, all
renewals of trademark and service mark registrations, all
rights corresponding thereto throughout the world, the right
to recover for all past, present and future infringements
thereof, all other rights of any kind whatsoever accruing
thereunder or pertaining thereto, together, in each case,
with the product lines and goodwill of the business connected
with the use of, and symbolized by, each such trade name,
trademark and service mark.
"Uniform Commercial Code" shall mean the Uniform
Commercial Code as in effect from time to time in the State
of New York.
Section 2. Representations and Warranties. The Company
represents and warrants to the Lenders and the Agent that:
(a) The Company is (or, at the time that the Company
acquires any interest therein, will be) the sole beneficial
owner of the Collateral and no Lien exists or will exist upon
the Collateral at any time (and no right or option to acquire
the same exists in favor of any other Person), except for
Liens permitted under Section 9.06 of the Credit Agreement
and except for the pledge and security interest in favor of
the Agent for the benefit of the Lenders created or provided
for herein, which pledge and security interest constitute a
perfected pledge and security interest in and to all of the
Collateral (other than Intellectual Property registered or
otherwise located outside of the United States of America),
subject to no equal or prior security interest or pledge
except as permitted under Section 9.06 of the Credit
Agreement.
(b) The Pledged Stock represented by the certificates
identified in Annex 1 hereto is, and all other Pledged Stock
in which the Company shall hereafter grant a security
interest pursuant to Section 3 hereof will be, duly
authorized, validly existing, fully paid and non-assessable
and none of such Pledged Stock is or will be subject to any
contractual restriction, or any restriction under the charter
or by-laws of the relevant issuer thereof, upon the transfer
of such Pledged Stock (except for any such restriction
contained herein or in the Credit Agreement).
(c) The Pledged Stock represented by the certificates
identified in Annex 1 hereto constitutes all of the issued
and outstanding shares of capital stock of each class of each
issuer thereof on the date hereof (or, in the case of any
Foreign Subsidiary, not less than 65% of the issued and
outstanding shares of capital stock of each class of such
Foreign Subsidiary on the date hereof), and said Annex 1
correctly identifies, as at the date hereof, the respective
class and par value of the shares comprising such Pledged
Stock, the respective number of shares represented by each
such certificate, and the respective beneficial and
registered owner of such shares.
(d) Annexes 2, 3 and 4 hereto, respectively, set forth
a complete and correct list of all Copyrights, Patents and
Trademarks owned by the Company on the date hereof; except
pursuant to licenses and other user agreements entered into
by the Company in the ordinary course of business, that are
listed in Annex 5 hereto, the Company owns and possesses the
right to use, and has done nothing to authorize or enable any
other Person to use, any Copyright, Patent or Trademark
listed in said Annexes 2, 3 and 4, and all registrations
listed in said Annexes 2, 3 and 4 are valid and in full force
and effect; except as may be set forth in said
Annex 5, the Company owns and possesses the right to use all
Copyrights, Patents and Trademarks.
(e) Annex 5 hereto sets forth a complete and correct
list of all licenses and other user agreements included in
the Intellectual Property on the date hereof.
(f) To the Company's knowledge, (i) except as set forth
in Annex 5 hereto, there is no violation by others of any
right of the Company with respect to any Copyright, Patent or
Trademark listed in Annexes 2, 3 and 4 hereto, respectively,
and (ii) the Company is not infringing in any respect upon
any Copyright, Patent or Trademark of any other Person; and
no proceedings have been instituted or are pending against
the Company or, to the Company's knowledge, threatened, and
no claim against the Company has been received by the
Company, alleging any such violation, except as may be set
forth in said Annex 5.
(g) The Company does not own any Trademarks registered
in the United States of America to which the last sentence of
the definition of Trademark Collateral applies.
(h) Any goods now or hereafter produced by the Company
or any of its Subsidiaries included in the Collateral have
been and will be produced in compliance with the requirements
of the Fair Labor Standards Act, as amended.
Section 3. Collateral. As collateral security for the
prompt payment in full when due (whether at stated maturity, by
acceleration or otherwise) of the Secured Obligations, the Company
hereby pledges and grants to the Agent, for the benefit of the
Lenders as hereinafter provided, a security interest in all of the
Company's right, title and interest in the following Property,
whether now owned by the Company or hereafter acquired and whether
now existing or hereafter coming into existence (all being
collectively referred to herein as "Collateral"):
(a) all shares of capital stock of whatever class of
each Subsidiary of the Company (other than United Business
Computers, Inc., a Delaware corporation ("UBC"), for so long
as, and to the extent, the Stockholders' Agreement dated July
1, 1993 between the Company, Theodore J. Crayne and United
Business Computers, Inc. prohibits transfer of the shares of
UBC, as described in Annex III to the Credit Agreement) now
or hereafter owned by the Company or any other Subsidiary of
the Company, including, without limitation, from and after
the effectiveness of the Mergers, the shares of stock
represented by the certificates identified in Annex 1 hereto,
in each case together with the certificates representing the
same (collectively, the
"Pledged Stock");
(b) all shares, securities, moneys or Property
representing a dividend on any of the Pledged Stock, or
representing a distribution or return of capital upon or in
respect of the Pledged Stock, or resulting from a split-up,
revision, reclassification or other like change of the
Pledged Stock or otherwise received in exchange therefor, and
any subscription warrants, rights or options issued to the
holders of, or otherwise in respect of, the Pledged Stock;
(c) all accounts and general intangibles (each as
defined in the Uniform Commercial Code) of the Company
constituting any right to the payment of money, including
(but not limited to) all moneys due and to become due to the
Company in respect of any loans or advances or for Inventory
or Equipment or other goods sold or leased or for services
rendered, all moneys due and to become due to the Company
under any guarantee (including a letter of credit) of the
purchase price of Inventory or Equipment sold by the Company
and all tax refunds (such accounts, general intangibles and
moneys due and to become due being herein called collectively
"Accounts");
(d) all instruments, chattel paper or letters of credit
(each as defined in the Uniform Commercial Code) of the
Company evidencing, representing, arising from or existing in
respect of, relating to, securing or otherwise supporting the
payment of, any of the Accounts, including (but not limited
to) promissory notes, drafts, bills of exchange and trade
acceptances (herein collectively called "Instruments");
(e) all inventory (as defined in the Uniform Commercial
Code) of the Company, all goods obtained by the Company in
exchange for such inventory, and any products made or
processed from such inventory including all substances, if
any, commingled therewith or added thereto (herein
collectively called "Inventory");
(f) all Intellectual Property and all other accounts or
general intangibles not constituting Intellectual Property or
Accounts;
(g) all equipment (as defined in the Uniform Commercial
Code) of the Company, including all Motor Vehicles (herein
collectively called "Equipment");
(h) each contract and other agreement of the Company
relating to the sale or other disposition of Inventory or
Equipment;
(i) all documents of title (as defined in the Uniform
Commercial Code) or other receipts of the Company covering,
evidencing or representing Inventory or Equipment (herein
collectively called "Documents");
(j) all rights, claims and benefits of the Company
against any Person arising out of, relating to or in
connection with Inventory or Equipment purchased by the
Company, including, without limitation, any such rights,
claims or benefits against any Person storing or transporting
such Inventory or Equipment;
(k) the balance from time to time in the Collateral
Account; and
(l) all other tangible and intangible personal Property
and fixtures of the Company, including, without limitation,
all proceeds, products, accessions, rents, profits, income,
benefits, substitutions and replacements of and to any of the
property of the Company described in the preceding clauses of
this Section 3 (including, without limitation, any proceeds
of insurance thereon and all causes of action, claims and
warranties now or hereafter held by the Company in respect of
any of the items listed above) and, to the extent related to
any Property described in said clauses or such proceeds,
products and accessions, all books, correspondence, credit
files, records, invoices and other papers, including without
limitation all tapes, cards, computer runs and other papers
and documents in the possession or under the control of the
Company or any computer bureau or service company from time
to time acting for the Company;
provided that Collateral shall not include (i) shares of capital
stock of any class issued by any Foreign Subsidiary to the extent
that the percentage of issued and outstanding shares of capital
stock of such class subject to the Lien of this Agreement would
constitute more than 65% of the issued and outstanding shares of
capital stock of such class and (ii) any tangible personal
Property located outside the United States of America.
Section 4. Cash Proceeds of Collateral.
4.01 Collateral Account. The Agent shall establish
with Chase a cash collateral account (the "Collateral Account") in
the name and under the control of the Agent into which there shall
be deposited from time to time the cash proceeds of any of the
Collateral (including proceeds of insurance thereon) required to
be delivered to the Agent pursuant hereto and into which the
Company may from time to time deposit any additional amounts that
it wishes to pledge to the Agent for the benefit of the Lenders as
additional collateral security hereunder or that, as provided in
Sections 2.10 and 10 of the Credit Agreement, it is required to
pledge as additional collateral security hereunder. The balance
from time to time in the Collateral Account shall constitute part
of the Collateral hereunder and shall not constitute payment of
the Secured Obligations until applied as hereinafter provided. As
promptly as possible after any amount is deposited into the
Collateral Account pursuant to the second or third sentence of
Section 4.02 hereof, the Agent shall remit the balance of such
amount (if any) to the Company's account (#910-2-668754) with
Chase. However, the Agent may (and, if instructed by the Lenders
of the Credit Agreement shall) at any time in its (or their)
discretion apply or cause to be applied the balance from time to
time outstanding to the credit of the Collateral Account to the
repayment of the principal of the Revolving Credit Loans
outstanding, to accrued interest on the principal so repaid, and
to the payment of any commitment fees with respect to the
Revolving Credit Commitments, in each case in accordance with the
Credit Agreement. Notwithstanding the above, at any time
following the occurrence and during the continuance of an Event of
Default, the Agent may (and, if instructed by the Lenders as
specified in Section 11.03 of the Credit Agreement, shall) in its
(or their) discretion apply or cause to be applied (subject to
collection) the balance from time to time standing to the credit
of the Collateral Account to the payment of the Secured
Obligations in the manner specified in Section 5.09 hereof. The
balance from time to time in the Collateral Account shall be
subject to withdrawal only as provided herein.
4.02 Proceeds of Accounts. The Company shall
within 90 days of the Closing Date instruct all account debtors
and other Persons obligated in respect of all Accounts to make all
payments in respect of the Accounts either (a) directly to the
Agent (by instructing that such payments be remitted to a post
office box which shall be in the name and under the control of the
Agent) or (b) to one or more other banks in the United States of
America (by instructing that such payments be remitted to a post
office box which shall be in the name and under the control of
such other bank(s)) under arrangements, in form and substance
satisfactory to the Agent pursuant to which the Company shall have
irrevocably instructed such other bank(s) (and such other bank(s)
shall have agreed) to remit all proceeds of such payments directly
to the Agent for deposit into the Collateral Account. All
payments made to the Agent, as provided in the preceding sentence,
shall be immediately deposited in the Collateral Account. In
addition to the foregoing, the Company agrees that if the proceeds
of any Collateral hereunder (including the payments made in
respect of Accounts) shall be received by it, the Company shall as
promptly as possible deposit such proceeds into the Collateral
Account. Until so deposited, all such proceeds shall be held in
trust by the Company for and as the property of the Agent and
shall not be commingled with any other funds or property of the
Company.
4.03 Investment of Balance in Collateral Account.
Amounts on deposit in the Collateral Account shall be invested
from time to time in such Permitted Investments as the Company
(or, after the occurrence and during the continuance of an Event
of Default, the Agent) shall determine, which Permitted
Investments shall be held in the name and be under the control of
the Agent, provided that (i) at any time after the occurrence and
during the continuance of an Event of Default, the Agent may (and,
if instructed by the Lenders as specified in Section 11.03 of the
Credit Agreement, shall) in its (or their) discretion at any time
and from time to time elect to liquidate any such Permitted
Investments and to apply or cause to be applied the proceeds
thereof to the payment of the Secured Obligations in the manner
specified in Section 5.09 hereof and (ii) if requested by the
Company, such Permitted Investments may be held in the name and
under the control of one or more of the Lenders (and in that
connection each Lender, pursuant to Section 11.10 of the Credit
Agreement, has agreed that such Permitted Investments shall be
held by such Lender as a collateral sub-agent for the Agent
hereunder).
4.04 Cover for Letter of Credit Liabilities. Amounts
deposited into the Collateral Account as cover for Letter of
Credit Liabilities under the Credit Agreement pursuant to Section
2.10(h) or Section 10 thereof shall be held by the Agent in a
separate sub-account (designated "Letter of Credit Liabilities Sub-
Account") and all amounts held in such sub-account shall
constitute collateral security first for the Letter of Credit
Liabilities outstanding from time to time and second as collateral
security for the other Secured Obligations hereunder.
Section 5. Further Assurances; Remedies. In
furtherance of the grant of the pledge and security interest
pursuant to Section 3 hereof, the Company hereby agrees with each
Lender and the Agent as follows:
5.01 Delivery and Other Perfection. The Company shall:
(a) if any of the shares, securities, moneys or
other Property required to be pledged by the Company under
clauses (a) and (b) of Section 3 hereof are received by the
Company, forthwith either (x) transfer and deliver to the
Agent such shares or securities so received by the Company
(together with the certificates for any such shares and
securities duly endorsed in blank or accompanied by undated
stock powers duly executed in blank), all of which
thereafter shall be held by the Agent, pursuant to the terms
of this Agreement, as part of the Collateral or (y) take such
other action as the Agent shall deem necessary or appropriate
to duly record the Lien created hereunder in such shares,
securities, moneys or Property in said clauses (a) and (b);
(b) deliver and pledge to the Agent any and all
Instruments, endorsed and/or accompanied by such instruments
of assignment and transfer in such form and substance as the
Agent may request; provided, that so long as no Event of
Default shall have occurred and be continuing, the Company
may retain for collection in the ordinary course any
Instruments received by the Company in the ordinary course of
business and the Agent shall, promptly upon request of the
Company, make appropriate arrangements for making any
Instrument pledged by the Company available to the Company
for purposes of presentation, collection or renewal (any such
arrangement to be effected, to the extent deemed appropriate
by the Agent, against trust receipt or like document);
(c) give, execute, deliver, file and/or record any
financing statement, notice, instrument, document, agreement
or other papers that may be necessary or desirable (in the
judgment of the Agent) to create, preserve, perfect or
validate the security interest granted pursuant hereto or to
enable the Agent to exercise and enforce its rights hereunder
with respect to such pledge and security interest, including,
without limitation, after the occurrence of an Event of
Default, causing any or all of the Stock Collateral to be
transferred of record into the name of the Agent or its
nominee (and the Agent agrees that if any Stock Collateral is
transferred into its name or the name of its nominee, the
Agent will thereafter promptly give to the Company copies of
any notices and communications received by it with respect to
the Stock Collateral), provided that notices to account
debtors in respect of any Accounts or Instruments shall be
subject to the provisions of clause (i) below;
(d) without limiting the obligations of the
Company under Section 5.04(c) hereof, upon the acquisition
after the date hereof by the Company of any Equipment covered
by a certificate of title or ownership, cause the Agent to be
listed as the lienholder on such certificate of title and
within 120 days of the acquisition thereof deliver evidence
of the same to the Agent;
(e) keep full and accurate books and records
relating to the Collateral, and stamp or otherwise mark such
books and records in such manner as the Agent may reasonably
require in order to reflect the security interests granted by
this Agreement;
(f) furnish to the Agent from time to time (but,
unless an Event of Default shall have occurred and be
continuing, no more frequently than quarterly) statements
and schedules further identifying and describing the
Copyright Collateral, the Patent Collateral and the Trademark
Collateral, respectively, and such other reports in
connection with the Copyright Collateral, the Patent
Collateral and the Trademark Collateral, as the Agent may
reasonably request, all in reasonable detail;
(g) promptly upon request of the Agent, following
receipt by the Agent of any statements, schedules or reports
pursuant to clause (f) above, modify this Agreement by
amending Annexes 2, 3 and/or 4 hereto, as the case may be, to
include any Copyright, Patent or Trademark that becomes part
of the Collateral under this Agreement;
(h) permit representatives of the Agent, upon
reasonable notice, at any time during normal business hours
to inspect and make abstracts from its books and records
pertaining to the Collateral, and permit representatives of
the Agent to be present at the Company's place of business to
receive copies of all communications and remittances relating
to the Collateral, and forward copies of any notices or
communications received by the Company with respect to the
Collateral, all in such manner as the Agent may require; and
(i) upon the occurrence and during the continuance of
any Event of Default, upon request of the Agent, promptly
notify (and the Company hereby authorizes the Agent so to
notify) each account debtor in respect of any Accounts or
Instruments that such Collateral has been assigned to the
Agent hereunder, and that any payments due or to become due
in respect of such Collateral are to be made directly to the
Agent.
5.02 Other Financing Statements and Liens. Except for
financing statements securing Liens expressly permitted by Section
9.06 of the Credit Agreement and protective filings filed against
the Company in respect of equipment, furniture or fixtures leased
to or Property consigned with the Company, without the prior
written consent of the Agent (granted with the authorization of
the Lenders as specified in Section 11.09 of the Credit
Agreement), the Company shall not file or suffer to be on file, or
authorize or permit to be filed or to be on file, in any
jurisdiction, any financing statement or like instrument with
respect to the Collateral in which the Agent is not named as the
sole secured party for the benefit of the Lenders.
5.03 Preservation of Rights. The Agent shall not be
required to take steps necessary to preserve any rights against
prior parties to any of the Collateral.
5.04 Special Provisions Relating to Certain
Collateral.
(a) Stock Collateral.
(1) The Company will cause the Pledged Stock to
constitute at all times 100% (or, with respect to any issuer that
is a Foreign Subsidiary, at least 65%) of the total number of
shares of each class of capital stock of each Subsidiary of the
Company then outstanding.
(2) Unless an Event of Default shall have occurred and
be continuing and the Agent shall have given notice to the Company
of its intention to exercise rights arising hereunder or under any
other Basic Document with respect to the Pledged Stock,
the Company shall have the right to exercise all voting,
consensual and other powers of ownership pertaining to the Pledged
Stock for all purposes not inconsistent with the terms of this
Agreement, the Credit Agreement, the Notes or any other instrument
or agreement referred to herein or therein, provided that the
Company agrees that it will not vote the Collateral in any manner
that is inconsistent with the terms of this Agreement, the Credit
Agreement, the Notes or any such other instrument or agreement;
and the Agent shall execute and deliver to the Company or cause to
be executed and delivered to the Company all such proxies, powers
of attorney, dividend and other orders, and all such instruments,
without recourse, as the Company may reasonably request for the
purpose of enabling the Company to exercise the rights and powers
that it is entitled to exercise pursuant to this Section
5.04(a)(2).
(3) Unless and until an Event of Default has occurred
and is continuing, the Company shall be entitled to receive and
retain any dividends on the Collateral paid in cash out of earned
surplus.
(4) If any Event of Default shall have occurred, then
so long as such Event of Default shall continue, and whether or
not the Agent or any Lender exercises any available right to
declare any Secured Obligation due and payable or seeks or pursues
any other relief or remedy available to it under applicable law or
under this Agreement, the Credit Agreement, the Notes or any other
agreement relating to such Secured Obligation, all dividends and
other distributions on the Pledged Stock shall be paid directly to
the Agent and retained by it as part of the Collateral, subject to
the terms of this Agreement, and, if the Agent shall so request in
writing, the Company agrees to execute and deliver to the Agent
appropriate additional dividend, distribution and other orders and
documents to that end, provided that if such Event of Default is
cured, any such dividend or distribution theretofore paid to the
Agent shall, upon request of the Company (except to the extent
theretofore applied to the Secured Obligations), be returned by
the Agent to the Company.
(b) Intellectual Property.
(1) For the purpose of enabling the Agent to exercise
rights and remedies under Section 5.05 hereof at such time as the
Agent shall be lawfully entitled to exercise such rights and
remedies, and for no other purpose, the Company hereby grants to
the Agent, to the extent assignable, an irrevocable, non-exclusive
license (exercisable without payment of royalty or other
compensation to the Company) to use, assign, license or sublicense
any of the Intellectual Property now owned or hereafter acquired
by the Company, wherever the same may be located, including in
such license reasonable access to all media in which any of the
licensed items may be recorded or stored and to all computer
programs used for the compilation or printout thereof.
(2) Notwithstanding anything contained herein to the
contrary, but subject to the provisions of Section 9.05 of the
Credit Agreement that limit the right of the Company to dispose of
its Property, so long as no Event of Default shall have occurred
and be continuing, the Company will be permitted to exploit, use,
enjoy, protect, license, sublicense, assign, sell, dispose of or
take other actions with respect to the Intellectual Property in
the ordinary course of the business of the Company. In furtherance
of the foregoing, unless an Event of Default shall have occurred
and be continuing the Agent shall from time to time, upon the
request of the Company, execute and deliver any
instruments, certificates or other documents, in the form so
requested, that the Company shall have certified are appropriate
(in its judgment) to allow it to take any action permitted above
(including relinquishment of the license provided pursuant to
clause (1) immediately above as to any specific Intellectual
Property). Further, upon the payment in full of all of the
Secured Obligations and cancellation or termination of the
Commitments and Letter of Credit Liabilities or earlier expiration
of this Agreement or release of the Collateral, the license
granted pursuant to clause (1) immediately above shall expire by
its own terms without further action on the part of the Company or
the Agent. The exercise of rights and remedies under Section 5.05
hereof by the Agent shall not terminate the rights of the holders
of any licenses or sublicenses theretofore granted by the Company
in accordance with the first sentence of this clause (2).
(c) Motor Vehicles. At any time after the occurrence
and during the continuance of an Event of Default, the Company
shall, upon the request of the Agent, deliver to the Agent
originals of the certificates of title or ownership for the Motor
Vehicles owned by it with the Agent listed as lienholder and take
such other action as the Agent shall deem appropriate to perfect
the security interest created hereunder in all such Motor
Vehicles.
5.05 Events of Default, Etc. During the period during
which an Event of Default shall have occurred and be continuing:
(a) the Company shall, at the request of the Agent,
assemble the Collateral owned by it at such place or places,
reasonably convenient to both the Agent and the Company,
designated in its request;
(b) the Agent may make any reasonable compromise or
settlement deemed desirable with respect to any of the
Collateral and may extend the time of payment, arrange for
payment in installments, or otherwise modify the terms of,
any of the Collateral;
(c) the Agent shall have all of the rights and remedies
with respect to the Collateral of a secured party under the
Uniform Commercial Code (whether or not said Code is in
effect in the jurisdiction where the rights and remedies are
asserted) and such additional rights and remedies to which a
secured party is entitled under the laws in effect in any
jurisdiction where any rights and remedies hereunder may be
asserted, including, without limitation, the right, to the
maximum extent permitted by law, to exercise all voting,
consensual and other powers of ownership pertaining to the
Collateral as if the Agent were the sole and absolute owner
thereof (and the Company agrees to take all such action as
may be appropriate to give effect to such right);
(d) the Agent in its discretion may, in its name or in
the name of the Company or otherwise, demand, sue for,
collect or receive any money or other Property at any time
payable or receivable on account of or in exchange for any of
the Collateral, but shall be under no obligation to do so;
and
(e) the Agent may, upon ten business days' prior
written notice to the Company of the time and place, with
respect to the Collateral or any part thereof that shall then
be or shall thereafter come into the possession,
custody or control of the Agent, the Lenders or any of their
respective agents, sell, lease, assign or otherwise dispose
of all or any part of such Collateral, at such place or
places as the Agent deems best, and for cash or for credit or
for future delivery (without thereby assuming any credit
risk), at public or private sale, without demand of
performance or notice of intention to effect any such
disposition or of the time or place thereof (except such
notice as is required above or by applicable statute and
cannot be waived), and the Agent or any Lender or anyone else
may be the purchaser, lessee, assignee or recipient of any or
all of the Collateral so disposed of at any public sale (or,
to the extent permitted by law, at any private sale) and
thereafter hold the same absolutely, free from any claim or
right of whatsoever kind, including any right or equity of
redemption (statutory or otherwise), of the Company, any such
demand, notice and right or equity being hereby expressly
waived and released. In the event of any sale, assignment,
or other disposition of any of the Trademark Collateral, the
goodwill connected with and symbolized by the Trademark
Collateral subject to such disposition shall be included, and
the Company shall supply to the Agent or its designee, for
inclusion in such sale, assignment or other disposition, all
Intellectual Property relating to such Trademark Collateral.
The Agent may, without notice or publication, adjourn any
public or private sale or cause the same to be adjourned from
time to time by announcement at the time and place fixed for
the sale, and such sale may be made at any time or place to
which the sale may be so adjourned.
The proceeds of each collection, sale or other disposition under
this Section 5.05, including by virtue of the exercise of the
license granted to the Agent in Section 5.04(b) hereof, shall be
applied in accordance with Section 5.09 hereof.
The Company recognizes that, by reason of certain
prohibitions contained in the Securities Act of 1933, as amended,
and applicable state securities laws, the Agent may be compelled,
with respect to any sale of all or any part of the Collateral, to
limit purchasers to those who will agree, among other things, to
acquire the Collateral for their own account, for investment and
not with a view to the distribution or resale thereof. The
Company acknowledges that any such private sales may be at prices
and on terms less favorable to the Agent than those obtainable
through a public sale without such restrictions, and,
notwithstanding such circumstances, agrees that any such private
sale shall be deemed to have been made in a commercially
reasonable manner and that the Agent shall have no obligation to
engage in public sales and no obligation to delay the sale of any
Collateral for the period of time necessary to permit the
respective issuer thereof to register it for public sale.
5.06 Deficiency. If the proceeds of sale, collection
or other realization of or upon the Collateral pursuant to Section
5.05 hereof are insufficient to cover the costs and expenses of
such realization and the payment in full of the Secured
Obligations, the Company shall remain liable for any deficiency.
5.07 Removals, Etc. Without at least 30 days' prior
written notice to the Agent, the Company shall not (i) maintain
any of its books and records with respect to the Collateral at any
office or maintain its principal place of business at any place,
or permit any Inventory or Equipment to be located anywhere, other
than at 2200 East Golf Road, Des Plaines,
Illinois, 60016-1267 or at one of the locations identified in
Annex 6 hereto or in transit from one of such locations to another
or (ii) change its name, or the name under which it does business,
from the name shown on the signature pages hereto.
5.08 Private Sale. The Agent and the Lenders shall
incur no liability as a result of the sale of the Collateral, or
any part thereof, at any private sale pursuant to Section 5.05
hereof conducted in a commercially reasonable manner. The Company
hereby waives any claims against the Agent or any Lender arising
by reason of the fact that the price at which the Collateral may
have been sold at such a private sale was less than the price that
might have been obtained at a public sale or was less than the
aggregate amount of the Secured Obligations, even if the Agent
accepts the first offer received and does not offer the Collateral
to more than one offeree.
5.09 Application of Proceeds. Except as otherwise
herein expressly provided and except as provided below in this
Section 5.09, the proceeds of any collection, sale or other
realization of all or any part of the Collateral pursuant hereto,
and any other cash at the time held by the Agent under Section 4
hereof or this Section 5, shall be applied by the Agent:
First, to the payment of the costs and expenses of such
collection, sale or other realization, including reasonable
out-of-pocket costs and expenses of the Agent and the fees
and expenses of its agents and counsel, and all expenses
incurred and advances made by the Agent in connection
therewith;
Next, to the payment in full of the Secured Obligations,
in each case equally and ratably in accordance with the
respective amounts thereof then due and owing or as the
Lenders holding the same may otherwise agree; and
Finally, to the payment to the Company, or its
successors or assigns, or as a court of competent
jurisdiction may direct, of any surplus then remaining.
Notwithstanding the foregoing, the proceeds of any cash or other
amounts held in the "Letter of Credit Liabilities Sub-Account" of
the Collateral Account pursuant to Section 4.04 hereof shall be
applied first to the Letter of Credit Liabilities outstanding from
time to time and second to the other Secured Obligations in the
manner provided above in this Section 5.09.
As used in this Section 5, "proceeds" of Collateral
shall mean cash, securities and other Property realized in respect
of, and distributions in kind of, Collateral, including any
thereof received under any reorganization, liquidation or
adjustment of debt of the Company or any issuer of or obligor on
any of the Collateral.
5.10 Attorney-in-Fact. Without limiting any rights or
powers granted by this Agreement to the Agent while no Event of
Default has occurred and is continuing, upon the occurrence and
during the continuance of any Event of Default the Agent is hereby
appointed the attorney-in-fact of the Company for the purpose of
carrying out the provisions of this Section 5 and taking any
action and executing any instruments that the Agent may deem
necessary or advisable to accomplish the purposes hereof, which
appointment as attorney-in-fact is irrevocable and coupled with an
interest. Without limiting the generality of the foregoing, so
long as the Agent shall be entitled under this Section 5 to make
collections in respect of the Collateral, the
Agent shall have the right and power to receive, endorse and
collect all checks made payable to the order of the Company
representing any dividend, payment or other distribution in
respect of the Collateral or any part thereof and to give full
discharge for the same.
5.11 Perfection. Prior to or concurrently with the
execution and delivery of this Agreement, the Company shall (i)
file such financing statements and other documents in such offices
as the Agent may request to perfect the security
interests granted by Section 3 of this Agreement and (ii), at the
request of the Agent, cause the Agent to be listed as the
lienholder on all certificates of title or ownership relating to
Motor Vehicles owned by the Company
5.12 Termination. When all Secured Obligations shall
have been paid in full and the Commitments of the Lenders under
the Credit Agreement and all Letter of Credit Liabilities shall
have expired or been terminated, this Agreement shall terminate,
and the Agent shall forthwith cause to be assigned, transferred
and delivered, against receipt but without any recourse, warranty
or representation whatsoever, any remaining Collateral and money
received in respect thereof, to or on the order of the Company and
to be released and canceled all licenses and rights referred to in
Section 5.04(b) hereof. The Agent shall also execute and deliver
to the Company upon such termination such Uniform Commercial Code
termination statements, certificates for terminating the Liens on
the Motor Vehicles and such other documentation as shall be
reasonably requested by the Company to effect the termination and
release of the Liens on the Collateral.
5.13 Further Assurances. The Company agrees that, from
time to time upon the written request of the Agent, the Company
will execute and deliver such further documents and do such other
acts and things as the Agent may reasonably request in order fully
to effect the purposes of this Agreement.
5.14 Release of Motor Vehicles. So long as no Event of
Default shall have occurred and be continuing, upon the request of
the Company, the Agent shall execute and deliver to the Company
such instruments as the Company shall reasonably request to remove
the notation of the Agent as lienholder on any certificate of
title for any Motor Vehicle; provided that any such instruments
shall be delivered, and the release effective only upon receipt by
the Agent of a certificate from the Company stating that the Motor
Vehicle the lien on which is to be released is to be sold or has
suffered a casualty loss (with title thereto passing to the
casualty insurance company (or its designee) therefor in
settlement of the claim for such loss) and any proceeds of such
sale or casualty loss to the extent required by the Credit
Agreement being paid to the Agent hereunder.
Section 6. Miscellaneous.
6.01 No Waiver. No failure on the part of the Agent or
any Lender to exercise, and no course of dealing with respect to,
and no delay in exercising, any right, power or remedy hereunder
shall operate as a waiver thereof; nor shall any single or partial
exercise by the Agent or any Lender of any right, power or remedy
hereunder preclude any other or further exercise thereof or the
exercise of any other right, power or remedy. The remedies herein
are cumulative and are not exclusive of any remedies provided by
law.
6.02 Notices. All notices, requests, consents and
demands hereunder shall be in writing and telecopied or delivered
to the intended recipient at its "Address for Notices" specified
pursuant to Section 12.02 of the Credit Agreement and shall be
deemed to have been given at the times specified in said Section
12.02.
6.03 Expenses. The Company agrees to reimburse each
of the Lenders and the Agent for all reasonable costs and expenses
of the Lenders and the Agent (including, without limitation, the
reasonable fees and expenses of legal counsel) in connection with
(i) any Default and any enforcement or collection proceeding
resulting therefrom, including, without limitation, all manner of
participation in or other involvement with (w) performance by the
Agent of any obligations of the Company in respect of the
Collateral that the Company has failed or refused to perform, (x)
bankruptcy, insolvency, receivership, foreclosure, winding up or
liquidation proceedings, or any actual or attempted sale, or any
exchange, enforcement, collection, compromise or settlement in
respect of any of the Collateral, and for the care of the
Collateral and defending or asserting rights and claims of the
Agent in respect thereof, by litigation or otherwise, including
expenses of insurance, (y) judicial or regulatory proceedings and
(z) workout, restructuring or other negotiations or proceedings
(whether or not the workout, restructuring or transaction
contemplated thereby is consummated) and (ii) the enforcement of
this Section 6.03, and all such costs and expenses shall be
Secured Obligations entitled to the benefits of the collateral
security provided pursuant to Section 3 hereof.
6.04 Amendments, Etc. The terms of this Agreement may
be waived, altered or amended only by an instrument in writing
duly executed by the Company and the Agent (with the consent of
the Lenders as specified in Section 11.09 of the Credit
Agreement). Any such amendment or waiver shall be binding upon
the Agent and each Lender each holder of any of the Secured
Obligations and the Company.
6.05 Successors and Assigns. This Agreement shall be
binding upon and inure to the benefit of the respective successors
and assigns of the Company, the Agent, the Lenders and each holder
of any of the Secured Obligations (provided, however, that the
Company shall not assign or transfer its rights hereunder without
the prior written consent of the Agent).
6.06 Captions. The captions and section headings
appearing herein are included solely for convenience of reference
and are not intended to affect the interpretation of any provision
of this Agreement.
6.07 Counterparts. This Agreement may be executed in
any number of counterparts, all of which taken together shall
constitute one and the same instrument and either of the parties
hereto may execute this Agreement by signing any such counterpart.
6.08 Governing Law. This Agreement shall be governed
by, and construed in accordance with, the law of the State of New
York.
6.09 Agents and Attorneys-in-Fact. The Agent may
employ agents and attorneys-in-fact in connection herewith and
shall not be responsible for the negligence or misconduct of any
such agents or attorneys-in-fact selected by it in good faith.
6.10 Severability. If any provision hereof is invalid
and unenforceable in any jurisdiction, then, to the fullest extent
permitted by law, (i) the other provisions hereof shall remain in
full force and effect in such jurisdiction and shall be liberally
construed in favor of the Agent and the Lenders in order to carry
out the intentions of the parties hereto as nearly as may be
possible and (ii) the invalidity or unenforceability of any
provision hereof in any jurisdiction shall not affect the validity
or enforceability of such provision in any other jurisdiction.
IN WITNESS WHEREOF, the parties hereto have caused this
Security Agreement to be duly executed and delivered as of the day
and year first above written.
UNITED STATIONERS SUPPLY CO.
By
Title:
THE CHASE MANHATTAN BANK (NATIONAL
ASSOCIATION),
as Agent
By
Title:
ANNEX 1
PLEDGED STOCK
[See Section 2(b)]
Number of Shares, Certif. No. Record & Beneficial Owner
Class & Par Value
ANNEX 2
LIST OF COPYRIGHTS, COPYRIGHT REGISTRATIONS AND
APPLICATIONS FOR COPYRIGHT REGISTRATIONS
[See Section 2(d)]
Title Date Filed Registration No. Effective Date
ANNEX 3
LIST OF PATENTS AND PATENT APPLICATIONS
[See Section 2(d)]
File Patent Country Registration No. Date
ANNEX 4
LIST OF TRADE NAMES, TRADEMARKS, SERVICES MARKS, TRADEMARK
AND SERVICE MARK REGISTRATIONS AND
APPLICATIONS FOR TRADEMARK AND SERVICE MARK REGISTRATIONS
[See Section 2(d)]
U.S. Trademarks
Application (A)
Registration (R) Registration
Mark or Series No. (S) or Filing Date
Foreign Trademarks
Application (A) Registration or
Mark Registration (R) Country Filing Date (F)
ANNEX 5
LIST OF CONTRACTS, LICENSES AND OTHER AGREEMENTS
[See Section 2(d), (e) and (f)]
ANNEX 6
LIST OF LOCATIONS
[See Section 5.07]
EXHIBIT D
[Form of Pledge Agreement]
PLEDGE AGREEMENT
PLEDGE AGREEMENT dated as of March 30, 1995 between
UNITED STATIONERS INC., a corporation duly organized and
validly existing under the laws of the State of Delaware
(together with its successors and assigns, the "Pledgor");
and THE CHASE MANHATTAN BANK (NATIONAL ASSOCIATION), as agent
for the lenders (the "Lenders") party to the Credit Agreement
referred to below (in such capacity, together with its
successors in such capacity, the "Agent").
WHEREAS, United Stationers Supply Co. (as successor
by merger to Associated Stationers, Inc.), a wholly-owned
subsidiary of the Pledgor and a corporation duly organized
and validly existing under the laws of the State of Illinois
(the "Company"), the Pledgor, the Lenders and the Agent are
parties to a Credit Agreement dated as of March 30, 1995 (as
modified and supplemented and in effect from time to time,
the "Credit Agreement"), providing, subject to the terms and
conditions thereof, for extensions of credit to be made by
the Lenders to the Company in an aggregate principal amount
not exceeding $500,000,000;
WHEREAS, to induce said lenders to enter into the
Credit Agreement and to extend credit thereunder, and for
other good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, the Pledgor has
agreed to pledge and grant a security interest in the
Collateral (as hereinafter defined) as security for the
Secured Obligations (as hereinafter defined).
NOW, THEREFORE, the parties hereto agree as
follows:
Section 1. Definitions. Terms defined in the
Credit Agreement are used herein as defined therein. In
addition, as used herein:
"Collateral" shall have the meaning ascribed
thereto in Section 3 hereof.
"Foreign Subsidiary" shall mean any Subsidiary of
the Pledgor that is not organized or created under the
laws of the United States of America, any State thereof
or the District of Columbia.
"Pledged Stock" shall have the meaning ascribed
thereto in Section 3(a) hereof.
"Secured Obligations" shall mean, collectively, (a)
the Guaranteed Obligations, which include the principal
of and interest on the Loans made by the Lenders to, and
the Note(s) held by each Lender of, the Company and all
other amounts from time to time owing to the Lenders or
the Agent by the Company under the Basic Documents
including, without limitation, all Reimbursement
Obligations and interest thereon, (b) all obligations of
the Pledgor under the Credit Agreement and the other
Basic Documents (including, without limitation, in
respect of its Guarantee under Section 6 of the Credit
Agreement) and (c) all obligations of the Pledgor to the
Lenders and the Agent hereunder.
"Uniform Commercial Code" shall mean the Uniform
Commercial Code as in effect from time to time in the
State of New York.
Section 2. Representations and Warranties. The
Pledgor represents and warrants to the Lenders and the Agent
that:
(a) The Pledgor is (or at the time that the
Pledgor acquires any interest therein, will be) the sole
beneficial owner of the Collateral and no Lien exists or
will exist upon the Collateral at any time (and no right
or option to acquire the same exists in favor of any
other Person), except for the pledge and security
interest in favor of the Agent for the benefit of the
Lenders created or provided for herein, which pledge and
security interest constitute a first priority perfected
pledge and security interest in and to all of the
Collateral.
(b) The Pledged Stock represented by certificates
identified in Annex 1 hereto is, and all other Pledged
Stock in which the Pledgor shall hereafter grant a
security interest pursuant to Section 3 hereof will be,
duly authorized, validly existing, fully paid and non-
assessable and none of such Pledged Stock is or will be
subject to any contractual restriction, or any
restriction under the charter or by-laws of the Company,
upon the transfer of such Pledged Stock (except for any
such restriction contained herein or in the Credit
Agreement).
(c) The Pledged Stock represented by certificates
identified in Annex 1 hereto constitutes all of the
issued and outstanding shares of capital stock of any
class of the Company beneficially owned by the Pledgor
on the date hereof (whether or not registered in the
name of the Pledgor) and said Annex 1 correctly
identifies, as at the date hereof, the respective class
and par value of the shares represented by such
certificate and, the Pledgor is the registered owner of
all such shares.
Section 3. The Pledge. As collateral security for
the prompt payment in full when due (whether at stated
maturity, by acceleration or otherwise) of the Secured
Obligations, the Pledgor hereby pledges and grants to the
Agent, for the benefit of the Lenders as hereinafter
provided, a security interest in all of the Pledgor's right,
title and interest in the following Property, whether now
owned by the Pledgor or hereafter acquired and whether now
existing or hereafter coming into existence (all being
collectively referred to herein as "Collateral"):
(a) the shares of common stock of the Company
represented by the certificates identified in Annex 1
hereto and all other shares of capital stock of whatever
class of the Company or any other Subsidiary of the
Pledgor, now or hereafter owned by the Pledgor, in each
case together with the certificates representing the
same (collectively, the "Pledged Stock");
(b) all shares, securities, moneys or Property
representing a dividend on any of the Pledged Stock, or
representing a distribution or return of capital upon or
in respect of the Pledged Stock, or resulting from a
split-up, revision, reclassification or other like
change of the Pledged Stock or otherwise received in
exchange therefor, and any subscription warrants, rights
or options issued to the holders of, or otherwise in
respect of, the Pledged Stock;
(c) without affecting the obligations of the
Pledgor under any provision prohibiting such action
hereunder or under the Credit Agreement, in the event of
any consolidation or merger in which the Company is not
the surviving corporation, all shares of each class of
the capital stock of the successor corporation (unless
such successor corporation is the Company itself) formed
by or resulting from such consolidation or merger; and
(d) all proceeds of and to any of the Property of
the Pledgor described in the preceding clauses of this
Section 3 (including, without limitation, all causes of
action, claims and warranties now or hereafter held by
the Pledgor in respect of any of the items listed above)
and, to the extent related to any Property described in
said clauses or such proceeds, all books,
correspondence, credit files, records, invoices and
other papers;
provided that Collateral shall not include shares of capital
stock of any class issued by any Foreign Subsidiary to the
extent that the percentage of issued and outstanding shares
of capital stock of such class subject to the Lien of this
Agreement would constitute more than 65% of the issued and
outstanding shares of capital stock of such class.
Section 4. Further Assurances; Remedies. In
furtherance of the grant of the pledge and security interest
pursuant to Section 3 hereof, the Pledgor hereby agrees with
each Lender and the Agent as follows:
4.01 Delivery and Other Perfection. The Pledgor
shall:
(a) if any of the shares, securities, moneys or
other Property required to be pledged by the Pledgor
under clauses (a), (b) and (c) of Section 3 hereof are
received by the Pledgor, forthwith either (x) transfer
and deliver to the Agent such shares or securities so
received by the Pledgor (together with the certificates
representing any such shares and securities duly
endorsed in blank or accompanied by undated stock powers
duly executed in blank), all of which thereafter shall
be held by the Agent, pursuant to the terms of this
Agreement, as part of the Collateral or (y) take such
other action as the Agent shall deem necessary or
appropriate to duly record the Lien created hereunder in
such shares, securities, moneys or other Property in
said clauses (a), (b) and (c);
(b) give, execute, deliver, file and/or record any
financing statement, notice, instrument, document,
agreement or other papers that may be necessary or
desirable (in the judgment of the Agent) to create,
preserve, perfect or validate the security interest
granted pursuant hereto or to enable the Agent to
exercise and enforce its rights hereunder with respect
to such pledge and security interest, including, without
limitation, following the occurrence of an
Event of Default, causing any or all of the Collateral
to be transferred of record into the name of the Agent
or its nominee (and the Agent agrees that if any
Collateral is transferred into its name or the name of
its nominee, the Agent will thereafter promptly give to
the Pledgor copies of any notices and communications
received by it with respect to the Collateral);
(c) keep full and accurate books and records
relating to the Collateral, and stamp or otherwise mark
such books and records in such manner as the Agent may
reasonably require in order to reflect the security
interests granted by this Agreement; and
(d) permit representatives of the Agent, upon
reasonable notice, at any time during normal business
hours to inspect and make abstracts from its books and
records pertaining to the Collateral, and permit
representatives of the Agent to be present at the
Pledgor's place of business to receive copies of all
communications and remittances relating to the
Collateral, and forward copies of any notices or
communications received by the Pledgor with respect to
the Collateral, all in such manner as the Agent may
require.
4.02 Other Financing Statements and Liens. The
Pledgor shall not file or suffer to be on file, or authorize
or permit to be filed or to be on file, in any jurisdiction,
any financing statement or like instrument with respect to
the Collateral in which the Agent is not named as the sole
secured party for the benefit of the Lenders.
4.03 Preservation of Rights. The Agent shall not
be required to take steps necessary to preserve any rights
against prior parties to any of the Collateral.
4.04 Collateral.
(a) The Pledgor will cause the Collateral to
constitute at all times 100% (or, with respect to any issuer
that is a Foreign Subsidiary, at least 65%) of the total
number of shares of each class of capital stock of the
Company and each other Subsidiary of the Pledgor then
outstanding.
(b) Unless an Event of Default shall have
occurred and be continuing and the Agent shall have given
notice to the Pledgor of its intention to exercise rights
arising hereunder or under any other Basic Document with
respect to the Pledged Stock, the Pledgor shall have the
right to exercise all voting, consensual and other powers of
ownership pertaining to the Collateral for all purposes not
inconsistent with the terms of this Agreement, the Credit
Agreement, the Notes or any other instrument or agreement
referred to herein or therein, provided that the Pledgor
agrees that it will not vote the Collateral in any manner
that is inconsistent with the terms of this Agreement, the
Credit Agreement, the Notes or any such other instrument or
agreement; and the Agent shall execute and deliver to the
Pledgor or cause to be executed and delivered to the Pledgor
all such proxies, powers of attorney, dividend and other
orders, and all such instruments, without recourse, as the
Pledgor may reasonably request for the purpose of enabling
the Pledgor to exercise the rights and powers that it is
entitled to exercise pursuant to this Section 4.04(b).
(c) Unless and until an Event of Default has
occurred and is continuing, and subject to the provisions of
Section 9.09 of the Credit Agreement, the Pledgor shall be
entitled to receive and retain any dividends on the
Collateral paid in cash out of earned surplus.
(d) If any Event of Default shall have occurred,
then so long as such Event of Default shall continue, and
whether or not the Agent or any Lender exercises any
available right to declare any Secured Obligation due and
payable or seeks or pursues any other relief or remedy
available to it under applicable law or under this Agreement,
the Credit Agreement, the Notes or any other agreement
relating to such Secured Obligation, all dividends and other
distributions on the Collateral shall be paid directly to the
Agent and retained by it as part of the Collateral, subject
to the terms of this Agreement, and, if the Agent shall so
request in writing, the Pledgor agrees to execute and deliver
to the Agent appropriate additional dividend, distribution
and other orders and documents to that end, provided that if
such Event of Default is cured, any such dividend or
distribution theretofore paid to the Agent shall, upon
request of the Pledgor (except to the extent theretofore
applied to the Secured Obligations), be returned by the Agent
to the Pledgor.
4.05 Events of Default, Etc. During the period
during which an Event of Default shall have occurred and be
continuing:
(a) the Agent shall have all of the rights and
remedies with respect to the Collateral of a secured
party under the Uniform Commercial Code (whether or not
said Code is in effect in the jurisdiction where the
rights and remedies are asserted) and such additional
rights and remedies to which a secured party is entitled
under the laws in effect in any jurisdiction where any
rights and remedies hereunder may be asserted,
including, without limitation, the right, to the maximum
extent permitted by law, to exercise all voting,
consensual and other powers of ownership pertaining to
the Collateral as if the Agent were the sole and
absolute owner thereof (and the Pledgor agrees to take
all such action as may be appropriate to give effect to
such right);
(b) the Agent in its discretion may, in its name
or in the name of the Pledgor or otherwise, demand, sue
for, collect or receive any money or property at any
time payable or receivable on account of or in exchange
for any of the Collateral, but shall be under no
obligation to do so; and
(c) the Agent may, upon ten business days' prior
written notice to the Pledgor of the time and place,
with respect to the Collateral or any part thereof that
shall then be or shall thereafter come into the
possession, custody or control of the Agent, the Lenders
or any of their respective agents, sell, lease, assign
or otherwise dispose of all or any part of such
Collateral, at such place or places as the Agent deems
best, and for cash or for credit or for future delivery
(without thereby assuming any credit risk), at public or
private sale, without demand of performance or notice of
intention to effect any such disposition or
of the time or place thereof (except such notice as is
required above or by applicable statute and cannot be
waived), and the Agent or any Lender or anyone else may
be the purchaser, lessee, assignee or recipient of any
or all of the Collateral so disposed of at any public
sale (or, to the extent permitted by law, at any private
sale) and thereafter hold the same absolutely, free from
any claim or right of whatsoever kind, including any
right or equity of redemption (statutory or otherwise),
of the Pledgor, any such demand, notice and right or
equity being hereby expressly waived and released. The
Agent may, without notice or publication, adjourn any
public or private sale or cause the same to be adjourned
from time to time by announcement at the time and place
fixed for the sale, and such sale may be made at any
time or place to which the sale may be so adjourned.
The proceeds of each collection, sale or other disposition
under this Section 4.05 shall be applied in accordance with
Section 4.09 hereof.
The Pledgor recognizes that, by reason of certain
prohibitions contained in the Securities Act of 1933, as
amended, and applicable state securities laws, the Agent may
be compelled, with respect to any sale of all or any part of
the Collateral, to limit purchasers to those who will agree,
among other things, to acquire the Collateral for their own
account, for investment and not with a view to the
distribution or resale thereof. The Pledgor acknowledges
that any such private sales may be at prices and on terms
less favorable to the Agent than those obtainable through a
public sale without such restrictions, and, notwithstanding
such circumstances, agrees that any such private sale shall
be deemed to have been made in a commercially reasonable
manner and that the Agent shall have no obligation to engage
in public sales and no obligation to delay the sale of any
Collateral for the period of time necessary to permit the
respective issuer thereof to register it for public sale.
4.06 Deficiency. If the proceeds of sale,
collection or other realization of or upon the Collateral
pursuant to Section 4.05 hereof are insufficient to cover the
costs and expenses of such realization and the payment in
full of the Secured Obligations, the Pledgor shall remain
liable for any deficiency.
4.07 Removals, Etc. Without at least 30 days'
prior written notice to the Agent, the Pledgor shall not (i)
maintain any of its books and records with respect to the
Collateral at any office or maintain its principal place of
business at any place other than at 2200 East Golf Road, Des
Plaines, Illinois 60016-1267 or (ii) change its name, or the
name under which it does business, from the name shown on the
signature pages hereto.
4.08 Private Sale. The Agent and the Lenders
shall incur no liability as a result of the sale of the
Collateral, or any part thereof, at any private sale pursuant
to Section 4.05 hereof conducted in a commercially reasonable
manner. The Pledgor hereby waives any claims against the
Agent or any Lender arising by reason of the fact that the
price at which the Collateral may have been sold at such a
private sale was less than the price that might have been
obtained at a public sale or was less than the aggregate
amount of the Secured Obligations, even if the
Agent accepts the first offer received and does not offer the
Collateral to more than one offeree.
4.09 Application of Proceeds. Except as
otherwise herein expressly provided, the proceeds of any
collection, sale or other realization of all or any part of
the Collateral pursuant hereto, and any other cash at the
time held by the Agent under this Section 4, shall be applied
by the Agent:
First, to the payment of the costs and expenses of
such collection, sale or other realization, including
reasonable out-of-pocket costs and expenses of the Agent
and the fees and expenses of its agents and counsel, and
all expenses incurred and advances made by the Agent in
connection therewith;
Next, to the payment in full of the Secured
Obligations, in each case equally and ratably in
accordance with the respective amounts thereof then due
and owing or as the Lenders holding the same may
otherwise agree; and
Finally, to the payment to the Pledgor, or its
successors or assigns, or as a court of competent
jurisdiction may direct, of any surplus then remaining.
As used in this Section 4, "proceeds" of
Collateral shall mean cash, securities and other property
realized in respect of, and distributions in kind of,
Collateral, including any thereof received under any
reorganization, liquidation or adjustment of debt of the
Pledgor or any issuer of or obligor on any of the Collateral.
4.10 Attorney-in-Fact. Without limiting any
rights or powers granted by this Agreement to the Agent while
no Event of Default has occurred and is continuing, upon the
occurrence and during the continuance of any Event of Default
the Agent is hereby appointed the attorney-in-fact of the
Pledgor for the purpose of carrying out the provisions of
this Section 4 and taking any action and executing any
instruments that the Agent may deem necessary or advisable to
accomplish the purposes hereof, which appointment as attorney-
in-fact is irrevocable and coupled with an interest. Without
limiting the generality of the foregoing, so long as the
Agent shall be entitled under this Section 4 to make
collections in respect of the Collateral, the Agent shall
have the right and power to receive, endorse and collect all
checks made payable to the order of the Pledgor representing
any dividend, payment or other distribution in respect of the
Collateral or any part thereof and to give full discharge for
the same.
4.11 Perfection. Prior to or concurrently with
the execution and delivery of this Agreement, the Pledgor
shall deliver to the Agent all certificates identified in
Section 3(a) hereof, accompanied by undated stock powers duly
executed in blank.
4.12 Termination. When all Secured Obligations
shall have been paid in full and the Commitments of the
Lenders under the Credit Agreement and all Letter of Credit
Liabilities shall have expired or been terminated, this
Agreement shall terminate, and the Agent shall forthwith
cause to be assigned, transferred and delivered, against
receipt but without any recourse, warranty or representation
whatsoever, any remaining Collateral and money received in
respect thereof, to or on the order of the Pledgor.
4.13 Expenses. The Pledgor agrees to pay to the
Agent all out-of-pocket expenses (including reasonable
expenses for legal services of every kind) of, or incident
to, the enforcement of any of the provisions of this Section
4, or performance by the Agent of any obligations of the
Pledgor in respect of the Collateral which the Pledgor has
failed or refused to perform, or any actual or attempted
sale, or any exchange, enforcement, collection, compromise or
settlement in respect of any of the Collateral, and for the
care of the Collateral and defending or asserting rights and
claims of the Agent in respect thereof, by litigation or
otherwise, and all such expenses shall be Secured Obligations
to the Agent secured under Section 3 hereof.
4.14 Further Assurances. The Pledgor agrees that,
from time to time upon the written request of the Agent, the
Pledgor will execute and deliver such further documents and
do such other acts and things as the Agent may reasonably
request in order fully to effect the purposes of this
Agreement.
Section 5. Miscellaneous.
5.01 No Waiver. No failure on the part of the
Agent or any Lender to exercise, and no course of dealing
with respect to, and no delay in exercising, any right, power
or remedy hereunder shall operate as a waiver thereof; nor
shall any single or partial exercise by the Agent or any
Lender of any right, power or remedy hereunder preclude any
other or further exercise thereof or the exercise of any
other right, power or remedy. The remedies herein are
cumulative and are not exclusive of any remedies provided by
law.
5.02 Notices. All notices, requests, consents and
demands hereunder shall be in writing and telecopied or
delivered to the intended recipient at its "Address for
Notices" specified pursuant to Section 12.02 of the Credit
Agreement and shall be deemed to have been given at the times
specified in said Section 12.02.
5.03 Amendments, Etc. The terms of this
Agreement may be waived, altered or amended only by an
instrument in writing duly executed by the Pledgor and the
Agent (with the consent of the Lenders as specified in
Section 11.09 of the Credit Agreement).
5.05 Successors and Assigns. This Agreement shall
be binding upon and inure to the benefit of the respective
successors and assigns of the Pledgor, the Agent, the Lenders
and each holder of any of the Secured Obligations (provided,
however, that the Pledgor shall not assign or transfer its
rights hereunder without the prior written consent of the
Agent).
5.06 Captions. The captions and section headings
appearing herein are included solely for convenience of
reference and are not intended to affect the interpretation
of any provision of this Agreement.
5.07 Counterparts. This Agreement may be executed
in any number of counterparts, all of which taken
together shall constitute one and the same instrument and
either of the parties hereto may execute this Agreement by
signing any such counterpart.
5.08 Governing Law. This Agreement shall be
governed by, and construed in accordance with, the law of the
State of New York.
5.09 Agents and Attorneys-in-Fact. The Agent may
employ agents and attorneys-in-fact in connection herewith
and shall not be responsible for the negligence or misconduct
of any such agents or attorneys-in-fact selected by it in
good faith.
5.10 Severability. If any provision hereof is
invalid and unenforceable in any jurisdiction, then, to the
fullest extent permitted by law, (i) the other provisions
hereof shall remain in full force and effect in such
jurisdiction and shall be liberally construed in favor of the
Agent and the Lenders in order to carry out the intentions of
the parties hereto as nearly as may be possible and (ii) the
invalidity or unenforceability of any provision hereof in any
jurisdiction shall not affect the validity or enforceability
of such provision in any other jurisdiction.
IN WITNESS WHEREOF, the parties hereto have caused
this Pledge Agreement to be duly executed and delivered as of
the day and year first above written.
UNITED STATIONERS INC.
By__________________________
Title:
THE CHASE MANHATTAN BANK
(NATIONAL ASSOCIATION),
as Agent
By__________________________
Title:
EXHIBIT E
MASTER FORM
USSC TO CMB MORTGAGE
This Indenture was prepared by
and when recorded mail to:
Kristin A. Halvey, Esq.
Milbank, Tweed, Hadley & McCloy
1 Chase Manhattan Plaza
New York, New York 10005
______________________________________________________________
Space above this line for recorder's use
INDENTURE OF MORTGAGE, ASSIGNMENT OF RENTS, SECURITY
AGREEMENT AND FIXTURE FILING
KNOW ALL MEN BY THESE PRESENTS:
THIS INDENTURE OF MORTGAGE, ASSIGNMENT OF RENTS,
SECURITY AGREEMENT AND FIXTURE FILING (this "Indenture") is
made as of March 30, 1995 by UNITED STATIONERS SUPPLY CO., a
corporation duly organized and validly existing under the
laws of the State of Illinois and having an office at
__________________ _________________________ (the "Company"),
in favor of THE CHASE MANHATTAN BANK (NATIONAL ASSOCIATION),
a national banking association having its principal office at
1 Chase Manhattan Plaza, New York, New York 10081, as agent
for the banks referred to below (in such capacity, together
with its successors in such capacity, the "Agent").
W I T N E S S E T H:
WHEREAS, Associated Stationers, Inc. (predecessorin-
interest by merger to the Company), Associated Holdings, Inc.
(predecessor-in-interest by merger to United Stationers, Inc.
("United")), certain lenders (collectively, together with
their successors and assigns, the "Lenders") and the Agent
are parties to a Credit Agreement dated as of March 30, 1995
(as modified and supplemented and in effect from time to
time, the "Credit Agreement"; terms defined in the Credit
Agreement unless otherwise defined herein being used herein
as defined therein), which Credit Agreement was assumed by
the Company and United pursuant to the Assumption Agreement
dated as of March 29, 1995 between United, the Company and
the Agent;
WHEREAS, the Credit Agreement provides for, inter
alia, extensions of credit by the Lenders to the Company by
the making of term loans and revolving credit loans
(collectively, the "Loans") and the issuance of letters of
credit in an aggregate principal amount not exceeding
$500,000,000;
WHEREAS, the Loans are to be evidenced by, and
repayable with interest thereon in accordance with, various
promissory notes to be executed and delivered by the Company
to the respective order of the Lenders (collectively, the
"Notes");
WHEREAS, it is a condition to the obligation of the
Lenders to extend credit to the Company pursuant to the
Credit Agreement that the Company execute and deliver this
Indenture;
NOW, THEREFORE, for good and valuable
consideration, the receipt of which is hereby acknowledged,
and FOR THE PURPOSE OF SECURING the following (collectively,
the "Obligations"):
(i) the payment of all indebtedness evidenced by
the Notes and any and all reborrowings, future advances and
readvances under the Credit Agreement and modifications,
extensions, substitutions, exchanges and renewals of the
Credit Agreement or the Notes (each of which reborrowings,
future advances, readvances, modifications, extensions,
substitutions, exchanges and renewals shall enjoy the same
priority as the initial advances evidenced by the Notes);
(ii) the performance and payment of the covenants,
agreements and obligations hereinafter contained and all
other monies secured hereby, including, without
limitation, any and all sums expended by the Agent
pursuant to Section 1.11 hereof, together with interest
thereon; and
(iii) the payment of all other indebtedness of the
Company to the Lenders and the Agent under the Credit
Agreement,
the Company hereby irrevocably grants, bargains, sells,
releases, conveys, warrants, assigns, transfers, mortgages,
pledges, sets over and confirms unto the Agent, under and
subject to the terms and conditions hereinafter set forth,
all of the following described property:
ALL OF the Company's right, title and interest in
and to the lands and premises (collectively, the "[Fee]
Properties") more particularly described on Exhibit A hereto;
[ALL OF the Company's right, title and interest in
and to the respective leases and lease agreement
(collectively, the "Leases") more particularly described on
Exhibit B hereto affecting the respective lands and premises
(collectively, the "Leasehold Properties" and together with
the Fee Properties, the "Properties");]
TOGETHER WITH all interests, estates or other
claims, both in law and in equity, that the Company now has
or may hereafter acquire in (a) the Properties, (b) all
easements, rights-of-way and rights used in connection
therewith or as a means of access thereto and (c) all
tenements, hereditaments and appurtenances in any manner
belonging, relating or appertaining thereto (all of the
foregoing interests, estates and other claims, collectively,
"Easements and Rights of Way");
TOGETHER WITH all estate, right, title and interest
of the Company, now owned or hereafter acquired, in and to
any land lying within the right-of-way of any streets, open
or proposed, adjoining the Properties, and any and all
sidewalks, alleys and strips and gores of land adjacent to or
used in connection therewith (all of the foregoing estate,
right, title and interest, collectively, "Adjacent Rights");
TOGETHER WITH all estate, right, title and interest
of the Company, now owned or hereafter acquired, in and to
any and all buildings and other improvements now or hereafter
located on the Properties and all building materials,
building equipment and fixtures of every kind and nature
located on the Properties or, attached to, contained in or
used in any such buildings and other improvements, and all
appurtenances and additions thereto and betterments,
substitutions and replacements thereof (all of the foregoing
estate, right, title and interest, collectively,
"Improvements");
TOGETHER WITH all estate, right, title and interest
of the Company in and to all such tangible property owned by
the Company (including all machinery, apparatus, equipment,
fittings and articles of personal property) and now or
hereafter located on or at or attached to the Properties that
an interest in such tangible property arises under applicable
real estate law, and any and all products
and accessions to any such property which may exist at any
time (all of the foregoing estate, right, title and interest,
and products and accessions, collectively, "Fixtures");
TOGETHER WITH all estate, right, title and interest
of the Company in and to all rights, royalties and profits in
connection with all minerals, oil and gas and other
hydrocarbon substances on or in the Properties, development
rights or credits, air rights, water, water rights (whether
riparian, appropriative, or otherwise and whether or not
appurtenant) and water stock (all of the foregoing estate,
right, title and interest, collectively, "Mineral and Related
Rights");
TOGETHER WITH all rents, revenues, proceeds,
issues, profits, royalties, income and other benefits derived
from the Properties, the Improvements and the Fixtures,
subject to the right, power and authority hereinafter given
to the Company to collect and apply the same (all of the
foregoing rents, revenues, proceeds, issues, profits,
royalties, income and other benefits, collectively, "Rents
and Royalties");
TOGETHER WITH all estate, right, title and interest
and other claim or demand that the Company now has or may
hereafter acquire with respect to any damage to the
Properties, the Improvements or the Fixtures and any and all
proceeds of insurance in effect with respect to the
Improvements or the Fixtures, and any and all awards made for
the taking by eminent domain, or by any proceeding or
purchase in lieu thereof, of the Properties, the Improvements
or the Fixtures, including without limitation any awards
resulting from a change of grade of streets or as the result
of any other damage to the Properties, the Improvements or
the Fixtures for which compensation shall be given by any
governmental authority (all of the foregoing estate, right,
title and interest and other claims or demand, and any such
proceeds or awards, collectively, "Damage Rights");
TOGETHER WITH all the estate, right, title,
interest and other claim of the Company with respect to any
parking facilities located other than on the Properties and
used or intended to be used in connection with the operation,
ownership or use of the Properties, any and all replacements
and substitutions for the same, and any other parking rights,
easements, covenants and other interests in parking
facilities acquired by the Company for the use of tenants or
occupants of the Improvements (all of the foregoing estate,
right, title, interest and other claim, collectively,
"Parking Rights");
TOGETHER WITH all estate, right, title and
interest of the Company in respect of any and all air rights,
development rights, zoning rights or other similar rights or
interests which benefit or are appurtenant to the Properties
or the Improvements (all of the foregoing estate, right,
title and interest, collectively, "Air and Development
Rights"); and
All of the foregoing Easements and Rights of Way,
Adjacent Rights, Improvements, Fixtures, Minerals and Related
Rights, Rents and Royalties, Damage Rights, Parking Rights
and Air and Development Rights being sometimes hereinafter
referred to collectively as the "Ancillary
Rights and Properties" and the Properties and Ancillary
Rights and Properties being sometimes hereinafter referred to
collectively as the "Mortgaged Property",
TO HAVE AND TO HOLD the Mortgaged Property with all
privileges and appurtenances thereunto belonging, to the
Agent and its successors and assigns, forever, in accordance
with the terms and conditions and for the uses hereinafter
set forth.
PROVIDED ALWAYS, that if the principal of and
interest on the Notes and all of the other Obligations shall
be paid in full, and the Company shall abide by and comply
with each and every covenant contained herein and in the
Credit Agreement, and the Commitments shall have terminated
then this Indenture and the lien and estate hereby granted
shall cease, terminate and be void.
This Indenture, the Notes, the Credit Agreement and
any other instrument given to evidence or further secure the
payment and performance of any Obligation are sometimes
hereinafter collectively referred to as the "Loan
Instruments".
TO PROTECT THE SECURITY OF THIS INDENTURE, THE
COMPANY HEREBY COVENANTS AND AGREES AS FOLLOWS:
ARTICLE I
Particular Covenants and Agreements of the Company
Section 1.01. Payment of Secured Obligations;
Title; etc. The Company shall pay when due the principal of,
and the interest on, the indebtedness evidenced by the Notes
and all other Obligations as provided in the Loan
Instruments, and the principal of, and the interest on, any
future advances secured by this Indenture.
The Company represents and warrants that it has
good and marketable fee simple title in and to the [Fee]
Properties identified on Exhibit A hereto, and the related
Ancillary Rights and Properties, in each case subject to no
mortgage, deed of trust, lien, pledge, charge, security
interest or other encumbrance or adverse claim of any nature,
except (i) those listed as exceptions to title in the title
policy insuring the lien or estate created by this Indenture
and (ii) those permitted by the Credit Agreement.
[The Company represents and warrants that (a) each
Lease is in full force and effect and there are no defaults
thereunder and no event has occurred and is continuing which
with notice or lapse of time or both will result in such a
default, (b) the Company is lawfully seized and possessed of
a valid and subsisting leasehold estate in and to the
Leasehold Properties identified in Exhibit B hereto and (c)
subject to the Leases, it has good marketable title in fee
simple to the related Ancillary Rights and Properties with
respect to each Lease, in each case subject to no mortgage,
deed of trust, lien, pledge, charge, security interest or
other encumbrance or adverse claim of any nature, except
those provided in the Lease or permitted by the Credit
Agreement.]
The Company represents and warrants that it has the
full power and lawful authority to grant, bargain, sell,
release, convey, warrant, assign, transfer, mortgage,
pledge, set over and confirm unto the Agent the Mortgaged
Property and warrants that it will forever defend the title
to the Mortgaged Property and the validity and priority of
the lien or estate hereof against the claims and demands of
all persons whomsoever.
Section 1.02. Further Assurances; Filing;
Re-Filing; etc.
(a) The Company shall execute, acknowledge and
deliver, from time to time, such further instruments as the
Agent may require to accomplish the purposes of this
Indenture.
(b) The Company, immediately upon the execution
and delivery of this Indenture, and thereafter from time to
time, shall cause this Indenture, any security agreement,
mortgage or deed of trust supplemental hereto and each
instrument of further assurance to be filed, registered or
recorded and refiled, re-registered or re-recorded in such
manner and in such places as may be required by any present
or future law in order to publish notice of and perfect the
lien or estate of this Indenture upon the Mortgaged Property.
(c) The Company shall pay all filing,
registration and recording fees, all refiling, re-
registration and re-recording fees, and all expenses incident
to the execution, filing, recording and acknowledgment of
this Indenture, any security agreement, mortgage or deed of
trust supplemental hereto and any instrument of further
assurance, and all Federal, State, county and municipal stamp
taxes and other taxes, duties, imposts, assessments and
charges arising out of or in connection with the execution,
delivery, filing and recording of the Notes, this Indenture,
any security agreement, mortgage or deed of trust
supplemental hereto or any instruments of further assurance.
Section 1.03. Liens. Except as otherwise
provided in Section 9.06 of the Credit Agreement, but without
limiting the obligations of the Company under Section 1.05 of
this Indenture (subject to its right to contest certain liens
and to withhold payment thereof as expressly provided in said
Section 1.05), the Company shall not create or suffer to be
created any mortgage, deed of trust, lien, security interest,
charge or encumbrance upon the Mortgaged Property prior to,
on a parity with, or subordinate to the lien of this
Indenture. The Company shall pay and promptly discharge at
the Company's cost and expense, any such mortgages, deeds of
trust, liens, security interests, charges or encumbrances
upon the Mortgaged Property or any portion thereof or
interest therein.
Section 1.04. Insurance.
(a) The Company shall purchase and maintain in
full force and effect policies of insurance in such form and
amounts, covering such risks, and issued by such companies,
in each case in the manner and to the extent required
pursuant to Section 9.04 of the Credit Agreement.
(b) After the occurrence of any fire or other
casualty to the Mortgaged Property or any part thereof
resulting in a loss in excess of $500,000, the Company shall
give prompt notice thereof to the Agent.
(c) After the occurrence of any fire or other
casualty to the Mortgaged Property or any part thereof,
provided that no Default (as defined in Section 4.01 hereof)
has occurred and is continuing, the Company may, at its
option, to be exercised by delivery of notice to the Agent
within four months of the damage or destruction caused by
such fire or other casualty, elect to either apply any
insurance proceeds received as a result of such fire or other
casualty: (i) to the restoration and repair of that part of
the Mortgaged Property damaged by such fire or casualty (the
"Damaged Property"); or (ii) to the prepayment of all or any
part of the indebtedness secured hereby. If a Default has
occurred and is continuing, or if the Company fails to make
such an election within four months from the date of any such
damage or destruction, such insurance proceeds shall
automatically be applied to the prepayment as aforesaid of
the indebtedness secured hereby.
If the Company elects to so restore and repair the
Damaged Property, any insurance proceeds in excess of
$500,000 shall be held by the Agent to be applied to the
restoration and repair of the Damaged Property and advanced
to the Company in periodic installments upon compliance by
the Company with such reasonable conditions as may be imposed
by the Agent, including, but not limited to, reasonable
retentions and lien releases. Interest, if any, actually
earned on any insurance proceeds held by the Agent shall be
credited to such insurance proceeds, for the benefit of the
Company.
Notwithstanding anything herein or at law or in
equity to the contrary, none of the insurance proceeds paid
to the Agent as herein provided shall be deemed trust funds,
and the Agent shall be entitled to advance all such proceeds
as provided in this Section 1.04(c). The Company expressly
assumes all risk of loss, including a decrease in the use,
enjoyment or value of the Mortgaged Property from any fire or
other casualty whatsoever, whether or not insurable or
insured against.
The Agent shall have no obligation to release any
of the insurance proceeds to the Company for restoration or
repair of the Damaged Property if a Default has occurred and
is continuing. If a Default has occurred and is continuing,
the Agent may, in its sole discretion, apply any insurance
proceeds received as a result of such fire or other casualty
either (i) to the payment of the Obligations as provided in
Section 4.03(a) hereof or (ii) to the restoration or repair
of the Damaged Property. If the Agent has required
application of such proceeds to such restoration or repair,
and such Default has been remedied, then the Agent will
advance to the Company in accordance with the foregoing
provisions of this Section 1.04(c), the insurance proceeds,
less such amounts that may have been expended by the Agent to
effectuate such cure. If a Default has occurred and is
continuing, all insurance proceeds remaining after the
payment for restoration and repair of the Damaged Property
pursuant to this Section 1.04(c) may, at the option of the
Agent, be applied to the payment of all or any part of the
Obligations.
(d) If a Default has occurred and is continuing,
the Agent shall be entitled at its option to participate in
any compromise, adjustment or settlement in connection with
any claims for loss, damage or destruction under any policy
or policies of insurance, in excess of $500,000, and the
Company shall within five Business Days after request
therefor reimburse the Agent for all out-of-pocket expenses
(including reasonable attorneys' fees) incurred by the Agent
in connection with such participation. Whether or not a
Default has occurred and is continuing, the Company shall not
make any compromise, adjustment or settlement in connection
with any such claim in excess of $500,000 without the
approval of the Agent, which approval shall not be
unreasonably withheld or delayed.
(e) In the event of foreclosure of the lien of
this Indenture or other transfer of title or assignment of
the Mortgaged Property in extinguishment, in whole or in
part, of the Obligations, all right, title and interest of
the Company in and to all policies of casualty insurance
covering all or any part of the Mortgaged Property shall
inure to the benefit of and pass to the successors in
interest to the Company or the purchaser or grantee of the
Mortgaged Property or any part thereof.
Section 1.05. Impositions.
(a) The Company shall pay or cause to be paid,
before any fine, penalty, interest or cost attaches thereto,
all taxes, assessments, water and sewer rates, utility
charges and all other governmental or nongovernmental charges
or levies now or hereafter assessed or levied against any
part of the Mortgaged Property (including, without
limitation, nongovernmental levies or assessments such as
maintenance charges, owner association dues or charges or
fees, levies or charges resulting from covenants, conditions
and restrictions affecting the Mortgaged Property) or upon
the lien or estate of the Agent therein (collectively,
"Impositions"), as well as all claims for labor, materials or
supplies that, if unpaid, might by law become a prior lien
thereon, and within ten days after request by the Agent will
exhibit receipts showing payment of any of the foregoing;
provided, however, that if by law any such Imposition may be
paid in installments (whether or not interest shall accrue on
the unpaid balance thereof), the Company may pay the same in
installments (together with accrued interest on the unpaid
balance thereof) as the same respectively become due, before
any fine, penalty or cost attaches thereto.
(b) Notwithstanding anything to the contrary
contained in this Indenture, the Company at its expense may
contest by appropriate legal, administrative or other
proceedings conducted in good faith and with due diligence,
the amount or validity or application, in whole or in part,
of any Imposition or lien therefor or any claims of
mechanics, materialmen, suppliers or vendors or lien thereof,
and may withhold payment of the same pending such proceedings
if permitted by law, provided, that (i) if the amount being
contested exceeds $500,000, the Company shall give the Agent
prior notice of such intention to contest and/or withhold
payment, (ii) in the case of any Impositions or lien therefor
or any claims of mechanics, materialmen, suppliers or vendors
or lien thereof, such proceedings shall suspend the
collection thereof from the Mortgaged Property or the Company
shall have posted such bonds or taken such other action as
may be necessary in order to effect such suspension, (iii)
neither the Mortgaged Property nor any part thereof or
interest therein will be sold, forfeited or lost if the
Company pays the amount or satisfies the
condition being contested, and the Company would have the
opportunity to do so in the event of the Company's failure to
prevail in the contest, (iv) neither the Agent, nor the
Lenders shall, by virtue of such permitted contest, be
exposed to any risk of any criminal liability or any civil
liability for which the Company has not furnished additional
security as provided in clause (v) below, and neither the
Mortgaged Property nor any interest therein would be subject
to the imposition of any lien for which the Company has not
furnished additional security as provided in clause (v)
below, as a result of the failure to comply with such law or
of such proceeding and (v) if a Default shall have occurred
and is continuing, the Company shall have furnished to the
Agent additional security in respect of the claim being
contested or the loss or damage which may result from the
Company's failure to prevail in such contest in such amount
as may be reasonably requested by the Agent.
Section 1.06. Maintenance of the Improvements and Fixtures.
Subject to Section 9.05 of the Credit Agreement, the Company
(i) shall not permit the Improvements or Fixtures to be
removed and (ii) shall maintain the Mortgaged Property in
good repair, working order and condition, except for
reasonable wear and use and to the extent the Agent shall
have control of or over any insurance proceeds and elect not
to release such proceeds for repair or restoration of the
Mortgaged Property. Subject to the provisions of Sections
1.04 and 1.12 hereof (including, without
limitation, the Company's rights to elect not to restore or
repair the Properties), the Company shall not commit, permit
or suffer any waste or deterioration of the Mortgaged
Property which, in the aggregate, could reasonably be
expected to have a material adverse effect on the value of
the Properties.
Section 1.07. Compliance With Laws.
(a) The Company represents and warrants that,
except as to matters covered by Section 8.13 of the Credit
Agreement (as to which the representations and warranties set
forth in the Credit Agreement shall apply) and except as
otherwise previously disclosed in writing to the Agent, the
Company and its operations at the Properties currently comply
with all applicable laws, ordinances, orders, rules and
regulations, including Environmental Laws (collectively
"laws") of all Federal, State, and local governments and of
the appropriate departments, commissions, boards and offices
thereof, and the orders, rules and regulations of the
American Insurance Association or any other body now or
hereafter constituted exercising similar functions, which at
any time are applicable to the Mortgaged Property, except to
the extent that failure to comply could not reasonably be
expected to have a Material Adverse Effect.
(b) The Company shall notify the Agent promptly of
any notice or order related to the Properties which the
Company receives from any agency or instrumentality of the
Federal, or any State or local, government with respect to
the Company's failure to comply with any laws or regulations
referred to in clause (a) above which failure could
reasonably be expected to have a Material Adverse Effect,
promptly take any and all actions necessary to bring its
operations at the Properties into compliance with such laws
or regulations and shall materially comply with the
requirements of such laws or regulations which at any time
are applicable to its operations at the Properties;
provided, however, that the Company at its expense may, with
simultaneous notice to the Agent, contest by appropriate
legal, administrative or other proceedings conducted in good
faith and with due diligence, the validity or application, in
whole or in part, of any such laws or regulations so long as
(i) neither the Properties nor any part thereof or interest
therein will be sold, forfeited or lost if the Company pays
the amount or satisfies the condition being contested in the
event of the Company's failure to prevail in the contest,
(ii) neither the Agent nor any of the Lenders would, by
virtue of such permitted contest, be in any danger of any
criminal liability or any civil liability for which the
Company has not furnished additional security as provided in
clause (iii) below, and none of the Properties nor any
interest therein would be subject to the imposition of any
lien for which the Company has not furnished additional
security as provided in clause (iii) below as a result of the
failure to comply with such law or of such proceeding and
(iii) if a Default has occurred and is continuing, the
Company shall have furnished to the Agent additional security
in respect of the claim being contested or the loss or damage
which may result from the Company's failure to prevail in
such contest in such amount as may be reasonably requested by
the Agent.
(c) Subject to the Company's right to contest, if
the Company fails to cure a failure to comply with any laws
or regulations referred to in clause (a) above within ten
days of written notice from the Agent to do so, the Agent, at
its election and in its sole discretion may (but shall not be
obligated to) cure any failure on the part of the Company to
comply with any laws or regulations referred to in clause (a)
above; provided, however, that the Agent shall not be
required to give the Company such notice if either this
Indenture is being enforced pursuant to Section 4.02(a)
hereof or an Event of Default shall have occurred under
Section 10(e), (f) or (g) of the Credit Agreement. Any
partial exercise by the Agent of the remedies hereinafter,
set forth, or any partial undertaking on the part of the
Agent to cure the Company's failure to comply with such laws
or regulations, shall not obligate the Agent to complete the
actions taken or require the Agent to expend further sums to
cure the Company's noncompliance; nor shall the exercise of
any such remedies operate to place upon the Agent any
responsibility for the operation, control, care, management
or repair of the Properties or make the Agent the "operator"
of the Properties within the meaning of any such laws. Any
amount paid or reasonable out-of-pocket costs incurred by the
Agent as a result of the exercise by the Agent of any of the
rights hereinabove set forth, together with interest thereon
at the Post-Default Rate under and as defined in the Credit
Agreement, shall be immediately due and payable by the
Company to the Agent, and until paid shall be added to and
become a part of the Obligations secured hereby; and the
Agent, by making any such payment or incurring any such
costs, shall be subrogated to any rights of the Company to
seek reimbursement from any third parties, including, without
limitation, a predecessor-in-interest to the Company's title
who may be a "responsible party" or otherwise liable under
the aforementioned laws or regulations.
(d) If after the occurrence and during the
continuance of any Default the Agent desires that an
environmental survey and risk assessment with respect to any
of the Properties be prepared, the Company agrees to supply
such a survey and risk assessment by an independent
engineering firm selected by the Company and reasonably
satisfactory to the Agent, in form and detail satisfactory to
the Agent (including test borings of the ground and chemical
analyses of air, water and waste discharges), estimating
current liabilities and assessing potential sources of future
liabilities of the Company or any other owner or operator of
the Properties under any Environmental Laws.
Section 1.08. Limitations of Use. The Company
shall not initiate, join in or consent to any change in any
private restrictive covenant, zoning ordinance or other
public or private restrictions limiting or defining the uses
that may be made of any of the Properties and the
Improvements or any part thereof that would have a material
adverse effect on the value of any of the Properties or the
Improvements. The Company shall comply with the provisions
of all leases, licenses, agreements and private covenants,
conditions and restrictions that at any time are applicable
to the Mortgaged Property, except to the extent failure to
comply could not reasonably be expected to have a material
adverse effect on the value of the Properties or the
Improvements.
Section 1.09. Inspection of the Properties. The
Company shall keep adequate records and books of account in
accordance with the requirements of the Credit Agreement and
shall permit the Agent and its authorized representatives to
enter and inspect the Properties, to examine the records and
books of account of the Company with respect thereto and make
copies or extracts thereof, all in accordance with the Credit
Agreement.
Section 1.10. Estoppel Certificates. The Company,
within ten days upon request in person or within 15 days upon
request by mail, shall furnish the Agent a written statement,
duly acknowledged, of the amount of the Obligations then
secured by this Indenture and whether to the Company's
knowledge, any offsets or defenses exist against any such
Obligations.
Section 1.11. Actions to Protect Mortgaged
Property. If the Company shall fail to [(a) perform and
observe any of the terms, covenants or conditions required to
be performed or observed by it under any of the Leases,] (b)
effect the insurance required by Section 1.04 hereof, (c)
make the payments required by Section 1.05 hereof or (d)
perform or observe any of its other covenants or agreements
hereunder, the Agent may, without obligation to do so, and
after ten days prior written notice to the Company (except in
an emergency) effect or pay the same. All sums, including
reasonable attorneys' fees, so expended or expended to
sustain the lien or estate of this Indenture or its priority,
or to protect or enforce any of the rights hereunder, or to
recover any of the Obligations, shall be a lien on the
Mortgaged Property, shall be deemed to be added to the
Obligations secured hereby, and shall be paid by the Company
within ten days after demand therefor, together with interest
thereon at the Post-Default Rate under and as defined in the
Credit Agreement. In any action or proceeding to foreclose
this Indenture or to recover or collect the Obligations
secured hereby, the provisions of law respecting the recovery
of costs, disbursements and allowances shall prevail
unaffected by this covenant.
Section 1.12. Condemnation.
(a) Should the Mortgaged Property or any part
thereof with a value in excess of $500,000 be taken or
damaged by reason of any public improvement or condemnation
proceeding, or in any other manner (a "Condemnation"), or
should the Company receive any written notice or other
information regarding such proceeding, the Company shall give
prompt notice thereof to the Agent.
(b) The Agent shall be entitled to all
compensation, awards and other payments or relief therefor,
and shall be entitled at its option to commence, appear in
and prosecute in its own name any compromise or settlement in
connection with such Condemnation involving an amount in
controversy in excess of $500,000. All such compensation,
awards, damages, rights of action and proceeds in excess of
$500,000 awarded to the Company and all interest thereon, if
any (the "Condemnation Proceeds") are hereby assigned to the
Agent, and the Company shall execute such further assignments
of the Condemnation Proceeds as the Agent may require.
(c) Upon the occurrence of a Condemnation,
provided that no Default has occurred and is continuing, the
Company may, at its option, to be exercised by delivery of
notice to the Agent within four months of such Condemnation,
elect to either apply any Condemnation Proceeds: (i) to the
replacement or restoration and repair of that part of the
Mortgaged Property affected by such Condemnation (the
"Affected Property"); or (ii) to the prepayment of all or any
part of the indebtedness secured hereby. If a Default has
occurred and is continuing or if the Company fails to make
such an election within four months from the date of any such
Condemnation, such Condemnation Proceeds shall automatically
be applied to the prepayment as aforesaid of the indebtedness
secured hereby.
If the Company elects to so replace or restore and
repair the Affected Property, any Condemnation Proceeds shall
be held by the Agent to be applied to the restoration and
repair of the Affected Property and advanced to the Company
in periodic installments upon compliance by the Company with
such reasonable conditions as may be imposed by the Agent
including, but not limited to, reasonable retentions and lien
releases. Interest, if any, actually earned on any
Condemnation Proceeds held by the Agent shall be credited to
such Condemnation Proceeds for the benefit of the Company.
Notwithstanding anything herein or at law or in
equity to the contrary, none of the Condemnation Proceeds
paid as herein provided shall be deemed trust funds and the
Agent shall be entitled to advance all such proceeds as
provided in this Section 1.12(c). The Company expressly
assumes all risk of loss, including a decrease in the use,
enjoyment or value of the Affected Property from any
Condemnation whatsoever.
The Agent shall have no obligation to release any
of the Condemnation Proceeds to the Company for restoration
or repair of Affected Property if a Default has occurred and
is continuing. If a Default has occurred and is continuing,
the Agent may, in its sole discretion, apply the Condemnation
Proceeds either (i) to the payment of the Obligations as
provided in Section 4.03(a) hereof or (ii) to
the restoration or repair of the Affected Property. If the
Agent has required application of Condemnation Proceeds to
such restoration or repair, and such Default has been
remedied, then the Agent will advance to the Company in
accordance with the foregoing provisions of this Section
1.12(c), the Condemnation Proceeds, less such amounts that
may have been expended by the Agent to effectuate such cure.
If a Default has occurred and is continuing, all Condemnation
Proceeds remaining after the payment, for restoration and
repair of the Affected Property pursuant to this Section
1.12(c), may, at the option of the Agent, be applied to
payment of all or any part of the Obligations.
Section 1.13. Insurance and Condemnation
Proceeds. Any moneys held by the Agent constituting
insurance proceeds received by the Agent in respect of any
loss or damage to, or destruction of, the Mortgaged Property
(or any portion thereof), or constituting Condemnation
Proceeds shall, so long as no Default shall have occurred and
be continuing, at the written request of the Company, be
invested or reinvested in such Permitted Investments as the
Company shall from time to time specify. Such Permitted
Investments shall be held by the Agent pursuant to this
Section 1.13; but, upon request of the Company, the Agent
shall sell all or any designated part of the same and the
proceeds of such sale shall be held by the Agent subject to
the provisions hereof in the same manner as the cash used by
it to purchase the obligations so sold. The Company agrees
to pay the Agent, on demand, amounts equal to any loss
resulting from any investment or reinvestment pursuant to
this Section 1.13, it being understood that the Agent shall
not be liable or responsible for any such loss. All amounts
from time to time received by the Agent in respect of any
gains or interest on such obligations or reimbursement in
respect of any loss resulting from any such investment or
reinvestment shall be paid to the Company within ten days of
receipt thereof.
[Section 1.14. Leasehold Interests.
(a) The Company shall (i), except where failure to
do so could not reasonably be expected to have a material
adverse effect on the Properties or the Improvements,
promptly perform and observe all of the terms, covenants and
conditions required to be performed and observed by the
Company under the Leases and do all things necessary to
preserve and to keep unimpaired its rights thereunder, (ii)
promptly notify the Agent of any material default by the
Company under any Lease in the performance of any of the
terms, covenants or conditions on the part of the Company to
be performed or observed thereunder or of the giving of any
notice by the lessor to the Company of any default under any
Lease or of such lessor's intention to exercise any remedy
reserved to the lessor thereunder and (iii) promptly cause a
copy of each such notice given by the lessor under any Lease
to the Company to be delivered to the Agent.
(b) If the Company shall fail promptly to perform
or observe any of the terms, covenants or conditions required
to be performed by it under any Lease, including, without
limitation, payment of all rent and other charges due
thereunder, the Agent may, without obligation to do so, after
ten days prior written notice to the Company, take such
action as is appropriate to cause such terms, covenants or
conditions to be promptly performed or observed on behalf of
the Company but no such action by the Agent shall release
the Company from any of its obligations under this Indenture.
Upon receipt by the Agent from the lessor under any Lease of
any notice of default by the Company thereunder, the Agent
may rely thereon and take any action as aforesaid to cure
such default even though the existence of such default or the
nature thereof be questioned or denied by the Company or by
any party on behalf of the Company; provided, however, that
the Agent must first give the Company ten days prior written
notice of its intent to cure such default so long as the
Agent is not prevented from giving such notice by order,
judgment or decree of court.
(c) Subject to the Company's rights pursuant to
Section 6.12 hereof, the Company shall not surrender its
leasehold estate and interests under any Lease, nor terminate
or cancel any Lease, and the Company shall not modify,
change, supplement, alter or amend any Lease orally or in
writing without the consent of the Agent, which consent shall
not be unreasonably withheld or delayed and any attempt on
the part of the Company to so modify, change, supplement,
alter or amend without the consent of the Agent shall be null
and void.
(d) No release or forbearance of any of the
Company's obligations under any Lease, pursuant to the terms
thereof or otherwise, shall release the Company from any of
its obligations under this Indenture.
(e) Neither the fee title to the property demised
by any Lease nor the leasehold estate created by any Lease
shall merge, but shall always remain separate and distinct,
notwithstanding the union of the aforesaid estates either in
the lessor or the Company under any Lease or in a third party
by purchase or otherwise, unless the Agent shall, at its
option, execute and record a document evidencing its intent
to merge the estates. If the Company acquires the fee title
or any other estate, title or interest in any Leasehold
Property covered by any Lease, this Indenture shall attach
to, be a lien upon and spread to the fee title or such other
estate so acquired, and such fee title or other estate shall,
without further assignment, mortgage or conveyance, become
and be subject to the lien of this Indenture. The Company
shall notify the Agent of any such acquisition by the Company
and, on written request by the Agent, shall cause to be
executed and recorded all such other and further assurances
or other instruments in writing as may in the opinion of the
Agent be required to carry out the intent and meaning hereof.
(f) Unless enforcement would, in the Company's
reasonable business judgment, be inadvisable, the Company
shall enforce the obligations of the lessor under the Leases
to the end that the Company may enjoy all of the material
rights granted to it under the Leases, and shall promptly
notify the Agent of any material default by the lessor under
any Lease, in the performance or observance of any of the
terms, covenants and conditions on the part of such lessor to
be performed or observed under any Lease and the Company
shall promptly advise the Agent of the occurrence of any
material event of default under any Lease.
(g) The Company shall use its best efforts to
obtain from the lessor under each Lease and deliver to the
Agent, within 20 days after written demand from the Agent, a
statement in writing certifying that such Lease is unmodified
and in full force and effect and the dates to
which the rent and other charges, if any, have been paid in
advance, and stating whether or not, to the best knowledge of
the signer of such certificate, the Company is in default in
the performance of any covenant, agreement or condition
contained in such Lease, and, if so, specifying each such
default of which the signer may have knowledge.
(h) Unless the exercise of any option, now
existing or hereafter created, to renew or extend the term of
any Lease would, in the Company's reasonable business
judgment, be inadvisable, the Company shall, at least two
months prior to the last day upon which the Company may
validly exercise such option, (i) exercise such option in
such manner as will cause the term of such Lease to be
effectively renewed or extended for the period provided by
such option and (ii) give prompt notice thereof to the Agent,
it being understood that if the Company fails to do so, the
Agent shall have, and is hereby granted, the irrevocable
right to exercise any such option, either in its own name and
behalf, or in the name and behalf of the Company, as the
Agent shall in its sole discretion determine; provided,
however, that the Agent shall, to the extent practicable,
first give the Company 20 days prior written notice and
opportunity to notify the Agent that the Company reasonably
deems such renewal inadvisable.
(i) The Company shall promptly notify the Agent of
any material change in the rent or other charges payable
under any Lease, except for changes made pursuant to the
provisions of such Lease.
(j) In the event that any proceeds of insurance in
excess of $500,000 on any part of the Mortgaged Property, or
any Condemnation Proceeds, shall be deposited with any person
pursuant to the requirements of any Lease, the Company shall
promptly notify the Agent of the name and address of the
person with whom such proceeds have been deposited and of the
amount so deposited.]
Section 1.15. Notice Regarding Special Flood
Hazards. The Company hereby acknowledges that it realizes
that the following Properties are in zones identified by the
Director of the Federal Emergency Management Agency as
special flood hazard zones described in 12 C.F.R. 22.2 and
that it has received prior to the making of the Loans, and
the incurrence of any other indebtedness constituting part of
the Obligations, secured by this Mortgage the notice
regarding Federal disaster relief assistance referred to in
the Appendix to 12 C.F.R. Part 22:
[List Properties located in special flood hazard
zones].
ARTICLE II
Assignment of Rents, Issues and Profits
Section 2.01. Assignment of Rents, Issues and
Profits. The Company does hereby assign to the Agent the
Company's right, title and interest in all current and future
rents, revenues, issues, profits, royalties, income and
benefits derived from the Properties, the Improvements and
the Fixtures (collectively, the "Rents"), it being intended
by the Company that this assignment constitutes a present,
absolute assignment and not an assignment for additional
security only. The Company agrees to execute and
deliver to the Agent such additional instruments, in form and
substance reasonably satisfactory to the Agent, as may
hereafter be requested by the Agent to further evidence and
confirm such assignment. Nevertheless, subject to the terms
of this Section 2.01, the Agent grants to the Company a
license, revocable as hereinafter provided, to operate and
manage the Mortgaged Property and to collect and use the
Rents subject to the requirements of the Credit Agreement.
Upon the occurrence of a Default, the license granted to the
Company herein may be revoked by the Agent, and, upon written
notice of such revocation, the Agent shall immediately be
entitled to possession of all Rents collected thereafter
(including Rents past due and unpaid), whether or not the
Agent enters upon or takes control of the Mortgaged Property.
The Agent is hereby granted and assigned by the Company the
right, at its option, upon revocation of the license granted
herein, to enter upon the Mortgaged Property in person, by
agent or by court appointed receiver to collect the Rents.
Any of the Rents collected after the revocation of the
license may be applied toward payment of the Obligations in
accordance with the Credit Agreement.
Section 2.02. Collection Upon Default. To the
extent permitted by law, upon the occurrence of any Default,
the Agent may, at any time without notice, either in person,
by agent or by a receiver appointed by a court, and without
regard to the adequacy of any security for the Obligations or
the solvency of the Company, enter upon and take possession
of the Properties, the Improvements and the Fixtures or any
part thereof, in its own name, sue for or otherwise collect
the Rents including those past due and unpaid, and apply the
same, less costs and expenses of operation and collection,
including attorneys' fees, to the payment of the Obligations
as provided in Section 4.03(a) hereof, and in such order as
the Agent may determine. The collection of the Rents or the
entering upon and taking possession of the Properties, the
Improvements or the Fixtures or any part thereof, or the
application thereof as aforesaid, shall not cure or waive any
Default or notice thereof or invalidate any act done in
response to such Default or pursuant to notice thereof.
ARTICLE III
Security Agreement
Section 3.01. Creation of Security Interest. The
Company hereby grants to the Agent a security interest in the
Fixtures for the purpose of securing the Obligations. The
Agent shall have, in addition to all rights and remedies
provided herein and in the other Loan Instruments, all the
rights and remedies of a secured party under the Uniform
Commercial Code of the State in which the applicable portion
of the Fixtures is located.
Section 3.02. Warranties, Representations and
Covenants. Subject to Section 9.05 of the Credit Agreement,
the Company hereby warrants, represents and covenants that:
(a) the Fixtures will be kept on or at the related Properties
and the Company will not remove any Fixtures from the related
Properties, except such portions or items of the Fixtures
which are consumed or worn out in ordinary usage, all of
which shall be promptly replaced by the Company, except as
otherwise expressly provided in Section 1.06 hereof, (b) all
covenants and obligations of the Company
contained herein relating to the Mortgaged Property shall be
deemed to apply to the Fixtures whether or not expressly
referred to herein and (c) this Indenture constitutes a
security agreement and "fixture filing" as those terms are
used in the applicable Uniform Commercial Code. Information
relative to the security interest created hereby may be
obtained by application to the Agent (secured party) c/o The
Chase Manhattan Bank (National Association), 1 Chase
Manhattan Plaza, New York, New York 10081. The mailing
address of the Company is set forth on Page 1 hereof.
ARTICLE IV
Defaults; Remedies
Section 4.01. Defaults. If any Event of Default
(herein, a "Default") under the Credit Agreement shall occur
and be continuing then, subject to and as more particularly
provided in the Credit Agreement, the principal of and
accrued interest on the Notes and all other Obligations may
be declared, or may become, due and payable, without
presentment, demand, protest or other formalities of any
kind, all of which have been waived pursuant to the Credit
Agreement.
Section 4.02. Default Remedies.
(a) If a Default shall have occurred and be
continuing, this Indenture may, to the maximum extent
permitted by law, be enforced as a mortgage, and the Agent
may exercise any right, power or remedy permitted to it
hereunder, under the Credit Agreement or under any of the
other Loan Instruments or by law, and, without limiting the
generality of the foregoing, the Agent may, personally or by
their respective agents, to the maximum extent permitted by
law:
(i) enter and take possession of the Mortgaged
Property or any part thereof, exclude the Company and
all persons claiming under the Company whose claims are
junior to this Indenture, wholly or partly therefrom,
and use, operate, manage and control the same either in
the name of the Company or otherwise as the Agent shall
deem best, and upon such entry, from time to time at the
expense of the Company and the Mortgaged Property, make
all such repairs, replacements, alterations, additions
or improvements to the Mortgaged Property or any part
thereof as the Agent may deem proper and, whether or not
the Agent has so entered and taken possession of the
Mortgaged Property or any part thereof, collect and
receive all the rents and profits and apply the same, to
the extent permitted by law, to the payment of all
expenses which the Agent may be authorized to make under
this Indenture, the remainder to be applied to the
payment of the Obligations until the same shall have
been repaid in full; if the Agent demands or attempts to
take possession of the Mortgaged Property or any portion
thereof in the exercise of any rights hereunder, the
Company shall promptly turn over and deliver complete
possession thereof to the Agent, as the case may be; and
(ii) to the maximum extent permitted by law,
personally or by agents, with or without entry, if the
Agent shall deem it advisable:
(x) sell the Mortgaged Property at a
sale or sales held at such place or places and time
or times and upon such notice and otherwise in such
manner as may be required by law, or, in the
absence of any such requirement, as the Agent may
deem appropriate, and from time to time adjourn any
such sale by announcement at the time and place
specified for such sale or for such adjourned sale
without further notice, except such as may be
required by law;
(y) proceed to protect and enforce its
rights under this Indenture, by suit for specific
performance of any covenant contained herein or in
the Loan Instruments or in aid of the execution of
any power granted herein or in the Loan
Instruments, or for the foreclosure of this
Indenture (as a mortgage or otherwise) and the sale
of the Mortgaged Property under the judgment or
decree of a court of competent jurisdiction, or for
the enforcement of any other right as the Agent
shall deem most effectual for such purpose,
provided, that in the event of a sale, by
foreclosure or otherwise, of less than all of the
Mortgaged Property, this Indenture shall continue
as a lien on, and security interest in, the
remaining portion of the Mortgaged Property; or
(z) exercise any or all of the remedies
available to a secured party under the applicable
Uniform Commercial Code, including, without
limitation:
(1) either personally or by means
of a court appointed receiver,
take possession of all or any of the Fixtures
and exclude therefrom the Company and all
persons claiming under the Company, and
thereafter hold, store, use, operate, manage,
maintain and control, make repairs,
replacements, alterations, additions and
improvements to and exercise all rights and
powers of the Company in respect of the
Fixtures or any part thereof; if the Agent
demands or attempts to take possession of the
Fixtures in the exercise of any rights
hereunder, the Company shall promptly turn
over and deliver complete possession thereof
to the Agent;
(2) without notice to or demand
upon the Company, make such payments and do
such acts as the Agent may deem necessary to
protect its security interest in the Fixtures,
including, without limitation, paying,
purchasing, contesting or compromising any
encumbrance which is prior to or superior to
the security interest granted hereunder, and
in exercising any such powers or authority
paying all expenses incurred in connection
therewith;
(3) require the Company to assemble
the Fixtures or any portion thereof, at a
place designated by the Agent and
reasonably convenient to both parties, and
promptly to deliver the Fixtures to the Agent,
or an agent or representative designated by
it; the Agent, and its agents and
representatives, shall have the right to enter
upon the premises and property of the Company
to exercise the Agent's rights hereunder;
(4) sell, lease or otherwise
dispose of the Fixtures, with or without
having the Fixtures at the place of sale, and
upon such terms and in such manner as the
Agent may determine (and the Agent or any
Lender may be a purchaser at any such sale);
and
(5) unless the Fixtures are
perishable or threaten to decline speedily in
value or are of a type customarily sold on a
recognized market, the Agent shall give the
Company at least ten days' prior notice of the
time and place of any sale of the Fixtures or
other intended disposition thereof.
(b) If a Default shall have occurred and be
continuing, the Agent, to the maximum extent permitted by
law, shall be entitled, as a matter of right, to the
appointment of a receiver of the Mortgaged Property, without
notice or demand, and without regard to the adequacy of the
security for the Obligations or the solvency of the Company.
The Company hereby irrevocably consents to such appointment
and waives notice of any application therefor. Any such
receiver or receivers shall have all the usual powers and
duties of receivers in like or similar cases and all the
powers and duties of the Agent in case of entry and shall
continue as such and exercise all such powers until the date
of confirmation of sale of the Mortgaged Property, unless
such receivership is sooner terminated.
(c) If a Default shall have occurred and be
continuing and either this Indenture is being enforced
pursuant to clause (a) above or an Event of Default shall
have occurred under Section 10(e), (f) or (g) of the Credit
Agreement, the Company shall, to the maximum extent permitted
by law, pay monthly in advance to the Agent, or to any
receiver appointed at the request of the Agent to collect
rents, the fair and reasonable rental value for the use and
occupancy of the Properties, the Improvements and the
Fixtures or of such part thereof as may be in the possession
of the Company. Upon default in the payment thereof, the
Company shall vacate and surrender possession of the
Properties, the Improvements and the Fixtures to the Agent or
such receiver, and upon a failure so to do may be evicted by
summary proceedings.
(d) In any sale under any provision of this
Indenture or pursuant to any judgment or decree of court, the
Mortgaged Property, to the maximum extent permitted by law,
may be sold in one or more parcels or as an entirety and in
such order as the Agent may elect, without regard to the
right of the Company or any person claiming under the Company
to the marshalling of assets. The purchaser at any such sale
shall take title to the Mortgaged Property or the part
thereof so sold free and discharged of the estate of
the Company therein, the purchaser being hereby discharged
from all liability to see to the application of the purchase
money. Any person, including the Agent or any Lender, may
purchase at any such sale. Upon the completion of any such
sale by virtue of this Section 4.02, the Agent shall execute
and deliver to the purchaser an appropriate instrument which
shall effectively transfer all of the Company's and the
Agent's estate, right, title, interest, property, claim and
demand in and to the Mortgaged Property or portion thereof so
sold, but without any covenant or warranty, express or
implied. The Agent is hereby irrevocably appointed the
attorney-in-fact of the Company in its name and stead to make
all appropriate transfers and deliveries of the Mortgaged
Property or any portions thereof so sold and, for that
purpose, the Agent may execute all appropriate instruments of
transfer, and may substitute one or more persons with like
power, the Company hereby ratifying and confirming all that
said attorneys or such substitute or substitutes shall
lawfully do by virtue hereof. Nevertheless, the Company shall
ratify and confirm, or cause to be ratified and confirmed,
any such sale or sales by executing and delivering, or by
causing to be executed and delivered, to the Agent or to such
purchaser or purchasers all such instruments as may be
advisable, in the judgment of the Agent, for such purpose,
and as may be designated in such request. Any sale or sales
made under or by virtue of this Indenture, to the extent not
prohibited by law, shall operate to divest all the estate,
right, title, interest, property, claim and demand
whatsoever, whether at law or in equity, of the Company in,
to and under the Mortgaged Property, or any portions thereof
so sold, and shall be a perpetual bar both at law and in
equity against the Company and against any and all persons
claiming or who may claim the same, or any part thereof, by,
through or under the Company. The powers and agency
herein granted are coupled
with an interest and are irrevocable.
(e) To the maximum extent permitted by applicable
law, all rights of action under the Loan Instruments and this
Indenture may be enforced by the Agent without the possession
of the Loan Instruments and without the production thereof at
any trial or other proceeding relative thereto.
Section 4.03. Application of Proceeds.
(a) The proceeds of any sale made either under the
power of sale hereby given or under a judgment, order or
decree made in any action to foreclose or to enforce this
Indenture, or of any monies held by the Agent hereunder
shall, to the maximum extent permitted by law, be applied:
(i) first to the payment of all costs and expenses
of such sale, including the Agent's attorneys' fees and
disbursements;
(ii) then to the payment of all charges, expenses
and advances incurred or made by the Agent in order to
protect the lien and estate of this Indenture or the
security afforded hereby;
(iii) then to the payment in full of the Obligations
in each case equally and ratably in accordance with the
respective amounts then due and owing or as the Lenders
holding the same may otherwise agree; first to accrued
interest on the Obligations,
then to premiums or prepayment charges and all other
fees and other amounts due in connection with the
Obligations other than such amounts due pursuant to
Section 5 of the Credit Agreement, then to the principal
of the Obligations, and then to all obligations due
pursuant to Section 5 of the Credit Agreement;
(iv) then to the payment in full of the principal
of and interest on all other Obligations, ratably in
accordance with the respective amounts thereof then due
and owing or as the Lenders holding the same may
otherwise agree,
and after payment in full of all Obligations any surplus
remaining shall be paid to the Company or to whomsoever may
be lawfully entitled to receive the same.
(b) No sale or other disposition of all or any
part of the Mortgaged Property pursuant to Section 4.02
hereof shall be deemed to relieve the Company of its
obligations under the Credit Agreement or any other Loan
Instrument except to the extent the proceeds thereof are
applied to the payment of such obligations. If the proceeds
of sale, collection or other realization of or upon the
Mortgaged Property are insufficient to cover the costs and
expenses of such realization and the payment in full of the
Obligations, the Company shall remain liable for any
deficiency.
Section 4.04. Right to Sue. The Agent shall have
the right from time to time to sue for any sums required to
be paid by the Company under the terms of this Indenture as
the same become due, without regard to whether or not the
Obligations shall be, or have become, due and without
prejudice to the right of the Agent thereafter to bring any
action or proceeding of foreclosure or any other action upon
the occurrence of any Default existing at the time such
earlier action was commenced.
Section 4.05. Powers of the Agent. To the extent
permitted by applicable law, the Agent may at any time or
from time to time renew or extend this Indenture or (with the
agreement of the Company) alter or modify the same in any
way, or waive any of the terms, covenants or conditions
hereof or thereof, in whole or in part, and may release or
reconvey any portion of the Mortgaged Property or any other
security, and grant such extensions and indulgences in
relation to the Obligations, or release any person liable
therefor as the Agent may determine without the consent of
any junior lienor or encumbrancer, without any obligation to
give notice of any kind thereto, without in any manner
affecting the priority of the lien and estate of this
Indenture on or in any part of the Mortgaged Property, and
without affecting the liability of any other person liable
for any of the Obligations.
Section 4.06. Remedies Cumulative.
(a) No right or remedy herein conferred upon or
reserved to the Agent is intended to be exclusive of any
other right or remedy, and each and every right and remedy
shall be cumulative and in addition to any other right or
remedy under this Indenture or under applicable law, whether
now or hereafter existing; the failure of the Agent to insist
at any time upon the strict observance or performance
of any of the provisions of this Indenture, or to exercise
any right or remedy provided for herein or under applicable
law, shall not impair any such right or remedy nor be
construed as a waiver or relinquishment thereof.
(b) The Agent shall be entitled to enforce
payment and performance of any of the obligations of the
Company and to exercise all rights and powers under this
Indenture or under any Loan Instrument or any applicable laws
now or hereafter in force, notwithstanding that some or all
of the Obligations may now or hereafter be otherwise secured,
whether by mortgage, deed of trust, pledge, lien, assignment
or otherwise; neither the acceptance of this Indenture nor
its enforcement, whether by court action or pursuant to the
power of sale or other powers herein contained, shall
prejudice or in any manner affect the Agent's right to
realize upon or enforce any other security now or hereafter
held by the Agent, it being stipulated that the Agent shall
be entitled to enforce this Indenture and any other security
now or hereafter held by the Agent in such order and manner
as the Agent, in its sole discretion, may determine; every
power or remedy given by the Credit Agreement, this Indenture
or any of the other Loan Instruments to the Agent or to which
the Agent is otherwise entitled, may be exercised,
concurrently or independently, from time to time and as often
as may be deemed expedient by the Agent.
Section 4.07. Waiver of Stay, Extension,
Moratorium Laws; Equity of Redemption. To the maximum extent
permitted by law, the Company shall not at any time insist
upon, or plead, or in any manner whatever claim or take any
benefit or advantage of any applicable present or future
stay, extension or moratorium law, which may affect
observance or performance of the provisions of this
Indenture; nor claim, take or insist upon any benefit or
advantage of any present or future law providing for the
valuation or appraisal of the Mortgaged Property or any
portion thereof prior to any sale or sales thereof which may
be made under or by virtue of Section 4.02 hereof; and the
Company, to the extent that it lawfully may, hereby waives
all benefit or advantage of any such law or laws. The
Company for itself and all who may claim under it, hereby
waives, to the maximum extent permitted by applicable law,
any and all rights and equities of redemption from sale under
the power of sale created hereunder or from sale under any
order or decree of foreclosure of this Indenture and (if a
Default shall have occurred) all notice or notices of
seizure, and all right to have the Mortgaged Property
marshalled upon any foreclosure hereof. The Agent shall not
be obligated to pursue or exhaust its rights or remedies as
against any other part of the Mortgaged Property and the
Company hereby waives any right or claim of right to have the
Agent proceed in any particular order.
ARTICLE V
Miscellaneous
Section 5.01. Reconveyance. Upon the termination
of the Commitments under and as defined in the Credit
Agreement and the payment in full of the Obligations, the
Agent shall release the lien of this Indenture or reconvey,
without warranty or covenant, any portion of the Mortgaged
Property then held hereunder to the Company or upon the
request of the Company and at the Company's expense assign
this Indenture without recourse to the Company's designee, or
to the person or persons legally entitled thereto, by an
instrument duly acknowledged in form for recording.
Section 5.02. Notices. All notices, demands,
consents, requests or other communications (collectively,
"notices") that are permitted or required to be given by any
party to the other hereunder shall be in writing and given in
the manner specified in Section 12.02 of the Credit
Agreement.
Section 5.03. Amendments; Waivers; etc. This
Indenture cannot be modified, changed or discharged except by
an agreement in writing, duly acknowledged in form for
recording, signed by the party against whom enforcement of
such modification, change or discharge is sought.
Section 5.04. Successors and Assigns. This
Indenture applies to, inures to the benefit of and binds each
of the parties hereto and their respective successors and
assigns and shall run with the Properties.
Section 5.05. Captions. The captions or headings
at the beginning of each Section hereof are for the
convenience of the parties hereto and are not a part of this
Indenture.
Section 5.06. Invalidity of Certain Provisions.
If the lien or estate of this Indenture is invalid or
unenforceable as to any part of the Mortgaged Property, the
unsecured or partially secured portion of such indebtedness
shall be completely paid prior to the payment of the
remaining and secured or partially secured portion thereof,
and all payments made on such indebtedness, whether voluntary
or under foreclosure or other enforcement action or
procedure, shall be considered to have been first paid on and
applied to the full payment of that portion thereof that is
not secured or fully secured by the lien or estate of this
Indenture.
Section 5.07. Severability. If any term or
provision of this Indenture or the application thereof to any
person or circumstance shall to any extent be invalid or
unenforceable, the remainder of this Indenture, or the
application of such term or provision to persons or
circumstances other than those as to which it is invalid or
unenforceable, shall not be affected thereby, and each term
and provision of this Indenture shall be valid and
enforceable to the maximum extent permitted by law.
Section 5.08. One of a Number of Indentures.
This Indenture is given as security together with certain
other indentures which collectively cover the Properties and
other properties more particularly described in the Loan
Instruments and secure the Obligations. A copy of all such
indenture instruments (including this Indenture) are on file
with the Company and with the Agent and are available for
inspection during normal business hours upon reasonable
advance request therefor. A default with respect to any such
indenture instrument (including this Indenture) shall
constitute a default under all such indenture instruments
(including this Indenture).
Section 5.09. Governing Law. This Indenture
shall be governed by and construed in accordance with the
laws of the State of New York including both matters of
internal law and conflicts of law, except that matters of
title to the Mortgaged Property and the creation, perfection,
priority and foreclosure of liens on, and security interests
in, the Mortgaged Property shall be governed by the laws of
the State in which the Mortgaged Property is located.
Section 5.10. Variable Rate. The interest rate on
the Notes is subject to change in accordance with the terms
of the Credit Agreement.
Section 5.11. Future Advances.
[To be added by Local Counsel.]
Section 5.12. Release. Anything contained in this
Indenture or any other Loan Instrument to the contrary
notwithstanding, the Company shall be entitled to dispose of
all or any part of the Mortgaged Property in accordance with
the terms of the Credit Agreement. If the Company so
disposes of the Mortgaged Property (or any part thereof), the
Agent shall release the lien, security interest and
assignment against or of the Mortgaged Property (or part
thereof) created and evidenced hereby.
IN WITNESS WHEREOF, this Indenture has been duly
executed by the Company as of the day and year first above
written.
UNITED STATIONERS SUPPLY CO.
By
_______________________________
Name:
Title:
STATE OF NEW YORK )
) ss:
COUNTY OF NEW YORK )
On this __ day of _______, 1995, before me
personally appeared ______________, to me known, who, being
by me duly sworn, did depose and say that [he] [she] resides
at _________________________; that [he] [she] is the
______________ of UNITED STATIONERS SUPPLY CO., an Illinois
corporation, the corporation described in and which executed
the foregoing instrument; and that [he] [she] signed [his]
[her] name thereto under authority of the board of directors
of said corporation.
WITNESS my hand and seal hereto affixed the day and
year first above written.
___________________________
NOTARY PUBLIC in and for
the State of New York My Commission
expires:
EXHIBIT F
[Form of Assumption Agreement]
ASSUMPTION AGREEMENT dated as of March 30, 1995 between
UNITED STATIONERS INC., a corporation duly organized and validly
existing under the laws of the State of Delaware ("United");
UNITED STATIONERS SUPPLY CO., a corporation duly organized and
validly existing under the laws of the State
of Illinois ("Supply"); and THE CHASE MANHATTAN BANK
(NATIONAL ASSOCIATION), as agent for the Lenders (as defined
herein).
WHEREAS, Associated Stationers, Inc., a Delaware
corporation (together with its successors and assigns,
including Supply from and after the effectiveness of the
Supply Merger (as defined below), the "Company"); Associated
Holdings, Inc., a corporation duly organized and validly
existing under the laws of the State of Delaware (together
with its successors and assigns, including United from and
after the effectiveness of the United Merger (as defined
below), the "Guarantor"); each of the lenders party thereto
(together with their permitted successors and assigns, the
"Lenders"); and The Chase Manhattan Bank (National
Association), as agent for the Lenders (the "Agent"), have
entered into a Credit Agreement dated as of March 30, 1995
(as at any time amended or otherwise modified, the "Credit
Agreement") pursuant to which the Lenders have agreed to make
loans to the Company in aggregate principal amount not
exceeding $500,000,000;
WHEREAS, the Guarantor and United have entered into
a Merger Agreement dated as of February 13, 1995 (as at any
time amended or otherwise modified, the "Merger Agreement"),
providing for the merger of the Guarantor with and into
United with United as the surviving corporation (the "United
Merger") and the subsequent merger of the Company, a wholly-
owned subsidiary of the Guarantor, with and into Supply, a
wholly-owned subsidiary of United, with Supply as the
surviving corporation (the "Supply Merger" and, with the
United Merger, the "Mergers");
WHEREAS, the Mergers have been consummated on the
date hereof; and
WHEREAS, each of United and Supply desires in and
by this Assumption Agreement to assume expressly the
performance of every obligation of the Guarantor (in the case
of United) and the Company (in the case of Supply) under the
Credit Agreement.
NOW, THEREFORE, for good and valuable
consideration, the receipt of which is hereby acknowledged by
each of United and Supply, and in order to induce the Lenders
to make loans to Supply (as successor to the Company) on the
date hereof pursuant to the Credit Agreement, each of United
and Supply agrees with and for the benefit of the Agent and
each Lender as follows:
Section 1. Definitions. Unless otherwise
provided, terms used or defined in the Credit Agreement are
used herein as used or defined therein.
Section 2. Assumption.
2.01 Assumption of Obligations by United.
United, as the surviving corporation of the United Merger and
the successor in interest to the Guarantor, hereby
(a) irrevocably and unconditionally assumes and
agrees to perform, observe and be bound by each and
every covenant, agreement, term, condition, obligation,
appointment, duty and liability of the Guarantor under
the Credit Agreement and the Guarantor Note and, by
virtue of the foregoing, accepts and assumes all
liabilities of the Guarantor related to any
representation or warranty made by, and all rights and
powers of the Guarantor under or in connection with the
Credit Agreement and the Guarantor Note and confirms and
restates all such representations and warranties as of
the date when made by the Guarantor;
(b) confirms and acknowledges that all references
to the "Guarantor" in the Credit Agreement or any
amendment thereto or any document, instrument or
agreement executed, or to be executed, in connection
therewith, or in the Guarantor Note shall be deemed to
be references to United, except where such references
relate to the Guarantor prior to the assumption provided
for in the foregoing clause (a).
(c) acknowledges and agrees that it is, and shall
continue to be, bound by the Credit Agreement and the
Guarantor Note as if it had been the "Guarantor"
thereunder from the original execution and delivery
thereof.
2.02 Assumption of Obligations by Supply.
Supply, as the surviving corporation of the Supply Merger and
the successor in interest to the Company, hereby
(a) irrevocably and unconditionally assumes and
agrees to perform, observe and be bound by each and
every covenant, agreement, term, condition, obligation,
appointment, duty and liability of the Company under the
Credit Agreement and, by virtue of the foregoing,
accepts and assumes all liabilities of the Company
related to any representation or warranty made by, and
all rights and powers of the Company under or in
connection with the Credit Agreement and confirms and
restates all such representations and warranties as of
the date when made by the Company;
(b) confirms and acknowledges that all references
to the "Company" in the Credit Agreement or any
amendment thereto or any document, instrument or
agreement executed, or to be executed, in connection
therewith, shall be deemed to be references to Supply,
except where such references relate to the Company prior
to the assumption provided for in the foregoing clause
(a); and
(c) acknowledges and agrees that it is, and shall
continue to be, bound by the Credit Agreement as if it
had been the "Company" thereunder from the original
execution and delivery thereof.
Section 3. Miscellaneous.
3.01 Obligations Cumulative. The obligations
undertaken herein by United and Supply are cumulative and not
exclusive of any obligations incurred by operation of law as
a result of the Mergers.
3.02 Successors and Assigns. This Agreement shall
be binding upon United and Supply and their respective
successors and (to the extent permitted by Section 12.06 of
the Credit Agreement) assigns and shall inure to the benefit
of, and be enforceable by the Agent and each Lender, and
their respective successors and (to the extent permitted by
said Section 12.06) assigns.
3.03 GOVERNING LAW. THIS AGREEMENT SHALL BE
GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE LAW OF THE
STATE OF NEW YORK.
3.04 Counterparts. This Agreement may be executed
in any number of counterparts, all of which taken together
shall constitute one and the same instrument and either of
the parties hereto may execute this Agreement by signing any
such counterpart.
3.05 Captions. The captions and section headings
appearing herein are included solely for convenience of
reference and are not intended to affect the interpretation
of any provision of this Agreement.
3.06 Severability. If any provision hereof is
invalid and unenforceable in any jurisdiction, then, to the
fullest extent permitted by law, (i) the other provisions
hereof shall remain in full force and effect in such
jurisdiction and shall be liberally construed in favor of the
Agent and the Lenders in order to carry out the intentions of
the parties hereto as nearly as may be possible and (ii) the
invalidity or unenforceability of any provision hereof in any
jurisdiction shall not affect the validity or enforceability
of such provision in any other jurisdiction.
IN WITNESS WHEREOF, each of United and Supply has
caused this Assumption Agreement to be duly executed and
delivered as of the day and year first above written.
UNITED STATIONERS INC.
By__________________________
Name:
Title:
UNITED STATIONERS SUPPLY CO.
By__________________________
Name:
Title:
Accepted and Acknowledged:
THE CHASE MANHATTAN BANK
(NATIONAL ASSOCIATION),
as Agent
By_______________________
Name:
Title:
EXHIBIT G-2
Opinion of Real Estate Counsel
[Real Estate Counsel Letterhead]
_____________, 1995
The Chase Manhattan Bank
(National Association)
As Agent for the Lenders hereinafter named
1 Chase Manhattan Plaza
New York, New York 10081
and
Each of the Lenders as defined in the
Credit Agreement referred to below
Re: United Stationers Supply Co.-The
Chase Manhattan Bank (National Association):
$500,000,000.00 Loan
Ladies and Gentlemen:
We have acted as special counsel in the State of
______________ (the "State") to United Stationers Supply Co.
(successor by merger to Associated Stationers, Inc. ("ASI")
and hereinafter called the "Company"), in connection with the
loans (the "Loans") to be made to the Company in an aggregate
amount not exceeding $500,000,000.00 by the respective
Lenders (as defined in the Credit Agreement hereinafter
mentioned) pursuant to the Credit Agreement dated as of March
__, 1995 (the "Credit Agreement") among ASI, Associated
Holdings, Inc. (having heretofore merged with and into United
Stationers, Inc.), each of the Lenders identified in the
Credit Agreement (the "Lenders") and The Chase Manhattan Bank
(National Association), as agent for the Lenders (the
"Agent"). Capitalized terms used herein but not defined
herein shall have the meaning provided in the Credit
Agreement.
In rendering the opinions expressed below, we have
examined copies or forms of the documents set forth below
(collectively, the "Documents") and such other certificates,
documents and materials as we have deemed necessary as a
basis for such opinions:
The Credit Agreement.
The Notes.
The Mortgage [Deed of Trust], Assignment of
Rents, Security Agreement and Fixture Filing (the "Mortgage")
made by the Company to [_______, as trustee, for the benefit
of] Agent for the benefit of the Lenders dated as of _____,
1995 covering the fee [and leasehold] interests of the
Company in the premises located in the State and known as
_______________ (the "Property") as more
particularly described therein.
Uniform Commercial Code Financing Statements
naming the Company, as debtor, and the Agent, as secured
party, (the "Personal Property Financing Statements") as
listed on Part A of Schedule 1 hereto.
Uniform Commercial Code Financing Statement,
naming the Company as debtor, and the Agent, as secured
party, as listed on Part B of Schedule 1 hereto (the "Fixture
Financing Statement"; together with the Personal Property
Financing Statements, the "Financing Statements"; and,
together with the Mortgage, the "Mortgage Documents").
The Security Agreement.
For purposes of this opinion, we have, with your permission
assumed without independent investigation that:
(i) the Company is a duly organized and
validly existing corporation under the laws of
the jurisdiction of its incorporation;
(ii) the documents submitted to us as
originals are authentic and the documents
submitted to us as copies conform to the
original documents;
(iii) ASI has been duly merged into
the Company and the Company has duly assumed
all of ASI's obligations under the Credit
Agreement;
(iv) the Documents have been duly
authorized, executed and delivered by each of
the parties thereto;
(v) the Company has full corporate power
and authority to enter into and pay or perform
and observe its obligations contained in the
Documents;
(vi) the persons who executed,
acknowledged and delivered the Documents on
behalf of each of the parties thereto were
duly authorized to do so by each such party;
and
(vii) the Company has title to the
Property covered by the Mortgage, and to the
Collateral (as defined in the Security
Agreement) in which it is granting a security
interest pursuant to the Security Agreement.
Based upon the foregoing, we are of the opinion that:
The Company has qualified to do business in the
State and is in good standing in the State.
The authorization, execution and delivery by the
Company of the Mortgage Documents in accordance with the laws of
the state of incorporation of such corporation and the State of
New York satisfy all applicable legal requirements of the State as
to such authorization, execution and delivery.
The Mortgage Documents constitute legal, valid and
binding obligations of the Company and are enforceable against the
Company in accordance with their respective terms, subject to the
qualifications hereafter set forth in this opinion. The choice of
law provisions contained in the Documents will be upheld and
enforced by the courts of the State and Federal courts sitting in
and applying the laws of the State. If the laws of the State were
held to govern the Documents, the amounts to be received by the
Lenders as interest in respect of the Notes and under the Credit
Agreement constitute lawful interest under the laws of the State
and are neither usurious nor illegal.
The Mortgage Documents are in forms satisfactory
for recording. The recording of the Mortgage in the office of
______________ and the filing and recording of the Fixture
Financing Statement in the offices of ____________________ and
______________________, respectively, are the only recordings or
filings necessary to publish notice of and to establish of record
the rights of the parties thereto and to perfect the liens and
security interests granted by the Company pursuant to the Mortgage
in the real property (including fixtures) covered thereby. The
Fixture Financing Statement complies in all respects with
applicable provisions of the Uniform Commercial Code as in effect
in the State (the "U.C.C.") and is in appropriate form for filing
or recording and the description therein of the property covered
thereby is adequate to permit the perfection of such security
interests. Upon the execution and delivery of the Mortgage and
the Fixture Financing Statement and the recording and filing of
said instruments in the aforesaid offices, the liens and security
interests thereby created shall be perfected. No documents or
instruments other than those referred to in this paragraph 4 need
to be recorded, registered or filed in any public office in the
State in order to publish notice of the Mortgage or to perfect
such liens and security interests or for the validity or
enforceability of any of the Documents or to permit the Lenders to
enforce their rights thereunder in the courts of the State.
[Note: (a) To the extent the recording of the Mortgage serves
as a fixture filing, paragraph 4 should be modified to delete
references to the Fixture Financing Statement.
(b) If a ground lease pursuant to which the Company
holds its leasehold interest in the Property or a short form of
ground lease or memorandum thereof must either (i) have been
recorded or (ii) be attached to the Mortgage when recorded, please
add to opinion.]
The Personal Property Financing Statements comply
in all respects with applicable provisions of the U.C.C. and are
in appropriate form for filing; and upon the filing of the
Personal Property Financing Statements in the offices of
_______________ and ___________________, the Lenders shall have a
perfected security interest in all of the Company's right, title
and interest in the Collateral located in the State. There are no
other filings necessary to perfect the foregoing security
interests, other than the continuation statements under the U.C.C.
required to be filed within six (6) months prior to the expiration
of five (5) years from the date of filing of the Personal Property
Financing Statements or the last timely filed continuation
statements.
[Except for _________________,] no recording,
filing, privilege, tax or other fee must be paid by the Company,
the Agent or the Lenders in connection with the execution,
delivery, recordation or enforcement of any of the Documents.
No consent, approval or other authorization of, or
filing or registration with, any court or governmental agency,
commission or other authority of the State or any subdivision
thereof is required for the due execution and delivery of any of
the Documents, or for the performance or observance of the terms
thereof, except for the filings and recordings in respect of the
Mortgage Documents set forth herein.
The execution and delivery by the Company of the
Documents to which it is a party, compliance with the provisions
thereof and the consummation of the transactions contemplated
thereby will not conflict with or result in a violation of any
law, statute or regulation of the State.
It is not necessary for the Agent or the Lenders to
register with or qualify to do business in the State solely to
make the Loans and enforce the provisions of the Documents. The
making of the Loans and enforcement of the provisions of the
Documents will not result in the imposition upon the Agent or the
Lenders of any taxes of the State, or any subdivision thereof in
which the Property is located (including, without limitation,
franchise, license, tax on interest received or income taxes),
other than taxes which the Agent and/or the Lenders, if and when
they become the actual and record owner of the Property, by reason
of power of sale or foreclosure under the Mortgage or by deed in
lieu of foreclosure, would be required to pay thereafter.
The foreclosure of the Mortgage, exercise of
mortgagee's power of sale, or exercise of any other remedy
provided in the Mortgage will not in any manner restrict, affect
or impair the liability of the Company with respect to the
indebtedness secured thereby or the rights and remedies of the
Agent or the Lenders with respect to the foreclosure or
enforcement of any other security interests or liens securing such
indebtedness, to the extent any deficiency remains unpaid after
application of the proceeds of the foreclosure of the Mortgage,
exercise of such power of sale or as a result of the exercise of
any other remedy.
The priority of the lien of the Mortgage in respect
of all advances or extensions of credit made by each Lender under
the Credit Agreement on, before or after the date on which the
Mortgage is recorded in the appropriate recording office referred
to in paragraph 4 above will be determined by the date of such
recording.
The priority of the lien of the Mortgage will not
be affected by (a) any prepayment of a portion of the Loans, or
(b) any increase in or reduction of the outstanding amount of the
Loans from time to time.
Our opinion as to enforceability of the designated
Documents in paragraph 3 above is subject to the qualifications
that:
(a) The enforceability of any of the Documents may be
limited by applicable bankruptcy, insolvency reorganization,
moratorium or other similar laws of general application affecting
the enforcement of creditors' rights; and
(b) The availability or enforceability of particular
remedies, including self-help remedies, or waivers contained in or
in respect of the Mortgage may be limited by (i) equitable
principles (regardless of whether the issue of enforceability is
considered in a proceeding in equity or at law) or (ii) applicable
laws, rules, regulations, court decisions and
constitutional requirements in and of the State or the United
States, provided that the limitations referred to in this clause
(ii) will not, in our opinion, make the remedies afforded by the
Mortgage (taken as a whole) inadequate for the practical
realization of the principal benefits of the collateral security
provided therein.
We express no opinion with regard to any matter which
may be governed by the law of any jurisdiction other than the law
of the State and the United States of America.
This opinion is rendered as of the effective date set
forth above, and we express no opinion as to circumstances or
events which may occur subsequent to such date.
Very truly yours,
SCHEDULE 1
Financing Statements
Part A - Personal Property Financing Statements
Part B - Fixture Financing Statements
EXHIBIT H
[Form of Opinion of Special New York Counsel to the Agent]
March __, 1995
To the Lenders party to the
Credit Agreement referred to
below and The Chase Manhattan Bank
(National Association), as Agent
Ladies and Gentlemen:
We have acted as special New York counsel to The
Chase Manhattan Bank (National Association), as Agent, in
connection with (i) the Credit Agreement dated as of March
30, 1995 (the "Credit Agreement") among Associated
Stationers, Inc. (together with its successors and assigns,
including United Stationers Supply Co. ("Supply") from and
after the effectiveness of the Supply Merger (as defined
therein), the "Company"), Associated Holdings, Inc. (together
with its successors and assigns, including, United Stationers
Inc. ("United") from and after the effectiveness of the
United Merger (as defined therein), the "Guarantor" and,
together with the Company, the "Obligors"), the lenders named
therein, and The Chase Manhattan Bank (National Association),
as Agent (the "Agent"), providing for extensions of credit to
be made by said lenders to the Company in an aggregate
principal amount not exceeding $500,000,000 and (ii) the
various other agreements, instruments and other documents
referred to in the next following paragraph. Except as
otherwise provided herein, terms defined in the Credit
Agreement are used herein as defined therein. This opinion
letter is being delivered pursuant to Section 7.01(f) of the
Credit Agreement.
In rendering the opinions expressed below, we have
examined the following agreements, instruments and other
documents:
(a) the Credit Agreement;
(b) the Revolving Credit Notes; (c)
the Tranche A Term Loan Notes;
(d) the Tranche B Term Loan Notes; (e) the
Security Agreement; (f) the Pledge
Agreement;
(g) the Assumption Agreement;
(h) financing statements being executed
and delivered pursuant to Section 7.01 of the
Credit Agreement concurrently with the
delivery of this opinion (collectively, the
"Financing Statements"); and
(i) such other documents as we have
deemed necessary as a basis for the opinions
expressed below.
The agreements, instruments and other documents referred to
in the foregoing lettered clauses (other than clauses (h) and
(i) above) are collectively referred to as the "Credit
Documents". The Revolving Credit Notes, the Tranche A Term
Loan Notes and the Tranche B Term Loan Notes are collectively
referred to as the "Notes".
In our examination, we have assumed the
genuineness of all signatures, the authenticity of all
documents submitted to us as originals and the conformity
with authentic original documents of all documents submitted
to us as copies. When relevant facts were not independently
established, we have relied upon representations made in or
pursuant to the Credit Documents.
In rendering the opinions expressed below, we have
assumed, with respect to all of the documents referred to in
this opinion letter, that:
(i) such documents have been duly
authorized by, have been duly executed and
delivered by, and (except to the extent set
forth in the opinions below as to the
Obligors) constitute legal, valid, binding and
enforceable obligations of, all of the parties
to such documents;
(ii) all signatories to such documents
have been duly authorized; and
(iii) all of the parties to such
documents are duly organized and validly
existing and have the power and authority
(corporate or other) to execute, deliver and
perform such documents.
We have further assumed for purposes of paragraph 3 below,
that the Financing Statements will be filed in the
appropriate office(s) no later than 10 days after the
initial extension of credit under the Credit Agreement.
Based upon and subject to the foregoing and
subject also to the comments and qualifications set forth
below, and having considered such questions of law as we have
deemed necessary as a basis for the opinions expressed below,
we are of the opinion that:
1. Each of the Credit Documents constitutes the
legal, valid and binding obligation of each Obligor
party thereto, enforceable against such Obligor in
accordance with its terms, except as may be limited by
bankruptcy, insolvency, reorganization, moratorium or
other similar laws relating to or affecting the rights
of creditors generally and except as the enforceability
of the Credit Documents is subject to the application of
general principles of equity (regardless of whether
considered in a proceeding in equity or at law),
including, without limitation, (a) the possible
unavailability of specific performance, injunctive
relief or any other equitable remedy and (b) concepts of
materiality, reasonableness, good faith and fair
dealing.
2. (a) The Security Agreement is effective to
create, in favor of the Agent for the benefit of the
Agent and the Lenders, a valid security interest under
the Uniform Commercial Code as in effect in the State of
New York (the "Uniform Commercial Code") in all of the
right, title and interest of the Company in, to and
under the Collateral (as defined in the Security
Agreement) as collateral security for the payment of the
Secured Obligations (as defined in the Security
Agreement), except that (a) such security interest will
continue in Collateral after its sale, exchange or other
disposition only to the extent provided in Sections 9-
306 and 9-307 of the Uniform Commercial Code, (b) the
security interest in Collateral in which the Company
acquires rights after the commencement of a case under
the Bankruptcy Code in respect of the Company may be
limited by Section 552 of the Bankruptcy Code and (c)
the creation of a security interest in any Collateral
(as defined in the Security Agreement) constituting a
"security" (as defined in Section 8-102 of the Uniform
Commercial Code) requires the transfer of said
Collateral to the Agent pursuant to Section 8-313(1) of
the Uniform Commercial Code, which transfer in the case
of a "certificated security" (as defined in Section 8-
102(1)(a) of the Uniform Commercial Code) may be
effected in the manner contemplated by paragraph 3(b)
below.
(b) The Pledge Agreement is effective to
create, in favor of the Agent for the benefit of the
Agent and the Lenders, a valid security interest under
the Uniform Commercial Code in all of the right, title
and interest of the Guarantor in, to and under the
Collateral (as defined in the Pledge Agreement) as
collateral security for the payment of the Secured
Obligations (as defined in the Pledge Agreement), except
that (a) such security interest will continue in
Collateral after its sale, exchange or other disposition
only to the extent provided in Section 9-306 of the
Uniform Commercial Code, (b) the security interest in
Collateral in which the Guarantor acquires rights after
the commencement of a case under the
Bankruptcy Code in respect of the Guarantor may be
limited by Section 552 of the Bankruptcy Code and (c)
the creation of a security interest in any Pledged Stock
(as defined in the Pledge Agreement) requires the
transfer of said Pledged Stock to the Agent pursuant to
Section 8-313(1) of the Uniform Commercial Code, which
transfer in the case of a "certificated security" (as
defined in Section 8-102(1)(a) of the Uniform Commercial
Code) may be effected in the manner contemplated by
paragraph 3(b) below.
3. The security interest referred to in paragraph
2 above in the types of Collateral (as defined in the
Pledge Agreement and the Security Agreement) described
below will be perfected as described below:
(a) such security interest in that
portion of the Collateral consisting of inventory
or equipment (each, as defined in Section 9-109 of
the Uniform Commercial Code but excluding equipment
that is mobile and of a type normally used in more
than one jurisdiction and inventory leased or held
for lease to others) that is located in the State
of New York will, upon the creation of such
security interest, be perfected by filing the
Financing Statements in the office of the Secretary
of State of the State of New York and, assuming the
sole place of business of the Company in the State
of New York is in the County of New York, the
Registry of The City of New York;
(b) such security interest in that
portion of the Collateral consisting of a
certificated security (including the Pledged Stock
under and as defined in the Pledge Agreement and
the Security Agreement), an instrument (as defined
in Section 9-105(1)(i) of the Uniform Commercial
Code) or a document (as defined in Section 9-
105(1)(f) of the Uniform Commercial Code), will,
upon the creation of such security interest, be
perfected by the Agent taking and thereafter
retaining possession thereof (or any certificates
representing any such certificated security) in the
State of New York;
(c) to the extent not expressly covered
by paragraphs (a) or (b) above, such security
interest in that portion of the Collateral
consisting of "proceeds" (as defined in Section 9-
306 of the Uniform Commercial Code) may be
perfected as and to the extent provided in Section
9-306 of the Uniform Commercial Code; and
(d) anything in this paragraph 3 to the
contrary notwithstanding, compliance with a statute
or treaty described in Section 9-302(3) of the
Uniform Commercial Code is required in order to
perfect such security interest in any portion of
the Collateral that is subject to any such statute
or treaty.
4. With respect to any portion of the Collateral
consisting of a certificated security (including the
Pledged Stock under and as defined in the Pledge
Agreement and the Security Agreement), issued in bearer
form or in registered form issued to the Agent or
indorsed to the Agent or in blank, or a negotiable
instrument (as defined in Section 3-104 of the Uniform
Commercial Code), if such security interest therein is
perfected by the Agent in the manner specified in
paragraph 3(b) above in good faith and (in the case of
any negotiable instrument) without notice that it is
overdue or has been dishonored or of any defense against
or claim to it on the part of any Person and (in the
case of any certificated security) without notice of any
adverse claim (as defined in Section 8-302(2) of the
Uniform Commercial Code), any perfected security
interest therein will have priority over all other
security interests theretofore or thereafter created
under the Uniform Commercial Code.
The foregoing opinions are subject to the
following comments and qualifications:
(A) The enforceability of Sections 6.03 and 12.03
of the Credit Agreement (and any similar provisions in
any of the other Credit Documents) may be limited by (i)
laws rendering unenforceable indemnification contrary to
Federal or state securities laws and the public policy
underlying such laws and (ii) laws limiting the
enforceability of provisions exculpating or exempting a
party, or requiring indemnification of a party for,
liability for its own action or inaction, to the extent
the action or inaction involves gross negligence,
recklessness, willful misconduct or unlawful conduct.
(B) The enforceability of provisions in the Credit
Documents to the effect that terms may not be waived or
modified except in writing may be limited under certain
circumstances.
(C) We express no opinion as to (i) the effect of
the laws of any jurisdiction in which any Lender is
located (other than the State of New York) that limit
the interest, fees or other charges such Lender may
impose, (ii) Section 4.07(c) of the Credit Agreement,
and (iii) the second sentence of Section 12.10 of the
Credit Agreement (and any similar provisions in any of
the other Credit Documents), insofar as such sentence
relates to the subject matter jurisdiction of the United
States District Court for the Southern District of New
York to adjudicate any controversy related to any of the
Credit Documents.
(D) We wish to point out that the obligations of
the Obligors, and the rights and remedies of the Agent
and the Lenders, under the Security Agreement and the
Pledge Agreement may be subject to possible limitations
upon the exercise of remedial or procedural provisions
contained in such Agreements, provided that such
limitations do not, in our opinion (but subject to the
other comments and qualifications set forth in this
opinion letter), make the remedies and procedures that
will be afforded to the Agent and the Lenders inadequate
for the practical realization of the substantive
benefits purported to be provided to the Agent and the
Lenders by such Agreements.
(E) With respect to our opinion in paragraphs 2, 3
or 4 above, we express no opinion as to the creation,
perfection or priority of any security interest in (or
other lien on) any Collateral (as defined in the Pledge
Agreement and the Security Agreement) (i) to the extent
that, pursuant to Section 9-104 of the Uniform
Commercial Code, Article 9 of the Uniform Commercial
Code does not apply thereto, (ii) consisting of
uncertificated securities (as defined in Section 8-
102(b) of the Uniform Commercial Code), or
(iii) covered by a certificate of title.
(F) We wish to point out that the acquisition by
an Obligor after the initial extension of credit under
the Credit Agreement of an interest in Property that
becomes subject to the Lien of either the Pledge
Agreement or the Security Agreement may constitute a
voidable preference under Section 547 of the Bankruptcy
Code.
(G) We express no opinion as to the applicability
to the obligations of the Company (or the enforceability
of such obligations) of Section 548 of the Bankruptcy
Code, Article 10 of the New York Debtor and Creditor Law
or any other provision of law relating to fraudulent
conveyances, transfers or obligations.
(H) The effectiveness of the Financing Statements
will lapse on the expiration of a five year period from
their date of filing, or (if later) five years from the
last date as to which such Financing Statements were
effective following the proper filing of continuation
statements with respect thereto, unless continuation
statements are filed within six months prior to the
expiration of the applicable five year period, and, if
the Company so changes its name, identity or corporate
structure that the Financing Statements naming the
Company as debtor become seriously misleading, the
Financing Statements naming the Company as debtor will
be ineffective to perfect a security interest in
Collateral (as defined in the Security Agreement)
acquired by the Company more than four months after such
change.
(I) We express no opinion as to the existence of,
or the right, title or interest of the Obligors in, to
or under, any of the Collateral (as defined in the
Pledge Agreement and the Security Agreement).
(J) Except as expressly provided in paragraphs 2
through 4 above, we express no opinion as to the
creation, perfection or priority of any security
interest in, or other Lien on, the Collateral (as
defined in the Pledge Agreement and the Security
Agreement).
The foregoing opinions are limited to matters
involving the Federal laws of the United States of America
and the law of the State of New York, and we do not express
any opinion as to the laws of any other jurisdiction.
At the request of our client, this opinion letter
is, pursuant to Section 7.01(f) of the Credit Agreement,
provided to you by us in our capacity as special New York
counsel to the Agent and may not be relied upon by any Person
for any purpose other than in connection with the
transactions contemplated by the Credit Agreement without, in
each instance, our prior written consent.
Very truly yours,
/s/ Milbank, Tweed, Hadley & McCloy
TDB/CDP
EXHIBIT I
[Form of Confidentiality Agreement] CONFIDENTIALITY
AGREEMENT
[Date]
[Insert Name and
Address of Prospective
Participant or Assignee]
Re: Credit Agreement dated as of March
30, 1995 (the "Credit Agreement"), among
United Stationers Supply Co. (as
successor by merger to Associated Stationers, Inc., the
"Company"), United Stationers Inc. (as successor by merger to
Associated Holdings, Inc.), as parent guarantor, the lenders
named therein and The Chase Manhattan Bank (National
Association), as Agent.
Dear Ladies and Gentlemen:
As a Lender party to the Credit Agreement, we have
agreed with the Company pursuant to Section 12.12 of the
Credit Agreement to use reasonable precautions to keep
confidential, except as otherwise provided therein, all non-
public information identified by the Company as being
confidential at the time the same is delivered to us pursuant
to the Credit Agreement.
As provided in said Section 12.12, we are
permitted to provide you, as a prospective [holder of a
participation in the Loans (as defined in the Credit
Agreement)] [assignee Lender], with certain of such non-
public information subject to the execution and delivery by
you, prior to receiving such non-public information, of a
Confidentiality Agreement in this form. Such information
will not be made available to you until your execution and
return to us of this Confidentiality Agreement.
Accordingly, in consideration of the foregoing, you
agree (on behalf of yourself and each of your affiliates,
directors, officers, employees and representatives) that (A)
such information will not be used by you except in connection
with the proposed [participation][assignment] mentioned above
and (B) you shall use reasonable precautions, in accordance
with your customary procedures for handling confidential
information and in accordance with safe and sound practices,
to keep such information confidential, provided that nothing
herein shall limit the disclosure of any such information (i)
to the extent required by statute, rule, regulation or
judicial process, (ii) to your counsel or to counsel for any
of the
Lenders or the Agent, (iii) to regulatory personnel, auditors
or accountants, (iv) to the Agent or any other Lender (or to
Chase Securities, Inc.), (v) in connection with any
litigation related to the Acquisition or the transactions
contemplated by the Credit Agreement or the other Basic
Documents to which you or any one or more of the Lenders or
the Agent is a party, or (vi) to a subsidiary or affiliate of
yours as provided in Section 12.12(a) of the Credit
Agreement; and provided that in no event shall you be
obligated to return any materials furnished to you pursuant
to this Confidentiality Agreement.
Please indicate your agreement to the foregoing by
signing as provided below the enclosed copy of this
Confidentiality Agreement and returning the same to us.
Very truly yours,
[INSERT NAME OF LENDER]
By_________________________
The foregoing is agreed to
as of the date of this letter.
[INSERT NAME OF PROSPECTIVE
PARTICIPANT OR ASSIGNEE]
By_________________________
EXHIBIT J
[Form of Notice of Assignment]
NOTICE OF ASSIGNMENT
[Date]
United Stationers Supply Co.
2200 East Golf Road
Des Plaines, IL 60016-1267
The Chase Manhattan Bank, N.A.,
as Agent
4 Chase Metrotech Center -- 13th Floor
Brooklyn, New York 11245
Attention: New York Agency
[Name of Issuing Bank]
_________________________ _________________________
Attention: _____________
Re: Credit Agreement dated as of March
30, 1995 (the "Credit Agreement"), among
United Stationers Supply Co., as
successor by merger to Associated Stationers, Inc. (the
"Company"), United Stationers Inc., as successor by merger to
Associated Holdings, Inc., as parent guarantor, the lenders
named therein and The Chase Manhattan Bank (National
Association), as Agent.
Dear Ladies and Gentlemen:
We hereby give notice that, effective as of the
date hereof, [Name of Assignor] (the "Assignor") has assigned
its rights and obligations with respect to %
(representing $_____________) of the Assignor's outstanding
[[Revolving Credit] [Tranche A Term Loan] [Tranche B Term
Loan] Commitment and] [[Revolving Credit] [Tranche A Term]
[Tranche B Term] Loans] (such interest in such rights and
obligations being hereinafter referred to as the "Assigned
Interest") under the Credit Agreement to [Name of Assignee]
(the "Assignee"). The Assignee hereby agrees (i) to become a
"Lender" pursuant to Section 12.06(b) of the Credit Agreement
(if not already a Lender under the Credit Agreement) and (ii)
agrees to assume all the obligations of the Assignor
thereunder with respect to the Assigned Interest.
The address for notices, lending office(s) and
payment instructions for the Assignee are as follows:
Address for Notices:
Attention:
Telephone:
Telecopier:
Lending Office for Base
Rate Loans:
Lending Office for Loans
other than Base Rate Loans:
Payment Instructions:
[We hereby request the Company to record on the
Register referred to in Section 12.06(g) of the Credit
Agreement the [[Tranche A] [Tranche B]] Term Loans assigned
hereunder.]6
Please sign and return the enclosed copy of this
letter to the undersigned to indicate your receipt hereof,
and your consent to or notice of (as applicable) the above-
mentioned assignment and assumption, and your agreement to
the release of the Assignor from its obligations under the
Credit Agreement with respect to the Assigned Interest. As
a condition to the effectiveness of the above-mentioned
assignment and assumption, the Assignee hereby agrees to pay
to the Agent on the date hereof an assignment fee of $3,500.
Very truly yours,
[NAME OF ASSIGNOR]
By
Title:
[NAME OF ASSIGNEE]
By
Title:
ACKNOWLEDGED OR CONSENTED TO
(AS APPLICABLE):
UNITED STATIONERS SUPPLY CO.
By
Title:
THE CHASE MANHATTAN BANK, N.A.,
as Agent
By
Title:
[NAME OF ISSUING BANK],
as Issuing Bank
By
Title:
EXECUTION COPY
WAIVER AND AMENDMENT NO. 1
WAIVER AND AMENDMENT NO. 1 dated as of April 13, 1995,
between UNITED STATIONERS SUPPLY CO., a corporation
duly organized and validly existing under the laws of the
State of Illinois (the "Company"); UNITED STATIONERS INC., a
corporation duly organized and validly existing under the
laws of the State of Delaware ("the Guarantor" and, together
with the Company, the "Obligors"); each of the lenders that
is a signatory hereto; and THE CHASE MANHATTAN BANK (NATIONAL
ASSOCIATION), a national banking association, as
agent for the Lenders under the Credit Agreement referred to
below (in such capacity, together with its successors in such
capacity, the "Agent").
The Company, the Guarantor, certain lenders and the
Agent are parties to a Credit Agreement dated as of March 30,
1995 (as heretofore modified and supplemented and in effect
on the date hereof, the "Credit Agreement"), providing,
subject to the terms and conditions thereof, for extensions
of credit (by making of loans and issuing letters of credit)
to be made by said lenders to the Company in an aggregate
principal or face amount not exceeding $500,000,000. The
Company, the Guarantor, certain lenders and the Agent wish to
amend the Credit Agreement in certain respects, and
accordingly, the parties hereto hereby agree as follows:
Section 1. Definitions. Except as otherwise
defined in this Waiver and Amendment No. 1, terms defined in
the Credit Agreement are used herein as defined therein.
Section 2. Waivers. Notwithstanding anything to
the contrary contained in Section 9.07, 9.09 or 9.16 of the
Credit Agreement and subject to Section 5 below, but
effective as of the date hereof,
(a) the Lenders hereby agree and consent to the
issuance of the Take-Out Notes in an aggregate principal
amount not to exceed $150,000,000, provided that the
proceeds of such issuance are applied as follows (and
the Lenders hereby consent to such application):
(i) First, an amount of such proceeds
equal to (x) $130,000,000 plus (y) accrued interest
on the Bridge Loans as of the date of such issuance
shall be applied to the payment in full of the
Bridge Loans;
(ii) Second, $6,500,000 of such proceeds
shall be applied to the prepayment of the Term
Loans in accordance with Section 2.09 of the Credit
Agreement; and
(iii) Finally, the remaining amount of
such proceeds shall be applied to the prepayment of
the Revolving Credit Loans; and
(b) the Lenders hereby agree and consent to the
redemption in full (but not any partial redemption) or
repurchase of all (but not less than all) of the
Guarantor's Class B Preferred Stock at any time, unless
a Default has occurred and is continuing at the time the
Guarantor has committed so to repurchase or redeem such
Class B Preferred Stock, provided that (i) such
redemption or repurchase is for an aggregate price of
not more than $7,500,000, (ii) the Guarantor shall have
received all applicable consents thereto (other than any
such consent required under the Credit Agreement waived
hereby), (iii) any such Class B Preferred Stock so
repurchased shall be immediately retired, (iv) such
redemption or repurchase shall be permitted only if the
Take-Out Notes are issued in the aggregate principal
amount of $150,000,000 and (v) such redemption or
repurchase shall have taken place not more than 60 days
after the Guarantor has committed to such repurchase or
redemption.
Section 3. Amendments. Subject to the
satisfaction of the conditions precedent specified in Section
5 below, but effective as of the date hereof, the Credit
Agreement shall be amended as follows:
3.01. References in the Credit Agreement
(including references to the Credit Agreement as amended
hereby) to "this Agreement" (and indirect references such as
"hereunder", "hereby", "herein" and "hereof") shall be deemed
to be references to the Credit Agreement as amended hereby.
3.02. Section 9.10 of the Credit Agreement shall
be amended by adding immediately after clause (b) thereto the
following:
"minus (c) at any time after the redemption in full or
repurchase and retirement of all of the Class B
Preferred Stock of the Guarantor, $3,750,000."
Section 4. Representations and Warranties. Each
of the Guarantor and the Company represents and warrants to
the Lenders that (a) no Default has occurred and is
continuing and (b) the representations and warranties set
forth in Section 8 of the Credit Agreement and in each other
Basic Document to which the Guarantor or the Company is a
party are true and complete on the date hereof as if made on
and as of the date hereof (or, if any such representation or
warranty is expressly stated to have been made as of a
specific date, as of such specific date) and as if each
reference in said Section 8 to "this Agreement" included
reference to this Waiver and Amendment No. 1.
Section 5. Effectiveness. As provided in Sections
2 and 3 above, the waivers of and amendments to the Credit
Agreement set forth in said Sections 2 and 3 shall become
effective, as of the date hereof, upon the execution and
delivery hereof.
Section 6. Miscellaneous. Except as herein
provided, the Credit Agreement shall remain unchanged and in
full force and effect. This Waiver and Amendment No. 1 may
be executed in any number of counterparts, all of which taken
together shall constitute one and the same amendatory
instrument and any of the parties hereto may execute this
Waiver and Amendment No. 1 by signing any such counterpart.
This Waiver and Amendment No. 1 shall be governed by, and
construed in accordance with, the law of the State of New
York.
IN WITNESS WHEREOF, the parties hereto have caused
this Waiver and Amendment No. 1 to be duly executed and
delivered as of the day and year first above written.
UNITED STATIONERS SUPPLY CO.
By _________________________
Title:
UNITED STATIONERS INC.
By_________________________
Title:
THE CHASE MANHATTAN BANK
(NATIONAL ASSOCIATION)
By________________________
Title:
ARAB BANKING CORPORATION
(B.S.C.)
By_____________________________
Title:
BANK OF AMERICA ILLINOIS
By_____________________________
Title:
THE BANK OF NEW YORK
By_____________________________
Title:
THE FIRST NATIONAL BANK OF
CHICAGO
By_____________________________
Title:
THE LONG-TERM CREDIT BANK OF
JAPAN, LTD., CHICAGO
BRANCH
By_____________________________
Title:
NATIONSBANK, N.A. (CAROLINAS)
By_____________________________
Title:
PNC BANK, NATIONAL ASSOCIATION
By____________________________
Title:
VAN KAMPEN MERRITT PRIME RATE
INCOME TRUST
By_____________________________
Title:
BANK ONE, MILWAUKEE, NA
By_____________________________
Title:
THE CIT GROUP/BUSINESS CREDIT,
INC.
By_____________________________
Title:
NATIONAL CANADA FINANCE
CORPORATION
By_____________________________
Title:
By_____________________________
Title:
SANWA BUSINESS CREDIT
CORPORATION
By_____________________________
Title:
TRANSAMERICA BUSINESS CREDIT
CORPORATION
By_____________________________
Title:
BANK OF SCOTLAND
By_____________________________
Title:
THE NORTHERN TRUST COMPANY
By_____________________________
Title: Vice President
CORESTATES BANK, N.A.
By_____________________________
Title:
COMERICA BANK
By_____________________________
Title:
THE FIRST NATIONAL BANK OF
MARYLAND
By_____________________________
Title:
THE MITSUBISHI TRUST AND
BANKING
CORPORATION CHICAGO BRANCH
By_____________________________
Title:
NBD BANK
By_____________________________
Title:
BANQUE PARIBAS
By_____________________________
Title:
By_____________________________
Title:
SOCIETY NATIONAL BANK
By_____________________________
Title:
THE BANK OF TOKYO TRUST COMPANY
By_____________________________
Title:
UNION BANK
By_____________________________
Title:
MICHIGAN NATIONAL BANK
By_____________________________
Title:
CREDITANSTALT CORPORATE
FINANCE,
INC.
By_____________________________
Title:
By_____________________________
Title:
KEYPORT LIFE INSURANCE COMPANY
By______________________ Title:
STICHTING RESTRUCTURED
OBLIGATIONS
BACKED BY SENIOR ASSETS 2
(ROSA2)
By CHANCELLOR SENIOR SECURED
MANAGEMENT, INC., as
Portfolio Advisor
By______________________
Title:
RESTRUCTURED OBLIGATIONS BACKED
BY SENIOR ASSETS B.V.
By CHANCELLOR SENIOR SECURED
MANAGEMENT, INC., as
Portfolio Advisor
By______________________
Title:
CERES FINANCE, LTD.
By CHANCELLOR SENIOR SECURED
MANAGEMENT, INC., as
Financial Manager
By______________________
Title:
STRATA FUNDING LTD.
By CHANCELLOR SENIOR SECURED
MANAGEMENT, INC., as
Financial Manager
By______________________
Title:
THE CHASE MANHATTAN BANK
(NATIONAL ASSOCIATION),
as Agent
By _________________________
Title:
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_ _
[Form of Opinion of Delaware Counsel to the Obligors]
_________, 1995
The Chase Manhattan Bank, N.A., as Agent
and the Lenders party to the Credit
Agreement dated as of March 29,
1995 among Associated Stationers, Inc.
Associated Holdings, Inc., the Lenders named
therein, and The Chase Manhattan Bank, N.A.,
as Agent
The Roebling Fund, as Agent and the Lenders
named in the Senior Subordinated Credit
Agreement dated as of March 29, 1995
among Associated Stationers, Inc., Associated
Holdings, Inc., the Lenders named therein,
and The Roebling Fund, N.A., as Agent
Re: Associated Holdings, Inc.
Ladies and Gentlemen:
We have acted as special Delaware counsel for
Associated Holdings, Inc., a Delaware corporation ("AHI"), in
connection with certain matters relating to the Agreement and
Plan of Merger (the "Merger Agreement") dated as of February
13, 1995, between AHI and United Stationers Inc., a Delaware
corporation ("USI"). We have not acted as counsel for USI,
nevertheless, we have been asked to speak to the
enforceability of the Merger Agreement against USI.
In rendering this opinion, we have examined and
relied upon the following documents: the Merger Agreement,
with Annex A and without the Exhibits; the Certificate of
Incorporation, as amended to date of AHI; the current Bylaws
of AHI; a Certificate of the Assistant Secretary of AHI with
resolutions of the board of directors of AHI and consents of
the stockholders of AHI attached thereto; an Officer's
Certificate of AHI and USI; a form of Certificate of
Ownership and Merger to be filed with the Office of the
Secretary of State of the State of Delaware with respect to
the merger of AHI with and into (the "Certificate of
Merger"); and a Certificate of Good Standing with respect to
AHI issued by the Delaware Secretary of State on March 30,
1995. We have not received or reviewed any other documents
and note that our definition of the Merger Agreement does not
include a review of any documents referred to or incorporated
by reference in the Merger Agreement other than those
identified in this paragraph. (All the foregoing documents
shall be herein referred to as the "Reviewed Documents").
With respect to the foregoing documents, we have
assumed and relied upon the authenticity of all documents
submitted to us as originals, the conformity with the
originals of all documents submitted to us as copies or
forms, the genuineness of all signatures, the legal capacity
of natural persons and that the foregoing documents, in the
forms submitted to us for our review, have not been and will
not be altered or amended in any respect material to our
opinion as stated herein. In rendering this opinion, we have
relied as to factual matters solely upon the Reviewed
Documents, which we believe are the documents necessary for
the opinions to be rendered herein, the statements and
information set forth therein, the additional matters recited
and assumed herein, all of which we assume to be true,
complete and accurate in all material respects. All terms
used herein, other than those defined or the definition of
which is otherwise referred to herein, are intended to have
the meaning set forth in the Merger Agreement.
For the purposes of rendering the opinions
hereinafter expressed, we have also assumed that each of the
parties to the Merger Agreement is a corporation that is duly
incorporated, validly existing and in good standing under the
laws of the State of Delaware and has the requisite corporate
power and authority to enter into and execute the Merger
Agreement and to perform the transactions contemplated by the
Merger Agreement, and the Merger Agreement has been duly
authorized, executed and delivered by the parties thereto.
Our opinion is subject to the following
qualifications:
(i) We are members of the Bar
of the State of Delaware and have made no inquiry
and are expressing no opinion as to any matter
relating to the laws of any jurisdiction other than
Delaware. Moreover, although the Delaware
Securities Act may be applicable to this opinion,
we have been expressly asked not to consider such
law.
(ii) We express no opinion as
to the financial terms of the transaction
contemplated by the Merger Agreement, the fairness
of those terms to any person or entity or with
respect to the satisfaction of any fiduciary duties
which may exist.
(iii) We express no opinion as
to the effect on rights of AHI or USI under the
Merger Agreement of any statute, rule, regulation
or other law or any court decision which becomes
effective after the date of this opinion. This
opinion is rendered, and speaks only, as of the
date hereof, and we assume no obligation to advise
you of any change, whether or not material, that
may be brought to our attention at a later date
with respect to the matters described herein.
(iv) We express no opinion as
to the effect of rules of equity governing specific
performance, injunction relief or other equitable
remedies or involving the exercise of judicial
discretion in any proceedings at law or in equity.
(v) We express no opinion on
the rights of the parties to the Merger Agreement
under any applicable bankruptcy, receivership,
insolvency, reorganization, liquidation, moratorium
or other laws affecting the rights and remedies of
creditors generally from time to time in effect,
the judicial imposition of an implied covenant of
commercial reasonableness, good faith and fair
dealing, public policy or the discretion of any
court as to the enforcement of remedies.
(vi) We express no opinion
with respect to any provision contained in the
Merger Agreement which purports to limit the
parties' ability to waive, modify, terminate or
amend the Merger Agreement except in writing.
(vii) We express no opinion
with respect to any indemnity, exculpation,
contribution or penalty provision contained in the
Merger Agreement.
Based upon the foregoing, subject thereto and in
reliance thereon, we are of the opinion that, under Delaware
law, the Merger Agreement constitutes the legal, valid and
binding obligation of the parties thereto and is enforceable
against them in accordance with its terms.
This opinion is limited to the matters of Delaware
law stated herein and no opinion is implied or may be
inferred beyond the matters expressly stated. The opinions
expressed herein may be relied upon only by you and any
assignee under the respective Credit Agreements.
Notwithstanding the foregoing, you may furnish copies of this
opinion in connection with any opinions or other advice you
render in connection with the Merger Agreement. Without our
express prior written consent, the opinions expressed herein
may not be used, circulated or quoted or otherwise referred
to in connection with any other transactions, except that
copies of this opinion may be furnished to your independent
auditors, legal counsel and appropriate regulatory
authorities and pursuant to an order of legal process of any
relevant government authority.
Very truly yours,
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_ _ EXHIBIT G-1
FORM OF OPINION
[WG&M LETTERHEAD]
March __, 1995
To the Lenders party to the Credit
Agreement referred to below and The
Chase Manhattan Bank (National
Association), as Agent
Ladies and Gentlemen:
We have acted as counsel (i) to Associated Holdings,
Inc. ("AHI"), a Delaware corporation, prior to the effectiveness
of the United Merger, and to United Stationers Inc., a Delaware
corporation ("United"), immediately after the effectiveness of
the United Merger, and (ii) to Associated Stationers, Inc.
("ASI"), a Delaware corporation, prior to the effectiveness of
the Supply Merger, and to United Stationers Supply Co., an
Illinois corporation ("Stationers"), immediately after the
effectiveness of the Supply Merger (AHI and ASI, prior to the
effectiveness of the Mergers, and United and Supply, immediately
after effectiveness of the Mergers, being herein collectively
referred to as the "Obligors"), in connection with the
preparation, authorization, execution and delivery of, and
consummation of the transactions contemplated by, that certain
Credit Agreement (the "Credit Agreement") dated as of March __,
1995 among ASI, AHI, the Lenders named therein (collectively, the
"Lenders"), and The Chase Manhattan Bank (National Association),
as Agent ("Agent"). Capitalized terms defined in the Credit
Agreement and used but not otherwise defined herein are used
herein with the meanings as so defined. This opinion is being
delivered to you pursuant to Section 7.01(d) of the Credit
Agreement.
In so acting, we have examined originals or copies,
certified or otherwise identified to our satisfaction, of
(a)(i) the Assumption Agreement, (ii) the Revolving Credit Notes,
(iii) the Tranche A Term Loan Notes, (iv) the Tranche B Term Loan
Notes, (v) the Credit Agreement, (vi) the Security Agreement,
(vii) the Pledge Agreement, and (viii) the Merger Agreement (such
documents being hereinafter collectively referred to as the
"Transaction Documents"), (b) the Certificates of Ownership and
Merger issued in connection with the Mergers, (c) the UCC-1
financing statements listed on Schedule 1 attached hereto and
made a part hereof (collectively, the "Financing Statements"),
(d) the Mortgages dated of even date herewith (collectively, the
"Real Estate Documents"), and (e) such corporate records,
agreements, documents and other instruments, and such
certificates or comparable documents of public officials and of
officers and representatives of the Obligors as we have deemed
relevant and necessary as a basis for the opinions hereinafter
set forth. We have also made such inquiries of such officers and
representatives as we have deemed relevant and necessary as a
basis for the opinions hereinafter set forth. As used herein,
"to our knowledge" and "of which we are aware" mean the conscious
awareness of facts or other information by any lawyer in our firm
actively involved in negotiating the transactions contemplated by
the Credit Agreement and in the examinations referred to in this
paragraph.
In such examination, we have assumed the genuineness of
all signatures, the legal capacity of natural persons, the
authenticity of all documents submitted to us as originals, the
conformity to original documents of all documents submitted to us
as certified or photostatic copies and the authenticity of the
originals of such latter documents. As to all questions of fact
material to this opinion that have not been independently
established, we have relied upon certificates or comparable
documents of officers and representatives of the Obligors and
upon the representations and warranties of the Obligors contained
in the Credit Agreement and the other Transaction Documents. We
have also assumed, for purposes of our opinions with respect to
Stationers set forth in the fourth sentence of paragraph 2 below
and in the second sentence of paragraph 11 below, (a) the due
organization, valid existence, and good standing of Stationers
under the laws of the State of Illinois, (b) that Stationers has
all requisite corporate power and authority to conduct its
business and enter into and perform the Transaction Documents to
which it is a party, and (c) the due authorization, execution and
delivery of the Transaction Documents, the Real Estate Documents
and the Financing Statements to which Stationers is or becomes a
party.
Based on the foregoing, and subject to the
qualifications stated herein, we are of the opinion that:
1. Each of AHI, ASI and United is a corporation
duly organized, validly existing and in good standing under the
laws of the State of Delaware.
2. Each of AHI and ASI had, at the time of
execution and delivery thereof, and United has, all requisite
corporate power and authority to execute and deliver the
Transaction Documents to which it is a party and to perform its
obligations under the Transaction Documents to which it is a
party. The execution, delivery, and performance by each of AHI,
ASI and United of the Transaction Documents to which it is a
party, and the consummation by each of AHI, ASI and United of the
transactions contemplated thereby have been duly authorized by
all necessary corporate action on the part of each of AHI, ASI
and United. Each of the Transaction Documents to which it is a
party has been duly and validly executed and delivered by each of
AHI, ASI and United. Assuming the due authorization, execution
and delivery thereof by each party thereto other than AHI, ASI
and United, each of the Transaction Documents (except the Merger
Agreement) to which each Obligor is a party constitutes the
legal, valid and binding obligation of each Obligor party
thereto, enforceable against such Obligor in accordance with its
respective terms, subject in all cases to applicable bankruptcy,
insolvency, fraudulent conveyance, reorganization, moratorium and
similar laws affecting creditors rights and remedies generally,
and, further subject, as to enforceability, to general principles
of equity, including principles of commercial reasonableness,
good faith and fair dealing (regardless of whether enforcement is
sought in a proceeding at law or in equity), and except to the
extent that rights to indemnification thereunder may be limited
by federal or state securities laws or public policy relating
thereto. The opinions expressed in this paragraph are further
subject to the qualifications that (i) certain remedial
provisions of the Pledge Agreement and the Security Agreement
(collectively, the "Security Documents") are or may be
unenforceable in whole or in part under the laws of the State of
New York, but the inclusion of such provisions does not affect
the validity of the Security Documents and the Security Documents
contain adequate provisions for the practical realization of the
rights and benefits intended to be afforded thereby, and (ii) we
express no opinion in this paragraph as to the effect on the
Transaction Documents of the laws of any jurisdiction other than
the State of New York, including laws which limit the rates of
interest legally chargeable or collectable. No opinion is
expressed in this paragraph as to the perfection or priority of
any liens granted pursuant to the Transaction Documents.
3. The execution and delivery of the Transaction
Documents, the Financing Statements and the Real Estate
Documents, the consummation of the transactions contemplated
thereby and compliance by each Obligor with any of the provisions
thereof pertaining to such party will not (x) conflict with,
constitute a default under or violate (i) any of the terms,
conditions or provisions of the certificate of incorporation or
by-laws of AHI, ASI or United, (ii) any of the terms, conditions
or provisions of any material document, agreement or other
instrument to which any Obligor is a party or by which it is
bound of which we are aware, (iii) any applicable New York,
Delaware corporate or federal law or regulation (other than
federal and state securities or blue sky laws, as to which we
express no opinion except as otherwise set forth herein), or (iv)
any writ, injunction, decree or order of any court or
governmental authority binding on the respective Obligor of which
we are aware, or (y) result in the creation of any Lien (except
for the Liens created in favor of the Agent by the Transaction
Documents and the Real Estate Documents) upon the assets of any
Obligor under any material document, agreement or other
instrument to which any Obligor is a party or by which it is
bound of which we are aware.
4. No consent, approval or authorization or
other action by or filing with any New York, Delaware corporate
or federal governmental authority is required in connection with
the execution, delivery and performance by each Obligor of any of
the Transaction Documents or the Real Estate Documents to which
it is a party or the consummation by each Obligor of the
transactions contemplated thereby, except for (i) UCC and
Mortgage filings, (ii) federal and state securities or blue sky
laws, as to which we express no opinion except as expressly
provided herein, (iii) the Notification and Report Form in
respect of the Acquisition furnished to the Department of Justice
and the Federal Trade Commission pursuant to the Hart-Scott
Rodino Antitrust Improvements Act of 1976 (which Notification and
Report Form has been duly filed and all applicable waiting
periods thereunder have expired or have been terminated without
any action having been taken by any competent authority that
restricts, prevents or imposes conditions upon the Acquisition of
which we are aware), (iv) certificates relating to the Mergers
required by applicable law to consummate the Mergers, and (v)
those already obtained.
5. To our knowledge, there is no litigation,
proceeding or governmental investigation pending or overtly
threatened against any Obligor, or any of their respective
Properties, that relates to any of the transactions contemplated
by the Assumption Agreement or the other Transaction Documents or
which, if adversely determined, would reasonably be expected to
have a Material Adverse Effect.
6. No Obligor is a "holding company" within the
meaning of the Public Utility Holding Company Act of 1935, as
amended.
7. No Obligor is an "investment company" within
the meaning of the Investment Company Act of 1940, as amended.
8. (a) The Security Agreement creates a valid
lien on and a security interest in the "Collateral" (as such term
is defined in the Security Agreement, other than the Pledged
Stock (as defined in the Security Agreement)), as security for
the obligations secured thereby under the laws of the State of
New York. Assuming that the Financing Statements are filed on
Form UCC-1 attached hereto as Schedule 2 in the offices of the
Secretary of the State of New York, the New York City Register
and the Secretary of State of Texas, then the security interest
created pursuant to the Security Agreement in that portion of the
Collateral consisting of "Equipment" and "Inventory" (as such
terms are defined in the Uniform Commercial Code in effect in the
State of New York (the "New York UCC") and in the Uniform
Commercial Code in effect in the State of Texas (the "Texas UCC,"
together with the New York UCC, collectively, the "UCC")) located
in the States of New York and Texas will be perfected in favor of
the Agent.
(a) Assuming delivery in New York to and
continued possession by Agent of all stock certificates listed in
the Security Agreement that represent Pledged Stock (as defined
therein), the Security Agreement is effective to create, in favor
of the Agent for the benefit of the Lenders, a valid and duly
perfected security interest under the New York UCC in all of the
right, title and interest of Stationers in such Pledged Stock.
Assuming that the Agent and the Lenders were without notice of
any adverse claim (as such term is used in Section 8-302 of the
New York UCC) with respect to such Pledged Stock, such perfected
security interest in such Pledged Stock will have priority over
all other security interests theretofore or thereafter created
under the New York UCC.
(b) Assuming delivery in New York to and
continued possession by Agent of all stock certificates listed in
the Pledge Agreement that represent the Pledged Stock (as defined
in the Pledge Agreement), the Pledge Agreement is effective to
create, in favor of the Agent for the benefit of the Lenders, a
valid and duly perfected security interest under the New York UCC
in all of the right, title and interest of United in such Pledged
Stock. Assuming that the Agent and the Lenders were without
notice of any adverse claim (as such term is used in Section
8-302 of the New York UCC) with respect to such Pledged Stock,
such perfected security interest in such Pledged Stock will have
priority over all other security interests theretofore or
thereafter created under the New York UCC.
The opinions set forth in subparagraph 8(a) are subject
to the following exceptions:
(i) that with respect to any Obligor's rights in or
title to the Collateral, we express no opinion and have assumed
that such Obligor has title to the Collateral; and
(ii) that with respect to Collateral which is or may
become fixtures (within the meaning of Section 9-313 of the UCC),
we express no opinion.
The opinions set forth in subparagraphs 8(b) and 8(c)
are subject to the following exceptions:
(i) that with respect to (x) federal tax liens
accorded priority under law and (y) liens created under Title IV
of the Employee Retirement Income Security Act of 1974 which are
properly filed after the date hereof, we express no opinion as to
the relative priority of such liens and the security interests
created in the respective Pledged Stock by the Pledge Agreement
and the Security Agreement;
(ii) that with respect to any claim (including for
taxes) in favor of any state or any of its respective agencies,
authorities, municipalities or political subdivisions which claim
is given lien status and/or priority under any law of such state,
we express no opinion as to the relative priority of such liens
and the security interests created in the respective Pledged
Stock by the Pledge Agreement and the Security Agreement; and
(iii) that with respect to a security interest
perfected pursuant to Section 9-304(4) or (5) of the New York
UCC, we express no opinion as to the relative priority of such
security interests and the security interests created in the
respective Pledged Stock pursuant to the Pledge Agreement and the
Security Agreement.
In addition, the opinions in this paragraph 8 are
subject to (i) the limitations on perfection of security
interests in proceeds resulting from the operation of Section 9
306 of the UCC; (ii) the limitations with respect to buyers in
the ordinary course of business imposed by Sections 9-307 and 9
308 of the UCC; (iii) the limitations with respect to documents,
instruments and securities imposed by Sections 8-301 and 9-309 of
the UCC; (iv) the provisions of Section 9-204 of the UCC relating
to the time of attachment and perfection of a security interest
in the items of Collateral in which Stationers does not now have
rights and of which it does not now have possession; (v) the
qualification that insofar as the stock of United Worldwide
Limited and United Stationers Hong Kong Limited constitutes
Collateral or Pledged Stock as to which the creation of a lien on
or security interest in such Collateral or Pledged Stock is
governed by the laws of any jurisdiction other than the State of
New York, we express no opinion; and (vi) Section 552 of Title 11
of the United States Code (the "Bankruptcy Code") with respect to
any Collateral acquired by Stationers subsequent to the
commencement of a case against or by Stationers under the
Bankruptcy Code.
We further assume that all (a) filings will be timely
made and duly filed as necessary (i) in the event of a change in
the name, identity or corporate structure of Stationers, (ii) in
the event of a change in location of the Collateral, or the
location of the principal office of Stationers or the place where
Stationers keeps its books and records, and (iii) to continue to
maintain the effectiveness of the original filings, and (b) any
money, instruments, documents or certificated securities which
may constitute part of the Collateral are and will remain in the
Agent's possession.
9. The making of the extensions of credit under
the Credit Agreement, the application of the proceeds thereof and
the pledge of the Collateral under the Security Agreement and
Pledged Stock under the Pledge Agreement do not violate
Regulation G, U or X of the Board of Governors of the Federal
Reserve System under the Securities Exchange Act of 1934, as
amended.
10. The Schedule 14D-1 has been duly and timely
filed by AHI with the Commission pursuant to Section 14(d) of the
Exchange Act.
11. The Schedule 14D-1 at the time it was filed
with the Commission (except the financial statements and other
financial and statistical data included therein, as to which we
express no opinion) complied as to form, in all material
respects, with the requirements of the Exchange Act.
12. The "Offer" as set forth in the Offer to
Purchase has been structured in a manner which complies with the
procedural requirements of Rule 14e-1 under the Exchange Act.
13. The United Merger has been duly authorized by
the Boards of Directors of United and AHI. The Supply Merger has
been duly authorized by the Boards of Directors of ASI and
Stationers. A Certificate of Ownership and Merger pursuant to
Section 253 of the General Corporation Law of the State of
Delaware having been filed with the Secretary of State of the
State of Delaware, in accordance with Section 103 of the General
Corporation Law of the State of Delaware, the United Merger has
become effective in accordance with the Merger Agreement and the
General Corporation Law of the State of Delaware.
14. Pursuant to the Assumption Agreement and by
operation of law, United has assumed all of the obligations of
AHI as Guarantor under the Credit Agreement. Pursuant to the
Assumption Agreement, Stationers has assumed all of the
obligations of ASI under the Credit Agreement.
The opinions expressed herein are limited to the laws
of the State of New York (and the Texas UCC with respect to
paragraph 8(a) hereof), the corporate laws of the State of
Delaware and the federal laws of the United States and we express
no opinion as to the effect on the matters covered by this letter
of the laws of any other jurisdiction.
The opinions expressed herein are rendered solely for
your benefit in connection with the transactions described
herein. These opinions may not be used or relied upon by any
other person (other than a person who is a permitted assignee or
participant pursuant to Section 12.06 of the Credit Agreement),
nor may this letter or any copies thereof be furnished to a third
party, filed with a governmental agency, quoted, cited or
otherwise referred to without our prior written consent, except
that copies of this opinion may be furnished to your independent
auditors, legal counsel and appropriate regulatory authorities
and pursuant to an order or legal process of any relevant
governmental authority.
Very truly yours,
[On File Copy only:]
Prepared by: C. Craig Lilly (1106)
Signed by: Mary R. McNabb (224)
Reviewed by:David P. Stone (54)
Reviewed as to
New York Law: Steven D. Rubin (188)
SCHEDULE 1
Financing Statements
SCHEDULE 2
Form UCC-1
DAFS02...:\33\78533\0004\2474\LTR5055W.420
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_ _ _ EXHIBIT G-4
Form of Opinion of Local Counsel
[Real Estate Counsel Letterhead]
_____________, 1995
The Chase Manhattan Bank
(National Association)
As Agent for the Lenders hereinafter named
1 Chase Manhattan Plaza
New York, New York 10081
and
Each of the Lenders as defined in the
Credit Agreement referred to below
Re: United Stationers supply Co.-The Chase Manhattan
Bank (National Association): $500,000,000.00 Loan
Ladies and Gentlemen:
We have acted as special counsel in the State of ____________
(the "State") to United Stationers Supply Co. (successor by merger
to Associated Stationers, Inc. ("ASI") and hereinafter called the
"Company"), in connection with the loans (the "Loans") to be made
to the Company in an aggregate amount not exceeding
$500,000,000.00 by the respective Lenders (as
defined in the Credit Agreement hereinafter mentioned)
pursuant to the Credit Agreement dated as of March __, 1995
(the "Credit Agreement") among ASI, Associated Holdings, Inc.
(having heretofore merged with and into United Stationers,
Inc.), each of the Lenders identified in the Credit Agreement
(the "Lenders") and The Chase Manhattan Bank (National
Association), as agent for the Lenders (the "Agent").
Capitalized terms used herein but not defined herein shall
have the meaning provided in the Credit Agreement.
In rendering the opinions expressed below, we have examined
copies or forms of the documents set forth below (collectively,
the "Documents") and such other certificates, documents and
materials as we have deemed necessary as a basis for such
opinions:
1. The Credit Agreement.
2. The Notes.
3. The Mortgage [Deed of Trust], Assignment of Rents,
Security Agreement and Fixture Filing (the "Mortgage") made by
the Company to [_______, as trustee, for the benefit of] Agent
for the benefit of the Lenders dated as of _____, 1995 covering
the fee [and leasehold] interests of the Company in the premises
located in the State and known as ______________ (the
"Property") as more particularly described therein.
4. Uniform Commercial Code Financing Statements naming
the Company, as debtor, and the Agent, as secured party, (the
"Personal Property Financing Statements") as listed on Part A of
Schedule 1 hereto.
5. Uniform Commercial Code Financing Statement, naming
the Company as debtor, and the Agent, as secured party, as
listed on Part B of Schedule 1 hereto (the "Fixture Financing
Statement"; together with the Personal Property Financing
Statements, the "Financing Statements"; and, together with the
Mortgage, the "Mortgage Documents").
6. The Security Agreement.
For purposes of this opinion, we have, with your permission
assumed without independent investigation that:
(i) the Company is a duly organized and
validly existing corporation under the laws of the
jurisdiction of its incorporation;
(ii) the documents submitted to us as
originals are authentic and the documents submitted to
us as copies conform to the original documents;
(iii) ASI has been duly merged into the Company
and the Company has duly assumed all of
ASI's obligations under the Credit Agreement;
(iv) the Documents have been duly authorized,
executed and delivered by each of the parties thereto;
(v) the Company has full corporate power and
authority to enter into and pay or perform and observe
its obligations contained in the Documents;
(vi) the persons who executed, acknowledged
and delivered the Documents on behalf of each of
the parties thereto were duly authorized to do so
by each such party; and
(vii) the Company has title to the
Property covered by the Mortgage, and to the
Collateral (as defined in the Security Agreement)
in which it is granting a security interest
pursuant to the Security Agreement.
Based upon the foregoing, we are of the opinion that:
7. The Company has qualified to do business in
the State and is in good standing in the State.
8. The authorization, execution and delivery by
the Company of the Mortgage Documents in accordance with the laws
of the state of incorporation of such corporation and the State of
New York satisfy all applicable legal requirements of the State as
to such authorization, execution and delivery.
9. The Mortgage Documents constitute legal, valid
and binding obligations of the Company and are enforceable against
the Company in accordance with their respective terms, subject to
the qualifications hereafter set forth in this opinion. The choice
of law provisions contained in the Documents will be upheld and
enforced by the courts of the State and Federal courts sitting in
and applying the laws of the State. If the laws of the State were
held to govern the Documents, the amounts to be received by the
Lenders as interest in respect of the Notes and under the Credit
Agreement constitute lawful interest under the laws of the State
and are neither usurious nor illegal.
10. The Mortgage Documents are in forms
satisfactory for recording. The recording of the Mortgage in the
office of ______________ and the filing and recording of the
Fixture Financing Statement in the offices of ___________________
and _____________________, respectively, are the only recordings or
filings necessary to publish notice of and to establish of record
the rights of the parties thereto and to perfect the liens and
security interests granted by the Company pursuant to the Mortgage
in the real property (including fixtures) covered thereby. The
Fixture Financing Statement complies in all respects with
applicable provisions of the Uniform Commercial Code as in effect
in the State (the "U.C.C.") and is in appropriate form for filing
or recording and the description therein of the property covered
thereby is adequate to permit the perfection of such security
interests. Upon the execution and delivery of the Mortgage and the
Fixture Financing Statement and the recording and filing of said
instruments in the aforesaid offices, the liens and security
interests thereby created shall be perfected. No documents or
instruments other than those referred to in this paragraph 4 need
to be recorded, registered or filed in any public office in the
State in order to publish notice of the Mortgage or to perfect such
liens and security interests or for the validity or enforceability
of any of the Documents or to permit the Lenders to enforce their
rights thereunder in the courts of the State.
(a) To the extent the recording of the
Mortgage serves as a fixture filing, paragraph 4 should be modified
to delete references to the Fixture Financing Statement.
(b) If a ground lease pursuant to which
the Company holds its leasehold interest in the Property or
a short form of ground lease or memorandum thereof must
either (1) have been recorded or (ii) be attached to the
Mortgage when recorded,
please add to opinion.]
11. The Personal Property Financing
Statements comply in all respects with applicable provisions
of the U.C.C. and are in appropriate form for filing; and
upon the filing of the Personal Property Financing Statements
in the offices of _______________ and __________________, the
Lenders shall have a perfected security interest in all of
the Company's right, title and interest in the Collateral
located in the State. There are no other filings necessary
to perfect the foregoing security interests, other than the
continuation statements under the U.C.C. required to be filed
within six (6) months prior to the expiration of five (5)
years from the date of filing of the Personal Property
Financing Statements or the last timely filed continuation
statements.
12. [Except for _______________,] no
recording, filing, privilege, tax or other fee must be paid
by the Company, the Agent or the Lenders in connection with
the execution, delivery, recordation or enforcement of any of
the Documents.
13. No consent, approval or other
authorization of, or filing or registration with, any court
or governmental agency, commission or other authority of the
State or any subdivision thereof is required for the due
execution and delivery of any of the Documents, or for the
performance or observance of the terms thereof, except for
the filings and recordings in respect of the Mortgage
Documents set forth herein.
14. The execution and delivery by the
Company of the Documents to which it is a party, compliance
with the provisions thereof and the consummation of the
transactions contemplated thereby will not conflict with or
result in a violation of any law, statute or regulation of
the State.
15. It is not necessary for the Agent or the
Lenders to register with or qualify to do business in the
State solely to make the Loans and enforce the provisions of
the Documents. The making of the Loans and enforcement of
the provisions of the Documents will not result in the
imposition upon the Agent or the Lenders of any taxes of the
State, or any subdivision thereof in which the Property is
located (including, without limitation, franchise, license,
tax on interest received or income taxes), other than taxes
which the Agent and/or the Lenders, if and when they become
the actual and record owner of the Property, by reason of
power of sale or foreclosure under the Mortgage or by deed in
lieu of foreclosure, would be required to pay thereafter.
16. The foreclosure of the Mortgage,
exercise of mortgagee's power of sale, or exercise of any
other remedy provided in the Mortgage will not in any manner
restrict, affect or impair the liability of the Company with
respect to the indebtedness secured thereby or the rights and
remedies of the Agent or the Lenders with respect to the
foreclosure or enforcement of any other security interests or
liens securing such indebtedness, to the extent any
deficiency remains unpaid after application of the proceeds
of the foreclosure of the Mortgage, exercise of such power of
sale or as a result of the exercise of any other remedy.
17. The priority of the lien of the Mortgage
in respect of all advances or extensions of credit made by
each Lender under the Credit Agreement on, before or after
the date on which the Mortgage is recorded in the appropriate
recording office referred to in paragraph 4 above will be
determined by the date of such recording.
18. The priority of the lien of the Mortgage
will not be affected by (a) any prepayment of a portion of
the Loans, or (b) any increase in or reduction of the
outstanding amount of the Loans from time to time.
Our opinion as to enforceability of the designated
Documents in paragraph 3 above is subject to the
qualifications that:
(a) The enforceability of any of the
Documents may be limited by applicable bankruptcy, insolvency
reorganization, moratorium or other similar laws of general
application affecting the enforcement of creditors' rights;
and
(b) The availability or enforceability of
particular remedies, including self-help remedies, or waivers
contained in or in respect of the Mortgage may be limited by
(i) equitable principles (regardless of whether the issue of
enforceability is considered in a proceeding in equity or at
law) or (ii) applicable laws, rules, regulations, court
decisions and constitutional requirements in and of the State
or the United States, provided that the limitations referred
to in this clause (ii) will not, in our opinion, make the
remedies afforded by the Mortgage (taken as a whole)
inadequate for the practical realization of the principal
benefits of the collateral security provided therein.
We express no opinion with regard to any matter
which may be governed by the law of any jurisdiction other
than the law of the State and the United States of America.
This opinion is rendered as of the effective date
set forth above, and we express no opinion as to
circumstances or events which may occur subsequent to such
date.
Very truly yours,
SCHEDULE 1
Financing Statements
Part A - Personal Property Financing Statements
Part B - Fixture Financing Statements
AT19:\DATA\WP\78533\0004\2474\LTR5055U.590
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_ _ _ March 30,1995
To the Lenders party to the
Credit Agreement referred to below
and The Chase Manhattan Bank
(National Organization),
as Agent
Ladies and Gentlemen:
We have acted as special Illinois counsel to United
Stationers Supply Co. ("Supply" and, together with United
Stationers, Inc. ("United"), the "Obligors") in connection
with (i) the Credit Agreement (the "Credit Agreement") dated
as of March 30, 1995, among Associated Stationers, Inc.
(together with its successors and assigns including, as of
the date hereof, Supply, the "Company"); Associated Holdings,
Inc. (together with its successors and assigns, including as
of the date hereof, United, the "Guarantor"), the lenders
named therein (the "Lenders") and The Chase Manhattan Bank
(National Association), as agent for the Lenders (in such
capacity, the "Agent"), providing for extensions of credit to
be made by the Lenders for the purpose, inter alia of
financing the Acquisition referred to therein and (ii) the
various agreements and instruments referred to the next
following paragraph. Except as otherwise provided herein,
capitalized terms defined in the Credit Agreement are used
herein as defined therein. The opinion is being delivered to
you at the request of the Company pursuant to the terms of
the Credit Agreement.
In rendering the opinions expressed below, we have
examined the following agreements, instruments and other
documents:
(a) the Credit Agreement;
(b) the Revolving Credit Notes;
(c) the Tranche A Term Loan Notes;
(d) the Tranche B Term Loan Notes;
(e) the Supply Security Agreement;
(f) the Assumption Agreement;
(g) the Supply Merger Agreement;
(h) financing statements for filing in
the Office of the Secretary of State of the
State of Illinois, which arc being executed
and delivered by Supply pursuant to the terms
of the Credit Agreement (collectively, the
"Financing Statements"); and
(i) such corporate records of Supply and
such other documents as we have deemed
necessary as a basis for the opinions
expressed below,
The agreements, instruments and other documents referred to
in the foregoing lettered clauses (other than clauses (h) and
(i) above) are collectively referred to as the "Transaction
Documents," and the Revolving Credit Notes, the Tranche A
Term Loan Notes and the Tranche B Term Loan Notes
are collectively referred to as the "Notes".
In our examination, we have assumed the legal
capacIty of natural persons, the genuineness of all
signatures, the authenticIty of all documents submItted to us
as originals and the conformity with authentic original
documents of all documents submitted to us as copies. We
have not independently investigated or established relevant
facts; we have relied, as to factual matters, exclusively
upon statements certificates of governmental officials,
representations made in or pursuant to the Transaction
Documents and certificates of appropriate representatives of
Supply. We have further assumed that the Supply Merger has
been consummated and its effective under applicable Delaware
law.
In rendering the opinions expressed below, we have
assumed, with respect to all of the documents referred to in
this opinion letter, that:
(i) such documents have been
duly authorized by, have been duly executed
and delivered by, and constitute legal, valid,
binding and enforceable obligations of, all of
the parties to such documents;
(ii) all signatories to such
documents have been duly authorized;
(iii) all of the partIes to such
documents are duly organized, validly existing
and in good standing under the laws of the
jurisdiction of their respective organization
and are qualified to transact business and are
in good standing in each jurIsdiction in which
the nature of their activities or assets
require such qualification, and have the power
and authority (corporate or other) to execute,
deliver and perform such documents; and
(iv) the Transaction Documents
are valid, binding and enforceable under the
laws of the State of New York;
provided that with respect to Supply, we have not assumed
such matters on which we provide an opinion in paragraph 1
below.
Based upon and subject to the foregoing and
subject also to the comments and qualifications set forth
below, and having considered such questions of law as we have
deemed necessary as a basis for the opinions expressed below,
we are of the opinion that:
1. Supply is a corporation validly existing and
in good standing under the laws of the State of Illinois.
Supply has all requisite corporate power to execute and
deliver the Transaction Documents to which it Is a party and
the Financing Statements, and to perform its obligations
under each of the Transaction Documents to which it is a
party. The execution, delivery and performance by Supply of
the Transaction Documents to which it is a party have been
duly authorized by all necessary corporate action on the part
of Supply.
2. No authorization, approval or consent of, and
no filing or registration with, any governmental or
regulatory authority or agency or any securities exchange of
the State of Illinois is required on the part of Supply for
the execution, delivery or performance by Supply of the
Transaction Documents to which it is a party or for the
legality, validity or enforceability thereof or for the
borrowings or the application for incurrence of liability in
respect of any Letter of Credit by Supply under the Credit
Agreement, except for (i) the filing of the Financing
Statements in respect of the Liens created pursuant to the
Transaction Documents, (ii) filings under applicable state
securities laws which we assume have been duly made,
(iii) immaterial state and municipal licenses; (iv) such
authorizations or approvals specifically contemplated by the
Transaction Documents; and (v) with respect to the Supply
Merger, any required filings or recordings under applicable
state employment, corporate or tax laws or regulations.
3. The execution and delivery by Supply of the
Transaction Documents to which it is a party and the
performance by Supply of its obligations under the
Transaction Documents to which it is a party and the
consummation of the transactions contemplated thereby and
compliance with the terms thereof do not and will not violate
any provision of the Articles of Incorporation or by-laws of
Supply.
4. The security interests granted by Supply
under the Security Agreement in the types of Collateral (as
defined in the Security Agreement) described below will be
perfected as follows:
(a) such security interest in that portion of the
Collateral consisting of (i) accounts or general
intangibles (each, as defined in Section 9-106 of the
Uniform Commercial Code of the State of Illinois (the
"Uniform Commercial Code")), and (ii) inventory or
equipment (each, as defined In Section 9-109 of the
Uniform Commercial Code) that is mobile and of a type
normally used in more than one jurisdiction and, if
inventory (as so defined), leased or held for lease to
others, will, upon the creation of such security
interest, be perfected by filing the Financing
Statements in the filing office listed in Schedule A
attached hereto; provided that, if Supply moves its
chief executive officer to another jurisdiction, the
effectiveness of the Financing Statements naming Supply
as debtor will cease on the expiration of four months
after such change or, in earlier, when perfection would
have otherwise ceased, unless such security interest
becomes perfected under the law of such other
jurisdiction prior to such expiration;
(b) such security interest in that portion of the
Collateral consisting of inventory or equipment (each as
defined in Section 9-109 of the Uniform Commercial Code)
that ii not of the type referred to in clause (a) above
and that is located in the State of Illinois will, upon
the creation of such security interest, be perfected by
filing the Financing Statements in the office listed in
Schedule A;
(c) to the extent not expressly covered by clauses
(a) or (b) above, such security interest in that portion
of the collateral consisting of "proceeds"
(as defined in Section 9-306 of the Uniform Commercial
Code; and
(d) anything in this paragraph 4 to the contrary
notwithstanding, compliance with a statute or treaty
described in Section 9-302(3) of the Uniform Commercial
Code is required in order to perfect such security
interest in any portion of the Collateral that is
subject to any such statute or treaty.
For purposes of this opinion we have assumed that
all filings will be timely made and duly filed as necessary
(i) in the event of a change in the name, identity or
corporate structure of Supply, (ii) in the event of a change
in location of the Collateral, or the location of, the chief
executive offices of Supply or the place where Supply keeps
its books and records, and (iii) to continue to maintain the
effectiveness of the original filings.
5. The Supply Merger between Associated
Stationers, Inc. and Supply has been duly authorized by the
Board of Directors of Supply. Articles of Merger (Form BCA-
11.25) have been filed with the Secretary of State of the
State of Illinois in accordance with Section 11.25 of the
Illinois Business CorporatIon Act of 1983, as amended (the
"Illinois BCA") and a Certificate of Merger having been
issued by the Secretary of State of the State of Illinois
evidences that the Supply Merger has become effective in
accordance with its terms and the Illinois BCA.
The foregoing opinions are subject to the
following comments and qualifications:
(A) We express no opinion as to (i) the perfection
of any security interest in (or other lien on) any
Collateral (a) to the extent that, pursuant to Section 9-
104 of the Uniform Commercial Code, Article 9 of the
Uniform Commercial Code does not apply thereto, (b)
consisting of uncertificated securities (as defined in
Section 8-102(b) of the Uniform CommercIal Code) or (c)
covered by a certificate of title; (ii) the perfection
of any security interest (or lien on) any Collateral in
which the perfection of a security interest is by means
other than the fling of a financing statement pursuant
to Article 9 of the Uniform Commercial Code; and (iii)
Collateral which is or may become fixtures within the
meaning of Section 9-313 of the Uniform Commercial Code.
(B) We have assumed that the chief executive
office of Supply is located in Illinois.
(C) We express no opinion as to the existence of,
or the right, title or interest of Supply in, to or
under, any of the Collateral.
(D) Except as expressly set forth in paragraph 4,
we express no opinion as to the perfection of any
security interest in, or other lien on, the Collateral.
(E) The perfection of your security interests
which are perfected by the filing of the Financing
Statements in the State of Illinois is limited by
provisions of the Uniform Commercial Code relating to
non-identifiable or commingled cash proceeds, after
acquired property, future advances, proceeds and sales
of goods in the ordinary course of business.
(F) We do not express any opinion as to the
priority of your security interests in the Collateral.
We understand that you will rely upon such Uniform
Commercial Code, judgment, tax lien and other searches
as you deem and, accordingly, we do not express any
opinion as to such matters.
(G) We do not express any opinion as to the
creation of any security interest in, or other Lien on,
the Collateral, and for purposes of our opinion provided
in paragraph 4 we have assumed the valid creation of a
security interest by Supply in the Collateral referred
to in paragraph 4.
(H) Our opinions are subject to limitations which
may be imposed by state or federal bankruptcy,
insolvency, reorganization, fraudulent conveyance or
transfer, moratorium or other laws relating to or
generally affecting the rights of creditors and general
equitable principles (regardless of whether considered
in a proceeding in equity or in law).
The foregoing opinions are limited to matters
involving the laws of the State of Illinois, and we do not
express any opinion as to federal law or the laws of any
other jurisdiction.
At the request of our clients this opinion letter
is provided to you by us in our capacity as counsel to Supply
and may not be relied upon by any Person for any purpose
other than in connection with the transactions contemplated
by the Credit Agreement without, in each instance, our prior
written consent, except that copies of this opinion may be
furnished to your independent auditors, legal counsel and
appropriate regulatory authorities and pursuant to an order
or legal process of any relevant governmental authority. Our
opinions are rendered as of the effective date set forth
above, and we express no opinion as to circumstances or
events which occur subsequent to such date.
Very truly yours,
D'Ancona & Pflaum
By:
Partner
LIST OF FILING OFFICES
SCHEDULE A
State of Illinois
State of Illinois, Secretary of State
UCC Section
Centennial Building
Springfield, Illinois 62756
______________________________________
We are advised that financing statements also have been
filed in the county offices set forth below:
County of DuPage, Illinois
Recorder of Deeds
421 N. County Farm Road
Wheaton, Illinois 60187
County of Cook, Illinois
Recorder of Deeds
118 North Clark
Chicago, IL 60606
_______________________________
1 Bracketed language to be inserted into Registered
Notes.
2 Bracketed language to be inserted into Registered
Notes.
3 Catalogue Receivables shall not constitute Ineligible
Receivables (unless they so constitute for other reasons) for
purposes of determinations made as of the last day of
September, October, November, December, January or February.
4 Calendars shall not be excluded from Eligible Inventory for
purposes of any determination of "Eligible Inventory" made as
of the last day of June, July, August, September, October,
November or December.
5 At any time after February 28 but before November 1,
this percentage shall be 60% (not 65%).
6 Insert this language if Assignee will acquire
Registered Loans hereunder.
81304_7/NYL3
INDENTURE, dated as of May 3, 1995 among UNITED
STATIONERS SUPPLY CO., a corporation duly organized and
existing under the laws of the State of Illinois (herein
called the "Company"), having its principal office at 2200
East Golf Road, Des Plaines, Illinois 60016-1267, United
Stationers Inc., a corporation duly organized and existing
under the laws of the State of Delaware ("United"), and The
Bank of New York, a New York banking corporation, as Trustee
(herein called the "Trustee").
RECITALS OF THE COMPANY
The Company has duly authorized the creation of an
issue of 12_% Senior Subordinated Notes due 2005 (herein
called the "Initial Securities"), and 12_% Senior
Subordinated Notes due 2005 (the "Exchange Securities" and,
together with the Initial Securities, the "Securities"), of
substantially the tenor and amount hereinafter set forth,
and to provide therefor the Company has duly authorized the
execution and delivery of this Indenture.
United has authorized the making of the guarantee
pursuant to this Indenture (the "Guarantee"). Upon the
issuance of the Exchange Securities, if any, or the
effectiveness of the Shelf Registration Statement (as
defined), this Indenture will become subject to the
provisions of the Trust Indenture Act
of 1939, as amended, that are required to be part of this
Indenture and shall, to the extent applicable, be governed
by such provisions.
All things necessary have been done (i) to make
the Securities, when executed by the Company and
authenticated and delivered hereunder and duly issued by the
Company, the valid obligations of the Company in accordance
with their terms, (ii) to make the Guarantee, when executed
and delivered by United, the valid obligation of United in
accordance with its terms and (iii) to make this Indenture,
when executed and delivered by the Company and United and
duly authorized, executed and delivered by the Trustee, a
valid agreement of the Company and the Guarantor, in
accordance with its terms.
NOW, THEREFORE, THIS INDENTURE WITNESSETH:
For and in consideration of the premises and the
purchase of the Securities by the Holders (as defined)
thereof, it is mutually covenanted and agreed, for the equal
and proportionate benefit of all Holders of the Securities,
as follows:
ARTICLE ONE
DEFINITIONS AND OTHER PROVISIONS
OF GENERAL APPLICATION
SECTION 101. Definitions.
For all purposes of this Indenture, except as
otherwise expressly provided or unless the context otherwise
requires:
(a) the terms defined in this Article have the
meanings assigned to them in this Article, and include
the plural as well as the singular;
(b) all other terms used herein which are defined
in the Trust Indenture Act, either directly or by
reference therein, have the meanings assigned to them
in the Trust Indenture Act, and the terms "cash
transaction" and "self-liquidating paper," as used in
the Trust Indenture Act Section 311, shall have the
meanings assigned to them in the rules of the
Commission adopted under the Trust Indenture Act;
(c) all accounting terms not otherwise defined
herein have the meanings assigned to them in accordance
with generally accepted accounting principles, and,
except as otherwise herein expressly provided, the term
"generally accepted accounting principles" with respect
to any computation required or permitted hereunder
shall have the meaning ascribed to "GAAP" in this
Article; and
(d) the words "herein," "hereof" and "hereunder"
and other words of similar import refer to this
Indenture as a whole and not to any particular Article,
Section or other subdivision.
"Acquired Indebtedness" means Indebtedness of a
Person (i) existing at the time such Person becomes a
Restricted Subsidiary or (ii) assumed in connection with the
acquisition of assets from such Person. Acquired
Indebtedness shall be deemed to be incurred on the date of
the related acquisition of assets from any Person or the
date the acquired Person becomes a Restricted Subsidiary.
"Affiliate" means, with respect to any specified
Person, (i) any other Person directly or indirectly
controlling or controlled by or under direct or indirect
common control with such specified Person or (ii) any other
Person that owns, directly or indirectly, 10% or more of
such specified Person's Capital Stock or any executive
officer or director of any such specified Person or other
Person or, with respect to any natural Person, any person
having a relationship with such Person by blood, marriage or
adoption not more remote than first cousin. For the purposes
of this definition, "control" when used with respect to any
specified Person means the power to direct the management
and policies of such Person, directly or indirectly, whether
through ownership of voting securities, by contract or
otherwise; and the terms "controlling" and "controlled" have
meanings correlative to the foregoing. Notwithstanding any
of the foregoing, for purposes of this Indenture, The Chase
Manhattan Corporation and its subsidiaries shall be deemed
not to be an Affiliate of United, the Company or any
Subsidiary.
"Asset Sale" means any sale, issuance, conveyance,
transfer, lease or other disposition (including, without
limitation, by way of merger, consolidation or Sale and
Leaseback Transaction) (collectively, a "transfer"),
directly or indirectly, in one or a series of related
transactions, of (i) any Capital Stock of any Subsidiary;
(ii) all or substantially all of the properties and assets
of any division or line of business of the Company or any
Restricted Subsidiary; or (iii) any other properties or
assets of the Company or any Restricted Subsidiary, other
than in the ordinary course of business. For the purposes
of this definition, the term "Asset Sale" shall not include
(x) any transfer of properties or assets (A) that is
governed by Section 801(a) hereof or (B) that is by the
Company to any Restricted Wholly Owned Subsidiary, or by any
Restricted Wholly Owned Subsidiary to the Company or any
Restricted Wholly Owned Subsidiary in accordance with the
terms of this Indenture or (y) transfers of properties and
assets listed on Schedule I to this Indenture.
"Associated" means Associated Stationers, Inc., a
Delaware corporation.
"Average Life to Stated Maturity" means, as of the
date of determination with respect to any Indebtedness, the
quotient obtained by dividing (i) the sum of the products of
(a) the number of years from the date of determination to
the date or dates of each successive scheduled principal
payment of such Indebtedness multiplied by (b) the amount of
each such principal payment by (ii) the sum of all such
principal payments.
"Bankruptcy Law" means Title 11, United States
Bankruptcy Code of 1978, as amended, or any similar United
States federal or state 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 either the board of
directors of the Company or any duly authorized committee of
that board.
"Board Resolution" means a copy of a resolution
certified by the Secretary or an Assistant Secretary of the
Company to have been duly adopted by the Board of Directors
and to be in full force and effect on the date of such
certification, and delivered to the Trustee.
"Borrowing Base" means, as of any date, an amount
equal to the sum of (a) 80% of the face amount of all
accounts receivable of the Company and its Restricted
Subsidiaries as of such date and (b) 50% of the book value
(calculated on a FIFO basis) of all inventory owned by the
Company and its Restricted Subsidiaries as of such date, all
calculated on a consolidated basis and in accordance with
GAAP. To the extent that information is not available as to
the amount of accounts receivable or inventory as of a
specific date, the Company may utilize the most recent
available quarterly or annual financial report for purposes
of calculating the Borrowing Base.
"Business Day" means each Monday, Tuesday,
Wednesday, Thursday and Friday which is not a day on which
banking institutions in The City of New York are authorized
or obligated by law or executive order to close.
"Capital Lease Obligation" means any obligations
of the Company and its Restricted Subsidiaries on a
Consolidated basis under any capital lease of real or
personal property which, in accordance with GAAP, has been
recorded as a capitalized lease obligation.
"Capital Stock" of any Person means any and all
shares, interests, participations, partnership interests or
other equivalents (however designated) of such Person's
capital stock.
"Change of Control" means the occurrence of any of
the following events: (i) any "person" or "group" (as such
terms are used in Sections 13(d) and 14(d) of the Exchange
Act), other than one or more of the Permitted Holders,
becomes the ultimate
"beneficial owner" (as defined in Rules 13d-3 and 13d-5
under the Exchange Act), directly or indirectly, of more
than 50% of the voting power of the total outstanding Voting
Stock of United (or any successor) or the Company (or any
successor) voting as one class; (ii) during any period of
two consecutive years, individuals who at the beginning of
such period constituted the Board of Directors of United or
the Company (together with any new directors whose election
to such Board of Directors or whose nomination for election
by the shareholders of such Person, was approved by a vote
of 66_% of the directors then still in office who were
either directors at the beginning of such period or whose
election or nomination for election was previously so
approved) cease for any reason to constitute a majority of
such Board of Directors then in office; (iii) United or the
Company conveys, transfers, or leases or otherwise disposes
of all or substantially all of its assets to any Person
(other than one or more of the Permitted Holders); (iv)
United (or any successor) or the Company (or any successor)
is liquidated or dissolved or adopts a plan of liquidation
or dissolution other than in a transaction which complies
with the provisions of Article Eight; and (v) the failure of
United (or any successor) to "beneficially own" 100% of the
voting power of the total outstanding Voting Stock of the
Company (or any successor).
"Closing Date" means May 3, 1995.
"Code" means the Internal Revenue Code of 1986, as
amended.
"Commission" means the Securities and Exchange
Commission, as from time to time constituted, created under
the Exchange Act, or if at any time after the execution of
this Indenture such Commission is not existing and
performing the duties now assigned to it under the Trust
Indenture Act, then the body performing such duties at such
time.
"Company" means United Stationers Supply Co., a
corporation incorporated under the laws of the State of
Illinois, until a successor Person shall have become such
pursuant to the applicable provisions hereof, and thereafter
"Company" shall mean such successor Person.
"Company Request" or "Company Order" means a
written request or order signed in the name of the Company
by any one of the following: its Chairman, its President,
any Vice President, its Treasurer or an Assistant Treasurer,
and delivered to the Trustee.
"Consolidated" means, with respect to any Person,
the consolidation of the accounts of such Person and each of
its Subsidiaries if and to the extent the accounts of such
Person and each of its Subsidiaries would normally be
consolidated with those of such Person, all in accordance
with GAAP consistently applied.
"Consolidated Fixed Charge Coverage Ratio" of the
Company means, for any period, the ratio of (a) the sum of
Consolidated Net Income (Loss), Consolidated Interest
Expense, Consolidated Income Tax Expense and Consolidated
Non-cash Charges deducted in computing Consolidated Net
Income (Loss) in each case, for such period, of the Company
and its Restricted Subsidiaries on a Consolidated basis, all
determined in accordance with GAAP to (b) the sum of
Consolidated Interest Expense for such period and cash and
non-cash dividends required to be paid or accrued on any
Preferred Stock of the Company and its Restricted
Subsidiaries during such period; provided that (i)
in making such computation, the Consolidated Interest
Expense attributable to interest on any Indebtedness
computed on a pro forma basis and (A) bearing a floating
interest rate, shall be computed as if the rate in effect on
the date of computation had been the applicable rate for the
entire period and (B) which was not outstanding during the
period for which the computation is being made but which
bears at the option of the Company, a fixed or floating rate
of interest, shall be computed by applying at the option of
the Company, either the fixed or floating rate and (ii) in
making such computation, the Consolidated Interest Expense
of the Company and its Restricted Subsidiaries attributable
to interest on any Indebtedness under a revolving credit
facility computed on a pro forma basis shall be computed
based upon the average daily balance of such Indebtedness
during the applicable period.
"Consolidated Income Tax Expense" means, for any
period, the provision for federal, state, local and foreign
income taxes of the Company and its Restricted Subsidiaries
for such period as determined in accordance with GAAP on a
Consolidated basis.
"Consolidated Interest Expense" of the Company
means, without duplication, for any period, the sum of (a)
the interest expense of the Company and its Restricted
Subsidiaries for such period, on a Consolidated basis,
including, without limitation, (i) amortization of debt
discount (other than debt discount attributable solely to a
discount in the purchase price of Indebtedness sold with an
equity security, to the extent of the amount of the value
reasonably attributed in good faith to such equity security
at the time of such sale and reflected in an Officers'
Certificate delivered promptly thereafter to the Trustee),
(ii) the net cost under Interest Rate Agreements (including
amortization of discounts), (iii) the interest portion of
any deferred payment obligation, (iv) accrued interest and
(v) the amortization of deferred financing costs, plus (b)
(i) the interest component of the Capital Lease Obligations
paid, accrued and/or scheduled to be paid or accrued by the
Company during such period and (ii) all capitalized interest
of the Company and its Restricted Subsidiaries, less (c) the
amortization of any deferred financing costs incurred with
respect to the issuance of the Notes or the borrowings under
the Senior Bank Facility, to the extent paid prior to or on
the Closing Date, in each case as determined in accordance
with GAAP on a Consolidated basis.
"Consolidated Net Income (Loss)" of the Company
means, for any period, the Consolidated net income (or loss)
of the Company and its Restricted Subsidiaries for such
period as determined in accordance with GAAP, adjusted, to
the extent included in calculating such net income (loss),
by excluding, without duplication, (i) all extraordinary
gains or losses (less all fees and expenses relating
thereto), (ii) the portion of net income (or loss) of the
Company and its Restricted Subsidiaries allocable to
minority interests in unconsolidated Persons to the extent
that cash dividends or distributions have not actually been
received by the Company or one of its Restricted
Subsidiaries, (iii) net income (or loss) of any Person
combined with the Company or any of its Restricted
Subsidiaries on a "pooling of interests" basis attributable
to any period prior to the date of combination, (iv) any
gain or loss, net of taxes, realized upon the termination of
any employee pension benefit plan, (v) net gains (or
losses), less all fees and expenses relating thereto, in
respect of dispositions of assets other than in the ordinary
course of business and the net income of any Unrestricted
Subsidiary, except to the extent paid to the Company
or any Restricted Subsidiary in cash as a dividend or
distribution or (vi) the net income of any Restricted
Subsidiary to the extent that the declaration of dividends
or similar distributions by that Restricted Subsidiary of
that income is not at the time permitted, directly or
indirectly, by operation of the terms of its charter or any
agreement, instrument, judgment, decree, order, statute,
rule or governmental regulations applicable to such
Restricted Subsidiary or its stockholders.
"Consolidated Net Worth" of any Person means the
Consolidated stockholders' equity (excluding Redeemable
Capital Stock) of such Person and its subsidiaries (or, in
the case of United or the Company, the Restricted
Subsidiaries), as determined in accordance with GAAP on a
Consolidated basis.
"Consolidated Non-cash Charges" of the Company
means, for any period, the aggregate depreciation,
amortization and other non-cash charges of the Company and
its Restricted Subsidiaries on a Consolidated basis reducing
the Consolidated Net Income of the Company and its
Restricted Subsidiaries for such period, as determined in
accordance with GAAP (excluding any non-cash charge which
requires an accrual or reserve for cash charges for any
future period).
"Consolidation" means, with respect to any Person,
the consolidation of the accounts of such Person and each of
its subsidiaries (or, in the case of United or the Company,
the Restricted Subsidiaries) if and to the extent the
accounts of such Person and each of its subsidiaries (or, in
the case of United or the Company, the Restricted
Subsidiaries) would normally be consolidated with those of
such Person, all in accordance with GAAP. The term
"Consolidated" shall have a similar meaning.
"Corporate Trust Office" means the principal
corporate trust office of the Trustee, at which at any
particular time its corporate trust business shall be
administered, which office at the date of execution of this
Indenture is located at 101 Barclay Street, New York, New
York 10286.
"Default" means any event which is, or after
notice or passage of time or both would be, an Event of
Default.
"Defaulted Interest" has the meaning specified in
Section 309.
"Depositary" means The Depository Trust Company,
its nominees and their respective successors.
"Designated Senior Guarantor Indebtedness" means
(i) all Senior Guarantor Indebtedness under the Senior Bank
Facility; and (ii) any other Senior Guarantor Indebtedness
outstanding in a principal amount of at least $50 million,
and which is specifically designated by the Guarantor in the
agreement governing or the instrument evidencing such Senior
Guarantor Indebtedness as "Designated Senior Guarantor
Indebtedness."
"Designated Senior Indebtedness" means (i) all
Senior Indebtedness under the Senior Bank Facility; and (ii)
any other Senior Indebtedness outstanding in a principal
amount of at least $50 million, and which is specifically
designated by the Company in the agreement governing or the
instrument evidencing such Senior Indebtedness as
"Designated Senior Indebtedness."
"Employment Agreements" means the several
employment agreements, dated on or prior to the Closing
Date, between or
among United and/or the Company and each of Joel D. Spungin,
Jeffrey K. Hewson, Ronald W. Weissman, Allen B. Kravis,
Steven R. Schwarz, Robert H. Cornell, Otis H. Halleen,
Jerold A. Hecktman, Ted S. Rzeszuto, Michael D. Rowsey,
Daniel J. Schleppe, Daniel H. Bushell, Robert D.
Eberspacher, Duane J. Ratay and Lawrence E. Miller.
"Event of Default" has the meaning specified in
Section 501.
"Exchange Act" means the Securities Exchange Act
of 1934, as amended.
"Exchange Offer" means the exchange offer that may
be effected pursuant to the Registration Rights Agreement.
"Exchange Offer Registration Statement" means the
Exchange Offer Registration Statement as defined in the
Registration Rights Agreement.
"Exchange Securities" has the meaning stated in
the first recital of this Indenture and refers to any
Exchange Securities containing terms substantially identical
to the Initial Securities (except that such Exchange
Securities shall not contain terms with respect to transfer
restrictions) that are issued and exchanged for the Initial
Securities pursuant to the Registration Rights Agreement and
this Indenture.
"Fair Market Value" means, with respect to any
asset or property, the sale value that would be obtained in
an arm'slength transaction between an informed and willing
seller under no compulsion to sell and an informed and
willing buyer under no compulsion to buy as determined by
the Board of Directors in good faith and evidenced by a
resolution of the Board of Directors.
"GAAP" or "Generally Accepted Accounting
Principles" means generally accepted accounting principles
in the United States, consistently applied, which are in
effect at the time any given calculation is made.
"Guarantee" means the guarantee by any Guarantor
of the Company's Indenture Obligations pursuant to a
guarantee given in accordance with this Indenture.
"Guaranteed Debt" of any Person means, without
duplication, all Indebtedness of any other Person guaranteed
directly or indirectly in any manner by such Person through
an agreement (i) to pay or purchase such Indebtedness or to
advance or supply funds for the payment or purchase of such
Indebtedness, (ii) to purchase, sell or lease (as lessee or
lessor) property, or to purchase or sell services, primarily
for the purpose of enabling the debtor to make payment of
such Indebtedness or to assure the holder of such
Indebtedness against loss, (iii) to supply funds to, or in
any other manner invest in, the debtor (including any
agreement to pay for property or services without requiring
that such property be received or such services be
rendered), (iv) to maintain working capital or equity
capital of the debtor, or otherwise to maintain the net
worth, solvency or other financial condition of the debtor
or (v) otherwise to assure a creditor against loss; provided
that the term "guarantee" shall not include endorsements for
collection or deposit, in either case in the ordinary course
of business.
"Guarantor" means United and each Restricted
Subsidiary that is organized under the laws of the United
States or any state or territory thereof, including the
District of Columbia,
other than the Joint Venture.
"Holder" means a Person in whose name a Security
is registered in the Security Register.
"Holdings" means Associated Holdings, Inc., a
Delaware corporation.
"incur" shall have the meaning ascribed thereto in
Section 1011; provided that with respect to any Indebtedness
of any Subsidiary that is owing to the Company or another
Subsidiary, (a) any disposition, pledge or transfer of such
Indebtedness to any Person (other than the Company or a
Wholly Owned Subsidiary or a pledge to lenders under the
Senior Bank Facilities) shall be deemed to be an incurrence
of such Indebtedness and (b) any transaction pursuant to
which a Wholly Owned Subsidiary (which is an obligor on
Indebtedness permitted by Section 1011(b)(vi)) ceases to be
a Wholly Owned Subsidiary shall be deemed to be an
incurrence of such Indebtedness not permitted by Section
1011(b)(vi).
"Indebtedness" means, with respect to any Person,
without duplication, (i) all indebtedness of such Person for
borrowed money or for the deferred purchase price of
property or services, excluding any trade payables, but
including, without limitation, all obligations, contingent
or otherwise, of such Person in connection with any letters
of credit issued under letter of credit facilities,
acceptance facilities or other similar facilities now or
hereafter outstanding, if, and to the extent, any of the
foregoing would appear as a liability upon a balance sheet
of such Person prepared in accordance with GAAP, (ii) all
obligations of such Person evidenced by bonds, notes,
debentures or other similar instruments, (iii) all
indebtedness created or arising under any conditional sale
or other title retention agreement with respect to property
acquired by such Person (even if the rights and remedies of
the seller or lender under such agreement in the event of
default are limited to repossession or sale of such
property), but excluding trade payables arising in the
ordinary course of business, (iv) all obligations under
Interest Rate Agreements of such Person, (v) all Capital
Lease Obligations of such Person, (vi) all Indebtedness
referred to in clauses (i) through (v) above of other
Persons and all dividends of other Persons, the payment of
which is secured by (or for which the holder of such
Indebtedness has an existing right, contingent or otherwise,
to be secured by) any Lien, upon or with respect to property
(including, without limitation, accounts and contract
rights) owned by such Person, even though such Person has
not assumed or become liable for the payment of such
Indebtedness, (vii) all Guaranteed Debt of such Person and
(viii) all Redeemable Capital Stock valued at the greater of
its voluntary or involuntary maximum fixed repurchase price.
For purposes hereof, the "maximum fixed repurchase price" of
any Redeemable Capital Stock which does not have a fixed
repurchase price shall be calculated in accordance with the
terms of such Redeemable Capital Stock as if such Redeemable
Capital Stock were purchased on any date on which
Indebtedness shall be required to be determined pursuant to
this Indenture, and if such price is based upon, or measured
by, the Fair Market Value of such Redeemable Capital Stock,
such Fair Market Value shall be determined in good faith by
the board of directors of the issuer of such Redeemable
Capital Stock.
"Indenture Obligations" means the obligations of
the Company and any other obligor, including any Guarantor,
under this Indenture or under the Securities to pay
principal of, premium, if any, and interest when due and
payable, and all other
amounts due or to become due under or in connection with
this Indenture, the Securities and the performance of all
other obligations to the Trustee and the Holders under this
Indenture and the Securities, according to the terms
thereof.
"Initial Securities" has the meaning stated in the
first recital of this Indenture.
"Interest Payment Date" means the Stated Maturity
of an installment of interest on the Securities.
"Interest Rate Agreements" means one or more of
the following agreements which shall be entered into by one
or more financial institutions: interest rate protection
agreements (including, without limitation, interest rate
swaps, caps, floors, collars and similar arrangements)
and/or other types of interest rate hedging agreements from
time to time.
"Investments" means, with respect to any Person,
directly or indirectly, any advance, loan (including
guarantees), or other extension of credit or capital
contribution to (by means of any transfer of cash or other
property to others or any payment for property or services
for the account or use of others), or any purchase,
acquisition or ownership by such Person of any Capital
Stock, bonds, notes, debentures or other securities issued
by, any other Person and all other items that would be
classified as investments on a balance sheet prepared in
accordance with GAAP. In addition, the Fair Market Value of
the net assets of any Restricted Subsidiary at the time that
such Restricted Subsidiary is designated an Unrestricted
Subsidiary shall be deemed to be an "Investment" made by the
Company in such Unrestricted Subsidiary. The amount of any
non-cash Investment shall be equal to the Fair Market Value
of the assets invested, as determined in good faith by (i)
in the case of any Investment in excess of $500,000, the
Board of Directors of the Company (provided that such
determination is evidenced by a Board Resolution) or (ii) in
any other case, an executive officer of the Company.
"Joint Venture" means United Business Computers,
Inc., a Delaware corporation.
"Lien" means any mortgage, charge, pledge, lien
(statutory or otherwise), privilege, security interest,
hypothecation or other encumbrance upon or with respect to
any property of any kind, real or personal, movable or
immovable, now owned or hereafter acquired.
"Management Services Agreements" means the several
investment banking fee and management agreements dated on or
prior to the Closing Date, among United, the Company and
Wingate Partners L.P., Cumberland Capital Corporation and
Good Capital Co., Inc., as amended to the Closing Date.
"Maturity" when used with respect to any Security
means the date on which the principal of such Security
becomes due and payable as therein provided or as provided
in this Indenture, whether at Stated Maturity, the
Repurchase Date or the redemption date and whether by
declaration of acceleration, Offer in respect of Excess
Proceeds, Change of Control, call for redemption or
otherwise.
"Merger" means, collectively, the merger of
Holdings with and into United and the merger of Associated
with and into the Company.
"Net Cash Proceeds" means (a) with respect to any
Asset
Sale by any Person, the proceeds thereof in the form of cash
or Temporary Cash Investments including payments in respect
of deferred payment obligations when received in the form
of, or stock or other assets when disposed for, cash or
Temporary Cash Investments (except to the extent that such
obligations are financed or sold with recourse to the
Company or any Restricted Subsidiary) net of (i) brokerage
commissions and other actual fees and expenses (including
fees and expenses of counsel and investment bankers) related
to such Asset Sale, (ii) provisions for all taxes payable as
a result of such Asset Sale, (iii) payments made to retire
Indebtedness where payment of such Indebtedness is secured
by the assets or properties the subject of such Asset Sale,
(iv) amounts required to be paid to any Person (other than
the Company or any Restricted Subsidiary) owning a
beneficial interest in the assets subject to the Asset Sale
and (v) appropriate amounts to be provided by the Company or
any Restricted Subsidiary, as the case may be, as a reserve,
in accordance with GAAP or, until no longer required by
contract with the buyer, as required by contract with the
buyer, against any liabilities associated with such Asset
Sale and retained by the Company or any Restricted
Subsidiary, as the case may be, after such Asset Sale,
including, without limitation, pension and other post-
employment benefit liabilities, liabilities related to
environmental matters and liabilities under any
indemnification obligations associated with such Asset Sale,
all as reflected in an Officers' Certificate delivered to
the Trustee and (b) with respect to any issuance or sale of
Capital Stock or options, warrants or rights to purchase
Capital Stock or Indebtedness or Capital Stock that have
been converted into or exchanged for Capital Stock, the
proceeds of such issuance or sale in the form of cash or
Temporary Cash Investments, including payments in respect of
deferred payment obligations when received in the form of,
or stock or other assets when disposed for, cash or
Temporary Cash Investments (except to the extent that such
obligations are financed or sold with recourse to the
Company or any Restricted Subsidiary), net of attorneys'
fees, accountants' fees and brokerage, consultation,
underwriting and other fees and expenses actually incurred
in connection with such issuance or sale and net of taxes
paid or payable as a result thereof.
"Officers' Certificate" means a certificate signed
by the Chairman, the President or a Vice President, and by
the Treasurer, an Assistant Treasurer, the Secretary or an
Assistant Secretary of the Company, and delivered to the
Trustee.
"Opinion of Counsel" means a written opinion of
counsel, who may be counsel for the Company, including an
employee of the Company, and who shall be reasonably
acceptable to the Trustee.
"Outstanding," when used with respect to
Securities, means, as of the date of determination, all
Securities theretofore authenticated and delivered under
this Indenture, except:
(i) Securities theretofore cancelled by the
Trustee or delivered to the Trustee for cancellation;
(ii) Securities, or portions thereof, for whose
payment or redemption money in the necessary amount has
been theretofore deposited with the Trustee or any
Paying Agent (other than the Company) in trust or set
aside and segregated in trust by the Company (if the
Company shall act as its own Paying Agent) for the
Holders of such Securities; provided that, if such
Securities are to be redeemed, notice of such
redemption has been duly given pursuant to this
Indenture or provision therefor satisfactory to the
Trustee has been made;
(iii) Securities, except and only to the
extent provided in Sections 1202 and 1203, with respect
to which the Company has effected defeasance and/or
covenant defeasance as provided in Article Twelve; and
(iv) Securities which have been paid pursuant to
Section 308 or in exchange for or in lieu of which
other Securities have been authenticated and delivered
pursuant to this Indenture;
provided, however, that in determining whether the Holders
of the requisite principal amount of Outstanding Securities
have given any request, demand, authorization, direction,
consent, notice or waiver hereunder, and for the purpose of
making the calculations required by TIA Section 313,
Securities owned by the Company or any other obligor upon
the Securities or any Affiliate of the Company or such other
obligor shall be disregarded and deemed not to be
Outstanding, except that, in determining whether the Trustee
shall be protected in making such calculation or in relying
upon any such request, demand, authorization, direction,
notice, consent or waiver, only Securities which the Trustee
actually knows to be so owned shall be so disregarded.
Securities so owned which have been pledged in good faith
may be regarded as Outstanding if the pledgee establishes to
the satisfaction of the Trustee the pledgee's right so to
act with respect to such Securities and that the pledgee is
not the Company or any other obligor upon the Securities or
any Affiliate of the Company or such other obligor.
"Pari Passu Indebtedness" means any Indebtedness
of the Company or a Guarantor that is pari passu in right of
payment to the Securities or a Guarantee of the Securities,
as the case may be.
"Paying Agent" means any Person (including the
Company acting as Paying Agent) authorized by the Company to
pay the principal of (and premium, if any, on) or interest
on any Securities on behalf of the Company.
"Permitted Holders" means Wingate Partners, L.P.,
Wingate Partners II, L.P., Wingate Affiliates, L.P., and
Wingate Affiliates II, L.P. (collectively, "Wingate
Partners"), ASI Partners, L.P., ASI Partners, II, L.P.,
Cumberland Capital Corporation, Good Capital Co., Inc.,
Daniel J. Good, Boise Cascade Corporation, Chase Manhattan
Investment Holdings, Inc., James A. Johnson, Michael D.
Rowsey, Daniel J. Schleppe, Daniel H. Bushell and Robert W.
Eberspacher, all such Persons being stockholders of United
on the Closing Date, together with the direct and indirect
general partners of Wingate Partners as set forth on
Schedule II to this Indenture, in each case on the date of
the final Offering Memorandum.
"Permitted Investment" means (i) Investments in
the Company or any Restricted Wholly Owned Subsidiary or any
Person which, as a result of such Investment, becomes a
Restricted Wholly Owned Subsidiary; (ii) Indebtedness of the
Company or a Restricted Subsidiary described under clauses
(v) and (vi) of the definition of "Permitted Indebtedness";
(iii) Temporary Cash Investments; (iv) Investments acquired
by the Company or any Restricted Subsidiary in connection
with an Asset Sale permitted under Section 1016 hereof to
the extent such Investments are noncash proceeds as
permitted under such covenant; (v) guarantees of
Indebtedness otherwise permitted by this Indenture; (vi)
Investments in existence on the Closing Date; (vii) customer
advances not to exceed $250,000 at any one time outstanding;
(viii) travel and relocation loans and advances made to
employees in the ordinary course of business not to exceed
$200,000 at any one time outstanding; (ix) Investments received
in settlement of defaulted receivables or in connection with the
bankruptcy or reorganization of suppliers and customers and in
connection with the settlement of other disputes with customers
and suppliers arising in the ordinary course of business; and
(x) additional Investments not to exceed $1 million at any one
time outstanding.
"Person" means any individual, corporation, limited
liability company, partnership, joint venture, association,
jointstock company, trust, unincorporated organization or
government or any agency or political subdivisions thereof.
"Predecessor Security" of any particular Security
means every previous Security evidencing all or a portion of the
same debt as that evidenced by such particular Security; and,
for the purposes of this definition, any Security authenticated
and delivered under Section 308 in exchange for a mutilated
security or in lieu of a lost, destroyed or stolen Security
shall be deemed to evidence the same debt as the mutilated,
lost, destroyed or stolen Security.
"Preferred Stock" means with respect to any Person,
any and all shares, interests, participations or other
equivalents (however designated) of such Person's preferred
stock whether now outstanding, or issued after the date of this
Indenture, and including, without limitation, all classes and
series of preferred or preference stock.
"Public Equity Offering" means an underwritten sale to
the public of Common Stock of the Company or of United, provided
that, in the case of such a sale of Common Stock of United, the
net cash proceeds thereof are paid to the Company as a capital
contribution, pursuant to a registration statement (other than
Form S-8 or a registration statement relating to securities
issuable by any benefit plan of United, the Company or any
Subsidiary) that is declared effective by the Commission.
"Qualified Capital Stock" of any Person means any and
all Capital Stock of such Person other than Redeemable Capital
Stock.
"Redeemable Capital Stock" means any Capital Stock
that, either by its terms or by the terms of any security into
which it is convertible or exchangeable or otherwise, is or upon
the happening of an event or passage of time would be, required
to be redeemed prior to any Stated Maturity of the principal of
the Securities or is redeemable at the option of the holder
thereof at any time prior to any such Stated Maturity.
"Redemption Date," when used with respect to any
Security to be redeemed, in whole or in part, means the date
fixed for such redemption by or pursuant to this Indenture.
"Redemption Price," when used with respect to any
Security to be redeemed, means the price at which it is to be
redeemed pursuant to this Indenture.
"Registration Rights Agreement" means the Registration
Rights Agreement among the Company, United and the Initial
Purchaser, dated as of May 3, 1995, relating to the Securities.
"Registration Statement" means a Registration
Statement
as defined in the Registration Rights Agreement.
"Regular Record Date" for the interest payable on any
Interest Payment Date means the April 15 or October 15 (whether
or not a Business Day), as the case may be, next preceding such
Interest Payment Date.
"Regulation S" means Regulation S under the
Securities Act.
"Representative" means, with respect to any
Designated Senior Indebtedness or Designated Senior Guarantor
Indebtedness, the indenture trustee or other trustee, agent or
representative in respect of such Indebtedness; provided that
if, and so long as, any such Indebtedness lacks such a
representative, then the "Representative" with respect to such
Indebtedness shall be the holders of a majority in outstanding
principal amount (or, if no amounts thereunder are outstanding,
the committed amounts) of such Indebtedness.
"Responsible Officer," when used with respect to the
Trustee, means the chairman or any vice-chairman of the board
of directors, the chairman or any vice-chairman of the
executive committee of the board of directors, the chairman of
the trust committee, the president, any vice president, any
assistant vice president, the secretary, any assistant
secretary, the treasurer, any assistant treasurer, the cashier,
any assistant cashier, any trust officer or assistant trust
officer, the controller or any assistant controller or any
other officer of the Trustee customarily performing functions
similar to those performed by any of the above-designated
officers, and also means, with respect to a particular
corporate trust matter, any other officer to whom such matter
is referred because of his knowledge of and familiarity with
the particular subject.
"Restricted Subsidiary" means any Subsidiary other
than an Unrestricted Subsidiary.
"Sale and Leaseback Transaction" means any
transaction or series of related transactions pursuant to which
the Company or a Restricted Subsidiary sells or transfers any
property or asset in connection with the leasing, or the resale
against installment payments, of such property or asset to the
seller or transferor.
"Securities" has the meaning stated in the first
recital of this Indenture and more particularly means any
Securities authenticated and delivered under this Indenture.
For all purposes of this Indenture, the term "Securities" shall
include any Exchange Securities that are issued and exchanged
for any Securities pursuant to the Registration Rights
Agreement and this Indenture and, for purposes of this
Indenture, all Securities and Exchange Securities shall vote
together as one series of Securities under this Indenture.
"Securities Act" means the Securities Act of 1933, as
amended.
"Security Register" and "Security Registrar" or
"Registrar" shall have the respective meanings specified in
Section 305.
"Senior Bank Facility" means the Senior Bank
Facility, each dated as of March 30, 1995, among the Company,
United, the subsidiaries of the Company, if any, identified on
the signature pages thereof under the caption "Subsidiary
Guarantors," the
lenders named therein and The Chase Manhattan Bank (National
Association) as agent, including a term loan made pursuant to
the term loan agreement, a revolving credit loan made pursuant
to the revolving credit loan agreement, and any ancillary
documents executed in connection therewith, as such agreements
may be amended, renewed, extended, substituted, refinanced,
restructured, replaced, supplemented or otherwise modified from
time to time (including, without limitation, any successive
renewals, extensions, substitutions, refinancings,
restructuring, replacements, supplementations or other
modifications of the foregoing, including the addition of new
lenders or agents). For purposes of this Indenture, "Senior
Bank Facility" shall include any amendments, renewals,
extensions, substitutions, refinancings, restructuring,
replacements, supplements or any other modifications that
increase the principal amount of the Indebtedness or the
commitments to lend thereunder; provided that, for purposes of
the definition of "Permitted Indebtedness," no such increase
may result in the principal amount of Indebtedness under the
Senior Bank Facility exceeding the amount permitted by
subparagraphs (b)(i) and (b)(ii) of Section 1011 hereof; and
provided further that there shall at any time be only one
instrument that constitutes the "Senior Bank Facility" under
this Indenture.
"Senior Guarantor Indebtedness" means, with respect
to any Guarantor, the principal of, premium, if any, and
interest (including interest accruing after the filing of a
petition initiating any proceeding under any state, federal or
foreign bankruptcy laws whether or not allowable as a claim in
such proceeding) on any Indebtedness of such Guarantor (except
as otherwise provided in this definition), whether outstanding
on the Closing Date or thereafter created, incurred or assumed,
unless, in the case of any particular Indebtedness, the
instrument creating or evidencing the same or pursuant to which
the same is outstanding expressly provides that such
Indebtedness shall not be senior in right of payment to such
Guarantor's Guarantee of the Securities. Without limiting the
generality of the foregoing, "Senior Guarantor Indebtedness"
shall include the principal of (and premium, if any) and
interest (including interest accruing after the filing of a
petition initiating any proceeding under any state, federal or
foreign bankruptcy laws whether or not allowable as a claim in
such proceeding) and all other obligations of every nature of
any Guarantor from time to time owed under the Senior Bank
Facility; provided, however, that any Indebtedness under any
refinancing, refunding or replacement of the Senior Bank
Facility shall not constitute Senior Guarantor Indebtedness to
the extent that the Indebtedness thereunder is by its express
terms subordinate to any other Indebtedness of any Guarantor.
Notwithstanding the foregoing, "Senior Guarantor Indebtedness"
shall not include any of the following (whether or not
constituting Indebtedness under this Indenture): (i)
Indebtedness evidenced by the Guarantees of the Securities,
(ii) Indebtedness that, by its express terms, is subordinate or
junior in right of payment to any Indebtedness of any
Guarantor, (iii) Indebtedness which when incurred and without
respect to any election under Section 1111(b) of Title 11,
United States Bankruptcy Code of 1978, as amended, is without
recourse to any Guarantor, (iv) Indebtedness which is
represented by Redeemable Capital Stock, (v) any liability for
foreign, federal, state, local or other taxes owed or owing by
any Guarantor, (vi) Indebtedness of any Guarantor to a
Subsidiary, and (vii) any trade payables.
"Senior Indebtedness" means the principal of,
premium, if any, and interest (including interest accruing
after the filing of a petition initiating any proceeding under
any state,
federal or foreign bankruptcy law whether or not allowable as a
claim in such proceeding) on any Indebtedness of the Company
(except as otherwise provided in this definition), whether
outstanding on the Closing Date or thereafter created, incurred
or assumed, unless, in the case of any particular Indebtedness,
the instrument creating or evidencing the same or pursuant to
which the same is outstanding expressly provides that such
Indebtedness shall not be senior in right of payment to the
Securities. Without limiting the generality of the foregoing,
"Senior Indebtedness" shall include the principal of (and
premium, if any) and interest (including interest accruing
after the filing of a petition initiating any proceeding under
any state, federal or foreign bankruptcy laws whether or not
allowable as a claim in such proceeding) and all other
obligations of every nature of the Company from time to time
owed under the Senior Bank Facility (including, without
limitation, agency fees, commitment fees and letter of credit
fees); provided, however, that any Indebtedness under any
refinancing, refunding or replacement of the Senior Bank
Facility shall not constitute Senior Indebtedness to the extent
that the Indebtedness thereunder is by its express terms
subordinate to any other Indebtedness of the Company.
Notwithstanding the foregoing, "Senior Indebtedness" shall not
include any of the following (whether or not constituting
Indebtedness under this Indenture): (i) Indebtedness evidenced
by the Securities, (ii) Indebtedness that, by its express
terms, is subordinate or junior in right of payment to any
Indebtedness of the Company, (iii) Indebtedness which, when
incurred and without respect to any election under Section
1111(b) of Title 11, United States Bankruptcy Code of 1978, as
amended, is without recourse to the Company, (iv) Indebtedness
which is represented by Redeemable Capital Stock, (v) any
liability for foreign, federal, state, local or other taxes
owed or owing by the Company, (vi) Indebtedness of the Company
to a Subsidiary, and (vii) any trade payables.
"Senior Subordinated Guarantor Obligations" is
defined to mean any principal of, premium, if any, or interest
on the Securities payable pursuant to the terms of a Guarantee
of the Securities or upon acceleration, including any amounts
received upon the exercise of rights of rescission or other
rights of action (including claims for damages) or otherwise,
to the extent relating to the purchase price of the Securities
or other amounts corresponding to such principal, premium, if
any, or interest on the Securities.
"Senior Subordinated Obligations" is defined to mean
any principal of, premium, if any, or interest on the
Securities payable pursuant to the terms of the Securities or
upon acceleration, including any amounts received upon the
exercise of rights of rescission or other rights of action
(including claims for damages) or otherwise, to the extent
relating to the purchase price of the Securities or amounts
corresponding to such principal, premium, if any, or interest
on the Securities.
"Shelf Registration Statement" means the Shelf
Registration Statement as defined in the Registration Rights
Agreement.
"Significant Subsidiary" means, at any date of
determination, any Restricted Subsidiary that, together with
its Subsidiaries, (i) for the most recent fiscal year of the
Company, accounted for more than 10% of the Consolidated
revenues of the Company or (ii) as of the end of such fiscal
year, was the owner of more than 10% of the Consolidated assets
of the Company, all as set forth on the most recently available
Consolidated
financial statements of the Company for such fiscal year.
"Special Record Date" for the payment of any
Defaulted Interest means a date fixed by the Trustee pursuant
to
Section 309.
"Stated Maturity" when used with respect to any
Indebtedness or any installment of interest thereon, means the
dates specified in such Indebtedness as the fixed date on which
the principal of such Indebtedness or such installment of
interest is due and payable.
"Subordinated Indebtedness" means Indebtedness of the
Company or a Guarantor subordinated in right of payment to the
Securities or a Guarantee of the Securities, as the case may
be.
"Subsidiary" means any Person a majority of the
equity ownership or the Voting Stock of which is at the time
owned, directly or indirectly, by the Company or by one or more
other Subsidiaries.
"Temporary Cash Investments" means (i) any evidence
of Indebtedness with a maturity of one year or less and issued
by the United States of America, or an instrumentality or
agency thereof and guaranteed fully as to principal, premium,
if any, and interest by the United States of America, (ii) any
certificate of deposit with a maturity of one year or less and
issued by, or a time deposit of, a commercial banking
institution that is a member of the Federal Reserve System and
that has combined capital and surplus and undivided profits of
not less than $500,000,000 whose debt has a rating, at the time
as of which any investment therein is made, of "P-1" (or
higher) according to Moody's Investors Service, Inc.
("Moody's") or any successor rating agency or "A-1" (or higher)
according to Standard & Poor's Ratings Group ("S&P") or any
successor rating agency, (iii) commercial paper with a maturity
of one year or less and issued by a corporation (other than an
Affiliate or Subsidiary of United) organized and existing under
the laws of any state of the United States of America or the
District of Columbia with a rating, at the time as of which any
investment therein is made, of "P-1" (or higher) according to
Moody's or "A1" (or higher) according to S&P and (iv) any money
market deposit accounts issued or offered by a domestic
commercial bank having capital and surplus in excess of
$500,000,000.
"Trust Indenture Act" or "TIA" means the Trust
Indenture Act of 1939, as amended.
"Unrestricted Subsidiary" means (1) any Subsidiary
which at the time of determination shall be designated an
Unrestricted Subsidiary (as designated by the Board of
Directors of the Company, as provided below), (2) any
Subsidiary of an Unrestricted Subsidiary, and (3) United
Stationers Hong Kong Limited and United Worldwide Limited, each
of which is a corporation organized under the laws of Hong
Kong. The Board of Directors of the Company may designate any
Subsidiary (including any newly acquired or newly formed
Subsidiary) to be an Unrestricted Subsidiary so long as (a)
neither the Company nor any Restricted Subsidiary is directly
or indirectly liable for any Indebtedness of such Subsidiary
(except pursuant to a guarantee that, if it had been made after
such designation, would have been permitted to be made under
Section 1012 hereof, including permitted Investments), (b) no
default with respect to any Indebtedness of such Subsidiary
would permit (upon notice, lapse of time or otherwise) any
holder of any other Indebtedness of the Company or any
Restricted Subsidiary having a principal
amount of $10 million or more to declare a default on such
other Indebtedness or cause the payment thereof to be
accelerated or payable prior to its stated maturity, (c)
neither the Company nor any Restricted Subsidiary has, prior to
the date of such designation, made an Investment in such
Subsidiary unless the amount of such Investment, if it had been
made after the date of such designation, would have been
permitted under Section 1012 hereof (including Permitted
Investments), (d) neither the Company nor any Restricted
Subsidiary has a contract, agreement, arrangement,
understanding or obligation of any kind, whether written or
oral, with such Subsidiary other than those that might be
obtained at the time from Persons who are not Affiliates of the
Company. Any such designation by the Board of Directors shall
be evidenced to the Trustee by filing a Board Resolution with
the Trustee giving effect to such designation and, for purposes
of Section 1012 hereof, shall constitute the making of an
Investment in such Unrestricted Subsidiary as provided under
the definition of Investment. The Board of Directors may
designate any Unrestricted Subsidiary as a Restricted
Subsidiary if immediately after giving effect to such
designation there would be no Default or Event of Default under
this Indenture and the Company could incur $1.00 of additional
Indebtedness (other than Permitted Indebtedness) pursuant to
Section 1011 hereof.
"Voting Stock" means stock of the class or classes
pursuant to which the holders thereof have the general voting
power under ordinary circumstances to elect at least a majority
of the board of directors, managers or trustees of a
corporation (irrespective of whether or not at the time stock
of any other class or classes shall have or might have voting
power by reason of the happening of any contingency).
"Wholly Owned Subsidiary" means a Subsidiary all the
Capital Stock of which (other than directors' qualifying shares
or a de minimis number of shares required, under applicable
law, to be owned by foreign nationals) is owned by the Company
or another Wholly Owned Subsidiary; and "Restricted Wholly
Owned Subsidiary" means a Wholly Owned Subsidiary that is a
Restricted Subsidiary.
SECTION 102. Compliance Certificates and Opinions.
Upon any application or request by the Company to the
Trustee to take any action under any provision of this
Indenture, the Company shall furnish to the Trustee an
Officers' Certificate stating that all conditions precedent, if
any, provided for in this Indenture (including any covenant, if
compliance therewith constitutes a condition precedent)
relating to the proposed action have been complied with and an
Opinion of Counsel stating that in the opinion of such counsel
all such conditions precedent, if any, have been complied with,
except that in the case of any such application or request as
to which the furnishing of such documents is specifically
required by any provision of this Indenture relating to such
particular application or request, no additional certificate or
opinion need be furnished.
Every certificate with respect to compliance with a
condition or covenant provided for in this Indenture (other
than pursuant to Section 1008(a)) shall include:
(1) a statement that each individual signing such
certificate or opinion has read such covenant or condition
and the definitions herein relating thereto;
(2) a brief statement as to the nature and scope of
the examination or investigation upon which the statements
or opinions contained in such certificate or opinion are
based;
(3) a statement that, in the opinion of each such
individual, he or she has made such examination or
investigation as is necessary to enable him to express an
informed opinion as to whether or not such covenant or
condition has been complied with; and
(4) a statement as to whether, in the opinion of
each such individual, such condition or covenant has been
complied with.
SECTION 103. Form of Documents Delivered to Trustee.
In any case where several matters are required to be
certified by, or covered by an opinion of, any specified
Person, it is not necessary that all such matters be certified
by, or covered by the opinion of, only one such Person, or that
they be so certified or covered by only one document, but one
such Person may certify or give an opinion with respect to some
matters and one or more other such Persons as to other matters,
and any such Person may certify or give an opinion as to such
matters in one or several documents.
Any certificate or opinion of an officer of the
Company or United may be based, insofar as it relates to legal
matters, upon a certificate or opinion of, or representations
by, counsel, unless such officer knows, or in the exercise of
reasonable care should know, that the certificate or opinion or
representations with respect to the matters upon which his
certificate or opinion is based are erroneous. Any such
certificate or Opinion of Counsel may be based, insofar as it
relates to factual matters, upon a certificate or opinion of,
or representations by, an officer or officers of the Company or
United stating that the information with respect to such
factual matters is in the possession of the Company or United,
unless such counsel has actual knowledge that the certificate
or opinion or representations with respect to such matters are
erroneous.
Where any Person is required to make, give or execute
two or more applications, requests, consents, certificates,
statements, opinions or other instruments under this Indenture,
they may, but need not, be consolidated and form one
instrument.
SECTION 104. Acts of Holders.
(a) Any request, demand, authorization, direction,
notice, consent, waiver or other action provided by this
Indenture to be given or taken by Holders may be embodied in
and evidenced by one or more instruments of substantially
similar tenor signed by such Holders in person or by agents
duly appointed in writing; and, except as herein otherwise
expressly provided, such action shall become effective when
such instrument or instruments are delivered to the Trustee
and, where it is hereby expressly required, to the Company.
Such instrument or instruments (and the action embodied therein
and evidenced thereby) are herein sometimes referred to as the
"Act" of the Holders signing such instrument or instruments.
Proof of execution of any such instrument or of a writing
appointing any such agent shall be sufficient for any purpose
of this Indenture and conclusive in favor of the Trustee and
the Company, if made in the manner provided in this Section.
(b) The fact and date of the execution by any Person
of any such instrument or writing may be proved by the
affidavit of a witness of such execution, by an attestation of
another authorized officer or by a certificate of a notary
public or other officer authorized by law to take
acknowledgments of deeds, certifying that the individual
signing such instrument or writing acknowledged to him the
execution thereof. Where such execution is by a signer acting
in a capacity other than his individual capacity, such
certificate or affidavit shall also constitute sufficient proof
of authority. The fact and date of the execution of any such
instrument or writing, or the authority of the Person executing
the same, may also be proved in any other manner which the
Trustee deems sufficient.
(c) The principal amount and serial numbers of
Securities held by any Person, and the date of holding the
same, shall be proved by the Security Register.
(d) If the Company shall solicit from the Holders of
Securities any request, demand, authorization, direction,
notice, consent, waiver or other Act, the Company may, at its
option, by or pursuant to Board Resolution, fix in advance a
record date for the determination of Holders entitled to give
such request, demand, authorization, direction, notice,
consent, waiver or other Act, but the Company shall have no
obligation to do so. Notwithstanding TIA Section 316(c), such
record date shall be the record date specified in or pursuant
to such Board Resolution, which shall be a date not earlier
than the date 10 days prior to the first solicitation of
Holders generally in connection therewith and not later than
the date such solicitation is completed. If such a record date
is fixed, such request, demand, authorization, direction,
notice, consent, waiver or other Act may be given before or
after such record date, but only the Holders of record at the
close of business on such record date shall be deemed to be
Holders for the purposes of determining whether Holders of the
requisite proportion of Outstanding Securities have authorized
or agreed or consented to such request, demand, authorization,
direction, notice, consent, waiver or other Act, and for that
purpose the Outstanding Securities shall be computed as of such
record date; provided that no such authorization, agreement or
consent by the Holders on such record date shall be deemed
effective unless it shall become effective pursuant to the
provisions of this Indenture not later than six months after
the record date.
(e) Any request, demand, authorization, direction,
notice, consent, waiver or other Act of the Holder of any
Security shall bind every future Holder of the same Security
and the Holder of every Security issued upon the registration
of transfer thereof or in exchange therefor or in lieu thereof
in respect of anything done, omitted or suffered to be done by
the Trustee or the Company in reliance thereon, whether or not
notation of such action is made upon such Security.
SECTION 105. Notices, etc., to Trustee and Company.
Any request, demand, authorization, direction,
notice, consent, waiver or Act of Holders or other document
provided or permitted by this Indenture to be made upon, given
or furnished to, or filed with,
(1) the Trustee by any Holder or by the Company
shall be sufficient for every purpose hereunder if made,
given, furnished or filed in writing to or with the
Trustee at its Corporate Trust Office, Attention:
Corporate Trust Trustee Administration, or
(2) the Company by the Trustee or by any Holder
shall be sufficient for every purpose hereunder (unless
otherwise herein expressly provided) if in writing and
mailed, first-class postage prepaid, to the Company
addressed to it at the address of its principal office
specified in the first paragraph of this Indenture, or at
any other address previously furnished in writing to the
Trustee by the Company.
SECTION 106. Notice to Holders; Waiver.
Where this Indenture provides for notice of any event
to Holders by the Company, United or the Trustee, such notice
shall be sufficiently given (unless otherwise herein expressly
provided) if in writing and mailed, first-class postage
prepaid, to each Holder affected by such event, at his address
as it appears in the Security Register, not later than the
latest date, and not earlier than the earliest date, prescribed
for the giving of such notice. In any case where notice to
Holders is given by mail, neither the failure to mail such
notice, nor any defect in any notice so mailed, to any
particular Holder shall affect the sufficiency of such notice
with respect to other Holders. Any notice mailed to a Holder
in the manner herein prescribed shall be conclusively deemed to
have been received by such Holder, whether or not such Holder
actually receives such notice. Where this Indenture provides
for notice in any manner, such notice may be waived in writing
by the Person entitled to receive such notice, either before or
after the event, and such waiver shall be the equivalent of
such notice. Waivers of notice by Holders shall be filed with
the Trustee, but such filing shall not be a condition precedent
to the validity of any action taken in reliance upon such
waiver.
In case by reason of the suspension of or
irregularities in regular mail service or by reason of any
other cause, it shall be impracticable to mail notice of any
event to Holders when such notice is required to be given
pursuant to any provision of this Indenture, then any manner of
giving such notice as shall be satisfactory to the Trustee
shall be deemed to be a sufficient giving of such notice for
every purpose hereunder.
SECTION 107. Effect of Headings and Table of
Contents.
The Article and Section headings herein and the Table
of Contents are for convenience only and shall not affect the
construction hereof.
SECTION 108. Successors and Assigns.
All covenants and agreements in this Indenture by
each of the Company and United shall bind their respective
successors and assigns, whether so expressed or not.
SECTION 109. Separability Clause.
In case any provision in this Indenture or in the
Securities shall be invalid, illegal or unenforceable, the
validity, legality and enforceability of the remaining
provisions shall not in any way be affected or impaired
thereby.
SECTION 110. Benefits of Indenture.
Nothing in this Indenture or in the Securities,
express or implied, shall give to any Person, other than the
parties hereto, any Paying Agent, any Securities Registrar and
their
successors hereunder, and the Holders any benefit or any legal
or equitable right, remedy or claim under this Indenture.
SECTION 111. Governing Law.
This Indenture and the Securities shall be governed
by and construed in accordance with the law of the State of New
York applicable to contracts to be performed entirely in that
state.
SECTION 112. Legal Holidays.
In any case where any Interest Payment Date,
Redemption Date, or Stated Maturity or Maturity of any Security
shall not be a Business Day, then (notwithstanding any other
provision of this Indenture or of the Securities) payment of
interest or principal (and premium, if any) need not be made on
such date, but may be made on the next succeeding Business Day
with the same force and effect as if made on the Interest
Payment Date, Redemption Date, or at the Stated Maturity or
Maturity; provided that no additional interest shall accrue for
the period from and after such Interest Payment Date,
Redemption Date, Stated Maturity or Maturity, as the case may
be, through such next succeeding Business Day.
SECTION 113. No Recourse Against Others.
No director, officer, employee or stockholder, as
such, of the Company or of a Guarantor shall have any liability
for any obligations of the Company or a Guarantor under the
Securities or this Indenture or for any claim based on, in
respect of or by reason of such obligations or their creation.
By accepting a Security, each Holder shall waive and release
all such liability. The waiver and release shall be part of the
consideration for the issue of the Securities.
SECTION 114. Miscellaneous.
The parties hereto may sign any number of copies of
this Indenture. Each signed copy shall be an original, but all
of them together represent the same agreement. Notwithstanding
any provision of this indenture, Securities may only be
redeemed or repurchased by the Company or any Guarantor in
integral multiples of $1,000.
ARTICLE TWO
SECURITY FORMS
SECTION 201. Forms Generally.
The Initial Securities shall be known as the "12_%
Senior Subordinated Notes due 2005" and the Exchange Securities
shall be known as the "12_% Senior Subordinated Notes due
2005," in each case, of the Company. The Securities and the
Trustee's certificate of authentication shall be in
substantially the forms annexed hereto as Exhibit A, with such
appropriate insertions, omissions, substitutions and other
variations as are required or permitted by this Indenture, and
may have such letters, numbers or other marks of identification
and such legends or endorsements placed thereon as may be
required to comply with the rules of any securities exchange or
the Depositary or as may, consistently herewith, be determined
by the officers executing such Securities, as evidenced by
their execution of the Securities. Any portion of the text of
any Security may be set forth on the reverse thereof, with an
appropriate reference thereto on the face of the Security.
Each Security shall be dated the date of
its authentication.
The definitive Securities may be printed,
lithographed or engraved on steel-engraved borders or may be
produced in any other manner, all as determined by the
authorized officers of the Company executing such Securities,
as evidenced by their execution of such Securities.
The terms and provisions contained in the form of the
Securities annexed hereto as Exhibit A shall constitute, and
are hereby expressly made, a part of this Indenture. To the
extent applicable, the Company and the Trustee, by their
execution and delivery of this Indenture, expressly agree to
such terms and provisions and to be bound thereby.
Initial Securities offered and sold in reliance on
Rule 144A shall be issued initially in the form of one or more
permanent global Securities substantially in the form set forth
in Exhibit A (the "U.S. Global Security") deposited with the
Trustee, as custodian for the Depositary, duly executed by the
Company and authenticated by the Trustee as hereinafter
provided. The aggregate principal amount of the U.S. Global
Security may from time to time be increased or decreased by
adjustments made on the records of the Trustee, as custodian
for the Depositary or its nominee, as hereinafter provided.
Initial Securities offered and sold in reliance on
Regulation S shall be issued initially in the form of temporary
global Securities in registered form substantially in the form
set forth in Exhibit A (the "Temporary Offshore Global
Securities"). The Temporary Offshore Global Securities will be
registered in the name of, and held by, a temporary certificate
holder designated by Chase Securities, Inc. until the later of
the completion of the distribution of the Initial Securities
and the termination of the "restricted period" (as defined in
Regulation S) with respect to the offer and sale of the Initial
Securities (the "Offshore Securities Exchange Date"). At any
time following the Offshore Securities Exchange Date, upon
receipt by the Trustee and the Company of a certificate
substantially in the form of Exhibit B hereto, the Company
shall execute, and the Trustee shall authenticate and deliver,
one or more permanent certificated Securities in registered
form substantially in the form set forth in Exhibit A (the
"Permanent Offshore Physical Securities"), in exchange for the
surrender of Temporary Offshore Global Securities of like tenor
and amount and shall authenticate and deliver one or more
permanent global Securities substantially in the form set forth
on Exhibit A ("Permanent Offshore Global Securities") in
exchange for the surrender of Temporary Offshore Global
Securities of like tenor and amount.
Initial Securities offered and sold other than as
described in the preceding two paragraphs shall be issued in
the form of permanent certificated Securities in registered
form in substantially the form set forth in Exhibit A (the
"U.S. Physical Securities").
The Permanent Offshore Physical Securities and U.S.
Physical Securities are sometimes collectively herein referred
to as the "Physical Securities."
SECTION 202. Restrictive Legends.
Unless and until (i) an Initial Security is sold
under an effective Registration Statement or (ii) an Initial
Security is exchanged for an Exchange Security in connection
with an
effective Registration Statement, in each case pursuant to the
Registration Rights Agreement, each such U.S. Global Security
and each Physical Security shall bear the following legend (the
"Private Placement Legend") on the face thereof:
THESE SECURITIES HAVE NOT BEEN
REGISTERED UNDER THE SECURITIES ACT OF
1933, AS AMENDED (THE "SECURITIES ACT"), OR
ANY STATE SECURITIES LAWS. NEITHER THIS
SECURITY NOR ANY INTEREST OR PARTICIPATION
HEREIN MAY BE REOFFERED, SOLD, ASSIGNED,
TRANSFERRED, PLEDGED, ENCUMBERED OR
OTHERWISE DISPOSED OF IN THE ABSENCE OF
SUCH REGISTRATION OR UNLESS SUCH
TRANSACTION IS EXEMPT FROM, OR NOT SUBJECT
TO, THE REGISTRATION REQUIREMENTS OF THE
SECURITIES ACT. THE HOLDER OF THIS
SECURITY BY ITS ACCEPTANCE HEREOF AGREES TO
OFFER, SELL OR OTHERWISE TRANSFER SUCH
SECURITY, PRIOR TO THE DATE THAT IS THREE
YEARS AFTER THE LATER OF THE ORIGINAL ISSUE
DATE HEREOF AND THE LAST DATE ON WHICH THE
COMPANY OR UNITED OR ANY AFFILIATE OF THE
COMPANY OR UNITED WAS THE OWNER OF THIS
SECURITY (OR ANY PREDECESSOR OF
THIS SECURITY) ONLY (A) TO THE COMPANY OR
UNITED, (B) PURSUANT TO A REGISTRATION
STATEMENT WHICH HAS BEEN DECLARED EFFECTIVE
UNDER THE SECURITIES ACT, (C) FOR SO LONG
AS THE NOTES ARE ELIGIBLE FOR RESALE
PURSUANT TO RULE 144A UNDER THE SECURITIES
ACT ("RULE 144A"), TO A PERSON IT
REASONABLY BELIEVES IS A "QUALIFIED
INSTITUTIONAL BUYER" AS DEFINED IN RULE
144A THAT PURCHASES FOR ITS OWN ACCOUNT OR
FOR THE ACCOUNT OF A QUALIFIED
INSTITUTIONAL BUYER TO WHOM NOTICE IS GIVEN
THAT THE TRANSFER IS BEING MADE IN RELIANCE
ON RULE 144A, (D) PURSUANT TO OFFERS AND
SALES TO NON-U.S. PERSONS THAT OCCUR
OUTSIDE THE UNITED STATES WITHIN THE
MEANING OF REGULATION S UNDER THE
SECURITIES ACT, (E) TO AN INSTITUTIONAL
"ACCREDITED INVESTOR" WITHIN THE MEANING OF
SUBPARAGRAPHS (A)(1), (2), (3) OR (7) OF
RULE 501 UNDER THE SECURITIES ACT THAT IS
ACQUIRING THIS SECURITY FOR ITS OWN ACCOUNT
OR FOR THE ACCOUNT OF SUCH AN INSTITUTIONAL
"ACCREDITED INVESTOR" FOR INVESTMENT
PURPOSES AND NOT WITH A VIEW TO, OR FOR
OFFER OR SALE IN CONNECTION WITH, ANY
DISTRIBUTION IN VIOLATION OF THE SECURITIES
ACT, IN EACH CASE IN A MINIMUM PRINCIPAL
AMOUNT OF $250,000, OR (F) PURSUANT TO
ANOTHER AVAILABLE EXEMPTION FROM THE
REGISTRATION REQUIREMENTS OF THE SECURITIES
ACT, SUBJECT TO THE COMPANY'S AND THE
TRUSTEE'S RIGHT PRIOR TO ANY SUCH OFFER,
SALE OR TRANSFER (i) PURSUANT TO CLAUSES
(D), (E) OR (F) TO REQUIRE THE DELIVERY OF
AN OPINION OF COUNSEL, CERTIFICATION OR
OTHER INFORMATION SATISFACTORY TO EACH OF
THEM, AND (ii) IN EACH OF THE FOREGOING
CASES (CLAUSES (A) THROUGH (F)), TO REQUIRE
THAT A CERTIFICATE OF TRANSFER IN THE FORM
APPEARING ON THE OTHER SIDE OF THIS
SECURITY IS COMPLETED AND DELIVERED BY THE
TRANSFEROR TO THE TRUSTEE.
Each U.S. Global Security, whether or not an
Initial Security, shall also bear the following legend on
the face thereof:
UNLESS THIS CERTIFICATE IS PRESENTED BY AN
AUTHORIZED REPRESENTATIVE OF THE DEPOSITORY TRUST
COMPANY TO THE COMPANY OR ITS AGENT FOR
REGISTRATION OF TRANSFER, EXCHANGE OR PAYMENT, AND
ANY CERTIFICATE ISSUED IS REGISTERED IN THE NAME
OF CEDE & CO., OR TO SUCH OTHER ENTITY AS
IS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF
THE DEPOSITORY TRUST COMPANY OR SUCH OTHER
REPRESENTATIVE OF THE DEPOSITORY TRUST COMPANY OR
SUCH OTHER NAME AS IS REQUESTED BY AN AUTHORIZED
REPRESENTATIVE OF THE DEPOSITORY TRUST COMPANY
(AND ANY PAYMENT HEREON IS MADE TO CEDE & CO.),
ANY TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE
OR OTHERWISE BY OR TO ANY PERSON IS WRONGFUL SINCE
THE REGISTERED OWNER HEREOF, CEDE & CO., HAS AN
INTEREST HEREIN.
TRANSFERS OF THIS GLOBAL SECURITY SHALL
BE LIMITED TO TRANSFERS IN WHOLE, BUT NOT
IN PART, TO NOMINEES OF CEDE & CO., OR TO A
SUCCESSOR THEREOF OR SUCH SUCCESSOR'S
NOMINEE AND TRANSFERS OF PORTIONS OF THIS
GLOBAL SECURITY SHALL BE LIMITED TO
TRANSFERS MADE IN ACCORDANCE WITH THE
RESTRICTIONS SET FORTH IN SECTIONS 306 AND
307 OF THE INDENTURE.
ARTICLE THREE
THE SECURITIES
SECTION 301. Title and Terms.
The aggregate principal amount of Securities which
may be authenticated and delivered under this Indenture is
limited to $150,000,000, except for Securities authenticated
and delivered upon registration of transfer of, or in exchange
for, or in lieu of, other Securities pursuant to Section 303,
304, 305, 306, 906, 1010, 1016 or 1108.
The Stated Maturity of the Securities shall be May 1,
2005, and they shall bear interest at the rate of 12_% per
annum from May 3, 1995, or from the most recent Interest
Payment Date to which interest has been paid or duly provided
for, payable on November 1, 1995 and semiannually thereafter on
May 1 and November 1 in each year and at said Stated Maturity,
until the principal thereof is paid or duly provided for.
Pursuant to and in accordance with the terms of the
Registration Rights Agreement, the interest rate borne by the
Securities shall be increased by an amount not to exceed one-
half of one percent per annum in the aggregate for the periods
specified in the Registration Rights Agreement.
The principal of (and premium, if any, on) and
interest on the Securities shall be payable at the office or
agency of the Company maintained for such purpose as provided
in Section 1002; provided, however, that, at the option of the
Company, interest may be paid by check mailed to addresses of
the Persons entitled thereto as such addresses shall appear on
the Security Register.
The Securities shall be redeemable as provided in
Article Eleven.
SECTION 302. Denominations.
The Securities shall be issuable only in registered
form without coupons and only in denominations of $1,000 and
any integral multiple thereof.
SECTION 303. Execution, Authentication, Delivery and
Dating.
The Securities shall be executed on behalf of the
Company by its Chairman, its President or a Vice President, and
attested by its Secretary, an Assistant Secretary or any Vice
President. The signature of any of these officers on the
Securities may be manual or facsimile signatures of the present
or any future such authorized officer and may be imprinted or
otherwise reproduced on the Securities.
Securities bearing the manual or facsimile signatures
of individuals who were, at the time such Securities were
executed by such individuals, the proper officers of the
Company shall bind the Company, notwithstanding that such
individuals or any of them have ceased to hold such offices
prior to the authentication and delivery of such Securities or
did not hold such offices at the date of such Securities.
At any time and from time to time after the execution
and delivery of this Indenture, the Company may deliver
Securities executed by the Company to the Trustee for
authentication, together with a Company Order for the
authentication and delivery of such Securities, and the Trustee
in accordance with such Company Order shall authenticate and
deliver such Securities.
Each Security shall be dated the date of its
authentication.
No Security shall be entitled to any benefit under
this Indenture or be valid or obligatory for any purpose unless
there appears on such Security a certificate of authentication
substantially in the form provided for herein duly executed by
the Trustee by manual signature of an authorized signatory, and
such certificate upon any Security shall be conclusive
evidence, and the only evidence, that such Security has been
duly authenticated and delivered hereunder and is entitled to
the benefits of this Indenture.
In case the Company shall be consolidated or merged
with or into any other Person or shall convey, transfer, lease
or otherwise dispose of its properties and assets substantially
as an entirety to any Person, and the successor Person
resulting from such consolidation, or surviving such merger, or
into which the Company shall have been merged, or the Person
which shall have received a conveyance, transfer, lease or
other disposition as aforesaid, shall have executed an
indenture supplemental hereto with the Trustee pursuant to
Article Eight, any of the Securities authenticated or delivered
prior to such consolidation, merger, conveyance, transfer,
lease or other disposition may, from time to time, at the
request of the successor Person, be exchanged for other
Securities executed in the name of the successor Person with
such changes in phraseology and form as may be appropriate, but
otherwise in substance of like tenor as the Securities
surrendered for such exchange and of like principal amount; and
the Trustee, upon Company Request of the successor Person,
shall authenticate and deliver Securities as specified in such
request for the purpose of such exchange.
If Securities shall at any time be authenticated and delivered
in any new name of a successor Person pursuant to this Section
in exchange or substitution for or upon registration of
transfer of any Securities, such successor Person, at the
option of the Holders but without expense to them, shall
provide for the exchange of all Securities at the time
Outstanding for Securities authenticated and delivered in such
new name.
SECTION 304. Temporary Securities.
Pending the preparation of definitive Securities, the
Company may execute, and upon Company Order the Trustee shall
authenticate and deliver, temporary Securities which are
printed, lithographed, typewritten, mimeographed or otherwise
produced, in any authorized denomination, substantially of the
tenor of the definitive Securities in lieu of which they are
issued and with such appropriate insertions, omissions,
substitutions and other variations as the officers executing
such Securities may determine, as conclusively evidenced by
their execution of such Securities.
If temporary Securities are issued, the Company will
cause definitive Securities to be prepared without unreasonable
delay. After the preparation of definitive Securities, the
temporary Securities shall be exchangeable for definitive
Securities upon surrender of the temporary Securities at the
office or agency of the Company designated for such purpose
pursuant to Section 1002, without charge to the Holder. Upon
surrender for cancellation of any one or more temporary
Securities, the Company shall execute and the Trustee shall
authenticate and deliver in exchange therefor a like principal
amount of definitive Securities of authorized denominations.
Until so exchanged, the temporary Securities shall in all
respects be entitled to the same benefits under this Indenture
as definitive Securities.
SECTION 305. Registration, Registration of Transfer
and Exchange.
The Company shall cause to be kept at the Corporate
Trust Office of the Trustee a register (the register maintained
in such office and in any other office or agency designated
pursuant to Section 1002 being herein sometimes referred to as
the "Security Register") in which, subject to such reasonable
regulations as it may prescribe, the Company shall provide for
the registration of Securities and of transfers of Securities.
The Security Register shall be in written form or any other
form capable of being converted into written form within a
reasonable time. At all reasonable times, the Security
Register shall be open to inspection by the Trustee. The
Trustee is hereby initially appointed as security registrar
(the "Registrar" or "Security Registrar") for the purpose of
registering Securities and transfers of Securities as herein
provided.
Upon surrender for registration of transfer of any
Security at the office or agency of the Company designated
pursuant to Section 1002, the Company shall execute, and the
Trustee shall authenticate and deliver, in the name of the
designated transferee or transferees, one or more new
Securities of any authorized denomination or denominations of a
like aggregate principal amount.
Furthermore, any Holder of the U.S. Global Security
shall, by acceptance of such Global Security, agree that
transfers of beneficial interest in such Global Security may be
effected only through a book-entry system maintained by the
Holder of such Global Security (or its agent), and that
ownership of a beneficial interest in the Security shall be
required to be reflected in book entry.
At the option of the Holder, Securities may be
exchanged for other Securities of any authorized denomination
and of a like aggregate principal amount, upon surrender of the
Securities to be exchanged at such office or agency. Whenever
any Securities are so surrendered for exchange, the Company
shall execute, and the Trustee shall authenticate and deliver,
the Securities which the Holder making the exchange is entitled
to receive; provided that no exchange of Initial Securities
for Exchange Securities shall occur until an Exchange Offer
Registration Statement shall have been declared effective by
the Commission and that the Initial Securities to be exchanged
for the Exchange Securities shall be cancelled by the Trustee.
All Securities issued upon any registration of
transfer or exchange of Securities shall be the valid
obligations of the Company and any Guarantors, evidencing the
same debt, and entitled to the same benefits under this
Indenture, as the Securities surrendered upon such registration
of transfer or exchange.
Every Security presented or surrendered for
registration of transfer or for exchange shall (unless not
required by the Company or the Security Registrar) be duly
endorsed, or be accompanied by a written instrument of
transfer, in form satisfactory to the Company and the Security
Registrar, duly executed by the Holder thereof or his attorney
duly authorized in writing.
No service charge shall be made for any registration
of transfer or exchange or redemption of Securities, but the
Company may require payment of a sum sufficient to cover any
tax or other governmental charge that may be imposed in
connection with any registration of transfer or exchange of
Securities, other than exchanges pursuant to Section 304, 906,
1010, 1016 or 1108 not involving any transfer.
The Company shall not be required (i) to issue,
register the transfer of or exchange any Security during a
period beginning at the opening of business 15 days before the
selection of Securities to be redeemed under Section 1104 and
ending at the close of business on the day of mailing of the
relevant notice of redemption, 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 306. Book-Entry Provisions for U.S. Global
Security.
(a) The U.S. Global Security initially shall (i) be
registered in the name of the Depositary for such global
Security or the nominee of such Depositary, (ii) be delivered
to the Trustee as custodian for such Depositary and (iii) bear
legends as set forth in Section 202.
Subject to Section 306(f), members of, or
participants in, the Depositary ("Agent Members") shall have no
rights under this Indenture with respect to any U.S. Global
Security held on their behalf by the Depositary, or the Trustee
as its custodian, or under the U.S. Global Security, and the
Depositary may be treated by the Company, the Trustee and any
agent of the Company or the Trustee as the absolute owner of
such U.S. Global Security for all purposes whatsoever.
Notwithstanding the foregoing,
nothing herein shall prevent the Company, the Trustee or any
agent of the Company or the Trustee, from giving effect to any
written certification, proxy or other authorization furnished
by the Depositary or shall impair, as between the Depositary
and its Agent Members, the operation of customary practices
governing the exercise of the rights of a holder of any
Security.
(b) Transfers of the U.S. Global Security shall be
limited to transfers of such U.S. Global Security in whole, but
not in part, to the Depositary, its successors or their
respective nominees. Interests of beneficial owners in the
U.S. Global Security may be transferred in accordance with the
rules and procedures of the Depositary and the provisions of
Section 307. Beneficial owners may obtain U.S. Physical
Securities in exchange for their beneficial interests in the
U.S. Global Security upon request in accordance with the
Depository's and the Security Registrar's procedures. In
addition, U.S. Physical Securities shall be transferred to all
beneficial owners in exchange for their beneficial interests in
the U.S. Global Security if (i) the Depositary notifies the
Company that it is unwilling or unable to continue as
Depositary for the U.S. Global Security and a successor
depositary is not appointed by the Company within 90 days of
such notice or (ii) an Event of Default has occurred and is
continuing and the Registrar has received a request from the
Depositary.
(c) In connection with any transfer of a portion of
the beneficial interest in the U.S. Global Security to
beneficial owners pursuant to subsection (b) of this Section,
the Registrar shall reflect on its books and records the date
and a decrease in the principal amount of the U.S. Global
Security in an amount equal to the principal amount of the
beneficial interest in the U.S. Global Security to be
transferred, and the Company shall execute, and the Trustee
shall authenticate and deliver, one or more U.S. Physical
Securities of like tenor and amount.
(d) In connection with the transfer of the entire
U.S. Global Security to beneficial owners pursuant to the
fourth sentence of subsection (b) of this Section, the U.S.
Global Security shall be surrendered to the Trustee for
cancellation, and the Company shall execute, and the Trustee
shall authenticate and deliver, to each beneficial owner
identified by the Depositary in exchange for its beneficial
interest in the U.S. Global Security, an equal aggregate
principal amount of U.S. Physical Securities of authorized
denominations.
(e) Any U.S. Physical Security delivered in exchange
for an interest in the U.S. Global Security pursuant to clause
(c) or clause (d) of this Section shall, except as otherwise
provided by paragraph (a)(i)(x) and paragraph (f) of Section
307, bear the applicable legends regarding transfer
restrictions applicable to the U.S. Physical Security set forth
in Section 202.
(f) The registered holder of the U.S. Global
Security may grant proxies and otherwise authorize any person,
including Agent Members and persons that may hold interests
through Agent Members, to take any action which a Holder is
entitled to take under this Indenture or the Securities, which
proxies or authorizations shall be effective notwithstanding
the second paragraph of Section 306(a).
SECTION 307. Special Transfer Provisions.
Unless and until (i) an Initial Security is sold
under an effective Registration Statement, or (ii) an Initial
Security
is exchanged for an Exchange Security in connection with an
effective Registration Statement, in each case pursuant to the
Registration Rights Agreement, the following provisions shall
apply:
(a) Transfers to Non-QIB Institutional Accredited
Investors. The following provisions shall apply with respect
to the registration of any proposed transfer of a Security to
any institutional "accredited investor" (as defined in Rule
501(a)(1), (2), (3) or (7) of Regulation D under the Securities
Act) which is not a QIB (excluding Non-U.S. Persons):
(i) The Registrar shall register the transfer of any
Security, whether or not such Security bears the Private
Placement Legend, if (x) the requested transfer is at
least three years after the later of the original issue
date of the Securities and the last date on which such
Security was held by an affiliate of the Company or (y)
the proposed transferee has delivered to the Registrar a
certificate substantially in the form of Exhibit C hereto
and an Opinion of Counsel acceptable to the Company and
the Trustee that such transfer is in compliance with the
Securities Act.
(ii) If the proposed transferor is an Agent Member
holding a beneficial interest in the U.S. Global Security,
upon receipt by the Registrar of (x) the documents, if
any, required by paragraph (i) and (y) instructions given
in accordance with the Depositary's and the Registrar's
procedures, the Registrar shall reflect on its books and
records the date and a decrease in the principal amount of
the U.S. Global Security in an amount equal to the
principal amount of the beneficial interest in the U.S.
Global Security to be transferred, and the Company shall
execute, and the Trustee shall authenticate and deliver,
one or more U.S. Physical Securities of like tenor and
amount.
(b) Transfers to QIBs. The following provisions
shall apply with respect to the registration of any proposed
transfer of a U.S. Physical Security or an interest in the U.S.
Global Security to a QIB (excluding Non-U.S. Persons):
(i) If the Initial Security to be transferred
consists of (x) U.S. Physical Securities, the Registrar
shall register the transfer if such transfer is being made
by a proposed transferor who has checked the box provided
for on the form of Initial Security stating, or has
otherwise advised the Company and the Registrar in
writing, that the sale has been made in compliance with
the provisions of Rule 144A to a transferee who has signed
the certification provided for on the form of Initial
Security stating, or has otherwise advised the Company and
the Registrar in writing, that it is purchasing the
Initial Security for its own account or an account with
respect to which it exercises sole investment discretion
and that it and any such account is a QIB within the
meaning of Rule 144A, and is aware that the sale to it is
being made in reliance on Rule 144A and acknowledges that
it has received such information regarding the Company as
it has requested pursuant to Rule 144A or has determined
not to request such information and that it is aware that
the transferor is relying upon its foregoing
representations in order to claim the exemption from
registration provided by Rule 144A or (y) an interest in
the U.S. Global Security, the transfer of such interest
may be effected only through the book-entry system
maintained by the Depositary.
(ii) If the proposed transferee is an Agent Member,
and the Initial Security to be transferred consists of
U.S. Physical Securities, upon receipt by the Registrar of
the documents referred to in clause (i) and instructions
given in accordance with the Depositary's and the
Registrar's procedures, the Registrar shall reflect on its
books and records the date and an increase in the
principal amount of the U.S. Global Security in an amount
equal to the principal amount of the U.S. Physical
Securities, to be transferred, and the Trustee shall
cancel the U.S. Physical Security so transferred.
(c) Transfers of Interests in the Temporary Offshore
Global Security. The following provisions shall apply with
respect to registration of any proposed transfer of interests
in the Temporary Offshore Global Security:
(i) The Registrar shall register the transfer of any
Initial Security (x) if the proposed transferee is a Non
U.S. Person and the proposed transferor has delivered to
the Registrar a certificate substantially in the form of
Exhibit D hereto or (y) if the proposed transferee is a
QIB and the proposed transferor has checked the box
provided for on the form of Initial Security stating, or
has otherwise advised the Company and the Registrar in
writing, that the sale has been made in compliance with
the provisions of Rule 144A to a transferee who has signed
the certification provided for on the form of Initial
Security stating, or has otherwise advised the Company and
the Registrar in writing, that it is purchasing the
Initial Security for its own account or an account with
respect to which it exercises sole investment discretion
and that it and any such account is a QIB within the
meaning of Rule 144A, and is aware that the sale to it is
being made in reliance on Rule 144A and acknowledges that
it has received such information regarding the Company as
it has requested pursuant to Rule 144A or has determined
not to request such information and that it is aware that
the transferor is relying upon its foregoing
representations in order to claim the exemption from
registration provided by Rule 144A.
(ii) If the proposed transferee is an Agent Member,
upon receipt by the Registrar of the documents referred to
in clause (i)(y) above and instructions given in
accordance with the Depositary's and the Registrar's
procedures, the Registrar shall reflect on its books and
records the date and an increase in the principal amount
of the U.S. Global Security, in an amount equal to the
principal amount of the Temporary Offshore Global Security
to be transferred, and the Trustee shall decrease the
amount of the Temporary Offshore Global Security.
(d) Transfers of Interests in the Permanent Offshore
Global Security or Permanent Offshore Physical Securities to
U.S. Persons. The following provisions shall apply with
respect to any transfer of interests in the Permanent Offshore
Global Security or Permanent Offshore Physical Securities to
U.S. Persons: The Registrar shall register the transfer of any
such Security without requiring any additional certification.
(e) Transfers to Non-U.S. Persons at Any Time. The
following provisions shall apply with respect to any transfer
of a Security to a Non-U.S. Person:
(i) Prior to 40 days after the Closing Date, the
Registrar shall register any proposed transfer of an
Initial
Security to a Non-U.S. Person upon receipt of a
certificate substantially in the form of Exhibit D hereto
from the proposed transferor.
(ii) On and after 40 days after the Closing Date, the
Registrar shall register any proposed transfer to any Non
U.S. Person if the Security to be transferred is a U.S.
Physical Security or an interest in the U.S. Global
Security, upon receipt of a certificate substantially in
the form of Exhibit D from the proposed transferor.
(iii) (a) If the proposed transferor is an Agent
Member holding a beneficial interest in the U.S. Global
Security, upon receipt by the Registrar of (x) the
documents, if any, required by paragraph (ii) and (y)
instructions in accordance with the Depositary's and the
Registrar's procedures, the Registrar shall reflect on its
books and records the date and a decrease in the principal
amount of the U.S. Global Security in an amount equal to
the principal amount of the beneficial interest in the
U.S. Global Security to be transferred, and (b) if the
proposed transferee is an Agent Member, upon receipt by
the Registrar of instructions given in accordance with the
Depositary's and the Registrar's procedures, the Registrar
shall reflect on its books and records the date and an
increase in the principal amount of the Permanent Offshore
Global Security in an amount equal to the principal amount
of the U.S. Physical Securities or the U.S. Global
Security, as the case may be, to be transferred, and the
Trustee shall cancel the U.S. Physical Security, if any,
so transferred or decrease the amount of the U.S. Global
Security.
(f) Private Placement Legend. Upon the transfer,
exchange or replacement of Securities not bearing the
Private Placement Legend, the Registrar shall deliver
Securities that do not bear the Private Placement Legend.
Upon the transfer, exchange or replacement of Securities
bearing the Private Placement Legend, the Registrar shall
deliver only Securities that bear the Private Placement
Legend unless either (i) the circumstances contemplated by
the fifth paragraph of Section 201 or paragraphs
(a)(i)(x), (d) or (e)(ii) of this Section 307 exists or
(ii) there is delivered to the Registrar an Opinion of
Counsel reasonably satisfactory to the Company and the
Trustee to the effect that neither such legend nor the
related restrictions on transfer are required in order to
maintain compliance with the provisions of the Securities
Act.
(g) General. By its acceptance of any Security
bearing the Private Placement Legend, each Holder of such
a Security acknowledges the restrictions on transfer of
such Security set forth in this Indenture and in the
Private Placement Legend and agrees that it will transfer
such Security only as provided in this Indenture.
The Registrar shall retain copies of all letters,
notices and other written communications received pursuant to
Section 306 or Section 307. The Company shall have the right
to inspect and make copies of all such letters, notices or
other written communications at any reasonable time upon the
giving of reasonable written notice to the Registrar.
SECTION 308. Mutilated, Destroyed, Lost and Stolen
Securities.
If (i) any mutilated Security is surrendered to the
Trustee, or (ii) the Company and the Trustee receive evidence
to their satisfaction of the destruction, loss or theft of any
Security, and there is delivered to the Company and the Trustee
(at the expense of the Holder) such security or indemnity as
may be required by them to save each of them harmless, then, in
the absence of notice to the Company or the Trustee that such
Security has been acquired by a bona fide purchaser, the
Company shall execute and upon Company Order the Trustee shall
authenticate and deliver, in exchange for any such mutilated
Security or in lieu of any such destroyed, lost or stolen
Security, a new Security of like tenor and principal amount,
bearing a number not contemporaneously outstanding.
In case any such mutilated, destroyed, lost or stolen
Security has become or is about to become due and payable, the
Company in its discretion may, instead of issuing a new
Security, pay such Security.
Upon the issuance of any new Security under this
Section, the Company may require the payment by the Holder of
such mutilated, destroyed, lost or stolen Security of a sum
sufficient to cover any tax or other governmental charge that
may be imposed in relation thereto and any other expenses
(including the fees and expenses of the Trustee) connected
therewith.
Every new Security issued pursuant to this Section in
lieu of any destroyed, lost or stolen Security shall constitute
an original additional contractual obligation of the Company
and any Guarantor, whether or not the destroyed, lost or stolen
Security shall be at any time enforceable by anyone, and shall
be entitled to all benefits of this Indenture equally and
proportionately with any and all other Securities duly issued
hereunder.
The provisions of this Section are exclusive and
shall preclude (to the extent lawful) all other rights and
remedies with respect to the replacement or payment of
mutilated, destroyed, lost or stolen Securities.
SECTION 309. Payment of Interest; Interest Rights
Preserved.
Interest on any Security which is payable, and is
punctually paid or duly provided for, on any Interest Payment
Date shall be paid to the Person in whose name such Security is
registered at the close of business on the Regular Record Date
immediately prior to such Interest Payment Date at the office
or agency of the Company maintained for such purpose pursuant
to Section 1002; provided, however, that each installment of
interest may at the Company's option be paid by mailing a check
for such interest, payable to or upon the written order of the
Person entitled thereto pursuant to Section 305, to the address
of such Person as it appears in the Security Register.
Any interest on any Security which is payable, but is
not punctually paid or duly provided for, on any Interest
Payment Date shall forthwith cease to be payable to the Holder
on the Regular Record Date by virtue of having been such
Holder, and such defaulted interest and (to the extent lawful)
interest on such defaulted interest at the rate borne by the
Securities (such defaulted interest and interest thereon herein
collectively called "Defaulted Interest") may be paid by the
Company, at its election in each case, as provided in clause
(1) or (2) below:
(1) The Company may elect to make payment of any
Defaulted Interest to the Persons in whose names the
Securities are registered at the close of business on a
Special Record Date for the payment of such Defaulted
Interest, which shall be fixed in the following manner.
The Company shall notify the Trustee in writing of the
amount of Defaulted Interest proposed to be paid on each
Security and the date of the proposed payment, and at the
same time the Company shall deposit with the Trustee an
amount of money equal to the aggregate amount proposed to
be paid in respect of such Defaulted Interest or shall
make arrangements satisfactory to the Trustee for such
deposit prior to the date of the proposed payment, such
money when deposited to be held in trust for the benefit
of the Persons entitled to such Defaulted Interest as in
this clause provided. Thereupon the Trustee shall fix a
Special Record Date for the payment of such Defaulted
Interest which shall be not more than 30 days and not less
than 10 days prior to the date of the proposed payment and
not less than 10 days after the receipt by the Trustee of
the notice of the proposed payment. The Trustee shall
promptly notify the Company of such Special Record Date,
and in the name and at the expense of the Company, shall
cause notice of the proposed payment of such Defaulted
Interest and the Special Record Date therefor to be given
in the manner provided for in
Section 106, not less than 10 days prior to such Special
Record Date. Notice of the proposed payment of such
Defaulted Interest and the Special Record Date therefor
having been so given, such Defaulted Interest shall be
paid to the Persons in whose names the Securities (or
their respective Predecessor Securities) are registered at
the close of business on such Special Record Date and
shall no longer be payable pursuant to the following
clause (2).
(2) The Company may make payment of any Defaulted
Interest in any other lawful manner not inconsistent with
the requirements of any securities exchange on which the
Securities may be listed, and upon such notice as may be
required by such exchange, if, after notice given by the
Company to the Trustee of the proposed payment pursuant to
this clause, such manner of payment shall not be deemed
impracticable by the Trustee.
Subject to the foregoing provisions of this Section,
each Security delivered under this Indenture upon registration
of transfer of or in exchange for or in lieu of any other
Security shall carry the rights to interest accrued and unpaid,
and to accrue, which were carried by such other Security.
SECTION 310. Persons Deemed Owners.
Prior to the due presentment of a Security for
registration of transfer, the Company, the Trustee and any
agent of the Company or the Trustee may treat the Person in
whose name such Security is registered as the owner of such
Security for the purpose of receiving payment of principal of
(and premium, if any, on) and (subject to Sections 305 and 309)
interest on such Security and for all other purposes
whatsoever, whether or not such Security be overdue, and none
of the Company, the Trustee or any agent of the Company or the
Trustee shall be affected by notice to the contrary.
SECTION 311. Cancellation.
All Securities surrendered for payment, redemption,
registration of transfer or exchange shall, if surrendered to
any Person other than the Trustee, be delivered to the Trustee
and shall be promptly cancelled by it. The Company may at any
time
deliver to the Trustee for cancellation any Securities
previously authenticated and delivered hereunder which the
Company may have acquired in any manner whatsoever, and may
deliver to the Trustee (or to any other Person for delivery to
the Trustee) for cancellation any Securities previously
authenticated hereunder which the Company has not issued and
sold, and all Securities so delivered shall be promptly
cancelled by the Trustee. If the Company shall so acquire any
of the Securities, however, such acquisition shall not operate
as a redemption or satisfaction of the Indebtedness represented
by such Securities unless and until the same are surrendered to
the Trustee for cancellation. No Securities shall be
authenticated in lieu of or in exchange for any Securities
cancelled as provided in this Section, except as expressly
permitted by this Indenture. All cancelled Securities held by
the Trustee shall be disposed of by the Trustee in accordance
with its customary procedures.
SECTION 312. Computation of Interest.
Interest on the Securities shall be computed on the
basis of a 360-day year of twelve 30-day months.
SECTION 313. CUSIP or CINS Numbers.
The Company in issuing the Securities may use "CUSIP"
or "CINS" numbers (if then generally in use), and, if so, the
Trustee shall use "CUSIP" or "CINS" numbers, as the case may
be, in notices of redemption as a convenience to Holders;
provided that any such notice may state that no representation
is made as to the correctness of such numbers either as printed
on the Securities or as contained in any notice of a redemption
and that reliance may be placed only on the other
identification numbers printed on the Securities, and any such
redemption shall not be affected by any defect in or omission
of such numbers.
ARTICLE FOUR
SATISFACTION AND DISCHARGE
SECTION 401. Satisfaction and Discharge of
Indenture.
This Indenture will be discharged and shall cease to
be of further effect (except as to surviving rights of
registration of transfer or exchange of the Securities, as
expressly provided for herein) as to all Outstanding Securities
when
(1) either
(a) all the Securities theretofore
authenticated and delivered (other than lost, stolen
or destroyed Securities which have been replaced or
paid as provided in Section 308) have been cancelled
or have been delivered to the Trustee for
cancellation; or
(b) all Securities not theretofore
delivered to the Trustee for cancellation
(i) have become due and payable,
or
(ii) will become due and payable
at their Stated Maturity within one year, or
(iii) are to be called for
redemption within one year under arrangements
satisfactory to the Trustee for the giving of
notice of redemption by the Trustee in the name,
and at the expense, of the Company,
and the Company or any Guarantor has irrevocably deposited
or caused to be deposited with the Trustee funds in an
amount sufficient to pay and discharge the entire
Indebtedness on the Securities not theretofore delivered
to the Trustee for cancellation, including principal of,
premium, if any, and accrued interest at such Stated
Maturity or redemption date;
(2) the Company or any Guarantor has paid or caused
to be paid all other sums payable under this Indenture by
the Company and each Guarantor; and
(3) the Company has delivered to the Trustee an
Officers' Certificate and an Opinion of Counsel each
stating that (a) all conditions precedent hereunder
relating to the satisfaction and discharge of this
Indenture have been complied with and (b) such
satisfaction and discharge will not result in a breach or
violation of, or constitute a default under, this
Indenture.
SECTION 402. Application of Trust Money.
Subject to the provisions of the last paragraph of
Section 1003, all money deposited with the Trustee pursuant to
Section 401 shall be held in trust and applied by it, in
accordance with the provisions of the Securities and this
Indenture, to the payment, either directly or through any
Paying Agent (including the Company acting as its own Paying
Agent) as the Trustee may determine, to the Persons entitled
thereto, of the principal (and premium, if any) and interest
for whose payment such money has been deposited with the
Trustee; but such money need not be segregated from other funds
except to the extent required by law.
ARTICLE FIVE
REMEDIES
SECTION 501. Events of Default.
"Event of Default," wherever used herein, means any
one of the following events (whatever the reason for such Event
of Default and whether it shall be voluntary or involuntary or
be effected by operation of law or pursuant to any judgment,
decree or order of any court or any order, rule or regulation
of any administrative or governmental body):
(1) there shall be a default in the payment of any
interest on any Security when it becomes due and payable,
and such default shall continue for a period of 30 days,
whether or not such payment is prohibited under the
provisions of Article Fourteen or Article Fifteen;
(2) there shall be a default in the payment of the
principal of (or premium, if any, on) any Security at its
Maturity (upon acceleration, optional or mandatory
redemption, required repurchase or otherwise), whether or
not such payment is prohibited under the provisions of
Article Fourteen or Article Fifteen;
(3) (a) there shall be a default in the performance,
or breach, of any covenant or agreement of the Company,
United or any Guarantor under this Indenture (other than a
default in the performance of, or breach of, a covenant or
agreement which is specifically dealt with in clause (1) or
(2) or in clauses (b), (c) and (d) of this clause (3)) and
such default or breach shall continue for a period of 30 days
after written notice has been given, by certified mail, (x)
to the Company by the Trustee or (y) to the Company and the
Trustee by the Holders of at least 25% in aggregate principal
amount of the Outstanding Securities, specifying such default
or breach and requiring it to be remedied and stating that
such notice is a "Notice of Default" under this Indenture;
(b) there shall be a default in the performance of, or breach
of, the provisions described in Article Eight; (c) the
Company shall have failed to make or consummate an Offer in
accordance with the provisions of Section 1016; or (d) the
Company shall have failed to make or consummate a Change of
Control Offer in accordance with the provisions of Section
1010;
(4) one or more defaults shall have occurred under any
agreements, indentures or instruments under which the Company
or any Restricted Subsidiary then has outstanding
Indebtedness in excess of $10 million principal amount in the
aggregate and, if not already matured at its final maturity
in accordance with its terms, such Indebtedness shall have
been accelerated;
(5) any Guarantee shall for any reason cease to be, or
shall be asserted in writing by such Guarantor, United or the
Company not to be, in full force and effect and enforceable
in accordance with its terms or any Subsidiary shall fail to
Guarantee the Securities as required by Section 1017;
(6) one or more judgments, orders or decrees for the
payment of money in excess of $10 million, either
individually or in the aggregate (net of amounts covered by
insurance, bond, surety or similar instrument), shall be
entered against the Company, United or any Restricted
Subsidiary, or any of their respective properties, and shall
not be discharged and either (a) any creditor shall have
commenced an enforcement proceeding upon such judgment, order
or decree or (b) there shall have been a period of 60
consecutive days during which a stay of enforcement of such
judgment or order, by reason of an appeal or otherwise, shall
not be in effect;
(7) there shall have been the entry by a court of
competent jurisdiction of (a) a decree or order for relief in
respect of the Company, United or any Significant Subsidiary
in an involuntary case or proceeding under any applicable
Bankruptcy Law or (b) a decree or order adjudging the
Company, United or any Significant Subsidiary bankrupt or
insolvent, or seeking reorganization, arrangement, adjustment
or composition of or in respect of the Company, United or any
Significant Subsidiary under any applicable federal or state
law, or appointing a custodian, receiver, liquidator,
assignee, trustee, sequestrator (or other similar official)
of the Company, United or any Significant Subsidiary or of
any substantial part of their respective properties, or
ordering the winding up or liquidation of their affairs, and
any such decree or order for relief shall continue to be in
effect, or any such other decree or order shall be unstayed
and in effect, for a period of 60 consecutive days; or
(8) (a) the Company, United or any Significant
Subsidiary commences a voluntary case or proceeding under
any applicable Bankruptcy Law or any other case or proceeding
to be adjudicated bankrupt or insolvent, (b) the Company,
United or any Significant Subsidiary consents to the entry of
a decree or order for relief in respect of the Company,
United or any Significant Subsidiary in an involuntary case
or proceeding under any applicable Bankruptcy Law or to the
commencement of any bankruptcy or insolvency case or
proceeding against it, (c) the Company, United or any
Significant Subsidiary files a petition or answer or consent
seeking reorganization or relief under any applicable federal
or state law, (d) the Company, United or any Significant
Subsidiary (x) consents to the filing of such petition or the
appointment of, or taking possession by, a custodian,
receiver, liquidator, assignee, trustee, sequestrator or
similar official of the Company, United or any Significant
Subsidiary or of any substantial part of their respective
properties or (y) makes an assignment for the benefit of
creditors or (e) the Company, United or any Significant
Subsidiary takes any corporate action in furtherance of any
such actions in this clause (8).
SECTION 502. Acceleration of Maturity; Rescission and
Annulment.
If an Event of Default (other than as specified in
Section 501(7) or 501(8)) shall occur and be continuing, the
Trustee or the Holders of not less than 25% in aggregate principal
amount of the Securities then Outstanding may, and the Trustee at
the request of such Holders shall, declare all unpaid principal of
(and premium, if any, on) and accrued interest on all the
Securities to be due and payable immediately, by a notice in
writing to the Company (and to the Trustee if given by the Holders
of the Securities); provided that so long as the Senior Bank
Facility is in effect, such declaration shall not become effective
until the earlier of (a) five Business Days after receipt of such
notice of acceleration from the Holders or the Trustee by the
agent under the Senior Bank Facility or (b) acceleration of the
Indebtedness under the Senior Bank Facility. Thereupon such
principal shall become immediately due and payable, and the
Trustee may, at its discretion, proceed to protect and enforce the
rights of the Holders of Securities by appropriate judicial
proceeding. If an Event of Default specified in Section 501(7) or
501(8) occurs, then all the Securities shall ipso facto become and
be immediately due and payable, in an amount equal to the
principal amount of the Securities, together with accrued and
unpaid interest, if any, to the date the Securities become due and
payable, without any declaration or other act on the part of the
Trustee or any Holder. The Trustee or, if notice of acceleration
is given by the Holders, the Holders shall give notice to the
agent under the Senior Bank Facility of any such acceleration;
provided that failure to give such notice shall not affect the
validity thereof.
At any time after a declaration of acceleration has been
made, but before a judgment or decree for payment of the money due
has been obtained by the Trustee, the Holders of a majority in
aggregate principal amount of Securities Outstanding, by written
notice to the Company and the Trustee, may rescind and annul such
declaration and its consequences if:
(1) the Company has paid or deposited with the Trustee
a sum sufficient to pay:
(a) all sums paid or advanced by the Trustee
hereunder and the reasonable compensation, expenses,
disbursements and advances of the Trustee, its agents
and counsel,
(b) all overdue interest on all Securities,
and
(c) to the extent that payment of such
interest is lawful, interest upon overdue interest at
the rate borne by the Securities;
(2) all Events of Default, other than the non-payment
of principal of the Securities which have become due solely
by such declaration of acceleration, have been cured or
waived as provided in Section 513; and
(3) the rescission will not conflict with any judgment
or decree of a court of competent jurisdiction.
No such rescission shall affect any subsequent default
or impair any right consequent thereon.
SECTION 503. Collection of Indebtedness and Suits for
Enforcement by Trustee.
The Company covenants that if:
(a) default is made in the payment of any installment
of interest on any Security when such interest becomes due
and payable and such default continues for a period of 30
days, or
(b) default is made in the payment of the principal of
(or premium, if any, on) any Security at the Maturity
thereof,
the Company will, upon demand of the Trustee, pay to the Trustee
for the benefit of the Holders of such Securities, the whole
amount then due and payable on such Securities for principal (and
premium, if any) and interest, and interest on any overdue
principal (and premium, if any) and, to the extent that payment of
such interest shall be legally enforceable, upon any overdue
installment of interest, at the rate borne by the Securities, and,
in addition thereto, such further amount as shall be sufficient to
cover the costs and expenses of collection, including the
reasonable compensation, expenses, disbursements and advances of
the Trustee, its agents and counsel, except costs and expenses
incurred as a result of the Trustee's negligence or bad faith.
If the Company fails to pay such amounts forthwith upon
such demand, the Trustee, in its own name as trustee of an express
trust, may institute a judicial proceeding for the collection of
the sums so due and unpaid, may prosecute such proceeding to
judgment or final decree and may enforce the same against the
Company, any Guarantor, or any other obligor upon the Securities
and collect the moneys adjudged or decreed to be payable in the
manner provided by law out of the property of the Company, any
Guarantor, or any other obligor upon the Securities, wherever
situated.
If an Event of Default occurs and is continuing, the
Trustee may in its discretion proceed to protect and enforce its
rights and the rights of the Holders by such appropriate judicial
proceedings as the Trustee shall deem most effectual to protect
and enforce any such rights, whether for the specific enforcement
of any covenant or agreement in this Indenture or in aid of the
exercise of any power granted herein, or to enforce any other
proper remedy.
SECTION 504. Trustee May File Proofs of Claim.
In case of 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,
premium, if any, 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, unless incurred as a
result of the Trustee's negligence or bad faith) and of the
Holders allowed in such judicial proceeding, and
(ii) to collect and receive any moneys or other property
payable or deliverable on any such claims and to distribute
the same;
and any custodian, receiver, assignee, trustee, liquidator,
sequestrator or 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 the
Trustee any amount due it for the reasonable compensation,
expenses, disbursements and advances of the Trustee, its agents
and counsel, unless incurred as a result of the Trustee's
negligence or bad faith, and any other amounts due the Trustee
under Section 606.
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, or to authorize the Trustee to vote in respect of
the claim of any Holder in any such proceeding.
SECTION 505. Trustee May Enforce Claims Without
Possession of Securities.
All rights of action and claims under this Indenture or
the Securities may be prosecuted and enforced by the Trustee
without the possession of any of the Securities or the production
thereof in any proceeding relating thereto, and any such
proceeding instituted by the Trustee shall be brought in its own
name and as trustee of an express trust, and any recovery of
judgment shall, after provision for the payment of the reasonable
compensation, expenses, disbursements and advances of the Trustee,
its agents and counsel, be for the ratable benefit of the Holders
in respect of which such judgment has been recovered.
SECTION 506. Application of Money Collected.
Any money collected by the Trustee pursuant to this
Article shall be applied in the following order, at the date or
dates fixed by the Trustee and, in case of the distribution of
such money on account of principal (or premium, if any) or
interest, upon presentation of the Securities and the notation
thereon of the payment if only partially paid and upon surrender
thereof if fully paid:
FIRST: To the payment of all amounts due the Trustee
under Section 606;
SECOND: To the payment of the amounts then due and
unpaid for principal of (and premium, if any, on,) and
interest on the Securities in respect of which or for the
benefit of which such money has been collected, ratably,
without preference or priority of any kind, according to the
amounts due and payable on such Securities for principal (and
premium, if any) and interest, respectively; and
THIRD: The balance, if any, to the Person or Persons
entitled thereto.
SECTION 507. Limitation on Suits.
No Holder shall have any right to institute any
proceeding, judicial or otherwise, with respect to this Indenture,
or for the appointment of a receiver or trustee, or for any other
remedy hereunder, unless
(1) such Holder has previously given written notice to
the Trustee of a continuing Event of Default;
(2) the Holders of not less than 25% in principal
amount of the Outstanding Securities shall have made written
request to the Trustee to institute proceedings in respect of
such Event of Default in its own name as Trustee hereunder;
(3) such Holder or Holders have offered to the Trustee
reasonable indemnity against the costs, expenses and
liabilities to be incurred in compliance with such request;
(4) the Trustee for 30 days after its receipt of such
notice, request and offer of indemnity has failed to
institute any such proceeding; and
(5) no direction inconsistent with such written request
has been given to the Trustee during such 30-day period by
the Holders of a majority or more in principal amount of the
Outstanding Securities;
it being understood and intended that no one or more Holders shall
have any right in any manner whatever by virtue of, or by availing
of, any provision of this Indenture to affect, disturb or
prejudice the rights of any other Holders, or to obtain or to seek
to obtain priority or preference over any other Holders or to
enforce any right under this Indenture, except in the manner
herein provided and for the equal and ratable benefit of all the
Holders.
SECTION 508. Unconditional Right of Holders to Receive
Principal, Premium and Interest.
Notwithstanding any other provision in this Indenture,
the Holder of any Security shall have the right, which is
absolute and unconditional, to receive payment, as provided herein
(including, if applicable, Article Twelve) and in such Security of
the principal of (and premium, if any, on) and (subject to Section
309) interest on, such Security on the respective Stated
Maturities expressed in such Security (or, in the case of
redemption, on the Redemption Date) and to institute suit for the
enforcement of any such payment, and such rights shall not be
impaired without the consent of such Holder.
SECTION 509. Restoration of Rights and Remedies.
If the Trustee or any Holder has instituted any
proceeding to enforce any right or remedy under this Indenture and
such proceeding has been discontinued or abandoned for any reason,
or has been determined adversely to the Trustee or to such Holder,
then and in every such case, subject to any determination in such
proceeding, the Company, the Trustee and the Holders shall be
restored severally and respectively to their former positions
hereunder and thereafter all rights and remedies of the Trustee
and the Holders shall continue as though no such proceeding had
been instituted.
SECTION 510. Rights and Remedies Cumulative.
Except as otherwise provided with respect to the
replacement or payment of mutilated, destroyed, lost or stolen
Securities in the last paragraph of Section 308, no right or
remedy herein conferred upon or reserved to the Trustee or to the
Holders is intended to be exclusive of any other right or remedy,
and every right and remedy shall, to the extent permitted by law,
be cumulative and in addition to every other right and remedy
given hereunder or now or hereafter existing at law or in equity
or otherwise. The assertion or employment of any right or remedy
hereunder, or otherwise, shall not prevent the concurrent
assertion or employment of any other appropriate right or remedy.
SECTION 511. Delay or Omission Not Waiver.
No delay or omission of the Trustee or of any Holder of
any Security to exercise any right or remedy accruing upon any
Event of Default shall impair any such right or remedy or
constitute a waiver of any such Event of Default or an
acquiescence therein. Every right and remedy given by this
Article or by law to the Trustee or to the Holders may be
exercised from time to time, and as often as may be deemed
expedient, by the Trustee or by the Holders, as the case may be.
SECTION 512. Control by Holders.
The Holders of not less than a majority in principal
amount of the Outstanding Securities shall have the right to
direct the time, method and place of conducting any proceeding for
any remedy available to the Trustee, or exercising any trust or
power conferred on the Trustee, provided that
(1) such direction shall not be in conflict with any
rule of law or with this Indenture,
(2) the Trustee may take any other action deemed proper
by the Trustee which is not inconsistent with such direction,
and
(3) the Trustee need not take any action which might
involve it in personal liability or be unjustly prejudicial
to the Holders not consenting.
SECTION 513. Waiver of Past Defaults.
The Holders of not less than a majority in principal
amount of the Outstanding Securities may on behalf of the Holders
of all the Securities waive any past default hereunder and its
consequences, except a default
(1) in respect of the payment of the principal of (or
premium, if any, on) or interest on any Security, or
(2) in respect of a covenant or provision hereof which
under Article Nine cannot be modified or amended without the
consent of the Holder of each Outstanding Security 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 Event of
Default or impair any right consequent thereon.
SECTION 514. Waiver of Stay or Extension Laws.
The Company and each Guarantor covenants (to the extent
that it may lawfully do so) that it will not at any time insist
upon, or plead, or in any manner whatsoever claim or take the
benefit or advantage of, any stay or extension law wherever
enacted, now or at any time hereafter in force, which may affect
the covenants or the performance of this Indenture; and the
Company and each Guarantor (to the extent that it may lawfully do
so) hereby expressly waives all benefit or advantage of any such
law and covenants that it will not hinder, delay or impede the
execution of any power herein granted to the Trustee, but will
suffer and permit the execution of every such power as though no
such law had been enacted.
SECTION 515. Undertaking for Costs.
In any suit for the enforcement of any right or remedy
under this Indenture or the Securities or in any suit against the
Trustee for any action taken or omitted by it as Trustee, a court
in its discretion may require the filing by any party litigant in
the suit of an undertaking to pay the costs of the suit, and the
court in its discretion may assess reasonable costs, including
reasonable attorneys' fees and expenses, against any party
litigant in the suit, having due regard to the merits and good
faith of the claims or defenses made by the party litigant. This
Section does not apply to a suit by the Trustee or a suit by
Holders of more than 10% in principal amount of the
Securities. ARTICLE SIX
THE TRUSTEE
SECTION 601. Notice of Defaults.
Within 90 days after the occurrence of any Default
hereunder, the Trustee shall transmit in the manner and to the
extent provided in TIA Section 313(c), notice of such Default
hereunder known to the Trustee, unless such Default shall have
been cured or waived; provided, however, that, except in the case
of a Default in the payment of the principal of (or premium, if
any, on) or interest on any Security or in the payment of any
sinking fund installment, the Trustee shall be protected in
withholding such notice if and so long as the board of directors,
the executive committee or a trust committee of directors and/or
Responsible Officers of the Trustee in good faith determines that
the withholding of such notice is in the interest of the Holders.
SECTION 602. Certain Rights of Trustee.
Subject to the provisions of TIA Sections 315(a) through
315(d):
(1) the Trustee may rely and shall be protected in
acting or refraining from acting upon any resolution,
certificate, statement, instrument, opinion, report, notice,
request, direction, consent, order, bond, debenture, note,
other evidence of indebtedness or other paper or document
believed by it to be genuine and to have been signed or
presented by the proper party or parties;
(2) any request or direction of the Company mentioned
herein shall be sufficiently evidenced by a Company Request
or Company Order and any resolution of the Board of Directors
may be sufficiently evidenced by a Board Resolution;
(3) whenever in the administration of this Indenture
the Trustee shall deem it desirable that a matter be proved
or established prior to taking, suffering or omitting any
action hereunder, the Trustee (unless other evidence be
herein specifically prescribed) may, in the absence of gross
negligence or bad faith on its part, rely upon an Officers'
Certificate;
(4) the Trustee may consult with counsel selected by it
and the advice of such counsel or any Opinion of Counsel
shall be full and complete authorization and protection in
respect of any action taken, suffered or omitted by it
hereunder in good faith and in reliance thereon;
(5) the Trustee shall be under no obligation to
exercise any of the rights or powers vested in it by this
Indenture at the request or direction of any of the Holders
pursuant to this Indenture, unless such Holders shall have
offered to the Trustee reasonable security or indemnity
against the costs, expenses and liabilities which might be
incurred by it in compliance with such request or direction;
(6) the Trustee shall not be bound to make any
investigation into the facts or matters stated in any
resolution, certificate, statement, instrument, opinion,
report, notice, request, direction, consent, order, bond,
debenture, note, other evidence of indebtedness or other
paper or document, but the Trustee, in its discretion, may
make such further inquiry or investigation into such facts or
matters as it may see fit, and, if the Trustee shall
determine to make such further inquiry or investigation, it
shall be entitled to examine the books, records and premises
of the Company, personally or by agent or attorney;
(7) the Trustee may execute any of the trusts or powers
hereunder or perform any duties hereunder either directly or
by or through agents or attorneys and the Trustee shall not
be responsible for any misconduct or negligence on the part
of any agent or attorney appointed with due care by it
hereunder;
(8) the Trustee shall not be liable for any action
taken, suffered or omitted by it in good faith and believed
by it to be authorized or within the discretion or rights or
powers conferred upon it by this Indenture;
(9) the Trustee shall not be required to take notice or
be deemed to have notice of any Default under this Indenture
except failure by the Company to cause to be made any of the
payments to the Trustee required to be made by Article Three
hereof unless the Trustee shall be specifically notified in
writing of such default by the Company, or by Holders of at
least 10% in principal amount of the Outstanding Securities.
All notices or the instruments required by this Indenture to
be delivered to the Trustee must, in order to be effective,
be delivered at the Corporate Trust Office, and in the
absence of such notice so delivered the Trustee may
conclusively assume there is no default except as aforesaid;
and
(10) if an Event of Default has occurred and is
continuing, the Trustee shall exercise the rights and powers
vested in it by this Indenture, and shall use the same degree
of care and skill in their exercise as a prudent Person would
exercise or use under the circumstances in the conduct of
such Person's own affairs.
The Trustee shall not be required to expend or risk its
own funds or otherwise incur any financial liability in the
performance of any of its duties hereunder, or in the exercise of
any of its rights or powers if it shall have reasonable grounds
for believing that repayment of such funds or adequate indemnity
against such risk or liability is not reasonably assured to it.
SECTION 603. Trustee Not Responsible for Recitals or
Issuance of Securities.
The recitals contained herein and in the Securities,
except for the Trustee's certificates of authentication, shall be
taken as the statements of the Company, and the Trustee assumes no
responsibility for their correctness. The Trustee makes no
representations as to the validity or sufficiency of this
Indenture or of the Securities, except that the Trustee represents
that it is duly authorized to execute and deliver this Indenture,
authenticate the Securities and perform its obligations hereunder
and that any statements made by it in a Statement of Eligibility
on Form T-1 supplied to the Company are (or when delivered, will
be) true and accurate, subject to the qualifications set forth
therein. The Trustee shall not be accountable for the use or
application by the Company of Securities or the proceeds thereof.
SECTION 604. Trustee May Hold Securities.
The Trustee, any Paying Agent, any Security Registrar or
any other agent of the Company or of the Trustee, in its
individual or any other capacity, may become the owner or pledgee
of Securities and, subject to TIA Sections 310(b) and 311, may
otherwise deal with the Company with the same rights it would have
if it were not Trustee, Paying Agent, Security Registrar or such
other agent.
SECTION 605. Money Held in Trust.
Money held by the Trustee in trust hereunder need not be
segregated from other funds except to the extent required by law.
The Trustee shall be under no liability for interest on any money
received by it hereunder except as otherwise agreed in writing
with the Company.
SECTION 606. Compensation and Reimbursement.
The Company agrees:
(1) to pay to the Trustee from time to time such
compensation as the Company and the Trustee shall agree for
all services rendered by it hereunder (which compensation
shall not be limited by any provision of law in regard to the
compensation of a trustee of an express trust);
(2) except as otherwise expressly provided herein, to
reimburse the Trustee upon its request for all reasonable
expenses, disbursements and advances incurred or made by the
Trustee in accordance with any provision of this Indenture
(including the reasonable compensation and the expenses and
disbursements of its agents and counsel), except any such
expense, disbursement or advance as may be attributable to
its negligence or bad faith; and
(3) to indemnify the Trustee (and any predecessor
Trustee) for, and to hold it harmless against, any and all
loss, damage, claim, liability or expense including, without
limitation, taxes (other than taxes based on the income of
the Trustee) incurred without negligence or bad faith on its
part, arising out of or in connection with the acceptance or
administration of this trust, including the costs and
expenses of defending itself against any claim or liability
in connection with the exercise or performance of any of its
powers or duties hereunder.
The obligations of the Company under this Section to
compensate the Trustee, to pay or reimburse the Trustee for
expenses, disbursements and advances and to indemnify and hold
harmless the Trustee shall constitute additional indebtedness
hereunder and shall survive the satisfaction and discharge of this
Indenture. As security for the performance of such obligations of
the Company, the Trustee shall have a lien prior to the Securities
upon all property and funds held or collected by the Trustee as
such, except funds held in trust for the payment of principal of
(and premium, if any, on) or interest on particular Securities.
If the Trustee incurs expenses or renders services in
connection with an Event of Default specified in Section 501(7) or
Section 501(8), the expenses (including the reasonable charges and
expenses of its counsel) and the compensation for the services are
intended to constitute expenses of administration under any
applicable federal or state bankruptcy, insolvency or other
similar law.
SECTION 607. Corporate Trustee Required; Eligibility.
There shall at all times be a Trustee hereunder which
shall be eligible to act as Trustee under TIA Section 310(a)(1)
and shall have a combined capital and surplus of at least
$50,000,000. If such corporation publishes reports of condition
at least annually, pursuant to law or to the requirements of
federal, state, territorial or District of Columbia supervising or
examining authority, then for the purposes of this Section, the
combined capital and surplus of such corporation shall be deemed
to be its combined capital and surplus as set forth in its most
recent report of condition so published. If at any time the
Trustee shall cease to be eligible in accordance with the
provisions of this Section, it shall resign promptly in the manner
and with the effect hereinafter specified in this Article.
SECTION 608. Resignation and Removal; Appointment of
Successor.
(a) No resignation or removal of the Trustee and no
appointment of a successor Trustee pursuant to this Article shall
become effective until the acceptance of appointment by the
successor Trustee in accordance with the applicable requirements
of Section 609.
(b) The Trustee may resign at any time by giving
written notice thereof to the Company. If the instrument of
acceptance by a successor Trustee required by Section 609 shall
not have been delivered to the Trustee within 30 days after the
giving of such notice of resignation, the resigning Trustee may
petition any court of competent jurisdiction for the appointment
of a successor Trustee.
(c) The Trustee may be removed at any time by Act of
the Holders of not less than a majority in principal amount of the
Outstanding Securities, delivered to the Trustee and to the
Company.
(d) If at any time:
(1) the Trustee shall fail to comply with the
provisions of TIA Section 310(b) after written request
therefor by the Company or by any Holder who has been a bona
fide Holder of a Security for at least six months, or
(2) the Trustee shall cease to be eligible under
Section 607(a) and shall fail to resign after written request
therefor by the Company or by any Holder who has been a bona
fide Holder of a Security for at least six months, or
(3) the Trustee shall become incapable of acting or
shall be adjudged a bankrupt or insolvent or a receiver of
the Trustee or of its property shall be appointed or any
public officer shall take charge or control of the Trustee or
of its property or affairs for the purpose of rehabilitation,
conservation or liquidation,
then, in any such case, (i) the Company, by a Board Resolution,
may remove the Trustee, or (ii) subject to TIA Section 315(e), any
Holder who has been a bona fide Holder of a Security for at least
six months may, on behalf of himself and all others similarly
situated, petition any court of competent jurisdiction for the
removal of the Trustee and the appointment of a successor Trustee.
(e) If the Trustee shall resign, be removed or become
incapable of acting, or if a vacancy shall occur in the office of
Trustee for any cause, the Company, by a Board Resolution, shall
promptly appoint a successor trustee. If, within one year after
such resignation, removal or incapability, or the occurrence of
such vacancy, a successor trustee shall be appointed by Act of the
Holders of a majority in principal amount of the Outstanding
Securities delivered to the Company and the retiring Trustee, the
successor trustee so appointed shall, forthwith upon its
acceptance of such appointment, become the successor trustee and
supersede the successor trustee appointed by the Company. If no
successor trustee shall have been so appointed by the Company or
the Holders and accepted appointment in the manner hereinafter
provided, any Holder who has been a bona fide Holder of a Security
for at least six months may, on behalf of himself and all others
similarly situated, petition any court of competent jurisdiction
for the appointment of a successor trustee.
(f) The Company shall give notice of each resignation
and each removal of the Trustee and each appointment of a
successor trustee to the Holders of Securities in the manner
provided for in Section 106. Each notice shall include the name
of the successor trustee and the address of its Corporate Trust
Office.
SECTION 609. Acceptance of Appointment by Successor.
Every successor trustee appointed hereunder shall
execute, acknowledge and deliver to the Company and to the
retiring Trustee an instrument accepting such appointment, and
thereupon the resignation or removal of the retiring Trustee shall
become effective and such successor trustee, without any further
act, deed or conveyance, shall become vested with all the rights,
powers, trusts and duties of the retiring Trustee; but, on request
of the Company or the successor trustee, such retiring Trustee
shall, upon payment of its charges, execute and deliver an
instrument transferring to such successor trustee all the rights,
powers and trusts of the retiring Trustee and shall duly assign,
transfer and deliver to such successor trustee all property and
money held by such retiring Trustee hereunder. Upon request of
any such successor trustee, the Company shall execute any and all
instruments for more fully and certainly vesting in and confirming
to such successor trustee all such rights, powers and trusts.
No successor trustee shall accept its appointment unless
at the time of such acceptance such successor trustee shall be
qualified and eligible under this Article.
SECTION 610. Merger, Conversion, Consolidation or
Succession to Business.
Any corporation into which the Trustee may be merged or
converted or with which it may be consolidated, or any corporation
resulting from any merger, conversion or consolidation to which
the Trustee shall be a party, or any corporation succeeding to all
or substantially all of the corporate trust business of the
Trustee, shall be the successor of the Trustee hereunder, provided
such corporation shall be otherwise qualified and eligible under
this Article, without the execution or filing of any paper or any
further act on the part of any of the parties hereto. In case any
Securities shall have been authenticated, but not delivered, by
the Trustee then in office, any successor by merger, conversion or
consolidation to such authenticating Trustee may adopt such
authentication and deliver the Securities so authenticated with
the same effect as if such successor trustee had itself
authenticated such Securities; and in case at that time any of the
Securities shall not have been authenticated, any successor
trustee may, upon receipt of a Company Order, authenticate such
Securities either in the name of any predecessor hereunder or in
the name of the successor trustee; and in all such cases such
certificates shall have the full force which it is anywhere in the
Securities or in this Indenture provided that the certificate of
the Trustee shall have; provided, however, that the right to adopt
the certificate of authentication of any predecessor Trustee or to
authenticate Securities in the name of any predecessor Trustee
shall apply only to its successor or successors by merger,
conversion or consolidation.
ARTICLE SEVEN
HOLDERS LISTS AND REPORTS BY TRUSTEE
SECTION 701. Disclosure of Names and Addresses of
Holders.
Every Holder of Securities, by receiving and holding the
same, agrees with the Company and the Trustee that none of the
Company or the Trustee or any agent of either of them shall be
held accountable by reason of the disclosure of any such
information as to the names and addresses of the Holders in
accordance with TIA Section 312, regardless of the source from
which such information was derived, and that the Trustee shall not
be held accountable by reason of mailing any material pursuant to
a request made under TIA Section 312(b).
SECTION 702. Reports by Trustee.
Within 60 days after May 15 of each year commencing with
the first May 15 after the first issuance of Securities, the
Trustee shall transmit to the Holders, in the manner and to the
extent provided in TIA Section 313(c), a brief report dated as of
such May 15 if required by TIA Section 313(a).
ARTICLE EIGHT
CONSOLIDATION, MERGER, CONVEYANCE, TRANSFER OR LEASE
SECTION 801. Company and Each Guarantor May
Consolidate, etc., Only on Certain Terms.
(a) The Company shall not, in a single transaction or
through a series of related transactions, consolidate with or
merge with or into any other Person or sell, assign, convey,
transfer, lease or otherwise dispose of all or substantially all
of its properties and assets as an entirety to any Person or group
of affiliated Persons, or permit any of its Restricted
Subsidiaries to enter into any such transaction or transactions if
such transaction or transactions, in the aggregate, would result
in a sale, assignment, conveyance, transfer, lease or disposal of
all or substantially all of the properties and assets of the
Company and its Restricted Subsidiaries on a Consolidated basis to
any other Person or group of affiliated Persons, unless at the
time and after giving effect thereto:
(1) either
(i) the Company shall be the continuing
corporation; or
(ii) the Person (if other than the Company)
formed by such consolidation or into which the Company
or such Subsidiary is merged or the Person which
acquires by sale, assignment, conveyance, transfer,
lease or disposition of all or substantially all of the
properties and assets of the Company or such Subsidiary,
as the case may be, substantially as an entirety (the
"Surviving Entity") shall be a corporation duly
organized and validly existing under the laws of the
United States of America, any state thereof or the
District of Columbia and such Person shall assume, by a
supplemental indenture executed and delivered to the
Trustee, all the obligations of the Company, under the
Securities and this Indenture, and this Indenture shall
remain in full force and effect;
(2) immediately before and immediately after giving
effect to such transaction or transactions, no Default or
Event of Default shall have occurred and be continuing;
(3) immediately after giving effect to such transaction
on a pro forma basis, the Consolidated Net Worth of the
Company (or the Surviving Entity if other than the Company)
is equal to or greater than the Consolidated Net Worth of the
Company immediately prior to such transaction or
transactions;
(4) immediately before and immediately after giving
effect to such transaction on a pro forma basis (on the
assumption that the transaction occurred on the first day of
the four-quarter period immediately prior to the consummation
of such transaction with the appropriate adjustments with
respect to the transaction being included in such pro forma
calculation), the Company (or the Surviving Entity if other
than the Company) could incur at least $1.00 of additional
Indebtedness under Section 1011 (other than Permitted
Indebtedness); and
(5) the Company or the Surviving Entity shall have
delivered, or caused to be delivered, to the Trustee, in form
and substance reasonably satisfactory to the Trustee, an
Officers' Certificate and an Opinion of Counsel, each to the
effect that such consolidation, merger, transfer, sale,
assignment, conveyance, lease or other transaction and the
supplemental indenture in respect thereto comply with this
Indenture and that all conditions precedent herein provided
for relating to such transaction have been complied with.
(b) Each Guarantor shall not, and (except in the case
of United) the Company will not permit a Guarantor to, in a single
transaction or through a series of related transactions, merge or
consolidate with or into any other corporation (other than the
Company or any Restricted Wholly Owned Subsidiary) or other
entity, sell, assign, convey, transfer, lease or otherwise dispose
of all or substantially all of the Guarantor's properties and
assets on a Consolidated basis to any entity (other than the
Company or any Restricted Wholly Owned Subsidiary) unless at the
time and after giving effect thereto:
(1) either
(i) such Guarantor shall be the continuing
corporation or partnership; or
(ii) the entity (if other than such Guarantor)
formed by such consolidation or into which such
Guarantor is merged or the entity which acquires by
sale, assignment, conveyance, transfer, lease or
disposition the properties and assets of such Guarantor
shall be a corporation duly organized and validly
existing under the laws of the United States, any state
thereof or the District of Columbia and shall expressly
assume by a supplemental indenture, executed and
delivered to the Trustee, in a form reasonably
satisfactory to the Trustee, all the obligations of such
Guarantor under its Guarantee and this Indenture;
(2) immediately before and immediately after giving
effect to such transaction or transactions, no Default or
Event of Default shall have occurred and be continuing; and
(3) such Guarantor shall have delivered to the Trustee
an Officers' Certificate and an Opinion of Counsel in form
and substance reasonably satisfactory to the Trustee, each
stating that such consolidation, merger, sale, assignment,
conveyance, transfer, lease or disposition and such
supplemental indenture comply with this Indenture, and
thereafter all obligations of the predecessor shall terminate
provided that the foregoing shall not apply to any Guarantor
(other than United) if (A) immediately after such merger,
consolidation, sale, assignment, conveyance, transfer, lease
or other disposition, the Person surviving such merger or
consolidation or the assignee, conveyee, transferee, lessee
or recipient of such other disposition are not Subsidiaries
and (B) Section 1016 of this Indenture is complied with in
connection with such transaction.
SECTION 802. Successor Substituted.
Upon any consolidation of the Company, United or any
other Guarantor with or merger of the Company, United or any other
Guarantor with or into any other corporation or any sale,
assignment, conveyance, transfer, lease or other deposition of the
properties and assets of the Company (or any Guarantor),
substantially as an entirety to any Person in accordance with
Section 801 (a) or Section 801(b), the successor Person formed by
such consolidation or into which the Company, United or any other
Guarantor is merged or to which such conveyance, transfer or lease
is made shall succeed to, and be substituted for, and may exercise
every right and power of, the Company or the Guarantor, as the
case may be, under this Indenture with the same effect as if such
successor Person had been named as the Company or the Guarantor,
as the case may be herein, and in the event of any such conveyance
or transfer, the Company (which term shall for this purpose mean
the Person named as the "Company" in the first paragraph of this
Indenture or any successor Person which shall theretofore become
such in the manner described in
Section 801(a)), or the Guarantor, as the case may be, except in
the case of a lease, shall be discharged of all obligations and
covenants under this Indenture and the Securities and may be
dissolved and liquidated.
ARTICLE NINE
SUPPLEMENTAL INDENTURES
SECTION 901. Supplemental Indentures Without Consent of
Holders.
Without the consent of any Holders, the Company, when
authorized by a Board Resolution, the Guarantors and the Trustee,
at any time and from time to time, may enter into one or more
indentures supplemental hereto, in form reasonably satisfactory to
the Trustee, for any of the following purposes:
(1) to evidence the succession of another Person to the
obligations under this Indenture and the Securities of the
Company or any Guarantor and the assumption by any such
successor of the covenants of the Company and any Guarantor
contained herein and in the Securities; or
(2) to add to the covenants of the Company and the
Guarantors for the benefit of the Holders or to surrender any
right or power herein conferred upon the Company or the
Guarantors; or
(3) to add any additional Events of Default; or
(4) to evidence and provide for the acceptance of
appointment hereunder by a successor trustee pursuant to the
requirements of Section 609; or
(5) to secure the Securities; or
(6) to cure any ambiguity, to correct or supplement any
provision herein which may be defective or inconsistent with
any other provision herein, or to make any other provisions
with respect to matters or questions arising under this
Indenture; provided that such actions pursuant to this clause
(6) shall not adversely affect the interests of the Holders
in any material respect; or
(7) to comply with any requirement of the Commission in
connection with qualifying and maintaining the qualification
of this Indenture under the TIA.
SECTION 902. Supplemental Indentures with Consent of
Holders.
With the consent of the Holders of not less than a
majority in principal amount of the Outstanding Securities, by Act
of said Holders delivered to the Company and the Trustee, the
Company, when authorized by a Board Resolution, the Guarantors and
the Trustee may enter into an indenture or indentures supplemental
hereto for the purpose of adding any provisions to or changing in
any manner or eliminating any of the provisions of this Indenture
or of modifying in any manner the rights of the Holders under this
Indenture; provided, however, that no such supplemental indenture
shall, without the consent of the Holder of each Outstanding
Security affected thereby:
(1) change the Stated Maturity of the principal of, or
any installment of interest on, any Security or reduce the
principal amount thereof or the rate of interest thereon or
any premium payable upon the redemption thereof, or change
the coin or currency in which the principal of any Security
or any premium or the interest thereon is payable, or impair
the right to institute suit for the enforcement of any such
payment on or after the Stated Maturity thereof;
(2) amend, change or modify the obligation of the
Company to make and consummate an Offer with respect to any
Asset Sale or Asset Sales in accordance with Section 1016 or
the obligation of the Company to make and consummate a Change
of Control Offer in the event of a Change of Control in
accordance with Section 1010, including amending, changing or
modifying any definitions with respect thereto;
(3) reduce the percentage in principal amount of
Outstanding Securities, the consent of whose Holders is
required for any such supplemental indenture, or the consent
of whose Holders is required for any waiver;
(4) modify any of the provisions of this Section or
Section 513, except to increase the percentage of Outstanding
Securities required for such actions or to provide that
certain other provisions of this Indenture cannot be modified
or waived without the consent of the Holder of each Security
affected thereby;
(5) except as otherwise permitted under Article Eight
consent to the assignment or transfer by the Company or any
Guarantor of any of its rights and obligations under this
Indenture; or
(6) amend or modify any of the provisions of Article
Fourteen or Article Fifteen in any manner adverse to the
Holders of the Securities.
It shall not be necessary for any Act of Holders under
this Section to approve the particular form of any proposed
supplemental indenture, but it shall be sufficient if such Act
shall approve the substance thereof.
SECTION 903. Execution of Supplemental Indentures.
In executing, or accepting the additional trusts created
by, any supplemental indenture permitted by this Article or the
modifications thereby of the trusts created by this Indenture, the
Trustee shall be entitled to receive, and shall be fully protected
in relying upon, an Opinion of Counsel stating that the execution
of such supplemental indenture is authorized or permitted by this
Indenture. The Trustee may, but shall not be obligated to, enter
into any such supplemental indenture which affects the Trustee's
own rights, duties or immunities under this Indenture or
otherwise.
SECTION 904. Effect of Supplemental Indentures.
Upon the execution of any supplemental indenture under
this Article, this Indenture shall be modified in accordance
therewith, and such supplemental indenture shall form a part of
this Indenture for all purposes; and every Holder of Securities
theretofore or thereafter authenticated and delivered hereunder
shall be bound thereby.
SECTION 905. Conformity with Trust Indenture Act.
Every supplemental indenture executed pursuant to this
Article shall conform to the requirements of the Trust Indenture
Act as then in effect.
SECTION 906. Reference in Securities to Supplemental
Indentures.
Securities authenticated and delivered after the
execution of any supplemental indenture pursuant to this Article
may, and shall if required by the Trustee, bear a notation in form
approved by the Trustee as to any matter provided for in such
supplemental indenture. If the Company shall so determine, new
Securities so modified as to conform, in the opinion of the
Trustee and the Company, to any such supplemental indenture may be
prepared and executed by the Company and authenticated and
delivered by the Trustee in exchange for Outstanding Securities.
SECTION 907. Notice of Supplemental Indentures.
Promptly after the execution by the Company and the
Trustee of any supplemental indenture pursuant to the provisions
of Section 902, the Company shall give notice thereof to the
Holders of each Outstanding Security affected, in the manner
provided for in Section 106, setting forth in general terms the
substance of such supplemental indenture.
ARTICLE TEN
COVENANTS
SECTION 1001. Payment of Principal, Premium, if any,
and Interest.
The Company covenants and agrees for the benefit of the
Holders that it will duly and punctually pay the principal of (and
premium, if any, on) and interest on the Securities in accordance
with the terms of the Securities and this Indenture.
SECTION 1002. Maintenance of Office or Agency.
The Company will maintain an office or agency where
Securities may be presented or surrendered for payment, where
Securities may be surrendered for registration of transfer or
exchange and where notices and demands to or upon the Company in
respect of the Securities and this Indenture may be served. The
Corporate Trust Office of the Trustee shall be such office or
agency of the Company, unless the Company shall designate and
maintain some other office or agency for one or more of such
purposes. The Company will give prompt written notice to the
Trustee of any change in the location of any such office or
agency. If at any time the Company shall fail to maintain any
such required office or agency or shall fail to furnish the
Trustee with the address thereof, such presentations, surrenders,
notices and demands may be made or served at the Corporate Trust
Office of the Trustee, and the Company hereby appoints the Trustee
as its agent to receive all such presentations, surrenders,
notices and demands.
The Company may also from time to time rescind the above
designation and designate one or more other offices or agencies
where the Securities may be presented or surrendered for any or
all such purposes and may from time to time rescind any such
subsequent designation; provided, however, that no such
designation or rescission shall in any manner relieve the Company
of its obligation to maintain an office or agency for such
purposes. The Company will give prompt written notice to the
Trustee of any such designation or rescission and any change in
the location of any such other office or agency.
SECTION 1003. Money for Security Payments to Be Held in
Trust.
If the Company shall at any time act as its own Paying
Agent, it will, on or before each due date of the principal of
(and premium, if any, on) or interest on any of the Securities,
segregate and hold in trust for the benefit of the Persons
entitled thereto a sum sufficient to pay the principal (and
premium, if any) or interest so becoming due until such sums shall
be paid to such Persons or otherwise disposed of as herein
provided and will promptly notify the Trustee of its action or
failure so to act.
Whenever the Company shall have one or more Paying
Agents for the Securities, it will, on or before each due date of
the principal of (and premium, if any, on), or interest on, any
Securities, deposit with a Paying Agent a sum sufficient to pay
the principal (and premium, if any) or interest so becoming due,
such sum to be held in trust for the benefit of the Persons
entitled to such principal, premium or interest, and (unless such
Paying Agent is the Trustee) the Company will promptly notify the
Trustee of such action or any failure so to act.
The Company will cause each Paying Agent (other than the
Trustee) to execute and deliver to the Trustee an instrument in
which such Paying Agent shall agree with the Trustee, subject to
the provisions of this Section, that such Paying Agent will:
(1) hold all sums held by it for the payment of the
principal of (and premium, if any, on) or interest on
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;
(2) 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 (and premium, if any) or
interest; and
(3) at any time during the continuance of any such
default, upon the written request of the Trustee, forthwith
pay to the Trustee all sums so held in trust by such Paying
Agent.
The Company may at any time, for the purpose of
obtaining the satisfaction and discharge of this Indenture or for
any other purpose, pay, or by Company Order direct any Paying
Agent to pay, to the Trustee all sums held in trust by the Company
or such Paying Agent, such sums to be held by the Trustee upon the
same trusts as those upon which such sums were held by the Company
or such Paying Agent; and, upon such payment by any Paying Agent
to the Trustee, such Paying Agent shall be released from all
further liability with respect to such sums.
Any money deposited with the Trustee or any Paying
Agent, or then held by the Company, in trust for the payment of
the principal of (and premium, if any, on) or interest on any
Security and remaining unclaimed for two years after such
principal (and premium, if any) or interest has become due and
payable shall be paid to the Company on Company Request, or (if
then held by the Company) shall be discharged from such trust; and
the Holder of such Security shall thereafter, as an unsecured
general creditor, look only to the Company for payment thereof,
and all liability of the Trustee or such Paying Agent with respect
to such trust money, and all liability of the Company as trustee
thereof, shall thereupon cease; provided, however, that the
Trustee or such Paying Agent, before being required to make any
such repayment, may at the expense of the Company cause to be
published once, in a newspaper published in the English language,
customarily published on each Business Day and of general
circulation in the Borough of Manhattan, The City of New York,
reasonable notice under the circumstances 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, any
unclaimed balance of such money then remaining will be repaid to
the Company.
SECTION 1004. Corporate Existence.
Subject to Article Eight, and as long as any Securities
remain Outstanding, each of United and the Company will do or
cause to be done all things necessary to preserve and keep in full
force and effect the corporate existence, rights (charter and
statutory) and franchises of the Company and each Subsidiary;
provided, however, that the Company shall not be required to
preserve any such right or franchise if the Board of Directors
shall determine that the preservation thereof is no longer
desirable in the conduct of the business of the Company and its
Subsidiaries as a whole and that the loss thereof is not
disadvantageous in any material respect to the Holders.
SECTION 1005. Payment of Taxes and Other Claims.
Each of United and the Company will pay or discharge or
cause to be paid or discharged, before the same shall become
delinquent, (a) all taxes, assessments and governmental charges
levied or imposed upon United, the Company or any Subsidiary or
upon the income, profits or property of United, the Company or any
Subsidiary and (b) all lawful claims for labor, materials and
supplies, which, if unpaid, might by law become a lien upon the
property of United, the Company or any Subsidiary; provided,
however, that United or the Company shall not be required to pay
or discharge or cause to be paid or discharged any such tax,
assessment, charge or claim (1) the amount, applicability or
validity of which is being contested in good faith by appropriate
proceedings or (2) the nonpayment or delayed payment of which
would not have a material adverse effect on Holders.
SECTION 1006. Maintenance of Properties.
Each of United and the Company will cause all material
properties owned by United, the Company or any Subsidiary or used
or held for use in the conduct of its business or the business of
any Subsidiary to be maintained and kept in good condition, repair
and working order and supplied with all necessary equipment and
will cause to be made all necessary repairs, renewals,
replacements, betterments and improvements thereof, all as in the
judgment of United or the Company may be necessary so that the
business carried on in connection therewith may be properly and
advantageously conducted at all times; provided, however, that
nothing in this Section shall prevent United or the Company (i)
from discontinuing the maintenance of any of such properties if
such discontinuance is, in the judgment of United or the Company,
desirable in the conduct of its business or the business of any
Subsidiary and not disadvantageous in any material respect to the
Holders or (ii) selling any properties or taking any action in
accordance with Article Eight or Section 1016.
SECTION 1007. Insurance.
Each of United and the Company will at all times keep
all of its and its Subsidiaries' properties which are of an
insurable nature insured with insurers, believed by United and the
Company to be responsible, against loss or damage to the extent
that property of similar character is usually so insured by
corporations similarly situated and owning like properties.
SECTION 1008. Statement by Officers As to Default.
(a) The Company will deliver to the Trustee, within 45
days after the end of each fiscal quarter (or 90 days, in the case
of the last fiscal quarter of each fiscal year), a brief
certificate from the principal executive officer, principal
financial officer or principal accounting officer as to his or her
knowledge of the Company's compliance with all conditions and
covenants under this Indenture. Such certificate shall state that
such officer has reviewed this Indenture and believes that either
(a) the Company and Guarantors are in compliance with terms
thereof or (b) the Company and Guarantors are not in compliance
with terms thereof. For purposes of this
Section 1008(a), such compliance shall be determined without
regard to any period of grace or requirement of notice under this
Indenture.
(b) When any Default has occurred and is continuing
under this Indenture, or if the trustee for or the holder of any
other evidence of Indebtedness of the Company, any Guarantor or
any Subsidiary gives any notice or takes any other action with
respect to a claimed default (other than with respect to
Indebtedness in the principal amount of less than $1,000,000), the
Company shall deliver to the Trustee by registered or certified
mail or by telegram, telex or facsimile transmission an
Officers' Certificate specifying such event, notice or other
action within five Business Days of its occurrence.
(c) The Company shall deliver to the Trustee, within 90
days after the end of each of the Company's fiscal years, a
certificate signed by the Company's independent certified public
accountants stating (i) that their audit examination has included
a review of the terms of this Indenture and the Securities as they
relate to accounting matters, (ii) that they have read the most
recent Officers' Certificate delivered to the Trustee pursuant to
paragraph (a) of this Section 1008 and (iii) whether, in
connection with their audit examination, anything came to their
attention that caused them to believe that the Company was not in
compliance with any of the terms, covenants, provisions or
conditions of Article Ten and Section 8.01 of this Indenture as
they pertain to accounting matters and, if any Default or Event of
Default has come to their attention, specifying the nature and
period of existence thereof; provided that such independent
certified public accountants shall not be liable in respect of
such statement by reason of any failure to obtain knowledge of any
such Default or Event of Default that would not be disclosed in
the course of an audit examination conducted in accordance with
generally accepted auditing standards in effect at the date of
such examination.
SECTION 1009. Provision of Financial Statements.
Whether or not United or the Company is subject to
Section 13(a) or 15(d) of the Exchange Act, United and the Company
will, to the extent permitted under the Exchange Act, deliver to
the Commission for filing the annual reports, quarterly reports
and other documents which United and the Company would have been
required to file with the Commission pursuant to such Section
13(a) or 15(d) if United and the Company were so subject, such
documents to be filed with the Commission on or prior to the
respective dates (the "Required Filing Dates") by which United and
the Company would have been required to so file such documents if
United and the Company were so subject (subject to a five day
grace period). United and the Company will also in any event (x)
within 15 days of each Required Filing Date (subject to a five day
grace period) (i) transmit by mail to all Holders, as their names
and addresses appear in the security register, without cost to
such Holders and (ii) file with the Trustee copies of the annual
reports, quarterly reports and other documents which United and
the Company would have been required to file with the Commission
pursuant to Section 13(a) or 15(d) of the Exchange Act if United
and the Company were subject to such Sections and (y) if filing
such documents by United and the Company with the Commission is
not permitted under the Exchange Act, promptly upon written
request, supply copies of such documents to any prospective Holder
at United's and the Company's cost. The Company and United will
also provide the information required by Rule 144A to any Holder
or prospective Holder of Securities.
Delivery of such reports, information and documents to
the Trustee is for informational purposes only and the Trustee's
receipt of such shall not constitute constructive notice of any
information contained therein or determinable from information
contained therein, including the Company's compliance with any of
its covenants hereunder (as to which the Trustee is entitled to
rely exclusively on Officers' Certificates).
SECTION 1010. Purchase of Securities upon Change in
Control.
(a) If a Change of Control shall occur at any time,
then the Company shall be obligated to make an offer to purchase
all of the Outstanding Securities (a "Change of Control Offer")
and the Company shall purchase all of the then Outstanding
Securities validly tendered pursuant to such Change of Control
Offer, in whole or in part in integral multiples of $1,000, at a
purchase price (the "Change of Control Purchase Price") in cash in
an amount equal to 101% of the principal amount of such
Securities, plus accrued and unpaid interest, if any, to the date
of purchase (the "Change of Control Purchase Date"), pursuant to
the procedures set forth in paragraphs (b), (c) and (d) of this
Section.
(b) Within 15 days
following any Change of
Control, the Company shall
notify the Trustee thereof and
shall give to each Holder of
the Securities in the manner
provided in Section 106, a
notice stating:
(1) that a Change of Control has occurred and that such
Holder has the right to require the Company to repurchase
such Holder's Securities at the Change of Control Purchase
Price;
(2) the Change of Control Purchase Price and the Change
of Control Purchase Date, which shall be a Business Day no
earlier than 30 days nor later than 60 days from the date
such notice is mailed, or such later date as is necessary to
comply with requirements under the Exchange Act;
(3) that any Security not tendered will continue to
accrue interest;
(4) that, unless the Company defaults in the payment of
the Change of Control Purchase Price, any Securities accepted
for payment pursuant to the Change of Control Offer shall
cease to accrue interest after the Change of Control Purchase
Date; and
(5) the procedures that a Holder must follow to accept
a Change of Control Offer or to withdraw such acceptance.
(c) Holders electing to have Securities purchased will
be required to surrender such Securities with the execution form
provided for on Exhibit A duly executed to the Company at the
address specified in the notice at least 10 Business Days prior to
the Change of Control Purchase Date. Holders will be entitled to
withdraw their election if the Company receives, not later than
three Business Days prior to the Change of Control Purchase Date,
a facsimile transmission or letter setting forth the name of the
Holder, the principal amount of the Securities delivered for
purchase by the Holder as to which his election is to be withdrawn
and a statement that such Holder is withdrawing his election to
have such Securities purchased. Holders whose Securities are
purchased only in part will be issued new Securities equal in
principal amount to the unpurchased portion of the Securities
surrendered.
(d) The Company will comply with any applicable tender
offer rules, including Rule 14e-1 under the Exchange Act, and any
other applicable securities laws or regulations in connection with
a Change of Control Offer. To the extent that the
provisions of any securities laws or regulations conflict with
provisions of this Section, the Company shall comply with the
applicable securities laws and regulations and shall not be deemed
to have breached its obligations under this Section by virtue
thereof.
(e) United will not, and will not permit any Subsidiary
to, create or permit to exist or become effective any restriction
(other than restrictions in effect on the Closing Date with
respect to Indebtedness outstanding on the Closing Date and
refinancings thereof and customary default provisions) that would
materially impair the ability of the Company to make a Change of
Control Offer to purchase the Securities or, if such Change of
Control Offer is made, to pay for the Securities tendered for
purchase.
SECTION 1011. Limitation on Indebtedness.
(a) The Company will not, and will not permit any of
its Restricted Subsidiaries to, create, issue, assume, incur,
guarantee, or otherwise in any manner become directly or
indirectly liable for (collectively, "incur") any Indebtedness
(including any Acquired Indebtedness); provided that the Company
may incur Indebtedness (including any Acquired Indebtedness) if
(A) the Consolidated Fixed Charge Coverage Ratio of the Company
for the four full fiscal quarters immediately preceding the
incurrence of such Indebtedness for which reports have been filed
pursuant to Section 1009 taken as one period (and after giving pro
forma effect to (i) if the computation of the Consolidated Fixed
Charge Coverage Ratio is made on any date prior to the end of the
four full fiscal quarters immediately following the effective date
of the Merger, the consummation of the Merger and the financing
related thereto (but excluding any anticipated savings, whether or
not related thereto), including the issuance of the Notes as
though they had been issued and outstanding at the effective time
of the Merger and the incurrence of indebtedness under the Senior
Bank Facility and, in each case, the application of the proceeds
thereof, as though such transaction had occurred on the first day
of the four full fiscal quarters commencing immediately prior to
the effective date of the Merger, (ii) the incurrence of such
Indebtedness and the application of the net proceeds therefrom,
including to refinance other Indebtedness, as if such Indebtedness
was incurred, and the application of such proceeds occurred, at
the beginning of such four-quarter period; (iii) the incurrence,
repayment or retirement of any other Indebtedness by the Company
and its Restricted Subsidiaries since the first day of such four-
quarter period as if such Indebtedness was incurred, repaid or
retired at the beginning of such four-quarter period (except that,
in making such computation, the amount of Indebtedness outstanding
under any revolving credit facility shall be computed based upon
the average daily balance of such Indebtedness during such four
quarter period); (iv) in the case of Acquired Indebtedness, the
related acquisition as if such acquisition occurred at the
beginning of such four-quarter period; and (v) any acquisition or
disposition by the Company or its Restricted Subsidiaries of any
company or any business or any assets out of the ordinary course
of business, whether by merger, stock purchase or sale or asset
purchase or sale, as if such acquisition or disposition, as the
case may be, occurred at the beginning of such four-quarter
period, and any related incurrence or repayment of Indebtedness,
in each case since the first day of such four-quarter period,
assuming such acquisition or disposition had been consummated on
the first day of such four-quarter period) is (x) for the period
from the Closing Date through May 3, 1998 at least equal to
2.00:1.00 and (y) thereafter at least equal to 2.25:1.00 and (B)
if such Indebtedness is Subordinated Indebtedness, such
Indebtedness shall have an Average Life to Stated Maturity longer
than the Average Life to Stated Maturity of the Notes and a final
Stated Maturity of principal later than the final Stated Maturity
of principal of the Notes.
(b) The foregoing limitation will not apply to the
incurrence of any of the following (collectively, "Permitted
Indebtedness"):
(i) Indebtedness of the Company (x) outstanding at any
time in an aggregate principal amount not to exceed an amount
equal to $200 million minus all principal amounts actually
repaid under the term loan portion of the Senior Bank
Facility, including any such amount repaid as provided under
Section 1016 below, and (y) outstanding at any time in an
aggregate amount equal to the greater of (I) the Borrowing
Base and (II) $300 million;
(ii) subject to Section 1017, Guarantees by Restricted
Subsidiaries of Senior Indebtedness of the Company; provided
that such Indebtedness of the Company is incurred in
compliance with the provisions of this Indenture;
(iii) Indebtedness of the Company pursuant to the
Notes and Indebtedness of any Guarantor pursuant to its
Guarantee of the Notes;
(iv) Indebtedness of the Company outstanding on the
Closing Date;
(v) Indebtedness of the Company owing to a Restricted
Wholly Owned Subsidiary, provided that any such Indebtedness
(x) is made pursuant to an intercompany note in the form
attached to this Indenture as Exhibit E and (y) is
subordinated in right of payment to the prior payment and
performance of the Company's obligations under the Notes, if
applicable; provided further that (A) any disposition, pledge
or transfer of any such Indebtedness to a Person (other than
a disposition, pledge or transfer to a Restricted Wholly
Owned Subsidiary or a pledge to or for the benefit of any
holder of Senior Indebtedness) or (B) any transaction
pursuant to which such Restricted Wholly Owned Subsidiary
ceases to be a Restricted Wholly Owned Subsidiary shall be
deemed to be an incurrence of such Indebtedness by the
Company not permitted by this clause (v);
(vi) Indebtedness of a Restricted Wholly Owned
Subsidiary owing to the Company or to a Restricted Wholly
Owned Subsidiary; provided that, with respect to Indebtedness
owing to any Restricted Wholly Owned Subsidiary, (x) any such
Indebtedness is made pursuant to an intercompany note in the
form attached to this Indenture as Exhibit F and (y) any such
Indebtedness shall be subordinated in right of payment to the
payment and performance of such Subsidiary's obligations
under its Guarantee of the Notes, if applicable; provided
further that (A) any disposition, pledge or transfer of any
such Indebtedness to a Person (other than a disposition,
pledge or transfer to the Company or a Restricted Wholly
Owned Subsidiary or a pledge to or for the benefit of any
holder of Senior Indebtedness) shall be deemed to be an
incurrence of such Indebtedness by the obligor not permitted
by this clause (vi), and (B) any transaction pursuant to
which any Restricted Wholly Owned Subsidiary, which has
Indebtedness owing to the Company or any other Restricted
Wholly Owned
Subsidiary, ceases to be a Restricted Wholly Owned Subsidiary
shall be deemed to be an incurrence of Indebtedness by such
Subsidiary that is not permitted by this clause (vi);
(vii) any renewals, extensions, substitutions,
refundings, refinancings or replacements (collectively, a
"refinancing") of any Indebtedness described in clauses (iii)
and (iv) of this paragraph (b) (including any successive
refinancings), so long as the aggregate principal amount of
Indebtedness represented thereby is not increased by such
refinancing, except by an amount equal to the lesser of (x)
the stated amount of any premium, interest or other payment
required to be paid in connection with such a refinancing
pursuant to the terms of the Indebtedness being refinanced or
(y) the amount of premium, interest or other payment actually
paid at such time to refinance the Indebtedness, plus, in
either case, the amount of expenses incurred in connection
with such refinancing; provided that in the case of Pari
Passu Indebtedness or Subordinated Indebtedness, (A) such new
Indebtedness does not have a shorter Average Life to Stated
Maturity or a final Stated Maturity of principal earlier than
the Indebtedness being refinanced, (B) in the case of Pari
Passu Indebtedness, such new Indebtedness is pari passu with,
or subordinated to, the Notes and (C) in the case of
Subordinated Indebtedness, such new Indebtedness is
subordinated to the Notes at least to the same extent as the
Indebtedness being refinanced; and provided further that in
no event may Indebtedness of the Company be refinanced with
Indebtedness of any Restricted Subsidiary pursuant to this
clause (vii);
(viii) Indebtedness of the Company consisting of
Capitalized Lease Obligations or purchase money obligations,
in addition to that described in clauses (i) through (vii) of
this paragraph (b), not to exceed $10 million outstanding at
any one time in the aggregate;
(ix) Indebtedness of the Company (whether or not
constituting purchase money obligations or Capitalized Lease
Obligations) not to exceed $20 million at any one time
outstanding; and
(x) Indebtedness of the Company consisting of bona fide
Interest Rate Agreements designed to protect the Company
from, or control the exposure of the Company to, fluctuations
in interest rates in respect of Indebtedness.
(c) Notwithstanding any other provision of this Section
1011, the maximum amount of Indebtedness that the Company or any
Restricted Subsidiary may incur pursuant to this Section 1011
shall be deemed not to be exceeded due solely to the result of
fluctuations in the exchange rates of currencies.
(d) For purposes of determining any particular amount
of Indebtedness under this Section 1011, (1) Indebtedness incurred
pursuant to the Senior Bank Facility prior to or on the Closing
Date shall be treated as incurred pursuant to clause (i) of
Section 1011(b), (2) guarantees of, or obligations with respect to
letters of credit supporting, Indebtedness otherwise included in
the determination of such particular amount shall not be included
and (3) any Liens granted pursuant to the equal and ratable
provisions referred to in the first paragraph of Section 1015 of
this Indenture shall not be treated as Indebtedness. For purposes
of determining compliance with this Section 1011, (x) in the event
that an item of Indebtedness meets the criteria of more
than one of the types of Indebtedness described in the above
clauses, the Company, in its sole discretion, shall classify such
item of Indebtedness and only be required to include the amount
and type of such Indebtedness in one of such clauses, and (y) the
amount of Indebtedness issued at a price that is less than the
principal amount thereof shall be equal to the amount of the
liability in respect thereof determined in conformity with GAAP.
SECTION 1012. Limitation on Restricted Payments.
(a) The Company will not, and will not permit any
Restricted Subsidiary to, directly or indirectly:
(i) declare or pay any dividend on, or make any
distribution to holders of, any shares of its Capital Stock
(other than dividends or distributions payable solely in
shares of its Qualified Capital Stock or in options, warrants
or other rights to acquire such Qualified Capital Stock and
other than dividends and distributions paid to the Company);
(ii) purchase, redeem or otherwise acquire or retire for
value, directly or indirectly, any shares of the Capital
Stock of United, the Company or any Restricted Subsidiary
(other than any Restricted Wholly Owned Subsidiary) or
options, warrants or other rights to acquire such Capital
Stock;
(iii) make any principal payment on, or repurchase,
redeem, defease, retire or otherwise acquire for value, prior
to the relevant scheduled principal payment, sinking fund or
maturity, any Subordinated Indebtedness; or
(iv) make any Investment in any Person, including,
without limitation, any Unrestricted Subsidiary (other than
any Permitted Investments)
(the foregoing actions described in clauses (i) through (iv),
collectively, "Restricted Payments") unless after giving effect to
the proposed Restricted Payment (the amount of any such Restricted
Payment, if other than cash, as determined in good faith by the
Board of Directors of the Company, such determination to be
conclusive and evidenced by a Board Resolution), (A) no Default or
Event of Default shall have occurred and be continuing and such
Restricted Payment shall not cause or constitute any of the
foregoing; (B) immediately before and immediately after giving
effect to such transaction on a pro forma basis, the Company could
incur $1.00 of additional Indebtedness (other than Permitted
Indebtedness) under Section 1011; and (C) the aggregate amount of
all such Restricted Payments declared or made after the Closing
Date (including such Restricted Payment) does not exceed the sum
of:
(I) 50% of the aggregate cumulative Consolidated Net
Income (or, if such aggregate cumulative Consolidated Net
Income shall be a loss, minus 100% of such loss) of the
Company accrued on a cumulative basis during the period
(taken as one accounting period) beginning on the date of the
Merger and ending on the last day of the Company's last
fiscal quarter ending prior to the date of the Restricted
Payment;
(II) the aggregate Net Cash Proceeds received after the
Closing Date by the Company from the issuance or sale (other
than to any of its Subsidiaries) of its shares of Qualified
Capital Stock or any options, warrants or rights to purchase
such shares of Qualified Capital Stock (less the value of
any equity security referred to (and determined in accordance
with) the parenthetical in clause (a)(i) of the definition of
Consolidated Interest Expense);
(III) the aggregate Net Cash Proceeds received after
the Closing Date by the Company (other than from any of its
Subsidiaries) upon the exercise of any options, warrants or
rights to purchase shares of Qualified Capital Stock of the
Company;
(IV) the aggregate Net Cash Proceeds received after the
Closing Date by the Company from Indebtedness of the Company
or Redeemable Capital Stock of the Company that has been
converted into or exchanged for Qualified Capital Stock of
the Company (or options, warrants or rights to purchase such
Qualified Capital Stock), to the extent such Indebtedness of
the Company or Redeemable Capital Stock of the Company was
originally incurred or issued for cash, plus the aggregate
Net Cash Proceeds received by the Company at the time of such
conversion or exchange;
(V) without duplication of any of the foregoing, 100%
of the aggregate Net Cash Proceeds received by the Company as
a capital contribution from United; plus
(VI) to the extent not included in Consolidated Net
Income, the net reduction (received by the Company or any
Restricted Subsidiary in cash) in Investments (other than
Permitted Investments) made by the Company and the Restricted
Subsidiaries since the Closing Date, not to exceed, in the
case of any Investments in any Person, the amount of
Investments (other than Permitted Investments) made by the
Company and the Restricted Subsidiaries in such Person since
the Closing Date.
(b) Notwithstanding the foregoing, and in the case of
clauses (ii), (iii), (iv), (v), (vi), (vii), (viii) and (ix)
below, so long as there is no Default or Event of Default
continuing, the foregoing provisions shall not prohibit the
following actions:
(i) the payment of any dividend within 60 days after
the date of declaration thereof, if at such date of
declaration such payment would be permitted by the provisions
of paragraph (a) of this Section 1012 (such payment shall be
deemed to have been paid on such date of declaration for
purposes of the calculation required by paragraph (a) of this
Section 1012);
(ii) the repurchase, redemption, or other acquisition or
retirement of any shares of any class of Capital Stock of the
Company or warrants, options or other rights to acquire such
stock in exchange for, or out of the Net Cash Proceeds of a
substantially concurrent issue and sale (other than to a
Subsidiary) for cash of, any Qualified Capital Stock of the
Company or warrants, options or other rights to acquire such
stock;
(iii) any repurchase, redemption, defeasance,
retirement, refinancing or acquisition for value or payment
of principal of any Subordinated Indebtedness in exchange
for, or out of the net proceeds of a substantially concurrent
issuance and sale (other than to a Subsidiary) for cash of,
any Qualified Capital Stock of the Company or warrants,
options or other rights to acquire such stock;
(iv) the repurchase, redemption, defeasance, retirement
or other acquisition for value or payment of principal of any
Subordinated Indebtedness through the issuance of
Indebtedness meeting the requirements of clause (vii) of
paragraph (b) of Section 1011;
(v) the repurchase, redemption, acquisition or
retirement of shares of Capital Stock of United or options,
warrants or other rights to purchase such shares held by
officers or employees or former officers or employees of
United and the Subsidiaries (or their estates or
beneficiaries), upon death, disability, retirement, or
termination of employment, pursuant to the terms of any
employee stock option or stock purchase plan or agreement
under which such shares were acquired; provided that the
aggregate consideration paid for all such shares following
the Closing Date does not exceed $600,000 in any fiscal year
of the Company; and provided further that the amount by which
$600,000 exceeds the amount so used in any fiscal year of the
Company shall be available to be so used in subsequent fiscal
years of the Company, notwithstanding the immediately
preceding proviso;
(vi) payments to United, to the extent used by United to
pay its operating and administrative expenses including,
without limitation, directors' fees, legal and audit
expenses, Commission compliance expenses and corporate
franchise and other taxes, not to exceed $500,000 in any
fiscal year of the Company;
(vii) payments to United, not to exceed $250,000 in
the aggregate after the Closing Date, to the extent used by
United to make cash payments to holders of its Capital Stock
in lieu of the issuance of fractional shares of Capital Stock
and to redeem or repurchase stock purchase or similar rights
issued as a shareholder rights device;
(viii) payments to United of up to $1,000,000 in any
fiscal year of the Company, to the extent used by United to
satisfy its payment obligations under the Management Services
Agreements; and
(ix) the payment of dividends or the making of
distributions to United, within 30 days of the Closing Date,
to the extent that United, within such 30 days, uses such
dividends and distributions to redeem or repurchase all or
any portion of United's Series B Preferred Stock that is
outstanding on the Closing Date (plus any shares of Series B
Preferred Stock issued as dividends on such outstanding
shares after the Closing Date and prior to such redemption or
repurchase); and the purchase by the Company of all or any
portion of United's Series B Preferred Stock that is
outstanding on the Closing Date (plus any shares of Series B
Preferred Stock issued as dividends on such outstanding
shares after the Closing Date and prior to such purchase),
within 30 days of the Closing Date; provided that the
aggregate amount of all such payments by the Company under
this clause (ix) shall not exceed $7.0 million.
The actions described in clauses (i) through (iii) and
clauses (v) through (vii) of this paragraph (b) shall be
Restricted Payments that shall be permitted to be taken in
accordance with this paragraph (b) but shall reduce the amount
that would otherwise be available for Restricted Payments under
clause (C) of paragraph (a) of this Section 1012 (provided that
any dividend paid pursuant to clause (i) of this paragraph (b)
shall reduce the amount that would otherwise be available under
clause (C) of paragraph (a) of this Section 1012 covenant when
declared, but not also when paid pursuant to such clause (i)) and
the actions described in clauses (iv), (viii) and (ix) of this
paragraph (b) shall be permitted to be taken in accordance with
this paragraph and shall not reduce the amount that would
otherwise be available for Restricted Payments under clause (C) of
paragraph (a).
SECTION 1013. Limitation on Transactions with
Affiliates.
The Company will not, and will not permit any of its
Restricted Subsidiaries to, directly or indirectly, enter into or
suffer to exist any transaction or series of related transactions
(including, without limitation, the sale, purchase, exchange or
lease of assets or property or the rendering of any services) with
any Affiliate of the Company (other than a Restricted Wholly Owned
Subsidiary of the Company) unless (i) such transaction or series
of transactions is in writing on terms that are no less favorable
to the Company or such Restricted Subsidiary, as the case may be,
than would be available in a comparable transaction in arm's-
length dealings with an unrelated third party, (ii) with respect
to any such transaction or series of transactions involving
aggregate payments in excess of $1.0 million, the Company delivers
an Officers' Certificate to the Trustee certifying that such
transaction or series of related transactions complies with clause
(i) above and such transaction or series of related transactions
has been approved by the Board of Directors of the Company, and
(iii) with respect to a transaction or series of related
transactions involving aggregate value in excess of $5.0 million,
the Company delivers to the Trustee an opinion of an independent
investment banking firm of national standing stating that the
transaction or series of transactions is fair to the Company or
such Restricted Subsidiary from a financial point of view.
The foregoing shall not apply to the performance of
obligations under the Management Service Agreements and the
Employment Contracts, in each case as in effect on the Closing
Date.
SECTION 1014. Limitation on Senior Subordinated
Indebtedness.
The Company and each Guarantor will not, directly or
indirectly, incur or otherwise permit to exist any Indebtedness
that is subordinate in right of payment to any Indebtedness of the
Company or such Guarantor, as the case may be, unless such
Indebtedness is also pari passu with the Securities or the
Guarantee of the Securities by such Guarantor, as the case may be,
or subordinate in right of payment to the Securities or such
Guarantee of the Securities, as the case may be, to at least the
same extent as the Securities or such Guarantee are subordinate in
right of payment to Senior Indebtedness or Senior Guarantor
Indebtedness, as the case may be, as set forth in Article Fourteen
or Article Fifteen, as the case may be.
SECTION 1015. Limitation on Liens.
The Company will not, and will not permit any Restricted
Subsidiary to, directly or indirectly, incur, assume or suffer to
exist any Lien of any kind upon any of its property or assets
(including any shares of Capital Stock or Indebtedness of any
Restricted Subsidiary), owned on the Closing Date or
acquired after the Closing Date, or any income or profits
therefrom, except if the Notes (or the Guarantee of the Notes, in
the case of Liens on properties or assets of a Restricted
Subsidiary that is a Guarantor) and all other amounts due under
this Indenture are directly secured equally and ratably with (or
prior to in the case of Liens with respect to Subordinated
Indebtedness) the obligation or liability secured by such Lien,
excluding, however, from the operation of the foregoing any of the
following:
(a) any Lien existing as of the Closing Date;
(b) any Lien arising by reason of (i) any judgment,
decree or order of any court, so long as such Lien is
adequately bonded and any appropriate legal proceedings which
may have been duly initiated for the review of such judgment,
decree or order shall not have been finally terminated or the
period within which such proceedings may be initiated shall
not have expired; (ii) taxes, assessments or other
governmental charges not yet delinquent or which are being
contested in good faith; (iii) security for payment of
workers' compensation or other insurance; (iv) good faith
deposits in connection with tenders, leases or contracts
(other than contracts for the payment of money); (v) zoning
restrictions, easements, licenses, reservations, provisions,
covenants, conditions, waivers, restrictions on the use of
property or minor irregularities of title (and with respect
to leasehold interests, mortgages, obligations, liens and
other encumbrances incurred, created, assumed or permitted to
exist and arising by, through or under a landlord or owner of
the leased property, with or without consent of the lessee),
none of which materially impairs the use of any property or
assets material to the operation of the business of the
Company or any Restricted Subsidiary or the value of such
property or assets for the purpose of such business; (vi)
deposits to secure public or statutory obligations, or in
lieu of surety or appeal bonds with respect to matters not
yet finally determined and being contested in good faith by
negotiations or by appropriate proceedings which suspend the
collection thereof; or (vii) operation of law in favor of
mechanics, materialmen, laborers, employees or suppliers,
incurred in the ordinary course of business for sums which
are not yet delinquent or are being contested in good faith
by negotiations or by appropriate proceedings which suspend
the collection thereof;
(c) any Lien now or hereafter existing on property of
the Company or any Guarantor securing Senior Indebtedness or
Senior Guarantor Indebtedness, as the case may be, of such
Person;
(d) any Lien securing Acquired Indebtedness created
prior to (and not created in connection with, or in
contemplation of) the incurrence of such Indebtedness by the
Company, which Indebtedness is permitted under Section 1011;
provided that any such Lien only extends to the assets that
were subject to such Lien securing such Acquired Indebtedness
prior to the related acquisition; and
(e) any extension, renewal, refinancing or replacement,
in whole or in part, of any Lien described in the foregoing
clauses (a) through (d) so long as the amount of property or
assets subject to such Lien is not increased thereby.
SECTION 1016. Limitation on Sale of Assets.
(a) The Company will not, and will not permit any of
its Restricted Subsidiaries to, directly or indirectly, consummate
an Asset Sale unless (i) at least 75% of the proceeds from such
Asset Sale are received in cash and (ii) the Company or such
Restricted Subsidiary receives consideration at the time of such
Asset Sale at least equal to the Fair Market Value of the shares
or assets sold.
(b) If all or a portion of the Net Cash Proceeds of any
Asset Sale is not applied to repay permanently any Senior
Indebtedness or Senior Guarantor Indebtedness then outstanding as
required by the terms thereof, and the Company determines not to
apply such Net Cash Proceeds to the prepayment of such Senior
Indebtedness or Senior Guarantor Indebtedness or if no such Senior
Indebtedness or Senior Guarantor Indebtedness is then outstanding,
then the Company may, within 12 months of the Asset Sale, invest
(or enter into a written, legally binding commitment to invest,
provided that the investment provided for in such commitment is
actually made within 24 months of the Asset Sale) the Net Cash
Proceeds in other properties and assets that will be used in the
businesses of the Company existing on the Closing Date or in any
company having such properties and assets. The amount of such Net
Cash Proceeds neither used to permanently repay or prepay Senior
Indebtedness or Senior Guarantor Indebtedness nor used or invested
as set forth in this paragraph (b) constitutes "Excess Proceeds."
(c) When the aggregate amount of Excess Proceeds equals
$10.0 million or more, the Company shall, within 15 Business Days:
make an offer (an "Offer") to purchase, for cash, at 100% of the
principal amount thereof, plus accrued and unpaid interest to the
repurchase date (the "Repurchase Date"), in accordance with the
procedures set forth in this Indenture the maximum principal
amount (expressed as a multiple of $1,000) of Notes that may be
purchased out of an amount (the "Note Amount") equal to the
product of such Excess Proceeds multiplied by a fraction, the
numerator of which is the outstanding principal amount of the
Notes, and the denominator of which is the sum of the outstanding
principal amount of the Notes and any Pari Passu Indebtedness that
is required to be repurchased under the instrument governing such
Pari Passu Indebtedness and (ii) to the extent required by such
Pari Passu Indebtedness, the Company shall make an offer to
purchase or, if required by the terms of such Pari Passu
Indebtedness, otherwise repurchase or redeem Pari Passu
Indebtedness (a "Pari Passu Repayment") in an amount (the "Pari
Passu Debt Amount") equal to the excess of the Excess Proceeds
over the Note Amount; provided that in no event shall the Pari
Passu Debt Amount exceed the principal amount of such Pari Passu
Indebtedness plus the amount of any premium, if any, and accrued
and unpaid interest required to be paid to repurchase such Pari
Passu Indebtedness. To the extent that the aggregate principal
amount of and accrued but unpaid interest with respect to the
Notes tendered pursuant to the Offer is less than the Note Amount
relating thereto or the aggregate amount of Pari Passu
Indebtedness that is purchased is less than the Pari Passu Debt
Amount, the Company may use such amounts not necessary to purchase
the tendered Notes and the Pari Passu Indebtedness required to be
purchased for any purpose not prohibited by this Indenture. Upon
completion of the purchase of all the Notes tendered pursuant to
an Offer and the purchase of the Pari Passu Indebtedness pursuant
to a Pari Passu Repayment, the amount of Excess Proceeds, if any,
shall be reset at zero.
(d) Within the period required by the first sentence
of paragraph (c) above, the Company shall notify the Trustee
thereof and shall give to each Holder of the Securities in the
manner provided in Section 106, a notice stating:
(1) that an Offer is being made and that such Holder
has the right to require the Company to repurchase such
Holder's Securities on a pro rata basis;
(2) the purchase price and the Repurchase Date, which
shall be a Business Day no earlier than 30 days nor later
than 60 days from the date such notice is mailed, or such
later date as may be necessary to comply with requirements
under the Exchange Act;
(3) that any Security not tendered will continue to
accrue interest;
(4) that, unless the Company defaults in the payment of
the purchase price, any Securities accepted for payment
pursuant to the Offer shall cease to accrue interest after
the Repurchase Date; and
(5) the procedures that a Holder must follow to accept
an Offer or to withdraw such acceptance.
(e) Holders electing to have Securities purchased will
be required to surrender such Securities with the execution form
provided for on Exhibit A duly executed to the Company at the
address specified in the notice at least 10 Business Days prior to
the Change of Control Repurchase Date. Holders will be entitled
to withdraw their election if the Company receives, not later than
three Business Days prior to the Change of Control Purchase Date,
a facsimile transmission or letter setting forth the name of the
Holder, the principal amount of the Securities delivered for
purchase by the Holder as to which his election is to be withdrawn
and a statement that such Holder is withdrawing his election to
have such Securities purchased. Holders whose Securities are
purchased only in part will be issued new Securities equal in
principal amount to the unpurchased portion of the Securities
surrendered.
On the Repurchase Date, the Company shall repurchase
Securities on the pro rata basis set forth in paragraph (c) above.
(f) The Company will comply with the applicable tender
offer rules, including Rule 14e-1 under the Exchange Act, and any
other applicable securities laws and regulations in connection
with an Offer.
SECTION 1017. Limitation on Issuances of Guarantees of
Indebtedness.
(a) The Company will not permit any Restricted
Subsidiary to incur any Guaranteed Debt, other than Guaranteed
Debt in respect of Senior Indebtedness of the Company; provided
that, concurrently with the incurrence of such Guaranteed Debt by
any Restricted Subsidiary, the Restricted Subsidiary incurring
such Guaranteed Debt (if it is not a Guarantor) shall execute a
supplemental indenture setting forth such Restricted Subsidiary's
senior subordinated guarantee of the Notes, such guarantee to be
on the same terms as United's Guarantee of the Notes. Neither the
Company nor any Guarantor shall be required to make a notation on
the Notes or the Guarantees to reflect such Guarantee. In
connection with such Guarantee of the Notes, such Restricted
Subsidiary shall waive, and agree that it will not in any manner
whatsoever claim or take the benefit or advantage of, any rights
or reimbursement, indemnity or subrogation or any other rights
against the Company or any Guarantor as a result of any payment by
such Restricted Subsidiary with respect to such Guaranteed Debt.
(b) United will not incur any Guaranteed Debt with
respect to any Pari Passu Indebtedness or Subordinated
Indebtedness unless such Guaranteed Debt is subordinated (at least
to the extent that Notes are subordinated in right of payment to
Senior Indebtedness) in right of payment to (or, in the case of
Guaranteed Debt with respect to Pari Passu Indebtedness, is pari
passu in right of payment with) United's Guarantee of the Notes.
(c) The Company will cause each of its domestic
Restricted Subsidiaries, other than the Joint Venture, promptly
upon becoming a Restricted Subsidiary, to execute a supplemental
indenture providing for a Guarantee of the Notes on the same terms
as United's Guarantee of the Notes, including, without limitation,
the waiver and agreement referred to in the last sentence of
paragraph (a) above. Neither the Company nor any Guarantor shall
be required to make a notation on the Notes or the Guarantees to
reflect such Guarantee.
SECTION 1018. Limitation on Subsidiary Capital Stock.
The Company will not transfer, and will not permit the
transfer or issuance of, any Capital Stock of any Restricted
Subsidiary (including options, warrants or other rights to
purchase shares of such Capital Stock) except for (i) Capital
Stock issued to and held by the Company or a Restricted Wholly
Owned Subsidiary, (ii) Capital Stock issued by a Person prior to
the time (A) such Person becomes a Restricted Subsidiary, (B) such
Person merges with or into a Restricted Subsidiary or (C) a
Restricted Subsidiary merges with or into such Person; provided
that such Capital Stock was not issued or incurred by such Person
in anticipation of the type of transaction contemplated by
subclause (A), (B) or (C), (iii) the transfer of all of the
Capital Stock of a Restricted Subsidiary or (iv) the issuance or
transfer of directors' qualifying shares or a de minimis number of
shares required to be held by foreign nationals, in each case to
the extent required by applicable law. The foregoing shall not
prohibit the pledge of any shares of Capital Stock permitted under
Section 1015.
SECTION 1019. Limitation on Dividends and Other Payment
Restrictions Affecting Restricted Subsidiaries.
The Company will not, and will not permit any
Restricted Subsidiary to, directly or indirectly, create or
otherwise cause or suffer to exist or become effective any
encumbrance or restriction on the ability of any Restricted
Subsidiary to (i) pay dividends, in cash or otherwise, or make any
other distribution on or in respect of its Capital Stock, (ii) pay
any Indebtedness owed to the Company or any other Restricted
Subsidiary, (iii) make any loans or advances to, or Investments
in, the Company or any other Restricted Subsidiary or (iv)
transfer any of its properties or assets to the Company or any
other Restricted Subsidiary, except in any such case (1) any
encumbrance or restriction pursuant to an agreement in effect on
the Closing Date, (2) any encumbrance or restriction, with respect
to a Person that becomes a Subsidiary after the Closing Date, in
existence at the time such Person becomes a Subsidiary and not
incurred in connection with, or in contemplation of, such Person
becoming a Subsidiary; (3) any encumbrance or restriction
existing under any agreement that extends, renews, refinances or
replaces the agreements containing the encumbrances or
restrictions in the foregoing clauses (1) and (2), or in this
clause (3), provided that the terms and conditions of any such
encumbrances or restrictions are not materially less favorable to
the Holders of the Notes than those under or pursuant to the
agreement so extended, renewed, refinanced or replaced, (4) any
encumbrance or restriction created pursuant to an asset sale
agreement, stock sale agreement or similar instrument pursuant to
which a bona fide Asset Sale the proceeds of which are applied as
provided in this Indenture is to be consummated, so long as such
restriction or encumbrance shall apply only to the assets subject
to such Asset Sale and shall be effective only for a period from
the execution and delivery of such agreement or instrument through
the earlier of the consummation of such Asset Sale or the
termination of such agreement or instrument, (5) customary non
assignment provisions of any lease governing any leasehold
interest of the Company or any Restricted Subsidiaries, (6) to the
extent required by this Indenture, and (7) any encumbrance or
restriction existing under or by reason of applicable law.
SECTION 1020. Waiver of Certain Covenants.
The Company may omit in any particular instance to
comply with any term, provision or condition set forth in Sections
1008 through 1019, inclusive, if before or after the time for such
compliance the Holders of at least a majority in principal amount
of the Outstanding Securities, by Act of such Holders, waive such
compliance in such instance with such term, provision or
condition, but no such waiver shall extend to or affect such term,
provision or condition except to the extent so expressly waived,
and, until such waiver shall become effective, the obligations of
the Company and the duties of the Trustee in respect of any such
term, provision or condition shall remain in full force and
effect.
ARTICLE ELEVEN
REDEMPTION OF SECURITIES SECTION 1101. Right
of Redemption.
(a) The Securities will be subject to redemption at
any time on or after May 1, 2000, at the option of the Company, in
whole or in part, on not less than 30 nor more than 60 days' prior
notice in amounts of $1,000 or an integral multiple thereof at the
following redemption prices (expressed as percentages of the
principal amount), if redeemed during the 12-month period
beginning May 1 of the years indicated below:
Redemption Year
Price
2000 106.375%
2001 104.781%
2002 103.188%
2003 101.594%
and thereafter at 100% of the principal amount, in each case
together with accrued and unpaid interest, if any, to the
redemption date (subject to the right of holders of record on
Regular Record Dates to receive interest due on an Interest
Payment Date).
(b) In addition, at any time or from time to time prior
to May 1, 1998, the Company may redeem Securities having a
principal amount of up to $50 million within 180 days following
one or more Public Equity Offerings with the net proceeds of such
offerings at a redemption price equal to 112_% of the principal
amount thereof, together with accrued and unpaid interest, if any,
to the date of redemption (subject to the right of holders of
record on relevant record dates to receive interest due on
relevant interest payment dates); provided that immediately after
giving effect to each such redemption, at least $100 million
aggregate principal amount of the Securities remain outstanding.
SECTION 1102. Applicability of Article.
Redemption of Securities at the election of the Company
or otherwise, as permitted or required by any provision of this
Indenture, shall be made in accordance with such provision and
this Article.
SECTION 1103. Election to Redeem; Notice to Trustee.
The election of the Company to redeem any Securities
pursuant to Section 1101 shall be evidenced by a Board Resolution.
In case of any redemption at the election of the Company, the
Company shall, at least 60 days prior to the Redemption Date fixed
by the Company (unless a shorter notice shall be satisfactory to
the Trustee), notify the Trustee of such Redemption Date and of
the principal amount of Securities to be redeemed and shall
deliver to the Trustee such documentation and records as shall
enable the Trustee to select the Securities to be redeemed
pursuant to Section 1104.
SECTION 1104. Selection by Trustee of Securities to Be
Redeemed.
If less than all the Securities are to be redeemed, the
particular Securities to be redeemed or portions thereof to be
redeemed pro rata shall be selected not more than 60 days prior to
the Redemption Date by the Trustee, from the Outstanding
Securities not previously called for redemption by lot or by any
other method as the Trustee shall deem fair and reasonable
consistent with the requirements of the Depositary and which may
provide for the selection for redemption of portions of the
principal of Securities; provided, however, that Securities may
only be redeemed in integral multiples of $1,000.
The Trustee shall promptly notify the Company in writing
of the Securities selected for redemption and, in the case of any
Securities selected for partial redemption, the principal amount
thereof to be redeemed.
For all purposes of this Indenture, unless the context
otherwise requires, all provisions relating to redemption of
Securities shall relate, in the case of any Security redeemed or
to be redeemed only in part, to the portion of the principal
amount of such Security which has been or is to be redeemed.
SECTION 1105. Notice of Redemption.
Notice of redemption shall be given in the manner
provided for in Section 106 not less than 30 nor more than 60
days, prior to the Redemption Date, to each Holder of Securities
to be redeemed.
All notices of redemption shall identify the Securities
to be redeemed (including CUSIP or CINS number) and shall state:
(1) the Redemption Date,
(2) the Redemption Price,
(3) if less than all Outstanding Securities are to be
redeemed, the identification (and, in the case of a partial
redemption, the principal amounts) of the particular
Securities to be redeemed,
(4) that on the Redemption Date the Redemption Price
(together with accrued interest, if any, to the Redemption
Date payable as provided in Section 1107) will become due and
payable upon each such Security, or the portion thereof, to
be redeemed, and that interest thereon will cease to accrue
on and after said date, and
(5) the place or places where such Securities are to be
surrendered for payment of the Redemption Price.
Notice of redemption of Securities to be redeemed at the
election of the Company shall be given by the Company or, at the
Company's request, by the Trustee in the name and at the expense
of the Company.
SECTION 1106. Deposit of Redemption Price.
Prior to any Redemption Date, the Company shall deposit
with the Trustee or with a Paying Agent (or, if the Company is
acting as its own Paying Agent, segregate and hold in trust as
provided in Section 1003) an amount of money sufficient to pay the
Redemption Price of, and accrued interest on, all the Securities
which are to be redeemed on that date.
SECTION 1107. Securities Payable on Redemption Date.
Notice of redemption having been given as aforesaid, the
Securities so to be redeemed shall, on the Redemption Date, become
due and payable at the Redemption Price therein specified
(together with accrued interest, if any, to the Redemption Date),
and from and after such date (unless the Company shall default in
the payment of the Redemption Price and accrued interest) such
Securities shall cease to bear interest. Upon surrender of any
such Security for redemption in accordance with said notice, such
Security shall be paid by the Company at the Redemption Price,
together with accrued interest, if any, to the Redemption Date;
provided, however, that installments of interest whose Stated
Maturity is on or prior to the Redemption Date shall be payable to
the Holders of such Securities, registered as such at the close of
business on the relevant Record Dates according to their terms and
the provisions of Section 309.
If any Security called for redemption shall not be so
paid upon surrender thereof for redemption, the principal (and
premium, if any) shall, until paid, bear interest from the
Redemption Date at the rate borne by the Securities.
SECTION 1108. Securities Redeemed in Part.
Any Security which is to be redeemed only in part shall
be surrendered at the office or agency of the Company maintained
for such purpose pursuant to Section 1002 (with, if the Company or
the Trustee so requires, due endorsement by, or a written
instrument of transfer in form satisfactory to the Company and the
Trustee duly executed by, the Holder thereof or such Holder's
attorney duly authorized in writing), and the Company shall
execute, and the Trustee shall authenticate and deliver to the
Holder of such Security without service charge, a new Security or
Securities, of any authorized denomination as requested by such
Holder, in aggregate principal amount equal to and in exchange for
the unredeemed portion of the principal of the Security so
surrendered.
ARTICLE TWELVE
DEFEASANCE AND COVENANT DEFEASANCE
SECTION 1201. Company's Option to Effect Defeasance or
Covenant Defeasance.
The Company may, at its option and at any time, elect to
have either Section 1202 or Section 1203 be applied to all
Outstanding Securities upon compliance with the conditions set
forth below in this Article Twelve.
SECTION 1202. Defeasance and Discharge.
Upon the passage of 123 days after the Company's
exercise under Section 1201 of the option applicable to this
Section 1202, the Company and the Guarantors shall be deemed to
have been discharged from their respective obligations with
respect to all the Outstanding Securities on the date the
conditions set forth in Section 1204 are satisfied (hereinafter,
"defeasance"). For this purpose, such defeasance means that the
Company shall be deemed to have paid and discharged the entire
indebtedness represented by Outstanding Securities except for (i)
the rights of Holders of Outstanding Securities to receive
payments in respect of the principal of, premium, if any, and
interest on such Securities when such payments are due, (ii) the
Company's obligations with respect to the Securities concerning
issuing temporary Securities, registration of Securities,
mutilated, destroyed, lost or stolen Securities, and the
maintenance of an office or agency for payment and money for
security payments held in trust, (iii) the rights, powers, trusts,
duties and immunities of the Trustee, and (iv) this Article
Twelve.
SECTION 1203. Covenant Defeasance.
Upon the passage of 123 days after the Company's
exercise under Section 1201 of the option applicable to this
Section 1203, the Company and the Guarantors shall be released
from their respective obligations under any covenant in Section
801 and in Sections 1003 and 1008 through 1019 with respect to the
Outstanding Securities on and after the date the conditions set
forth below are satisfied (hereinafter, "covenant defeasance"),
and the Securities shall thereafter be deemed not to be
"Outstanding" for the purposes of any direction, waiver, consent
or declaration or Act of Holders (and the consequences of any
thereof) in connection with such covenants, but shall continue to
be deemed "Outstanding" for all other purposes hereunder. For
this purpose, such covenant defeasance means that, with respect to
the Outstanding Securities, the Company and the Guarantors may
omit to comply with and shall have no liability in respect of any
term, condition or limitation set forth in any covenant referred
to in the first sentence of this Section 1203, whether directly or
indirectly, by reason of any reference elsewhere herein to any
such covenant or by reason of any reference in any such covenant
to any other provision herein or in any other document and such
omission to comply shall not constitute a Default or an Event of
Default under Section 501(3) or Section 501(5), but, except as
specified above, the remainder of this Indenture and such
Securities shall be unaffected thereby.
SECTION 1204. Conditions to Defeasance or Covenant
Defeasance.
The following shall be the conditions to application of
either Section 1202 or Section 1203 to the Outstanding Securities:
(1) The Company shall irrevocably have deposited or
caused to be deposited with the Trustee (or another trustee
satisfying the requirements of Section 607 who shall agree to
comply with the provisions of this Article Twelve applicable
to it) as trust funds in trust for the purpose of making the
following payments, specifically pledged as security for, and
dedicated solely to, the benefit of the Holders of such
Securities, (A) cash in United States dollars in an amount,
or (B) U.S. Government Obligations which through the
scheduled payment of principal and interest in respect
thereof in accordance with their terms will provide, not
later than one day before the due date of any payment, money
in an amount, or (C) a combination thereof, sufficient, in
the opinion of a nationally recognized firm of independent
public accountants expressed in a written certification
thereof delivered to the Trustee, to pay and discharge, and
which shall be applied by the Trustee (or other qualifying
trustee) to pay and discharge, the principal of (and premium,
if any, on) and interest on the Outstanding Securities on the
Stated Maturity (or Redemption Date, if applicable) of such
principal (and premium, if any) or interest (or if specified
by the Company in an Officers' Certificate delivered to the
Trustee at the time of such deposit, any date upon which the
Company would be entitled to redeem all Securities
Outstanding (such date being referred to as the "Defeasance
Redemption Date")); provided that the Trustee shall have been
irrevocably instructed to apply such money or the proceeds of
such U.S. Government Obligations to said payments with
respect to the Securities. Before such a deposit, the
Company may give to the Trustee, in accordance with Section
1103 hereof, a notice of its election to redeem all of the
Outstanding Securities at a future date in accordance with
Article Eleven hereof, which notice shall be irrevocable.
Such irrevocable redemption notice, if given, shall be given
effect in applying the foregoing. For this purpose, "U.S.
Government Obligations" means securities that are (x) direct
obligations of the United States of America for the timely
payment of which its full faith and credit is pledged or (y)
obligations of a Person controlled or supervised by and
acting as an agency or instrumentality of the United States
of America the timely payment of which is unconditionally
guaranteed as a full faith and credit obligation by the
United States of America, which, in either case, are not
callable or redeemable at the option of the issuer thereof,
and shall also include a depository receipt issued by a bank
(as defined in Section 3(a)(2) of the Securities Act of 1933,
as amended), as custodian with respect to any such U.S.
Government Obligation or a specific payment of principal of
or interest on any such U.S. Government Obligation held by
such custodian for the account of the holder of such
depository receipt, provided that (except as required by law)
such custodian is not authorized to make any deduction from
the amount payable to the holder of such depository receipt
from any amount received by the custodian in respect of the
U.S. Government Obligation or the specific payment of
principal of or interest on the U.S. Government Obligation
evidenced by such depository receipt.
(2) No Default or Event of Default with respect to the
Securities shall have occurred and be continuing on the date
of such deposit or, with respect to Section 501(7) or Section
501(8), at any time during the period ending on the 123rd day
after the date of deposit.
(3) Such defeasance or covenant defeasance shall not
cause the Trustee to have a conflicting interest with respect
to any securities of the Company or any Guarantor.
(4) Such defeasance or covenant defeasance shall not
result in a breach or violation of, or constitute a default
under, this Indenture or any other material agreement or
instrument to which the Company or any Guarantor is a party
or by which it is bound.
(5) In the case of an election under Section 1202, the
Company shall have delivered to the Trustee an Opinion of
Counsel in the United States to the effect that since the
date of this Indenture (A) the Company has received from, or
there has been published by, the Internal Revenue Service a
ruling or (B) there has been a change in the applicable
federal income tax law, in either case, to the effect that,
and based thereon such Opinion of Counsel in the United
States shall confirm that, the Holders of the Outstanding
Securities will not recognize income, gain or loss for
federal income tax purposes as a result of such defeasance
and will be subject to federal income tax on the same
amounts, in the same manner and at the same times as would
have been the case if such covenant defeasance had not
occurred.
(6) In the case of an election under Section 1203, the
Company shall have delivered to the Trustee an Opinion of
Counsel in the United States to the effect that the Holders
of the Outstanding Securities will not recognize income, gain
or loss for federal income tax purposes as a result of such
covenant defeasance and will be subject to federal income tax
on the same amounts, in the same manner and at the same times
as would have been the case if such covenant defeasance had
not occurred.
(7) The Company shall have delivered to the Trustee an
Opinion of Counsel (which may be delivered on such 123rd day)
to the effect that (A) the trust funds will not be subject to
any rights of holders of Senior Indebtedness or Senior
Guarantor Indebtedness, including, without limitation, those
arising under this Indenture and (B) after the 123rd day
following the deposit, the trust funds will not be subject to
the effect of any applicable bankruptcy, insolvency,
reorganization or similar laws affecting creditors' rights
generally.
(8) The Company shall have delivered to the Trustee an
Officers' Certificate stating that the deposit was not made
by the Company with the intent of preferring the Holders of
the Securities or any Guarantee over the other creditors of
the Company or any Guarantor with the intent of defeating,
hindering, delaying or defrauding creditors of the Company,
any Guarantor or others.
(9) No event or condition shall exist that would
prevent the Company from making payments of principal of,
premium, if any, and interest on the Securities on the date
of such deposit or at any time ending on the 123rd day after
the date of such deposit.
(10) The Company shall have delivered to the Trustee an
Officers' Certificate and an Opinion of Counsel, each stating
that all conditions precedent provided for relating to either
the defeasance under Section 1202 or the covenant defeasance
under Section 1203 (as the case may be) have been complied
with.
The Company shall pay and indemnify the Trustee against
any tax, fee or other charge imposed on or assessed against the
U.S. Government Obligations deposited pursuant to Section 1202 or
Section 1203 or the principal and interest received in respect
thereof other than any such tax, fee or other charge which by law
is for the account of the Holders of
Outstanding Securities. ARTICLE THIRTEEN
GUARANTEE OF SECURITIES
SECTION 1301. Guarantee.
Subject to the provisions of this Article Thirteen,
United hereby, fully, unconditionally and irrevocably guarantees
to each Holder and to the Trustee on behalf of the Holders: (i)
the due and punctual payment of the principal of, premium, if any,
on and interest on each Security, when and as the same shall
become due and payable, whether at maturity, by acceleration or
otherwise, the due and punctual payment of interest on the overdue
principal of and interest, if any, on the Securities, to the
extent lawful, and the due and punctual performance of all other
obligations of the Company to the Holders or the Trustee, all in
accordance with the terms of such Security and this Indenture and
(ii) in the case of any extension of time of payment or renewal of
any Securities or any of such other obligations, that the same
will be promptly paid in full when due or performed in accordance
with the terms of the extension or renewal, at Stated Maturity, by
acceleration or otherwise, provided that this Guarantee shall not
be enforceable against United in an amount in excess of the net
worth of United at the time that determination of such net worth
is, under applicable law, relevant to the enforceability of such
Guarantee. Such net worth shall include any claim of United
against the Company for reimbursement and any claim against any
other Guarantor for contribution. United hereby waives diligence,
presentment, demand of payment, filing of claims with a court in
the event of merger or bankruptcy of the Company, any right to
require a proceeding first against the Company, the benefit of
discussion, protest or notice with respect to any such Security or
the debt evidenced thereby and all demands whatsoever (except as
specified above), and covenants that this Guarantee will not be
discharged as to any such Security except by payment in full of
the principal thereof and interest thereon and as provided in
Section 401 and Section 1202 or in the event of a transaction in
compliance with Section 801(b). The maturity of the obligations
Guaranteed hereby may be accelerated as provided in Article Five
for the purposes of this Article Thirteen. In the event of any
declaration of acceleration of such obligations as provided in
Article Five, such obligations (whether or not due and payable)
shall forthwith become due and payable by United for the purpose
of this Article Thirteen. In addition, without limiting the
foregoing provisions, upon the effectiveness of an acceleration
under Article Five, the Trustee shall promptly make a demand for
payment on the Securities under the Guarantee provided for in this
Article Thirteen.
If the Trustee or the Holder of any Security is
required by any court or otherwise to return to the Company or any
Guarantor, or any custodian, receiver, liquidator, trustee,
sequestrator or other similar official acting in relation to the
Company or such Guarantor, any amount paid to the Trustee or such
Holder in respect of a Security, this Guarantee, to the extent
theretofore discharged, shall be reinstated in full force and
effect. United further agrees, to the fullest extent that it may
lawfully do so, that, as between it, on the one hand, and the
Holders and the Trustee, on the other hand, the maturity of the
obligations Guaranteed hereby may be accelerated as provided in
Article Five hereof for the purposes of this Guarantee,
notwithstanding any stay, injunction or other prohibition extant
under any applicable bankruptcy law preventing such acceleration
in respect of the obligations Guaranteed hereby.
United hereby irrevocably waives any claim or other
rights which it may now or hereafter acquire against the Company
or any other Guarantor that arise from the existence, payment,
performance or enforcement of its obligations under this Guarantee
and this Indenture, including, without limitation, any right of
subrogation, reimbursement, exoneration, contribution,
indemnification, any right to participate in any claim or remedy
of the Holders against the Company or any Guarantor or any
collateral which any such Holder or the Trustee on behalf of such
Holder hereafter acquires, whether or not such claim, remedy or
right arises in equity, or under contract, statute or common law,
including, without limitation, the right to take or receive from
the Company or a Guarantor, directly or indirectly, in cash or
other property or by set-off or in any other manner, payment or
security on account of such claim or other rights. If any amount
shall be paid to a Guarantor in violation of the preceding
sentence and the principal of, premium, if any, and accrued
interest on the Securities shall not have been paid in full, such
amount shall be deemed to have been paid to such Guarantor for the
benefit of, and held in trust for the benefit of, the Holders, and
shall forthwith be paid to the Trustee for the benefit of the
Holders to be credited and applied upon the principal of, premium,
if any, and accrued interest on the Securities. United
acknowledges that it will receive direct and indirect benefits
from the issuance of the Securities pursuant to this Indenture and
that the waivers set forth in this Section 1301 are knowingly made
in contemplation of such benefits.
The Guarantee set forth in this Section 1301 shall not
be valid or become obligatory for any purpose with respect to a
Security until the certificate of authentication on such Security
shall have been signed by or on behalf of the Trustee.
SECTION 1302. Obligations Unconditional.
Except as provided in Section 1301, nothing contained in
this Article Thirteen or elsewhere in this Indenture or in the
Securities is intended to or shall impair, as among United and the
holders of the Securities, the obligation of United, which is
absolute and unconditional, upon failure by the Company, to pay to
the holders of the Securities the principal of, premium, if any,
and interest on the Securities as and when the same shall become
due and payable in accordance with their terms, or is intended to
or shall affect the relative rights of the holders of the
Securities and creditors of United, nor shall anything herein or
therein prevent the holder of any Security or the Trustee on their
behalf from exercising all remedies otherwise permitted by
applicable law upon default under this Indenture.
Without limiting the foregoing, nothing contained in
this Article Thirteen will restrict the right of the Trustee or
the holders of the Securities to take any action to declare the
Guarantee provided for herein to be due and payable prior to the
Stated Maturity of the Securities pursuant to Section 502 or to
pursue any rights or remedies hereunder.
SECTION 1303. Notice to Trustee.
United shall give prompt written notice to the Trustee
of any fact known to United which prohibits the making of any
payment to or by the Trustee in respect of the Guarantee pursuant
to the provisions of this Article Thirteen other than any
agreement in effect on the date hereof.
SECTION 1304. This Article Not to Prevent Events of
Default.
The failure to make a payment on account of principal
of, premium, if any, or interest on the Securities by reason of
any provision of this Article will not be construed as preventing
the occurrence of an Event of Default.
ARTICLE FOURTEEN
SUBORDINATION OF SECURITIES
SECTION 1401. Securities Subordinated to Senior
Indebtedness. The Company, United and the Trustee each covenants
and agrees and each Holder, by its acceptance of a Security,
likewise covenants and agrees that all Securities shall be issued
subject to the provisions of this Article Fourteen; and each
Person holding any Security, whether upon original issue or upon
transfer, assignment or exchange thereof, accepts and agrees that
Senior Subordinated Obligations shall, to the extent and in the
manner set forth in this Article Fourteen, be subordinated in
right of payment to the prior payment in full, in cash or cash
equivalents, of all amounts payable under Senior Indebtedness,
including, without limitation, the Company's obligations under the
Senior Credit Facilities (including any interest accruing
subsequent to an event specified in Sections 501(7) and 501(8) of
this Indenture, whether or not such interest is an allowed claim
enforceable against the debtor under the United States Bankruptcy
Code).
SECTION 1402. No Payment on Securities in Certain
Circumstances. (a) During the continuance of any default in the
payment of any Senior Indebtedness beyond any applicable grace
period, no payment (other than payments previously made pursuant
to Article Twelve) or distribution of any assets of the Company of
any kind or character shall be made by the Company on account of
Senior Subordinated Obligations (other than such payments or
distributions as may be agreed to by the lenders under the Senior
Bank Facility in accordance with the terms of the Senior Bank
Facility) unless and until such default shall have been cured or
waived or shall have ceased to exist or the Senior Indebtedness
with respect to which such payment default shall have occurred
shall have been discharged or paid in full in cash or in any other
form acceptable to the holders of such Senior Indebtedness (or
such payment shall be duly provided for to the satisfaction of the
holders of the Senior Indebtedness), after which the Company shall
resume making any and all required payments in respect of Senior
Subordinated Obligations, including any missed payments.
(b) During the continuance of any non-payment event of
default with respect to any Designated Senior Indebtedness (as
such event of default is defined in the instrument creating or
evidencing such Designated Senior Indebtedness) pursuant to which
the maturity thereof may be accelerated (a "Non-payment Default")
and after receipt by the Trustee and the Company from a
representative of the holders of such Designated Senior
Indebtedness of written notice of such event of default, no
payment (other than payments previously made pursuant to Article
Twelve) or distribution of any assets of the Company of any kind
or character (other than such payments or distributions as may be
agreed to by the holders of such Designated Senior Indebtedness in
accordance with the terms of the agreement governing such
Designated Senior Indebtedness) shall be made by the Company on
account of Senior Subordinated Obligations for the period
specified below (the "Payment Blockage Period").
The Payment Blockage Period shall commence upon the
receipt of notice of the Non-payment Default by the Trustee from a
Representative of the holder of any Designated Senior Indebtedness
and shall end on the earliest of (i) the first date on which 179
days shall have elapsed since the receipt of such written notice,
(ii) the date on which such Non-payment Default is cured, waived
or ceases to exist or on which such Designated Senior Indebtedness
is discharged or paid in full in cash or in any other manner
acceptable to the holders of Designated Senior Indebtedness (as
determined in accordance with the terms of the agreement governing
such Designated Senior Indebtedness) (or the date on which payment
shall be duly provided for to the satisfaction of the holders of
such Designated Senior Indebtedness) or (iii) the date on which
such Payment Blockage Period shall have been terminated by written
notice to the Company or the Trustee from the Representative of,
or the holders of at least a majority in principal amount of, the
Designated Senior Indebtedness initiating such Payment Blockage
Period, after which, in the case of clause (i), (ii) and (iii),
the Company shall resume making any and all required payments in
respect of Senior Subordinated Obligations, including any missed
payments. In no event will a Payment Blockage Period extend
beyond 179 days from the date of the receipt by the Company or the
Trustee of the notice initiating such Payment Blockage Period
(such 179-day period referred to as the "Initial Period"). Any
number of notices of Non-payment Defaults may be given during the
Initial Period; provided that during any 365 consecutive day
period, only one such period during which payment of principal of,
or interest on, the Notes may not be made may be commenced, and
the duration of such period may not exceed 179 days. No Non
payment Default with respect to Designated Senior Indebtedness
which existed or was continuing on the date of the commencement of
any Payment Blockage Period will be, or can be, made the basis for
the commencement of a second Payment Blockage Period, whether or
not within a period of 365 consecutive days, unless such event of
default has been cured or waived for a period of not less than 90
consecutive days.
(c) In the event that, notwithstanding the foregoing,
any payment shall be received by the Trustee or any Holder when
such payment is prohibited by Section 1402(a) or 1402(b) of this
Indenture, the Trustee shall promptly notify the holders of Senior
Indebtedness of such prohibited payment and such payment shall be
held in trust for the benefit of, and shall be paid over or
delivered to, the holders of Senior Indebtedness or their
respective Representatives, or to the trustee or trustees under
any indenture pursuant to which any of such Senior Indebtedness
may have been issued, as their respective interests may appear,
but only to the extent that, upon notice from the Trustee to the
holders of Senior Indebtedness that such prohibited payment has
been made, the holders of the Senior Indebtedness (or their
Representative or Representatives or a trustee) within 30 days of
receipt of such notice from the Trustee notify the Trustee of the
amounts then due and owing on the Senior Indebtedness, if any, and
only the amounts specified in such notice to the Trustee shall be
paid to the holders of Senior Indebtedness and any excess above
such amounts due and owing on Senior Indebtedness shall be paid to
the Company.
SECTION 1403. Payment Over of Proceeds Upon
Dissolution, Etc. (a) Upon any payment or distribution of assets
or securities of the Company, of any kind or character, whether in
cash, property or securities, upon any dissolution or winding up
or total or partial liquidation or reorganization of the Company,
whether voluntary or involuntary or in bankruptcy, insolvency,
receivership or other proceedings, all amounts due or to become
due upon all Senior Indebtedness (including any interest accruing
subsequent to an event specified in Sections 501(7) and 501(8) of
this Indenture, whether or not such interest is an allowed claim
enforceable against the debtor under the United States Bankruptcy
Code) shall first be paid in full, in cash or cash equivalents,
before the Holders or the Trustee on behalf of the Holders shall
be entitled to receive any payment by the Company on account of
Senior Subordinated Obligations, or any payment to acquire any of
the Securities for cash, property or securities, or any
distribution with respect to the Securities of any cash, property
or securities. Before any payment may be made by the Company of
any Senior Subordinated Obligations upon any such dissolution,
winding up, liquidation or reorganization, any payment or
distribution of assets or securities of the Company of any kind or
character, whether in cash, property or securities, to which the
Holders or the Trustee on behalf of the Holders would be entitled,
but for the provisions of this Article Fourteen, shall be made by
the Company or by any receiver, trustee in bankruptcy, liquidating
trustee, agent or other similar Person making such payment or
distribution, or by the Holders or the Trustee if received by them
or it, directly to the holders of Senior Indebtedness (pro rata to
such holders on the basis of the respective amounts of Senior
Indebtedness held by such holders) or their Representatives, or to
any trustee or trustees under any other indenture pursuant to
which any such Senior Indebtedness may have been issued, as their
respective interests appear, to the extent necessary to pay all
such Senior Indebtedness in full, in cash or cash equivalents
after giving effect to any concurrent payment, distribution or
provision therefor to or for the holders of such Senior
Indebtedness.
(b) To the extent any payment of Senior Indebtedness
(whether by the Company, as proceeds of security or enforcement of
any right of setoff or otherwise) is declared to be fraudulent or
preferential, set aside, or required to be paid to any receiver,
trustee in bankruptcy, liquidating trustee, agent or other similar
Person under any bankruptcy, insolvency, receivership, fraudulent
conveyance or similar law, then if such payment is recovered by,
or paid over to, such receiver, trustee in bankruptcy, liquidating
trustee, agent or other similar Person, the Senior Indebtedness or
part thereof originally intended to be satisfied shall be deemed
to be reinstated and outstanding as if such payment had not
occurred. To the extent the obligation to repay any Senior
Indebtedness is declared to be fraudulent, invalid, or otherwise
set aside under any bankruptcy, insolvency, receivership,
fraudulent conveyance or similar law, then the obligation so
declared fraudulent, invalid or otherwise set aside (and all other
amounts that would come due with respect thereto had such
obligation not been so affected) shall be deemed to be reinstated
and outstanding as Senior Indebtedness for all purposes hereof as
if such declaration, invalidity or setting aside had not occurred.
(c) In the event that, notwithstanding the foregoing
provision prohibiting such payment or distribution, any payment or
distribution of assets or securities of the Company of any kind or
character, whether in cash, property or securities, shall be
received by the Trustee or any Holder at a time when such payment
or distribution is prohibited by Section 1403(a) of this Indenture
and before all obligations in respect of Senior Indebtedness are
paid in full, in cash or cash equivalents, such payment or
distribution shall be received and held in trust for the benefit
of, and shall be paid over or delivered to, the holders of Senior
Indebtedness (pro rata to such holders on the basis of the
respective amount of Senior Indebtedness held by such holders) or
their Representatives or to the trustee or trustees under any
other indenture pursuant to which any such Senior Indebtedness may
have been issued, as their respective interests appear, for
application to the payment of Senior Indebtedness remaining unpaid
until all such Senior Indebtedness has been paid in full, in cash
or cash equivalents, after giving effect to any concurrent
payment, distribution or provision therefor to or for the holders
of such Senior Indebtedness.
(d) For purposes of this Section 1403, the words "cash,
property or securities" shall not be deemed to include (so long as
the effect of this clause is not to cause the Securities to be
treated in any case or proceeding or similar event described in
this Section 1403 as part of the same class of claims as the
Senior Indebtedness or any class of claims pari passu with, or
senior to, the Senior Indebtedness for any payment or
distribution), securities of the Company or any other corporation
provided for by a plan of reorganization or readjustment that are
subordinated, at least to the extent that the Securities are
subordinated, to the payment of all Senior Indebtedness then
outstanding; provided that (1) if a new corporation results from
such reorganization or readjustment, such corporation assumes the
Senior Indebtedness and (2) the rights of the holders of the
Senior Indebtedness are not, without the consent of such holders,
altered by such reorganization or readjustment. The consolidation
of the Company with, or the merger of the Company with or into,
another corporation or the liquidation or dissolution of the
Company following the sale, conveyance, transfer, lease or other
disposition of all or substantially all of its property and assets
to another corporation upon the terms and conditions provided in
Article Eight of this Indenture shall not be deemed a dissolution,
winding up, liquidation or reorganization for the purposes of this
Section 1403 if such other corporation shall, as a part of such
consolidation, merger, sale, conveyance, transfer, lease or other
disposition, comply with the conditions stated in
Article Eight of this Indenture.
SECTION 1404. Subrogation. (a) Upon the payment in
full of all Senior Indebtedness in cash or cash equivalents, the
Holders shall be subrogated to the rights of the holders of Senior
Indebtedness to receive payments or distributions of cash,
property or securities of the Company made on such Senior
Indebtedness until the principal of, premium, if any, and interest
on the Securities shall be paid in full; and, for the purposes of
such subrogation, no payments or distributions to the holders of
the Senior Indebtedness of any cash, property or securities to
which the Holders or the Trustee on their behalf would be entitled
except for the provisions of this Article Fourteen, and no payment
pursuant to the provisions of this Article Fourteen to the holders
of Senior Indebtedness by Holders or the Trust on their behalf
shall, as between the Company, their creditors other than holders
of Senior Indebtedness, and the
Holders, be deemed to be a payment by the Company to or on account
of the Senior Indebtedness. It is understood that the provisions
of this Article Fourteen are intended solely for the purpose of
defining the relative rights of the Holders, on the one hand, and
the holders of the Senior Indebtedness, on the other hand.
(b) If any payment or distribution to which the Holders
would otherwise have been entitled but for the provisions of this
Article Fourteen shall have been applied, pursuant to the
provisions of this Article Fourteen, to the payment of all amounts
payable under Senior Indebtedness, then, and in such case, the
Holders shall be entitled to receive from the holders of such
Senior Indebtedness any payments or distributions received by such
holders of Senior Indebtedness in excess of the amount required to
make payment in full, in cash or cash equivalents, of such Senior
Indebtedness of such holders.
SECTION 1405. Obligations of Company Unconditional. (a)
Nothing contained in this Article Fourteen or elsewhere in this
Indenture or in the Securities is intended to or shall impair, as
among the Company and the Holders, the obligation of the Company,
which is absolute and unconditional, to pay to the Holders the
principal of, premium, if any, and interest on the Securities as
and when the same shall become due and payable in accordance with
their terms, or is intended to or shall affect the relative rights
of the Holders and creditors of the Company other than the holders
of the Senior Indebtedness, nor shall anything herein or therein
prevent the Holders or the Trustee on their behalf from exercising
all remedies otherwise permitted by applicable law upon default
under this Indenture, subject to the rights, if any, under this
Article Fourteen of the holders of the Senior Indebtedness.
(b) Without limiting the generality of the foregoing,
nothing contained in this Article Fourteen will restrict the right
of the Trustee or the Holders to take any action to declare the
Securities to be due and payable prior to their Stated Maturity
pursuant to Section 502 of this Indenture or to pursue any rights
or remedies hereunder; provided, however, that all Senior
Indebtedness then due and payable or thereafter declared to be due
and payable shall first be paid in full, in cash or cash
equivalents, before the Holders or the Trustee are entitled to
receive any direct or indirect payment from the Company of Senior
Subordinated Obligations.
SECTION 1406. Notice to Trustee. The Company shall
give prompt written notice to the Trustee of any fact known to the
Company that would prohibit the making of any payment to or by the
Trustee in respect of the Securities pursuant to the provisions of
this Article Fourteen. The Trustee shall not be charged with
knowledge of the existence of any default or event of default with
respect to any Senior Indebtedness or of any other facts that
would prohibit the making of any payment to or by the Trustee
unless and until the Trustee shall have received notice in writing
at its Corporate Trust Office to that effect signed by an Officer
of the Company, or by a holder of Senior Indebtedness, holder of
Senior Notes, or trustee or agent therefor; and prior to the
receipt of any such written notice, the Trustee shall, subject to
Article Six, be entitled to assume that no such facts exist;
provided that, if the Trustee shall not have received the notice
provided for in this Section 1406 at least two Business Days prior
to the date upon which, by the terms of this Indenture, any monies
shall become payable for any purpose (including, without
limitation, the payment of the principal of, premium, if any, or
interest on any Security),
then, notwithstanding anything herein to the contrary, the Trustee
shall have full power and authority to receive any monies from the
Company and to apply the same to the purpose for which they were
received, and shall not be affected by any notice to the contrary
that may be received by it on or after such prior date except for
an acceleration of the Securities prior to such application.
Nothing contained in this Section 1406 shall limit the right of
the holders of Senior Indebtedness to recover payments as
contemplated by this Article Fourteen. The foregoing shall not
apply if the Paying Agent is the Company. The Trustee shall be
entitled to rely on the delivery to it of a written notice by a
Person representing himself or itself to be a holder of any Senior
Indebtedness (or a trustee on behalf of, or other Representative
of, such holder) to establish that such notice has been given by a
holder of such Senior Indebtedness or a trustee or Representative
on behalf of any such holder.
(b) In the event that the Trustee determines in good
faith that any evidence is required with respect to the right of
any Person as a holder of Senior Indebtedness to participate in
any payment or distribution pursuant to this Article Fourteen, the
Trustee may request such Person to furnish evidence to the
reasonable satisfaction of the Trustee as to the amount of Senior
Indebtedness held by such Person, the extent to which such Person
is entitled to participate in such payment or distribution and any
other facts pertinent to the rights of such Person under this
Article Fourteen and, if such evidence is not furnished to the
Trustee, the Trustee may defer any payment to such Person pending
judicial determination as to the right of such Person to receive
such payment.
SECTION 1407. Reliance on Judicial Order or
Certificate of Liquidating Agent. Upon any payment or
distribution of assets or securities referred to in this Article
Fourteen, the Trustee and the Holders shall be entitled to rely
upon any order or decree made by any court of competent
jurisdiction in which bankruptcy, dissolution, winding up,
liquidation or reorganization proceedings are pending, or upon a
certificate of the receiver, trustee in bankruptcy, liquidating
trustee, agent or other similar Person making such payment or
distribution, delivered to the Trustee or to the Holders for the
purpose of ascertaining the persons entitled to participate in
such distribution, the holders of the Senior Indebtedness and
other Indebtedness of the Company, the amount hereof or payable
thereon, the amount or amounts paid or distributed thereon and all
other facts pertinent thereto or to this Article Fourteen.
SECTION 1408. Trustee's Relation to Senior
Indebtedness. (a) The Trustee and any Paying Agent shall be
entitled to all the rights set forth in this Article Fourteen with
respect to any Senior Indebtedness that may at any time be held by
it in its individual or any other capacity to the same extent as
any other holder of Senior Indebtedness and nothing in this
Indenture shall deprive the Trustee or any Paying Agent of any of
its rights as such holder.
(b) With respect to the holders of Senior Indebtedness,
the Trustee undertakes to perform or to observe only such of its
covenants and obligations as are specifically set forth in this
Article Fourteen, and no implied covenants or obligations with
respect to the holders of Senior Indebtedness shall be read into
this Indenture against the Trustee. The Trustee shall not be
deemed to owe any fiduciary duty to the holders of Senior
Indebtedness (except as provided in Sections 1402(c) and 1403(c)
of this Indenture) and shall not be liable to any such holders if
the Trustee shall in good faith mistakenly
pay over or distribute to Holders of Securities or to the Company
or to any other person cash, property or securities to which any
holders of Senior Indebtedness shall be entitled by virtue of this
Article Fourteen or otherwise.
SECTION 1409. Subordination Rights Not Impaired by Acts
or Omissions of the Company or Holders of Senior Indebtedness. No
right of any present or future holders of any Senior Indebtedness
to enforce subordination as provided in this Article Fourteen will
at any time in any way be prejudiced or impaired by any act or
failure to act on the part of the Company or by any act or failure
to act, in good faith, by any such holder, or by any noncompliance
by the Company with the terms of this Indenture, regardless of any
knowledge thereof that any such holder may have or otherwise be
charged with. The provisions of this Article Fourteen are
intended to be for the benefit of, and shall be enforceable
directly by, the holders of Senior Indebtedness.
SECTION 1410. Holders Authorize Trustee to Effectuate
Subordination of Securities. Each Holder by his acceptance of any
Securities authorizes and expressly directs the Trustee on his
behalf to take such action as may be necessary or appropriate to
effectuate the subordination provided in this Article Fourteen,
and appoints the Trustee his attorney-in-fact for such purposes,
including, in the event of any dissolution, winding up,
liquidation or reorganization of the Company (whether in
bankruptcy, insolvency, receivership, reorganization or similar
proceedings or upon an assignment for the benefit of creditors or
otherwise) tending towards liquidation of the property and assets
of the Company, the filing of a claim for the unpaid balance of
its Securities in the form required in those proceedings. If the
Trustee does not file a proper claim or proof of indebtedness in
the form required in such proceeding at least 5 days before the
expiration of the time to file such claim or claims, each holder
of Senior Indebtedness is hereby authorized to file an appropriate
claim for and on behalf of the Holders.
SECTION 1411. Not to Prevent Events of Default. The
failure to make a payment on account of principal of, premium, if
any, or interest on the Securities by reason of any provision of
this Article Fourteen will not be construed as preventing the
occurrence of an Event of Default.
SECTION 1412. Trustee's Compensation Not Prejudiced.
Nothing in this Article Fourteen will apply to amounts due to the
Trustee pursuant to other sections of this Indenture.
SECTION 1413. No Waiver of Subordination Provisions.
Without in any way limiting the generality of Section 1409 of this
Indenture, the holders of Senior Indebtedness may, at any time and
from time to time, without the consent of or notice to the Trustee
or the Holders, without incurring responsibility to the Holders
and without impairing or releasing the subordination provided in
this Article Fourteen or the obligations hereunder of the Holders
to the holders of Senior Indebtedness, do any one or more of the
following: (a) change the manner, place or terms of payment or
extend the time of payment of, or renew or alter, Senior
Indebtedness or any instrument evidencing the same or any
agreement under which Senior Indebtedness is outstanding or
secured; (b) sell, exchange, release or otherwise deal with any
property pledged, mortgaged or otherwise securing Senior
Indebtedness; (c) release any Person liable in any manner for the
collection of Senior Indebtedness; and (d) exercise or refrain
from exercising any rights against the Company and any other
Person.
SECTION 1414. Payments May Be Paid Prior to
Dissolution. Nothing contained in this Article Fourteen or
elsewhere in this Indenture shall prevent (i) the Company, except
under the conditions described in Section 1402 or 1403 of this
Indenture, from making payments of principal of, premium, if any,
and interest on the Securities, or from depositing with the
Trustee any money for such payments, or (ii) the application by
the Trustee of any money deposited with it for the purpose of
making such payments of principal of, premium, if any, and
interest on the Securities to the holders entitled thereto unless,
at least two Business Days prior to the date upon which such
payment becomes due and payable, the Trustee shall have received
the written notice provided for in Section 1402(b) of this
Indenture (or there shall have been an acceleration of the
Securities prior to such application) or in Section 1406 of this
Indenture. The Company shall give prompt written notice to the
Trustee of any dissolution, winding up, liquidation or
reorganization of the Company.
ARTICLE FIFTEEN
SUBORDINATION OF GUARANTEE
SECTION 1501. Guarantee Subordinated to Senior
Guarantor Indebtedness. The Company, United and the Trustee each
covenants and agrees and each Holder, by its acceptance of a
Security, likewise covenants and agrees that United's Guarantee
shall be issued subject to the provisions of this Article Fifteen;
and each Person holding any Security, whether upon original issue
or upon transfer, assignment or exchange thereof, accepts and
agrees that Senior Subordinated Guarantor Obligations shall, to
the extent and in the manner set forth in this Article Fifteen, be
subordinated in right of payment to the prior payment in full, in
cash or cash equivalents, of all amounts payable under Senior
Guarantor Indebtedness, including, without limitation, United's
obligations under the Senior Credit Facilities (including any
interest accruing subsequent to an event specified in Sections
501(7) and 501(8) of this Indenture, whether or not such interest
is an allowed claim enforceable against the debtor under the
United States Bankruptcy Code).
SECTION 1502. No Payment on Guarantee of Securities in
Certain Circumstances. (a) During the continuance of any default
in the payment of any Senior Guarantor Indebtedness beyond any
applicable grace period, no payment (other than payments
previously made pursuant to Article Twelve) or distribution of any
assets of United of any kind or character shall be made by United
on account of Senior Subordinated Guarantor Obligations (other
than such payments or distributions as may be agreed to by the
lenders under the Senior Bank Facility in accordance with the
terms of the Senior Bank Facility) unless and until such default
shall have been cured or waived or shall have ceased to exist or
the Senior Guarantor Indebtedness with respect to which such
payment default shall have occurred shall have been discharged or
paid in full in cash or in any other form acceptable to the
holders of such Senior Guarantor Indebtedness (or such payment
shall be duly provided for to the satisfaction of the holders of
the Senior Guarantor Indebtedness), after which United shall
resume making any and all required payments in respect of Senior
Subordinated Guarantor Obligations, including any missed payments.
(b) During the continuance of any non-payment event of
default with respect to any Designated Senior Guarantor
Indebtedness (as such event of default is defined in the
instrument creating or evidencing such Designated Senior Guarantor
Indebtedness) pursuant to which the maturity thereof may be
accelerated (a "Non-payment Default") and after receipt by the
Trustee and United from a representative of the holders of such
Designated Senior Guarantor Indebtedness of written notice of such
event of default, no payment (other than payments previously made
pursuant to Article Twelve) or distribution of any assets of
United of any kind or character (other than such payments or
distributions as may be agreed to by the holders of such
Designated Senior Guarantor Indebtedness in accordance with the
terms of the agreement governing such Designated Senior Guarantor
Indebtedness) shall be made by United on account of Senior
Subordinated Guarantor Obligations for the period specified below
(the "Payment Blockage Period").
The Payment Blockage Period shall commence upon the
receipt of notice of the Non-payment Default by the Trustee from a
Representative of the holder of any Designated Senior Guarantor
Indebtedness and shall end on the earliest of (i) the first date
on which 179 days shall have elapsed since the receipt of such
written notice, (ii) the date on which such Non-payment Default is
cured, waived or ceases to exist or on which such Designated
Senior Guarantor Indebtedness is discharged or paid in full in
cash or in any other manner acceptable to the holders of
Designated Senior Guarantor Indebtedness (as determined in
accordance with the terms of the agreement governing such
Designated Senior Guarantor Indebtedness) (or the date on which
payment shall be duly provided for to the satisfaction of the
holders of such Designated Senior Guarantor Indebtedness) or (iii)
the date on which such Payment Blockage Period shall have been
terminated by written notice to United or the Trustee from the
Representative of, or the holders of at least a majority in
principal amount of, the Designated Senior Guarantor Indebtedness
initiating such Payment Blockage Period, after which, in the case
of clause (i), (ii) and (iii), United shall resume making any and
all required payments in respect of Senior Subordinated Guarantor
Obligations, including any missed payments. In no event will a
Payment Blockage Period extend beyond 179 days from the date of
the receipt by United or the Trustee of the notice initiating such
Payment Blockage Period (such 179-day period referred to as the
"Initial Period"). Any number of notices of Non-payment Defaults
may be given during the Initial Period; provided that during any
365 consecutive day period, only one such period during which
payment of principal of, or interest on, the Notes may not be made
may be commenced, and the duration of such period may not exceed
179 days. No Non-payment Default with respect to Designated
Senior Guarantor Indebtedness which existed or was continuing on
the date of the commencement of any Payment Blockage Period will
be, or can be, made the basis for the commencement of a second
Payment Blockage Period, whether or not within a period of 365
consecutive days, unless such event of default has been cured or
waived for a period of not less than 90 consecutive days.
(c) In the event that, notwithstanding the foregoing,
any payment shall be received by the Trustee or any Holder when
such payment is prohibited by Section 1502(a) or 1502(b) of this
Indenture, the Trustee shall promptly notify the holders of Senior
Guarantor Indebtedness of such prohibited payment and such payment
shall be held in trust for the benefit of, and shall be paid over
or delivered to, the holders of Senior Guarantor Indebtedness or
their respective Representatives, or to the trustee or trustees
under any indenture pursuant to which any of such Senior Guarantor
Indebtedness may have been issued, as their respective interests
may appear, but only to the extent that, upon notice from the
Trustee to the holders of Senior Guarantor
Indebtedness that such prohibited payment has been made, the
holders of the Senior Guarantor Indebtedness (or their
Representative or Representatives or a trustee) within 30 days of
receipt of such notice from the Trustee notify the Trustee of the
amounts then due and owing on the Senior Guarantor Indebtedness,
if any, and only the amounts specified in such notice to the
Trustee shall be paid to the holders of Senior Guarantor
Indebtedness and any excess above such amounts due and owing on
Senior Guarantor Indebtedness shall be paid to United.
SECTION 1503. Payment Over of Proceeds Upon
Dissolution, Etc. (a) Upon any payment or distribution of assets
or securities of United, of any kind or character, whether in
cash, property or securities, upon any dissolution or winding up
or total or partial liquidation or reorganization of United,
whether voluntary or involuntary or in bankruptcy, insolvency,
receivership or other proceedings, all amounts due or to become
due upon all Senior Guarantor Indebtedness (including any interest
accruing subsequent to an event specified in Sections 501(7) and
501(8) of this Indenture, whether or not such interest is an
allowed claim enforceable against the debtor under the United
States Bankruptcy Code) shall first be paid in full, in cash or
cash equivalents, before the Holders or the Trustee on behalf of
the Holders shall be entitled to receive any payment by United on
account of Senior Subordinated Guarantor Obligations, or any
payment to acquire any of the Securities for cash, property or
securities, or any distribution with respect to the Securities of
any cash, property or securities. Before any payment may be made
by United of any Senior Subordinated Guarantor Obligations upon
any such dissolution, winding up, liquidation or reorganization,
any payment or distribution of assets or securities of United of
any kind or character, whether in cash, property or securities, to
which the Holders or the Trustee on behalf of the Holders would be
entitled, but for the provisions of this Article Fifteen, shall be
made by United or by any receiver, trustee in bankruptcy,
liquidating trustee, agent or other similar Person making such
payment or distribution, or by the Holders or the Trustee if
received by them or it, directly to the holders of Senior
Guarantor Indebtedness (pro rata to such holders on the basis of
the respective amounts of Senior Guarantor Indebtedness held by
such holders) or their Representatives, or to any trustee or
trustees under any other indenture pursuant to which any such
Senior Guarantor Indebtedness may have been issued, as their
respective interests appear, to the extent necessary to pay all
such Senior Guarantor Indebtedness in full, in cash or cash
equivalents after giving effect to any concurrent payment,
distribution or provision therefor to or for the holders of such
Senior Guarantor Indebtedness.
(b) To the extent any payment of Senior Guarantor
Indebtedness (whether by United, as proceeds of security or
enforcement of any right of setoff or otherwise) is declared to be
fraudulent or preferential, set aside, or required to be paid to
any receiver, trustee in bankruptcy, liquidating trustee, agent or
other similar Person under any bankruptcy, insolvency,
receivership, fraudulent conveyance or similar law, then if such
payment is recovered by, or paid over to, such receiver, trustee
in bankruptcy, liquidating trustee, agent or other similar Person,
the Senior Guarantor Indebtedness or part thereof originally
intended to be satisfied shall be deemed to be reinstated and
outstanding as if such payment had not occurred. To the extent the
obligation to repay any Senior Guarantor Indebtedness is declared
to be fraudulent, invalid, or otherwise set aside under any
bankruptcy, insolvency, receivership, fraudulent conveyance or
similar law, then the obligation so
declared fraudulent, invalid or otherwise set aside (and all other
amounts that would come due with respect thereto had such
obligation not been so affected) shall be deemed to be reinstated
and outstanding as Senior Guarantor Indebtedness for all purposes
hereof as if such declaration, invalidity or setting aside had not
occurred.
(c) In the event that, notwithstanding the foregoing
provision prohibiting such payment or distribution, any payment or
distribution of assets or securities of United of any kind or
character, whether in cash, property or securities, shall be
received by the Trustee or any Holder at a time when such payment
or distribution is prohibited by Section 1503(a) of this Indenture
and before all obligations in respect of Senior Guarantor
Indebtedness are paid in full, in cash or cash equivalents, such
payment or distribution shall be received and held in trust for
the benefit of, and shall be paid over or delivered to, the
holders of Senior Guarantor Indebtedness (pro rata to such holders
on the basis of the respective amount of Senior Guarantor
Indebtedness held by such holders) or their Representatives or to
the trustee or trustees under any other indenture pursuant to
which any such Senior Guarantor Indebtedness may have been issued,
as their respective interests appear, for application to the
payment of Senior Guarantor Indebtedness remaining unpaid until
all such Senior Guarantor Indebtedness has been paid in full, in
cash or cash equivalents, after giving effect to any concurrent
payment, distribution or provision therefor to or for the holders
of such Senior Guarantor Indebtedness.
(d) For purposes of this Section 1503, the words "cash,
property or securities" shall not be deemed to include (so long as
the effect of this clause is not to cause the Securities to be
treated in any case or proceeding or similar event described in
this Section 1503 as part of the same class of claims as the
Senior Guarantor Indebtedness or any class of claims pari passu
with, or senior to, the Senior Guarantor Indebtedness for any
payment or distribution), securities of United or any other
corporation provided for by a plan of reorganization or
readjustment that are subordinated, at least to the extent that
the Securities are subordinated, to the payment of all Senior
Guarantor Indebtedness then outstanding; provided that (1) if a
new corporation results from such reorganization or readjustment,
such corporation assumes the Senior Guarantor Indebtedness and (2)
the rights of the holders of the Senior Guarantor Indebtedness are
not, without the consent of such holders, altered by such
reorganization or readjustment. The consolidation of United with,
or the merger of United with or into, another corporation or the
liquidation or dissolution of United following the sale,
conveyance, transfer, lease or other disposition of all or
substantially all of its property and assets to another
corporation upon the terms and conditions provided in Article
Eight of this Indenture shall not be deemed a dissolution, winding
up, liquidation or reorganization for the purposes of this Section
1503 if such other corporation shall, as a part of such
consolidation, merger, sale, conveyance, transfer, lease or other
disposition, comply with the conditions stated in Article Eight of
this Indenture.
SECTION 1504. Subrogation. (a) Upon the payment in
full of all Senior Guarantor Indebtedness in cash or cash
equivalents, the Holders shall be subrogated to the rights of the
holders of Senior Guarantor Indebtedness to receive payments or
distributions of cash, property or securities of United made on
such Senior Guarantor Indebtedness until the principal of,
premium, if any, and interest on the Securities shall be paid in
full; and, for the purposes of such subrogation, no payments or
distributions to the holders of the Senior Guarantor Indebtedness
of any cash, property or securities to which the Holders or the
Trustee on their behalf would be entitled except for the
provisions of this Article Fifteen, and no payment pursuant to the
provisions of this Article Fifteen to the holders of Senior
Guarantor Indebtedness by Holders or the Trust on their behalf
shall, as between United, their creditors other than holders of
Senior Guarantor Indebtedness, and the Holders, be deemed to be a
payment by United to or on account of the Senior Guarantor
Indebtedness. It is understood that the provisions of this
Article Fifteen are intended solely for the purpose of defining
the relative rights of the Holders, on the one hand, and the
holders of the Senior Guarantor Indebtedness, on the other hand.
(b) If any payment or distribution to which the Holders
would otherwise have been entitled but for the provisions of this
Article Fifteen shall have been applied, pursuant to the
provisions of this Article Fifteen, to the payment of all amounts
payable under Senior Guarantor Indebtedness, then, and in such
case, the Holders shall be entitled to receive from the holders of
such Senior Guarantor Indebtedness any payments or distributions
received by such holders of Senior Guarantor Indebtedness in
excess of the amount required to make payment in full, in cash or
cash equivalents, of such Senior Guarantor Indebtedness of such
holders.
SECTION 1505. Obligations of Company Unconditional. (a)
Nothing contained in this Article Fifteen or elsewhere in this
Indenture or in the Securities is intended to or shall impair, as
among United and the Holders, the obligation of United, which is
absolute and unconditional, to pay to the Holders the principal
of, premium, if any, and interest on the Securities as and when
the same shall become due and payable in accordance with their
terms, or is intended to or shall affect the relative rights of
the Holders and creditors of United other than the holders of the
Senior Guarantor Indebtedness, nor shall anything herein or
therein prevent the Holders or the Trustee on their behalf from
exercising all remedies otherwise permitted by applicable law upon
default under this Indenture, subject to the rights, if any, under
this Article Fifteen of the holders of the Senior Guarantor
Indebtedness.
(b) Without limiting the generality of the foregoing,
nothing contained in this Article Fifteen will restrict the right
of the Trustee or the Holders to take any action to declare the
Securities to be due and payable prior to their Stated Maturity
pursuant to Section 502 of this Indenture or to pursue any rights
or remedies hereunder; provided, however, that all Senior
Guarantor Indebtedness then due and payable or thereafter declared
to be due and payable shall first be paid in full, in cash or cash
equivalents, before the Holders or the Trustee are entitled to
receive any direct or indirect payment from United of Senior
Subordinated Guarantor Obligations.
SECTION 1506. Notice to Trustee. United shall give
prompt written notice to the Trustee of any fact known to United
that would prohibit the making of any payment to or by the Trustee
in respect of the Securities pursuant to the provisions of this
Article Fifteen. The Trustee shall not be charged with knowledge
of the existence of any default or event of default with respect
to any Senior Guarantor Indebtedness or of any other facts that
would prohibit the making of any payment to or by the Trustee
unless and until the Trustee shall have received notice in writing
at its Corporate Trust Office to that effect signed by an Officer
of United, or by a holder of Senior Guarantor
Indebtedness, holder of Senior Notes, or trustee or agent
therefor; and prior to the receipt of any such written notice, the
Trustee shall, subject to Article Six, be entitled to assume that
no such facts exist; provided that, if the Trustee shall not have
received the notice provided for in this Section 1506 at least two
Business Days prior to the date upon which, by the terms of this
Indenture, any monies shall become payable for any purpose
(including, without limitation, the payment of the principal of,
premium, if any, or interest on any Security), then,
notwithstanding anything herein to the contrary, the Trustee shall
have full power and authority to receive any monies from United
and to apply the same to the purpose for which they were received,
and shall not be affected by any notice to the contrary that may
be received by it on or after such prior date except for an
acceleration of the Securities prior to such application. Nothing
contained in this Section 1506 shall limit the right of the
holders of Senior Guarantor Indebtedness to recover payments as
contemplated by this Article Fifteen. The foregoing shall not
apply if the Paying Agent is United. The Trustee shall be
entitled to rely on the delivery to it of a written notice by a
Person representing himself or itself to be a holder of any Senior
Guarantor Indebtedness (or a trustee on behalf of, or other
Representative of, such holder) to establish that such notice has
been given by a holder of such Senior Guarantor Indebtedness or a
trustee or Representative on behalf of any such holder.
(b) In the event that the Trustee determines in good
faith that any evidence is required with respect to the right of
any Person as a holder of Senior Guarantor Indebtedness to
participate in any payment or distribution pursuant to this
Article Fifteen, the Trustee may request such Person to furnish
evidence to the reasonable satisfaction of the Trustee as to the
amount of Senior Guarantor Indebtedness held by such Person, the
extent to which such Person is entitled to participate in such
payment or distribution and any other facts pertinent to the
rights of such Person under this Article Fifteen and, if such
evidence is not furnished to the Trustee, the Trustee may defer
any payment to such Person pending judicial determination as to
the right of such Person to receive such payment.
SECTION 1507. Reliance on Judicial Order or
Certificate of Liquidating Agent. Upon any payment or
distribution of assets or securities referred to in this Article
Fifteen, the Trustee and the Holders shall be entitled to rely
upon any order or decree made by any court of competent
jurisdiction in which bankruptcy, dissolution, winding up,
liquidation or reorganization proceedings are pending, or upon a
certificate of the receiver, trustee in bankruptcy, liquidating
trustee, agent or other similar Person making such payment or
distribution, delivered to the Trustee or to the Holders for the
purpose of ascertaining the persons entitled to participate in
such distribution, the holders of the Senior Guarantor
Indebtedness and other Indebtedness of United, the amount hereof
or payable thereon, the amount or amounts paid or distributed
thereon and all other facts pertinent thereto or to this Article
Fifteen.
SECTION 1508. Trustee's Relation to Senior Guarantor
Indebtedness. (a) The Trustee and any Paying Agent shall be
entitled to all the rights set forth in this Article Fifteen with
respect to any Senior Guarantor Indebtedness that may at any time
be held by it in its individual or any other capacity to the same
extent as any other holder of Senior Guarantor Indebtedness and
nothing in this Indenture shall deprive the Trustee or any Paying
Agent of any of its rights as such holder.
(b) With respect to the holders of Senior Guarantor
Indebtedness, the Trustee undertakes to perform or to observe only
such of its covenants and obligations as are specifically set
forth in this Article Fifteen, and no implied covenants or
obligations with respect to the holders of Senior Guarantor
Indebtedness shall be read into this Indenture against the
Trustee. The Trustee shall not be deemed to owe any fiduciary
duty to the holders of Senior Guarantor Indebtedness (except as
provided in Sections 1502(c) and 1503(c) of this Indenture) and
shall not be liable to any such holders if the Trustee shall in
good faith mistakenly pay over or distribute to Holders of
Securities or to United or to any other person cash, property or
securities to which any holders of Senior Guarantor Indebtedness
shall be entitled by virtue of this Article Fifteen or otherwise.
SECTION 1509. Subordination Rights Not Impaired by Acts
or Omissions of United or Holders of Senior Guarantor
Indebtedness. No right of any present of future holders of any
Senior Guarantor Indebtedness to enforce subordination as provided
in this Article Fifteen will at any time in any way be prejudiced
or impaired by any act or failure to act on the part of United or
by any act of failure to act, in good faith, by any such holder,
or by any noncompliance by United with the terms of this
Indenture, regardless of any knowledge thereof that any such
holder may have or otherwise be charged with. The provisions of
this Article Fifteen are intended to be for the benefit of, and
shall be enforceable directly by, the holders of Senior Guarantor
Indebtedness.
SECTION 1510. Holders Authorize Trustee to Effectuate
Subordination of Guarantee of Securities. Each Holder by his
acceptance of any Securities authorizes and expressly directs the
Trustee on his behalf to take such action as may be necessary or
appropriate to effectuate the subordination provided in this
Article Fifteen, and appoints the Trustee his attorney-in-fact for
such purposes, including, in the event of any dissolution, winding
up, liquidation or reorganization of United (whether in
bankruptcy, insolvency, receivership, reorganization or similar
proceedings or upon an assignment for the benefit of creditors or
otherwise) tending towards liquidation of the property and assets
of United, the filing of a claim for the unpaid balance of its
Securities in the form required in those proceedings. If the
Trustee does not file a proper claim or proof of indebtedness in
the form required in such proceeding at least 5 days before the
expiration of the time to file such claim or claims, each holder
of Senior Guarantor Indebtedness is hereby authorized to file an
appropriate claim for and on behalf of the Holders.
SECTION 1511. Not to Prevent Events of Default. The
failure to make a payment on account of principal of, premium, if
any, or interest on the Securities by reason of any provision of
this Article Fifteen will not be construed as preventing the
occurrence of an Event of Default.
SECTION 1512. Trustee's Compensation Not Prejudiced.
Nothing in this Article Fifteen will apply to amounts due to the
Trustee pursuant to other sections of this Indenture.
SECTION 1513. No Waiver of Subordination Provisions.
Without in any way limiting the generality of Section 1509 of this
Indenture, the holders of Senior Guarantor Indebtedness may, at
any time and from time to time, without the consent of or notice
to the Trustee or the Holders, without incurring responsibility to
the Holders and without impairing or releasing the subordination
provided in this Article Fifteen or the
obligations hereunder of the Holders to the holders of Senior
Guarantor Indebtedness, do any one or more of the following: (a)
change the manner, place or terms of payment or extend the time of
payment of, or renew or alter, Senior Guarantor Indebtedness or
any instrument evidencing the same or any agreement under which
Senior Guarantor Indebtedness is outstanding or secured; (b) sell,
exchange, release or otherwise deal with any property pledged,
mortgaged or otherwise securing Senior Guarantor Indebtedness; (c)
release any Person liable in any manner for the collection of
Senior Guarantor Indebtedness; and (d) exercise or refrain from
exercising any rights against United and any other Person.
SECTION 1514. Payments May Be Paid Prior to
Dissolution. Nothing contained in this Article Fifteen or
elsewhere in this Indenture shall prevent (i) United, except under
the conditions described in Section 1502 or 1503 of this
Indenture, from making payments of principal of, premium, if any,
and interest on the Securities, or from depositing with the
Trustee any money for such payments, or (ii) the application by
the Trustee of any money deposited with it for the purpose of
making such payments of principal of, premium, if any, and
interest on the Securities pursuant to United's Guarantee thereof
to the holders entitled thereto unless, at least two Business Days
prior to the date upon which such payment becomes due and payable,
the Trustee shall have received the written notice provided for in
Section 1502(b) of this Indenture (or there shall have been an
acceleration of the Securities prior to such application) or in
Section 1506 of this Indenture. United shall give prompt written
notice to the Trustee of any dissolution, winding up, liquidation
or reorganization of United.
IN WITNESS WHEREOF, the parties hereto have caused this
Indenture to be duly executed, and their respective corporate
seals to be hereunto affixed and attested, all as of the day and
year first above written.
UNITED STATIONERS SUPPLY CO.,
as Issuer
By
Title:
Attest:
Title:
UNITED STATIONERS INC.,
as Guarantor
By
Title:
Attest:
Title:
THE BANK OF NEW YORK,
as Trustee
By
Title:
Attest:
Title:
EXECUTION COPY
UNITED STATIONERS SUPPLY CO.,
as Issuer UNITED
STATIONERS INC.,
as Guarantor
AND
THE BANK OF NEW YORK,
as Trustee
____________________
Indenture
Dated as of May 3, 1995
_____________________
$150,000,000
12_% Senior Subordinated Notes
due 2005
UNITED STATIONERS SUPPLY CO.
Reconciliation and tie between Trust Indenture Act
of 1939 and Indenture, dated as of May 3, 1995
Trust Indenture
Act Section Indenture
Section
310(a)(1) 607
(a)(2) 607
(b) 608
312(c) 701
314(a)(4) 1008(a)
(c)(1) 102
(c)(2) 102
(e) 102
315(b) 601
316(a)(last
sentence) 101
("Outstanding")
(a)(1)(A) 502, 512
(a)(1)(B) 513
(b) 508
(c) 104(d)
317(a)(1) 503
(a)(2) 504
(b) 1003
318(a) 111
Table of Contents
Page
PARTIES 1
RECITALS OF THE COMPANY 1
The above two items were not marked as part of the Table of
Contents - AND NEITHER ARE THE ANNEXES, ETC. AT THE END
ARTICLE ONE
DEFINITIONS AND OTHER PROVISIONS
OF GENERAL APPLICATION
SECTION 101. Definitions 2
SECTION 102. Compliance Certificates
and Opinions 20
SECTION 103. Form of Documents
Delivered to Trustee 21
SECTION 104. Acts of Holders 21
SECTION 105. Notices, etc., to Trustee
and Company 23
SECTION 106. Notice to Holders; Waiver 23
SECTION 107. Effect of Headings and
Table of Contents 24
SECTION 108. Successors and Assigns 24
SECTION 109. Separability Clause 24
SECTION 110. Benefits of Indenture 24
SECTION 111. Governing Law 24
SECTION 112. Legal Holidays 24
SECTION 113. No Recourse Against Others 25
SECTION 114. Miscellaneous 25
ARTICLE TWO
SECURITY FORMS
SECTION 201. Forms Generally 25
SECTION 202. Restrictive Legends 27
ARTICLE THREE
THE SECURITIES
SECTION 301. Title and Terms 29
SECTION 302. Denominations 30
SECTION 303. Execution, Authentication,
Delivery and Dating 30
SECTION 304. Temporary Securities 31
SECTION 305. Registration, Registration
of Transfer and Exchange 31
SECTION 306. Book-Entry Provisions for
U.S. Global Security 33
SECTION 307. Special Transfer
Provisions 34
SECTION 308. Mutilated, Destroyed, Lost
and Stolen Securities 38
SECTION 309. Payment of Interest;
Interest Rights Preserved 39
SECTION 310. Persons Deemed Owners 40
SECTION 311. Cancellation 40
SECTION 312. Computation of Interest 41
SECTION 313. CUSIP or CINS Numbers 41
ARTICLE FOUR
SATISFACTION AND DISCHARGE
SECTION 401. Satisfaction and Discharge
of Indenture 41
SECTION 402. Application of Trust Money 42
ARTICLE FIVE
REMEDIES
SECTION 501. Events of Default 42
SECTION 502. Acceleration of Maturity;
Rescission and Annulment 44
SECTION 503. Collection of Indebtedness
and Suits for Enforcement by Trustee 46
SECTION 504. Trustee May File Proofs of
Claim 46
SECTION 505. Trustee May Enforce Claims
Without Possession of Securities 47
SECTION 506. Application of Money
Collected 48
SECTION 507. Limitation on Suits 48
SECTION 508. Unconditional Right of
Holders to Receive Principal, Premium
and Interest 49
SECTION 509. Restoration of Rights and
Remedies 49
SECTION 510. Rights and Remedies
Cumulative 49
SECTION 511. Delay or Omission Not
Waiver 50
SECTION 512. Control by Holders 50
SECTION 513. Waiver of Past Defaults 50
SECTION 514. Waiver of Stay or
Extension Laws 51
SECTION 515. Undertaking for Costs 51
ARTICLE SIX
THE TRUSTEE
SECTION 601. Notice of Defaults 51
SECTION 602. Certain Rights of Trustee 52
SECTION 603. Trustee Not Responsible
for Recitals or Issuance of Securities 53
SECTION 604. Trustee May Hold
Securities 54
SECTION 605. Money Held in Trust 54
SECTION 606. Compensation and
Reimbursement 54
SECTION 607. Corporate Trustee
Required; Eligibility 55
SECTION 608. Resignation and Removal;
Appointment of Successor 55
SECTION 609. Acceptance of Appointment
by Successor 57
SECTION 610. Merger, Conversion,
Consolidation or Succession to Business 57
ARTICLE SEVEN
HOLDERS LISTS AND REPORTS BY TRUSTEE
SECTION 701. Disclosure of Names and
Addresses of Holders 58
SECTION 702. Reports by Trustee 58
ARTICLE EIGHT
CONSOLIDATION, MERGER, CONVEYANCE, TRANSFER OR LEASE
SECTION 801. Company and Each Guarantor
May Consolidate, etc., Only on Certain
Terms 58
SECTION 802. Successor Substituted 61
ARTICLE NINE
SUPPLEMENTAL INDENTURES
SECTION 901. Supplemental Indentures
Without Consent of Holders 61
SECTION 902. Supplemental Indentures
with Consent of Holders 62
SECTION 903. Execution of Supplemental
Indentures 63
SECTION 904. Effect of Supplemental
Indentures 63
SECTION 905. Conformity with Trust
Indenture Act 63
SECTION 906. Reference in Securities to
Supplemental Indentures 63
SECTION 907. Notice of Supplemental
Indentures 64
ARTICLE TEN
COVENANTS
SECTION 1001. Payment of Principal,
Premium, if any, and Interest 64
SECTION 1002. Maintenance of Office or
Agency 64
SECTION 1003. Money for Security
Payments to Be Held in Trust 65
SECTION 1004. Corporate Existence 66
SECTION 1005. Payment of Taxes and
Other Claims 66
SECTION 1006. Maintenance of Properties 67
SECTION 1007. Insurance 67
SECTION 1008. Statement by Officers As
to Default 67
SECTION 1009. Provision of Financial
Statements 68
SECTION 1010. Purchase of Securities
upon Change in Control 69
SECTION 1011. Limitation on
Indebtedness 70
SECTION 1012. Limitation on Restricted
Payments 74
SECTION 1013. Limitation on
Transactions with Affiliates 77
SECTION 1014. Limitation on Senior
Subordinated Indebtedness 78
SECTION 1015. Limitation on Liens 78
SECTION 1016. Limitation on Sale of
Assets 79
SECTION 1017. Limitation on Issuances
of Guarantees of Indebtedness 81
SECTION 1018. Limitation on Subsidiary
Capital Stock 82
SECTION 1019. Limitation on Dividends
and Other Payment Restrictions Affecting Restricted
Subsidiaries 83
SECTION 1020. Waiver of Certain
Covenants 83
ARTICLE ELEVEN
REDEMPTION OF SECURITIES
SECTION 1101. Right of Redemption 84
SECTION 1102. Applicability of Article 84
SECTION 1103. Election to Redeem;
Notice to Trustee 85
SECTION 1104. Selection by Trustee of
Securities to Be Redeemed 85
SECTION 1105. Notice of Redemption 85
SECTION 1106. Deposit of Redemption
Price 86
SECTION 1107. Securities Payable on
Redemption Date 86
SECTION 1108. Securities Redeemed in
Part 87
ARTICLE TWELVE
DEFEASANCE AND COVENANT DEFEASANCE
SECTION 1201. Company's Option to
Effect Defeasance or Covenant Defeasance 87
SECTION 1202. Defeasance and Discharge 87
SECTION 1203. Covenant Defeasance. 88
SECTION 1204. Conditions to Defeasance
or Covenant Defeasance. 88
ARTICLE THIRTEEN
GUARANTEE OF SECURITIES
SECTION 1301. Guarantee. 91
SECTION 1302. Obligations Unconditional 92
SECTION 1303. Notice to Trustee 93
SECTION 1304. This Article Not to
Prevent Events of Default 93
ARTICLE FOURTEEN
SUBORDINATION OF SECURITIES
SECTION 1401. Securities Subordinated
to Senior Indebtedness 93
SECTION 1402. No Payment on Securities
in Certain Circumstances 94
SECTION 1403. Payment Over of Proceeds
Upon Dissolution, Etc 95
SECTION 1404. Subrogation 97
SECTION 1405. Obligations of Company
Unconditional 98
SECTION 1406. Notice to Trustee 98
SECTION 1407. Reliance on Judicial
Order or Certificate of Liquidating
Agent 99
SECTION 1408. Trustee's Relation to
Senior Indebtedness 99
SECTION 1409. Subordination Rights Not
Impaired by Acts or Omissions of the Company or
Holders of Senior
Indebtedness 100
SECTION 1410. Holders Authorize Trustee
to Effectuate Subordination of
Securities 100
SECTION 1411. Not to Prevent Events of
Default 100
SECTION 1412. Trustee's Compensation
Not Prejudiced 100
SECTION 1413. No Waiver of
Subordination Provisions 100
SECTION 1414. Payments May Be Paid
Prior to Dissolution 101
ARTICLE FIFTEEN
SUBORDINATION OF GUARANTEE
SECTION 1501. Guarantee Subordinated to
Senior Guarantor Indebtedness 101
SECTION 1502. No Payment on Guarantee
of Securities in Certain Circumstances 102
SECTION 1503. Payment Over of Proceeds
Upon Dissolution, Etc 103
SECTION 1504. Subrogation 105
SECTION 1505. Obligations of Company
Unconditional 106
SECTION 1506. Notice to Trustee 106
SECTION 1507. Reliance on Judicial
Order or Certificate of Liquidating
Agent 107
SECTION 1508. Trustee's Relation to
Senior Guarantor Indebtedness 107
SECTION 1509. Subordination Rights Not
Impaired by Acts or Omissions of United
or Holders of Senior Guarantor
Indebtedness 108
SECTION 1510. Holders Authorize Trustee
to Effectuate Subordination of Guarantee
of Securities 108
SECTION 1511. Not to Prevent Events of
Default 108
SECTION 1512. Trustee's Compensation
Not Prejudiced 109
SECTION 1513. No Waiver of
Subordination Provisions 109
SECTION 1514. Payments May Be Paid
Prior to Dissolution 109
SIGNATORIES AND TESTIMONIUM 108
Exhibit A - Form of Securities, Trustee's Certificate of
Authentication
Exhibit B - Form of Certificate to Be Delivered Upon Termination
of Restricted Period
Exhibit C - Form of Certificate to Be Delivered in Connection with
Transfers to Non-QIB Institutional Accredited
Investors
Exhibit D - Form of Certificate to Be Delivered in Connection with
Transfers Pursuant to Regulation S
Exhibit E - Form of Intercompany Note of the Company
Exhibit F - Form of Intercompany Note of Restricted Subsidiary
Schedule I -Asset Sale Exclusions
Schedule II - Certain Permitted Holders
Exhibit A
[FACE OF SECURITY]
UNITED STATIONERS SUPPLY CO. 12_%
Senior Subordinated Note due 2005
CUSIP
No. $
UNITED STATIONERS SUPPLY CO., an Illinois corporation
(the "Company," which term includes any successor under the
Indenture hereinafter referred to), for value received, promises
to pay to , or its registered assigns, the principal
sum of _____________, on May 1, 2005.
[Initial Interest Rate: 12_% per annum.]*
[Interest Rate: 12_% per annum.]**
Interest Payment Dates:
May 1 and November 1 of each
year commencing November 1,
1995.
Regular Record Dates:
April 15 and October 15 of
each year.
Reference is hereby made to the further provisions of
this Security set forth on the reverse hereof, which further
provisions shall for all purposes have the same effect as if set
forth at this place.
IN WITNESS WHEREOF, the Company has caused this
Security to be signed manually or by facsimile by its duly
authorized officers.
Date: UNITED
STATIONERS SUPPLY CO.
By:
Title:
Attest:
Title:
(Form of Trustee's Certificate of Authentication)
Dated:_____
This is one of the 12_% Senior Subordinated Notes due 2005
described in the within-mentioned Indenture.
THE BANK
OF NEW YORK,
as Trustee
By:
Authorized Signatory
[REVERSE SIDE OF SECURITY]
UNITED STATIONERS SUPPLY CO.
12_% Senior Subordinated Note due 2005
1. Principal and Interest.
The Company will pay the principal of this Security on
May 1, 2005.
The Company promises to pay interest on the principal
amount of this Security on each Interest Payment Date, as set
forth below, at the rate of [12_% per annum (subject to adjustment
as provided below)]* [12_% per annum except that interest accrued
on this Security pursuant to the penultimate paragraph of this
Section 1 for periods prior to the applicable Exchange Date (as
such term is defined in the Registration Rights Agreement referred
to below) will accrue at the rate or rates borne by the Securities
from time to time during such periods].**
Interest will be payable semiannually (to the holders of
record of the Securities at the close of business on the October
15 or April 15 immediately preceding the Interest Payment Date) on
each Interest Payment Date, commencing November 1, 1995.
[The Holder of this Security is entitled to the benefits
of the Registration Rights Agreement, dated as of May 3, 1995,
among United Stationers Inc. ("United"), the Company and the
Initial Purchaser named therein (the "Registration Rights
Agreement"). In the event that certain events have not occurred
by certain dates the interest rate on the Securities will increase
until such events have occurred.]*
Interest on this Security will accrue from the most
recent date to which interest has been paid [on this Security or
the Security surrendered in exchange herefor]*** or, if no
interest has been paid, from May 3, 1995; provided that, if there
is no existing default in the payment of interest and if this
Security is authenticated between a Regular Record Date referred
to on the face hereof and the next succeeding Interest Payment
Date, interest shall accrue from such Interest Payment Date.
Interest will be computed on the basis of a 360-day year of twelve
30-day months.
The Company shall pay interest on overdue principal and
premium, if any, and interest on overdue installments of interest,
to the extent lawful, at a rate per annum equal to the rate of
interest applicable to the Securities.
2. Method of Payment.
The Company will pay interest (except defaulted
interest) on the outstanding principal amount of the Securities on
each May 1 and November 1 to the persons who are holders thereof
(as reflected in the Security Register at the close of business on
the April 15 and October 15 immediately preceding the Interest
Payment Date), in each case, even if the Security is cancelled on
registration of transfer or registration of exchange after such
record date; provided that, with respect to the payment of
principal, the Company will make payment to the Holder that
surrenders this Security to any Paying Agent on or after May 1,
2005.
The Company will pay principal, premium, if any, 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
its check payable in such money. The Company may mail an interest
check to a Holder's registered address (as reflected in the
Security Register). If a payment date is a date other than a
Business Day at a place of payment, payment may be made at that
place on the next succeeding day that is a Business Day and no
interest shall accrue for the intervening period.
3. Paying Agent and Registrar.
Initially, the Trustee will act as Paying Agent and
Registrar. The Company may change any Paying Agent or Registrar
upon written notice thereto. The Company, United, any Subsidiary
or any Affiliate of any of them may act as Paying Agent, Registrar
and/or co-registrar.
4. Indenture; Limitations.
The Company issued the Securities under an Indenture
dated as of May 3, 1995 (the "Indenture"), among the Company,
United, as guarantor, and The Bank of New York, as trustee (the
"Trustee"). Capitalized terms herein are used as defined in the
Indenture unless otherwise indicated. 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. The Securities
are subject to all such terms, and Holders are referred to the
Indenture and the Trust Indenture Act for a
statement of all such terms. To the extent permitted by
applicable law, in the event of any inconsistency between the
terms of this Security and the terms of the Indenture, the terms
of the Indenture shall control.
The Securities are general unsecured obligations of the
Company. The Indenture limits the aggregate principal amount of
the Securities to $150,000,000 at any one time outstanding.
5. Guarantee.
The payment of principal and interest on the Notes is
guaranteed on a senior subordinated basis by United pursuant to
Article Thirteen of the Indenture.
6. Redemption.
Optional Redemption.
The Securities will be subject to redemption at any time
on or after May 1, 2000, at the option of the Company, in whole or
in part, on not less than 30 nor more than 60 days' prior notice
in amounts of $1,000 or an integral multiple thereof at the
following redemption prices (expressed as percentages of the
principal amount), if redeemed during the 12-month period
beginning May 1 of the years indicated below:
Redemption
Year Price
2000 106.375%
2001 104.781%
2002 103.188%
2003 101.594%
and thereafter at 100% of the principal amount, in each case,
together with accrued and unpaid interest, if any, to the
redemption date (subject to the right of holders of record on
regular record dates to receive interest due to an Interest
Payment Date).
Optional Redemption upon a Public Offering.
In addition, at any time or from time to time prior to
May 1, 1998, the Company may redeem Securities having a principal
amount of up to $50 million within 180 days following one or more
Public Equity Offerings with the net proceeds of such offerings at
a redemption price equal to 112_% of the principal amount thereof,
together with accrued and unpaid interest, if any, to the date of
redemption (subject to the right of holders of record on relevant
record dates to receive interest due on relevant interest payment
dates); provided that immediately after giving effect to each such
redemption, at least $100 million aggregate principal amount of
the Securities remain outstanding.
On and after the redemption date, interest ceases to
accrue on Securities or portions of Securities called for
redemption, unless the Company defaults in the payment of the
Redemption Price.
7. Repurchase upon a Change in Control and Asset Sales.
Upon the occurrence of a Change of Control, the Company
is obligated to make an offer to purchase all Outstanding
Securities at a redemption price of 101% of the principal amount
thereof, plus accrued and unpaid interest, if any, to the date of
purchase. Upon the consummation of an Asset Sale, the Company
may, under certain circumstances, be obligated to make an offer to
purchase Securities with a portion of the Net Cash Proceeds of
such Asset Sale at a redemption price of 100% of the principal
amount thereof plus accrued and unpaid interest, if any, to the
date of purchase.
8. Denominations; Transfer; Exchange.
The Securities are in registered form without coupons,
in denominations of $1,000 and integral multiples of $1,000 in
excess thereof. A Holder may register the transfer or exchange of
Securities in accordance with the Indenture. The Registrar may
require a Holder, among other things, to furnish appropriate
endorsements and transfer documents and to pay any taxes and fees
required by law or permitted by the Indenture. The Registrar need
not register the transfer or exchange of any Securities selected
for redemption (except the unredeemed portion of any Security
being redeemed in part). Also, the Registrar need not register
the transfer or exchange of any Securities for a period of 15 days
before a selection of Securities to be redeemed is made.
9. Persons Deemed Owners.
A Holder may be treated as the owner of a Security for
all purposes.
10. Unclaimed Money.
If money for the payment of principal, premium, if any,
or interest remains unclaimed for two years, the Trustee and the
Paying Agent will pay the money back to the Company at its
request. After that, Holders entitled to the money must look to
the Company for payment, unless an abandoned property law
designates another Person, and all liability of the Trustee and
such Paying Agent with respect to such money shall cease.
11. Discharge Prior to Redemption or Maturity.
If the Company irrevocably deposits, or causes to be
deposited, with the Trustee money or U.S. Government Obligations
sufficient to pay the then outstanding principal of, premium, if
any, and accrued interest on the Securities (a) to redemption or
maturity, the Company and any Guarantor will be discharged from
the Indenture and the Securities, except in certain circumstances
for certain sections thereof, and (b) to the Stated Maturity, the
Company and any Guarantor will be discharged from certain
covenants set forth in the Indenture.
12. Amendment; Supplement; Waiver.
Subject to certain exceptions, the Indenture or the
Securities may be amended or supplemented with the consent of the
Holders of at least a majority in aggregate principal amount of
the Securities then outstanding, and any existing default or
compliance with any provision may be waived with the consent of
the Holders of a majority in aggregate principal amount of the
Securities then outstanding. Without notice to or the consent of
any Holder, the parties thereto may amend or supplement the
Indenture or the Securities to, among other things, cure any
ambiguity, defect or inconsistency.
13. Restrictive Covenants.
The Indenture contains certain covenants, including,
without limitation, covenants with respect to the following
matters: (i) Indebtedness; (ii) Restricted Payments;
(iii) issuances and sales of Subsidiary stock; (iv) transactions
with Affiliates; (v) Liens; (vi) guarantees of Indebtedness by
Restricted Subsidiaries; (vii) disposition of proceeds of Asset
Sales; (viii) dividends and other payment restrictions affecting
Restricted Subsidiaries; (ix) mergers and certain transfers of
assets; and (x) Senior Subordinated Indebtedness. Within 90 days
after the end of each fiscal year and within 90 days after each
fiscal quarter, the Company must report to the Trustee on
compliance with such limitations.
14. Successor Persons.
When a successor person or other entity assumes all the
obligations of its predecessor under the Securities and the
Indenture, the predecessor person will be released from those
obligations.
15. Remedies for Events of Default.
If an Event of Default, as defined in the Indenture,
occurs and is continuing, the Trustee or the Holders of not less
than 25% in principal amount of the Securities then outstanding
may declare all the Securities to be immediately due and payable.
If a bankruptcy or insolvency default with respect to United, the
Company or any Significant Subsidiary occurs and is continuing,
the Securities automatically become immediately due and payable.
Holders may not enforce the Indenture or the Securities except as
provided in the Indenture. The Trustee may require indemnity
satisfactory to it before it enforces the Indenture or the
Securities. Subject to certain limitations, Holders of at least a
majority in principal amount of the Securities then outstanding
may direct the Trustee in its exercise of any trust or power.
16. Subordination.
The payment of the Securities will, to the extent set
forth in the Indenture, be subordinated in right of payment to the
prior payment in full, in cash, of all Senior Indebtedness.
17. Trustee Dealings with Company.
The Trustee under the Indenture, in its individual or
any other capacity, may become the owner or pledgee of Securities
and may make loans to, accept deposits from, perform services for,
and otherwise deal with, the Company, United and its Affiliates as
if it were not the Trustee.
18. Authentication.
This Security shall not be valid until the Trustee signs
the certificate of authentication on the other side of this
Security.
19. Governing Law.
This Security shall be governed by the laws of the State
of New York applicable to contracts to be performed entirely
within that state.
20. 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 U/G/M/A (= Uniform Gifts to Minors Act).
The Company will furnish to any Holder upon written
request and without charge a copy of the Indenture. Requests may
be made to United Stationers Supply Co., 2200 East Golf Road, Des
Plaines, Illinois 60016, Attention: Secretary.
[FORM OF TRANSFER NOTICE]
FOR VALUE RECEIVED the undersigned registered holder
hereby sell(s), assign(s) and transfer(s) unto
Insert Taxpayer Identification No.
(Please print or typewrite name and address including zip code of
assignee)
the within Security and all rights thereunder, hereby irrevocably
constituting and appointing
attorney to transfer such Security on the books of the Company
with full power of substitution in the premises.
[THE FOLLOWING PROVISION TO BE INCLUDED
ON ALL CERTIFICATES
EXCEPT PERMANENT OFFSHORE PHYSICAL CERTIFICATES]
In connection with any transfer of this Security
occurring prior to the date which is the earlier of the date of an
effective Registration Statement or three years after the last
date upon which this Security or any Predecessor Security was held
by the Company or an Affiliate of the Company, the undersigned
confirms that, without utilizing any general solicitation or
general advertising:
[Check One]
[ ] (a) this Security is being transferred in compliance
with the exemption from registration under the
Securities Act of 1933, as amended, provided by
Rule 144A thereunder.
or
[ ] (b) this Security is being transferred other than in
accordance with (a) above and documents are being
furnished which comply with the conditions of transfer
set forth in this Security and the Indenture.
If none of the foregoing boxes is checked, the Trustee or other
Registrar shall not be obligated to register this Security in the
name of any Person other than the Holder hereof unless and until
the conditions to any such transfer of registration set forth
herein and in Sections 305 and 307 of the Indenture shall have
been satisfied.
Date:
NOTICE: The signature to this
assignment must correspond with
the name as written upon the
face of the withinmentioned
instrument in every particular,
without alteration or any
change whatsoever.
Signature Guarantee:
TO BE COMPLETED BY PURCHASER IF (a) ABOVE IS CHECKED.
The undersigned represents and warrants that it is
purchasing this Security for its own account or an account with
respect to which it exercises sole investment discretion and that
it and any such account is a "qualified institutional buyer"
within the meaning of Rule 144A under the Securities Act of 1933,
as amended, and is aware that the sale to it is being made in
reliance on Rule 144A and acknowledges that it has received such
information regarding the Company as the undersigned has requested
pursuant to Rule 144A or has determined not to request such
information and that it is aware that the transferor is relying
upon the undersigned's foregoing representations in order to claim
the exemption from registration provided by Rule 144A.
Dated:
NOTICE: To be executed by an
executive
officer
OPTION OF HOLDER TO ELECT PURCHASE
If you wish to have this Security purchased by the
Company pursuant to Section 1010 or Section 1016 of the Indenture,
check the Box: [ ].
If you wish to have a portion of this Security purchased
by the Company pursuant to Section 1010 or Section 1016 of the
Indenture, state the amount (in original principal amount) below:
$ .
Date:
Your Signature:
(Sign exactly as your name appears on the other side of this
Security)
Signature Guarantee:
Exhibit B
Form of Certificate
to Be Delivered Upon
Termination of Restricted Period
_________, 1995
The Bank of New York
101 Barclay Street
Floor 21 West
New York, New York 10286
Attention: Corporate Trust Trustee Administration
Re: United Stationers Supply Co.
(the "Company") 12_% Senior
Subordinated
Notes due 2005 (the "Securities")
Ladies and Gentlemen:
This letter relates to U.S. $
principal amount of Securities represented by the temporary global
note certificate (the "Temporary Offshore Global Security").
Pursuant to Section 201 of the Indenture dated as of May 3, 1995
relating to the Securities (the "Indenture"), we hereby certify
that (1) we are the beneficial owner of such principal amount of
Securities represented by the Temporary Offshore Global Security
and (2) we are a person outside the United States to whom the
Securities could be transferred in accordance with Rule 904 of
Regulation S promulgated under the U.S. Securities Act of 1933, as
amended. Accordingly, you are hereby requested to issue a
certificated Security representing the undersigned's interest in
the principal amount of securities represented by the Temporary
Offshore Global Security, all in the manner provided by the
Indenture.
You and the Company are entitled to rely upon this
letter and are irrevocably authorized to produce this letter or a
copy hereof to any interested party in any administrative or legal
proceedings or official inquiry with respect to the matters
covered hereby. Terms used in this certificate have the meanings
set forth in Regulation S.
Very truly yours,
[Name of Holder]
By:
Authorized Signature
Exhibit C
Form of Certificate to Be
Delivered in Connection with
Transfers to Non-QIB Institutional Accredited Investors
, ____
United Stationers Supply Co.
2200 East Golf Road
Des Plaines, Illinois 60016-1267
The Bank of New York
101 Barclay Street
Floor 21 West
New York, New York 10286
Attention: Corporate Trust Trustee Administration
Re: United Stationers Supply Co.
(the "Company") 12_% Senior
Subordinated
Notes due 2005 (the "Securities")
Ladies and Gentlemen:
In connection with our proposed purchase of $
aggregate principal amount of the Securities:
1. We understand that the Securities have not been
registered under the Securities Act of 1933, as amended (the
"Securities Act"), and may not be sold except as permitted in
the following sentence. We agree on our own behalf and on
behalf of any investor account for which we are purchasing
the Securities to offer, sell or otherwise transfer such
Securities prior to the date which is three years after the
later of the date of original issue and the last date on
which the Company or United Stationers Inc. ("United") or any
affiliate of the Company or United was the owner of such
Securities (or any predecessor of such Securities) (the
"Resale Restriction Termination Date") only (a) to the
Company or United, (b) pursuant to a registration statement
which has been declared effective under the Securities Act,
(c) for so long as the Securities are eligible for resale
pursuant to Rule 144A under the Securities Act, to a person
we reasonably believe is a qualified institutional buyer
under Rule 144A (a "QIB") that purchases for its own account
or for the account of a QIB to whom notice is given that the
transfer is being made in reliance on Rule 144A, (d) pursuant
to offers and sales to non-U.S. persons that occur outside
the United States within the meaning of Regulations S under
the Securities Act,
(e) to an institutional "accredited investor" within the
meaning of subparagraph (a)(1), (2), (3) or (7) of Rule 501
under the Securities Act that is acquiring the Securities for
its own account or for the account of such an institutional
"accredited investor" for investment purposes and not with a
view to, or for offer or sale in connection with, any
distribution thereof in violation of the Securities Act or
(f) pursuant to any other available exemption from the
registration requirements of the Securities Act, subject in
each of the foregoing cases to any requirement of law that
the disposition of our property and the property of such
investor account or accounts be at all times within our or
their control and to compliance with
any applicable state securities laws. The foregoing
restrictions on resale will not apply subsequent to the
Resale Restriction Termination Date. If any resale or other
transfer of the Securities is proposed to be made pursuant to
clause (e) above prior to the Resale Restriction Termination
Date, the transferor shall deliver a letter from the
transferee substantially in the form of this letter to the
Trustee, which shall provide, among other things, that the
transferee is an institutional "accredited investor" within
the meaning of subparagraph (a)(1), (2), (3) or (7) or Rule
501 under the Securities Act and that it is acquiring such
Securities for investment purposes and not for distribution
in violation of the Securities Act. We acknowledge that the
Company and the Trustee reserve the right prior to any offer,
sale or other transfer prior the Resale Restriction
Termination Date of the Securities pursuant to clauses (d),
(e) and (f) above to require the delivery of an opinion of
counsel, certifications and/or other information satisfactory
to the Company and the Trustee.
2. We are an institutional "accredited investor" (as
defined in Rule 501(a)(1), (2), (3) or (7) of Regulation D
under the Securities Act) purchasing for our own account or
for the account of such an institutional "accredited
investor," and we are acquiring the Securities for investment
purposes and not with a view to, or for offer or sale in
connection with, any distribution in violation of the
Securities Act and we have such knowledge and experience in
financial and business matters as to be capable of evaluating
the merits and risks of our investment in the Securities, and
we and any accounts for which we are acting are each able to
bear the economic risk of our or its investment.
3. We are acquiring the Securities purchased by us for
our own account or for one or more accounts as to each of
which we exercise sole investment discretion.
4. You are entitled to rely upon this letter and you
are irrevocably authorized to produce this letter or a copy
hereof to any interested party in any administrative or legal
proceeding or official inquiry with respect to the matters
covered hereby.
Very truly yours,
By:
(NAME OF PURCHASER)
Date:
Upon transfer, the Securities should be registered in
the name of the new beneficial owner as follows:
Name:
Address:
Taxpayer ID Number:
Exhibit D
Form of Certificate to Be Delivered
in Connection with Transfers
Pursuant to Regulation S
, ____
The Bank of New York
101 Barclay Street
Floor 21 West
New York, New York 10286
Attention: Corporate Trust Trustee Administration
Re: United Stationers Supply Co.
(the "Company") 12_% Senior
Subordinated
Notes due 2005 (the "Securities")
Ladies and Gentlemen:
In connection with our proposed sale of $
aggregate principal amount of the Securities, we confirm that such
sale has been effected pursuant to and in accordance with
Regulation S under the Securities Act of 1933, as amended, and,
accordingly, we represent that:
(1) the offer of the Securities was not made to a
person in the United States;
(2) either (a) at the time the buy order was
originated, the transferee was outside the United States or
we and any person acting on our behalf reasonably believed
that the transferee was outside the United States or (b) the
transaction was executed in, on or through the facilities of
a designated off-shore securities market and neither we nor
any person acting on our behalf knows that the transaction
has been pre-arranged with a buyer in the United States;
(3) no directed selling efforts have been made in the
United States in contravention of the requirements of
Rule 903(b) or Rule 904(b) of Regulation S, as applicable;
and
(4) the transaction is not part of a plan or scheme to
evade the registration requirements of the U.S. Securities
Act of 1933, as amended.
In addition, if the sale is made during a restricted
period and the provisions of Rule 903(c)(3) or Rule 904(c)(1) of
Regulation S are applicable thereto, we confirm that such sale has
been made in accordance with the applicable provisions of Rule
903(c)(3) or Rule 904(c)(1), as the case may be.
You and the Company are entitled to rely upon this
letter and are irrevocably authorized to produce this letter or a
copy hereof to any interested party in any administrative or legal
proceedings or official inquiry with respect to the matters
covered hereby. Terms used in this letter have the meanings set
forth in Regulation S.
Very truly yours,
[Name of Transferor]
By:
Authorized Signature
Exhibit E
UNITED STATIONERS SUPPLY CO.
__% Senior Subordinated Note
$____________
UNITED STATIONERS SUPPLY CO., an Illinois corporation (the
"Company"), for value received, promises to pay to [Restricted
Subsidiary], or its registered assigns, the principal sum of
_______________________________________ ($_______) on
_____________.
Interest Rate: ______% per annum.
Interest Payment Dates: ___________ and ___________,
commencing __________.
Reference is hereby made to the further provisions of this
Note set forth on the reverse hereof, which further provisions
shall for all purposes have the same effect as if set forth at
this place.
IN WITNESS WHEREOF, the Company has caused this Note to be
signed manually by its duly authorized officers.
Date: UNITED STATIONERS SUPPLY
CO.
By
Title:
By
Title:
UNITED STATIONERS SUPPLY CO.
__% Subordinated Note due ____
1. Principal and Interest.
The Company promises to pay interest on the principal amount
of this Note on each Interest Payment Date, as set forth below, at
the rate of ___% per annum.
Interest will be payable [semiannually] on each Interest
Payment Date, commencing _________________.
Interest on the Note will accrue from the most recent date to
which interest has been paid or, if no interest has been paid,
from the date of issuance. Interest will be computed on the
basis of a 360-day year of twelve 30-day months.
2. Subordination
The Note will be subordinated indebtedness of the Company.
Payment of the Subordinated Obligations (as defined below) will be
subordinated in right of payment to the prior payment in full, in
cash or cash equivalents, of all Senior Indebtedness, including,
without limitation, the Company's obligations under the 12_%
Senior Subordinated Notes due 2005.
"Subordinated Obligations" means any principal of, premium,
if any, or interest on the Note payable pursuant to the terms of
the Note or upon acceleration, including any amounts received upon
the exercise of rights of rescission or other rights of action
(including claims for damages) or otherwise, to the extent
relating to the purchase price of the Note or amounts
corresponding to such principal, premium, if any, or interest on
the Note.
Upon any payment or distribution of assets or securities of
the Company, of any kind or character, whether in cash, property
or securities, in connection with any dissolution or winding up or
total or partial liquidation or reorganization of the Company,
whether voluntary or involuntary, or in bankruptcy, insolvency,
receivership or other proceedings, all amounts due or to become
due upon all Senior Indebtedness (including any interest accruing
subsequent to an event of bankruptcy, whether or not such interest
is an allowed claim enforceable against the debtor under the
United States Bankruptcy Code) shall first be paid in full, in
cash or cash equivalents, before the holders shall be entitled to
receive any payment by the Company on account of Subordinated
Obligations, or any payment to acquire the Note for cash, property
or securities, or any distribution with respect to the Note of any
cash, property or securities. Before any payment may be made by,
or on behalf of, the Company on any Subordinated Obligations in
connection with any such dissolution, winding up, liquidation or
reorganization, any payment or distribution of assets or
securities of the Company of any kind or character, whether in
cash, property or securities, to which the holders would be
entitled, but for the subordination provisions of the Note, shall
be made by the Company or by any receiver, trustee in bankruptcy,
liquidating trustee, agent or other similar person making such
payment or distribution or by the holders if received by them,
directly to the holders of the Senior Indebtedness (pro rata to
such holders on the basis of the respective amounts of Senior
Indebtedness held by such holders) or their representatives or to
any trustee or trustees under any indenture pursuant to which any
such Senior Indebtedness may have been issued, as their respective
interests appear, to the extent necessary to pay all such Senior
Indebtedness in full, in cash or cash equivalents after giving
effect to any concurrent payment, distribution or provision
therefor to or for the holders of such Senior Indebtedness.
No direct or indirect payment by or on behalf of the Company
of Subordinated Obligations, whether pursuant to the terms of the
Note or upon acceleration or otherwise, shall be made if, at the
time of such payment, there exists an event of default, or a
default (it being understood that as used in that sentence a
"default" with respect to any Senior Indebtedness shall mean the
happening of any event or the existence of any condition which,
after the giving of notice or the passage of time or both, would
constitute an event of default under such Senior Indebtedness)
with respect to any portion of the obligations on any Senior
Indebtedness, and such default shall not have been cured or
waived or the benefits of this sentence waived by or on behalf of
the holders of such Senior Indebtedness.
"Senior Indebtedness" means the following obligations of the
Company: (i) any obligation with respect to the 12_% Senior
Subordinated Notes due 2005 of the Company; and (ii) all other
indebtedness of the Company, including principal, premium and
interest on such indebtedness, unless such indebtedness, by its
terms or by the terms of any agreement or instrument pursuant to
which such indebtedness is outstanding, is expressly subordinated
in right of payment to any other indebtedness of the Company.
To the extent any payment of Senior Indebtedness (whether by
or on behalf of the Company, as proceeds of security or
enforcement of any right of setoff or otherwise) is declared to be
fraudulent or preferential, set aside or required to be paid to
any receiver, trustee in bankruptcy, liquidating trustee, agent or
other similar person under any bankruptcy, insolvency,
receivership, fraudulent conveyance or similar law, then if such
payment is recovered by, or paid over to, such receiver, trustee
in bankruptcy, liquidating trustee, agent or other similar person,
the Senior Indebtedness or part thereof originally intended to be
satisfied shall be deemed to be reinstated and outstanding as if
such payment had not occurred. To the extent the obligation to
repay any Senior Indebtedness is declared to be fraudulent,
invalid, or otherwise set aside under any bankruptcy, insolvency,
receivership, fraudulent conveyance or similar law, then the
obligation so declared fraudulent, invalid or otherwise set aside
(and all other amounts that would come due with respect thereto
had such obligation not been affected) shall be deemed to be
reinstated and outstanding as Senior Indebtedness for all purposes
hereof as if such declaration invalidity or setting aside had not
occurred.
Exhibit F
[RESTRICTED SUBSIDIARY]
__% Senior Note due ____
$____________
[RESTRICTED SUBSIDIARY], a _______ corporation, for value
received, promises to pay to United Stationers Supply Co., the
principal sum of ___________________________ ($_______) on
_____________.
Interest Rate: ______% per annum, in cash.
Interest Payment Dates: ___________ and ___________,
commencing __________.
This Note is an unsubordinated, senior obligation of
[Restricted Subsidiary].
IN WITNESS WHEREOF, [Restricted Subsidiary] has caused this
Note to be signed manually by its duly authorized officers.
Date: [RESTRICTED SUBSIDIARY]
By
Title:
By
Title
Schedule I
ASSET SALE EXCLUSIONS
The Company currently contemplates disposing of the real
property interest and all personal property (including furniture
and equipment) and fixtures at the locations listed below. All
facilities are warehouse space, except as otherwise noted.
PART A
California
Y City of Industry (Los Angeles area) - 18960 E. San
Jose Avenue (Lease)
Y North Highland (Sacramento area) - 3030 Orange
Grove (Lease)
Colorado
Y Denver - 501 Raritan Way (Fee)
Florida
Y Hialeah (Miami area) - 5523 NW 161st Street
(Lease)
5400 NW 163rd Street (Lease)
Georgia
Y Smyrna (Atlanta) - 4800 Highlands Parkway (Fee)
Y Doraville - 4303 Pleasantdale Road (this property
is not a facility and was acquired in satisfaction of a
debt owed to Supply) (Fee)
Illinois
Y Des Plaines (Chicago area) - 2200 East Golf Road
(Corporate headquarters) (Fee)
Y Forest Park (Chicago area) - 1900 South Des
Plaines Road (Fee)
Y Forest Park (Chicago area) - 7750 Industrial -
Annex (Lease)
Y Forest Park (Chicago area) - 7725 Industrial Drive
(Lease)
Maryland
Y Elkridge (Baltimore area) - 6725 Business Parkway
(Lease)
Minnesota
Y Brooklyn Park (St. Paul area) - 7509 Boone Avenue
(Fee)
North Carolina
Y Charlotte - Commerce Park III - 1400 Westinghouse
Blvd. (Fee)
Ohio
Y Valley View (Cleveland area) - 9450 Allen Drive
(Fee)
Y Springdale (Cleveland area) - 201 W. Crescentville
Road (Lease)
Tennessee
Y Nashville - 724 Massman Drive (entire
facility) or
1920 Nolensville Road
(Lease)
Texas
Y Fort Worth (DFW area) - 3300 West Bolt Street (Old
SDC corporate office building) (Fee)
PART B
California
Y Sacramento - 723 Striker Avenue
Colorado
Y Denver - 2005A West 5th Street/2465 W. 4th Avenue
(Leasehold)
Illinois
Y Carol Stream (Chicago area) - 898 Carol Court
(Leasehold)
Y Itasca (Chicago area) - 1075 Hawthorn Drive
(Leasehold)
Y Mount Prospect (Chicago area) - 1661 Feehanville
Drive (Leasehold)
North Carolina
Y Charlotte - 1949-2001 Freedom Drive (Leasehold)
Ohio
Y Twinsburg (Cleveland area) - 2100 Highland Road
(Fee)
Tenneseee
Y Memphis - 2843 Harbor Avenue (Leasehold)1
Texas
Y Dallas (DFW area) - 613-21 Mockingbird Lane/3439
Irving Boulevard
REAL PROPERTY INTERESTS
Arizona
Leasehold
Y Tempe - 1005-1017 West Alameda Drive
California
Fee Owned
Y City of Industry (Los Angeles area) - 918 South
Stimson Avenue
Leasehold
Y City of Industry (Los Angeles area) - 18305-385
San Jose Avenue
Y City of Industry - 18960 E. San Jose Avenue
Y North Highland - 3030 Orange Grove
Y Sacramento - 723 Striker Avenue
Y Sacramento - 5440 Stationers Way
Colorado
Fee Owned
Y Denver - 501 Raritan Way
Leasehold
Y Denver - 2005A West 5th Street
Y Denver - 2465 W. 4th Avenue
Connecticut
Leasehold
Y North Brandford - 104-5 Branford
Florida
Fee Owned
Y Jacksonville - 5400 West 12th Street
Y Tampa - 3402 Queen Palm Drive
Leasehold
Y Ft. Lauderdale - 3365 Enterprise Avenue
Y Hialeah - 5523 NW 161st Street
Y Hialeah - 5400 NW 163rd Street
Y Orlando - 4315 W. 34th Street
Georgia
Fee Owned
Y Norcross (Atlanta area) - 6448 Best Friend Road
Y Doraville - 4303 Pleasantdale Road (this property
is not a facility and was acquired in satisfaction of a
debt owned to the Company, however, the Company is using
the facility for temporary storage)
Y Smyrna - 4800 Highlands Parkway
Illinois
Fee Owned
Y Des Plaines - 2220 East Golf Road2
Y Forest Park - 1900 South Des Plaines Road
Y Greenville (St. Louis area) - 2000 Wolf Business
Park
Leasehold
Y Carol Stream - 898 Carol Court
Y Forest Park - 7750 Industrial - Annex
Y Forest Park - 7725 Industrial Drive
Y Itasca - 1075 Hawthorn Drive
Y Mount Prospect - 1661 Feenhanville Drive
Y Woodale - 376 Balm Court
Indiana
Fee Owned
Y Indianapolis - 5345 West 81st Street
Louisiana
Leasehold
Y Lafayette - 223 I.B. Street
Y Harahan - 1000 Edwards Avenue
Y New Orleans - 300 Plauche Street and Bevin Street
Maryland
Fee Owned
Y Hanover (Baltimore area) - 7441 Candlewood Road
Leasehold
Y Elkridge - 6725 Business Parkway
Y Hanover - 7465 Candlewood Road (the property is
subleased to Andrews Office Supply)
Y Jessup - 8155 Stayton Drive
Massachusetts
Fee Owned
Y Woburn (Boston area) - 415 Wildwood Avenue
Michigan
Fee Owned
Y Livonia (Detroit area) - 32432 Capitol Drive
Leasehold
Y Livonia (Detroit area) - 13001 Merriman Road
Y Wyoming - 900 47th Street S.W.
Minnesota
Fee Owned
Y Brooklyn Park (St. Paul area) - 7509 Boone Avenue
Y Eagan (Minneapolis area) - 1720 Alexander Road
Missouri
Leasehold
Y Kansas City - 1606 Linn Street
New Jersey
Fee Owned
Y Edison (New York area) - 77 Executive Avenue
Y Pennsauken (Philadelphia area) - 9009 Pennsauken
Highway
Leasehold
Y Edison - 260 Meadow Road
Y Pennsauken - 9020 Pennsauken Highway
New York
Fee Owned
Y Coxsackie (Albany area) - Route 9W and Wolf Road
Leasehold
Y Manhattan - 537-45 W. 27th Street/538-46 W. 28th
Street
North Carolina
Fee Owned
Y Charlotte - Commerce Park III - 1400 Westinghouse
Blvd.
Leasehold
Y Charlotte - 1949-2001 Freedom Drive
Ohio
Fee Owned
Y Sharonville (Cincinnati area) - 9775 International
Drive
Y Twinsburg (Cleveland area) - 2100 Highland Road
Y Valley View - 9450 Allen Drive
Leasehold
Y Columbus - 1630 Westbelt Drive
Y Springdale - 201 W. Crescentville Road
Oklahoma
Fee Owned
Y Tulsa - 1870 North 109th East Avenue
Leasehold
Y Tulsa - 11525 East Pine Street
Oregon
Leasehold
Y Portland - 4409 S.E. 24th Street
Pennsylvania
Leasehold
Y Pittsburgh - 707 Parkway View Drive
Tennessee
Leasehold
Y Memphis - 2843 Harbor Avenue
Y Nashville - 1920 Nolensville Road
Y Nashville - 724 Massman Drive - 48,000 sq. ft.
Y Nashville - 724 Massman Drive - 18,000 sq. ft.
Texas
Fee Owned
Y Dallas - 119 Regal Row
Y Fort Worth - 3300 West Bolt Street
Leasehold
Y Dallas - 613-21 Mockingbird Lane
Y Dallas - 3439 Irving Blvd.
Y Houston - 1160 Silber Road
Y Houston - 2155 Silber Road
Y Lubbock - 116 Slaton Road
Y San Antonio - 3615 Highpoint Drive
Utah
Leasehold
Y Salt Lake City - 888/890 West 2600
Y Salt Lake City - 889 W. 2500 South Street
Y Salt Lake City - 2495 S. 900 West (Lease expires
May 1, 1995)
Washington
Leasehold
Y Tukwila - 18351 Cascade Avenue South, Building 255
Y Tukwila - 18300 Southcenter Parkway
Wisconsin
Fee Owned
Y Milwaukee - 87111 West Point Avenue
MORTGAGES
Fee Owned
California
Y City of Industry (Los Angeles area) - 918 South
Stimson Avenue
Colorado
Y Denver - 501 Raritan Way
Florida
Y Jacksonville - 5400 West 12th Street
Y Tampa - 3402 Queen Palm Drive
Illinois
Y Des Plaines - 2200 East Golf Road
Y Forest Park - 1900 South Des Plaines Road
Y Greenville (St. Louis area) - 2000 Wolf Business
Park
Indiana
Y Indianapolis - 5345 West 81st Street
Maryland
Y Hanover (Baltimore area) - 7441 Candlewood Road
Massachusetts
Y Woburn (Boston area) - 415 Wildwood Avenue
Michigan
Y Livonia (Detroit area) - 32342 Capitol Drive
Minnesota
Y Brooklyn Park (St. Paul area) - 7509 Boone Avenue
North
Y Eagan (Minneapolis area) - 1720 Alexander Road
New Jersey
Y Pennsauken (Philadelphia area) - 9009 Pennsauken
Highway
New York
Y Coxsackie (Albany area) - Route 9W and Wolf Road
North Carolina
Y Charlotte - 1400 Westinghouse Blvd.
Ohio
Y Sharonville (Cincinnati area) - 9775 International
Drive
Texas
Y Dallas - 119 Regal Row
Wisconsin
Y Milwaukee - 8711 West Point Avenue
Leasehold
Arizona
Y Tempe - 1005-1017 West Alameda Drive
California
Y Sacramento - 5440 Stationers Way
Illinois
Y Carol Stream - 898 Carol Stream
Louisiana
Y New Orleans - 300 Plauche Street and Bevin Street
Tennessee
Y Memphis - 2843 Harbor Avenue
Y Nashville - 724 Massman Drive
Texas
Y San Antonio - 3615 Highpoint
Washington
Y Tukwila - 18351 Cascade Avenue South, Building 225
Schedule II
CERTAIN PERMITTED HOLDERS
Thomas W. Sturgess
Frederick B. Hegi, Jr.
James T. Callier, Jr.
James A. Johnson
V. Edward Easterling, Jr.
Wingate Management Company, L.P.
Wingate Management Company II, L.P.
Wingate Management Limited, LLC
_______________________________
Note: This table of contents shall not, for any purpose, be
deemed to be a part of this Indenture.
* Include only for Initial Securities
** Include only for Exchange Securities.
* Include only for Initial Securities.
** Include only for Exchange Securities.
*** Include only for Exchange Securities.
1 The Company is considering consolidating the Memphis and
Nashville operations in a new location which may service both
markets.
2 On or about March 16, 1995, the Company was notified of an
action filed by The Illinois State Toll Highway Authority to
condemn approximately 4,336 square feet of land and to obtain
a temporary construction easement for a period of three years
across and upon approximately 24,090 square feet of land
constituting a part of the property.
EXHIBIT A
[Form of Bridge Note]
PROMISSORY NOTE
$_______________ March __,
1995
New York, New
York
FOR VALUE RECEIVED, UNITED STATIONERS SUPPLY CO.,
an Illinois corporation (the "Company"), hereby promises to
pay to __________________ (the "Lender") [or registered
assigns]1, for account of its Lending Offices provided for
by the Senior Subordinated Credit Agreement referred to
below, at the principal office of The Chase Manhattan Bank
(National Association) at 1 Chase Manhattan Plaza, New
York, New York 10081, the principal sum of _______________
Dollars (or such lesser amount as shall equal the
aggregate unpaid principal amount of the Bridge Loans made
by the Lender to the Company under the Senior Subordinated
Credit Agreement), in lawful money of the United States of
America and in immediately available funds, on the dates
and in the principal amounts provided in the Senior
Subordinated Credit Agreement, and to pay interest on the
unpaid principal amount of each such Bridge Loan, at such
office, in like money and funds, for the period commencing
on the date of such Bridge Loan until such Bridge Loan
shall be paid in full, at the rates per annum and on the
dates provided in the Senior Subordinated Credit
Agreement.
[This Note and the Loans evidenced hereby may be
transferred in whole or in part only by registration of
such transfer on the register maintained for such purpose
by or on behalf of the Company as provided in Section
13.06(g) of the Senior Subordinated Credit Agreement.]
The date, amount, and interest rate of each
Bridge Loan made by the Lender to the Company, and each
payment made on account of the principal thereof, shall be
recorded by the Lender on its books and, prior to any
transfer of this Note, endorsed by the Lender on the
schedule attached hereto or any continuation thereof,
provided that the failure of the Lender to make any such
recordation or endorsement shall not affect the
obligations of the Company to make a payment when due of
any amount owing under the Senior Subordinated Credit
Agreement or hereunder in respect of the Bridge Loans made
by the Lender.
This Note is one of the Bridge Notes
[(constituting a Registered Note)] referred to in the
Senior Subordinated Credit Agreement dated as of March 30,
1995 (as modified and supplemented and in effect from time
to time, the "Senior Subordinated Credit Agreement")
between the Company, Associated Holdings, Inc., as parent
guarantor, the lenders named therein and The Roebling
Fund, as Agent, and evidences Bridge Loans made by the
Lender thereunder. Terms used but not defined in this
Note have the respective meanings assigned to them in the
Senior Subordinated Credit Agreement.
As provided in the Senior Subordinated Credit
Agreement, to the extent any interest accrues on any
Bridge Loan during any Quarterly Period at a rate per
annum in
excess of 15% (other than interest accrued at the Post
Default Rate), such accrued interest shall, to such
extent, be paid on the last day of such Quarterly Period
by the addition of such accrued interest in excess of 15%
to the unpaid principal amount of such Loan, and the
unpaid principal amount of such Loan, as so increased,
shall thereafter bear interest as provided herein.
The Senior Subordinated Credit Agreement
provides for the acceleration of the maturity of this Note
upon the occurrence of certain events and for prepayments
of Bridge Loans upon the terms and conditions specified
therein.
Except as permitted by Section 13.06(b) of the
Senior Subordinated Credit Agreement, this Note may not be
assigned by the Lender to any other Person.
This Note shall be governed by, and construed in
accordance with, the law of the State of New York.
UNITED STATIONERS SUPPLY CO.
By_________________________
Title:
SCHEDULE OF BRIDGE LOANS
This Note evidences Bridge Loans made under the
within-described Senior Subordinated Credit Agreement to
the Company, on the dates and in the principal amounts set
forth below, subject to the payments and prepayments of
principal set forth below:
Prin-
cipal Unpaid
Amount Amount Prin-
Date of Paid or cipal Notation
Made Loan Prepaid Amount Made by
EXHIBIT
B
[Form of Assumption Agreement]
ASSUMPTION AGREEMENT dated as of March 30, 1995
between UNITED STATIONERS INC., a corporation duly organized
and validly existing under the laws of the State of Delaware
("United"); UNITED STATIONERS SUPPLY CO., a corporation duly
organized and validly existing under the laws of the State
of Illinois ("Supply"); and THE ROEBLING FUND, as agent
for the Lenders (as defined herein).
WHEREAS, Associated Stationers, Inc., a
corporation duly organized and validly existing under the
laws of the State of Delaware (together with its
successors and assigns, including Supply from and after
the effectiveness of the Supply Merger (as defined
below), the
"Company"); Associated Holdings, Inc., a corporation duly
organized and validly existing under the laws of the State
of Delaware (together with its successors and assigns,
including United from and after the effectiveness of the
United Merger (as defined below), the "Guarantor"); each
of the lenders party thereto (together with their
permitted successors and assigns, the "Lenders"); and The
Roebling Fund, as agent for the Lenders (the "Agent"),
have entered into a Senior Subordinated Credit Agreement
dated as of March 30, 1995 (as at any time amended or
otherwise modified, the "Senior Subordinated Credit
Agreement") pursuant to which the Lenders have agreed to
make loans to the Company in aggregate principal amount
not exceeding $130,000,000;
WHEREAS, the Guarantor and United have entered
into a Merger Agreement dated as of February 13, 1995 (as
at any time amended or otherwise modified, the "Merger
Agreement"), providing for the merger of the Guarantor
with and into United with United as the surviving
corporation (the "United Merger") and the subsequent
merger of the Company, a wholly-owned subsidiary of the
Guarantor, with and into Supply, a wholly-owned subsidiary
of United, with Supply as the surviving corporation (the
"Supply Merger" and, with the United Merger, the
"Mergers");
WHEREAS, the Mergers have been consummated on
the date hereof; and
WHEREAS, each of United and Supply desires in
and by this Assumption Agreement to assume expressly the
performance of every obligation of the Guarantor (in the
case of United) and the Company (in the case of Supply)
under the Senior Subordinated Credit Agreement to which
either the Guarantor or the Company is a party;
NOW, THEREFORE, for good and valuable
consideration, the receipt of which is hereby acknowledged
by each of United and Supply, and in order to induce the
Lenders to make loans to Supply (as successor to the
Company) on the date hereof pursuant to the Senior
Subordinated Credit Agreement, each of United and Supply
agrees with and for the benefit of the Agent and each
Lender as follows:
Section 1. Definitions. Unless otherwise
provided, terms used or defined in the Senior Subordinated
Credit Agreement are used herein as used or defined
therein.
Section 2. Assumption.
2.01 Assumption of Obligations by United.
United, as the surviving corporation of the United Merger
and the successor in interest to the Guarantor, hereby
(a) irrevocably and unconditionally assumes and
agrees to perform, observe and be bound by each and
every covenant, agreement, term, condition,
obligation, appointment, duty and liability of the
Guarantor under the Senior Subordinated Credit
Agreement and the Guarantor Note and, by virtue of
the foregoing, accepts and assumes all liabilities of
the Guarantor related to any representation or
warranty made by, and all rights and powers of the
Guarantor under or in connection with the Senior
Subordinated Credit Agreement and the Guarantor Note
and confirms and restates all such
representations and warranties as of the date when
made by the Guarantor;
(b) confirms and acknowledges that all
references to the "Guarantor" in the Senior
Subordinated Credit Agreement or any amendment
thereto or any document, instrument or agreement
executed, or to be executed, in connection therewith,
or in the Guarantor Note shall be deemed to be
references to United, except where such references
relate to the Guarantor prior to the assumption
provided for in the foregoing clause (a).
(c) acknowledges and agrees that it is, and
shall continue to be, bound by the Senior
Subordinated Credit Agreement and the Guarantor as if
it had been the "Guarantor" thereunder from the
original execution and delivery thereof.
2.02 Assumption of Obligations by Supply.
Supply, as the surviving corporation of the Supply Merger
and the successor in interest to the Company, hereby
(a) irrevocably and unconditionally assumes and
agrees to perform, observe and be bound by each and
every covenant, agreement, term, condition,
obligation, appointment, duty and liability of the
Company under the Senior Subordinated Credit
Agreement and, by virtue of the foregoing, accepts
and assumes all liabilities of the Company related to
any representation or warranty made by, and all
rights and powers of the Company under or in
connection with the Senior Subordinated Credit
Agreement and confirms and restates all such
representations and warranties as of the date when
made by the Company;
(b) confirms and acknowledges that all
references to the "Company" in the Senior
Subordinated Credit Agreement or any amendment
thereto or any document, instrument or agreement
executed, or to be executed, in connection therewith,
shall be deemed to be references to Supply, except
where such references relate to the Company prior to
the assumption provided for in the foregoing clause
(a); and
(c) acknowledges and agrees that it is, and
shall continue to be, bound by the Senior
Subordinated Credit Agreement as if it had been the
"Company" thereunder from the original execution and
delivery thereof.
Section 3. Miscellaneous.
3.01 Obligations Cumulative. The obligations
undertaken herein by United and Supply are cumulative and
not exclusive of any obligations incurred by operation of
law as a result of the Mergers.
3.02 Successors and Assigns. This Agreement
shall be binding upon United and Supply and their
respective successors and (to the extent permitted by
Section 13.06 of the Senior Subordinated Credit Agreement)
assigns and shall inure to the benefit of, and be
enforceable by the Agent and each Lender, and their
respective successors and (to the extent permitted by said
Section 13.06) assigns.
3.03 GOVERNING LAW. THIS AGREEMENT SHALL BE
GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE LAW OF
THE
STATE OF NEW YORK.
3.04 Counterparts. This Agreement may be
executed in any number of counterparts, all of which taken
together shall constitute one and the same instrument and
either of the parties hereto may execute this Agreement by
signing any such counterpart.
3.05 Captions. The captions and section
headings appearing herein are included solely for
convenience of reference and are not intended to affect
the interpretation of any provision of this Agreement.
3.06 Severability. If any provision hereof is
invalid and unenforceable in any jurisdiction, then, to
the fullest extent permitted by law, (i) the other
provisions hereof shall remain in full force and effect in
such jurisdiction and shall be liberally construed in
favor of the Agent and the Lenders in order to carry out
the intentions of the parties hereto as nearly as may be
possible and (ii) the invalidity or unenforceability of
any provision hereof in any jurisdiction shall not affect
the validity or enforceability of such provision in any
other jurisdiction.
IN WITNESS WHEREOF, each of United and Supply
has caused this Assumption Agreement to be duly executed
and delivered as of the day and year first above written.
UNITED STATIONERS INC.
By________________________
Name:
Title:
UNITED STATIONERS SUPPLY CO.
By________________________
Name:
Title:
Accepted and Acknowledged:
THE ROEBLING FUND,
as Agent
By THE CHASE MANHATTAN BANK
(NATIONAL ASSOCIATION),
as Manager
By______________________
Name:
Title:
EXHIBIT D-
1
[Form of Opinion of Special New York Counsel
to the Agent]
March __,
1995
To the Lenders party to the
Senior Subordinated Credit
Agreement referred to
below and The Roebling Fund,
as Agent
Ladies and Gentlemen:
We have acted as special New York counsel to the
Agent in connection with (i) the Senior Subordinated
Credit Agreement dated as of March 30, 1995 (the "Senior
Subordinated Credit Agreement") among Associated
Stationers, Inc. (together with its successors and
assigns, including United Stationers Supply Co. from and
after the effectiveness of the Supply Merger referred to
therein, the "Company"), Associated Holdings, Inc.
(together with its successors and assigns, including
United Stationers Inc. from and after the effectiveness of
the United Merger referred to therein, the "Guarantor" and
together with the Company, the "Obligors"), the lenders
named therein, and The Roebling Fund, as Agent (the
"Agent"), providing for extensions of credit to be made by
said lenders to the Company in an aggregate principal
amount not exceeding $130,000,000 and (ii) the various
other agreements, instruments and other documents referred
to in the next following paragraph. Except as otherwise
provided herein, terms defined in the Senior Subordinated
Credit Agreement are used herein as defined therein. This
opinion letter is being delivered pursuant to Section
7.01(e) of the Senior Subordinated Credit Agreement.
In rendering the opinions expressed below, we
have examined the following agreements, instruments and
other documents:
(a) the Senior Subordinated Credit
Agreement;
(b) the Bridge Notes;
(c) such records of the Obligors and
such other documents as we have deemed
necessary as a basis for the opinions
expressed below.
The agreements, instruments and other documents referred
to in the foregoing lettered clauses (other than clause
(c) above) are collectively referred to as the "Credit
Documents".
In our examination, we have assumed the
genuineness of all signatures, the authenticity of all
documents submitted to us as originals and the conformity
with authentic original documents of all documents
submitted to us as copies. When relevant facts were not
independently established, we have relied upon
certificates of governmental officials and appropriate
representatives of the Obligors and upon representations
made in or pursuant to the Credit Documents.
In rendering the opinions expressed below, we
have
assumed, with respect to all of the documents referred to
in this opinion letter, that:
(i) such documents have been duly
authorized by, have been or (in the case of
the Bridge Notes) will be duly executed and
delivered by, and (except to the extent set
forth in the opinions below as to the
Obligors) constitute legal, valid, binding
and enforceable obligations of, all of the
parties to such documents;
(ii) all signatories to such documents
have been duly authorized; and
(iii) all of the parties to such
documents are duly organized and validly
existing and have the power and authority
(corporate or other) to execute, deliver
and perform such documents.
Based upon and subject to the foregoing and
subject also to the comments and qualifications set forth
below, and having considered such questions of law as we
have deemed necessary as a basis for the opinion expressed
below, we are of the opinion that each of the Credit
Documents constitutes the legal, valid and binding
obligation of each Obligor party thereto, enforceable
against such Obligor in accordance with its terms, except
as may be limited by bankruptcy, insolvency,
reorganization, moratorium or other similar laws relating
to or affecting the rights of creditors generally and
except as the enforceability of the Credit Documents is
subject to the application of general principles of equity
(regardless of whether considered in a proceeding in
equity or at law), including, without limitation, (a) the
possible unavailability of specific performance,
injunctive relief or any other equitable remedy and (b)
concepts of materiality, reasonableness, good faith and
fair dealing.
The foregoing opinions are subject to the
following comments and qualifications:
(A) The enforceability of Sections 6.03 and
12.03 of the Senior Subordinated Credit Agreement
(and any similar provisions in any of the other
Credit Documents) may be limited by (i) laws
rendering unenforceable indemnification contrary to
Federal or state securities laws and the public
policy underlying such laws and (ii) laws limiting
the enforceability of provisions exculpating or
exempting a party, or requiring indemnification of a
party for, liability for its own action or inaction,
to the extent the action or inaction involves gross
negligence, recklessness, willful misconduct or
unlawful conduct.
(B) The enforceability of provisions in the
Credit Documents to the effect that terms may not be
waived or modified except in writing may be limited
under certain circumstances.
(C) We express no opinion as to (i) the effect
of the laws of any jurisdiction in which any Lender
is located (other than the State of New York) that
limit the interest, fees or other charges such Lender
may impose, (ii) Section 4.07(c) or 6.06 of the
Senior
Subordinated Credit Agreement, and (iii) the second
sentence of Section 12.10 of the Senior Subordinated
Credit Agreement (and any similar provisions in any
of the other Credit Documents), insofar as such
sentence relates to the subject matter jurisdiction
of the United States District Court for the Southern
District of New York to adjudicate any controversy
related to any of the Credit Documents.
(D) We express no opinion as to the
applicability to the obligations of the Company (or
the enforceability of such obligations) of Section
548 of the Bankruptcy Code, Article 10 of the New
York Debtor and Creditor Law or any other provision
of law relating to fraudulent conveyances, transfers
or obligations.
The foregoing opinions are limited to matters
involving the Federal laws of the United States and the
law of the State of New York, and we do not express any
opinion as to the laws of any other jurisdiction.
At the request of our client, this opinion
letter is, pursuant to Section 7.01(e) of the Senior
Subordinated Credit Agreement, provided to you by us in
our capacity as special New York counsel to the Agent and
may not be relied upon by any Person for any purpose other
than in connection with the transactions contemplated by
the Senior Subordinated Credit Agreement without, in each
instance, our prior written consent.
Very truly yours,
EXHIBIT D-
2
[Matters to be covered in the Opinion of Counsel to
the Agent to be delivered on the Conversion Date]
(i) The Rollover Notes, assuming due
authorization, execution and delivery by the Company
and due authentication by the Trustee under the
Indenture, constitute legal, valid and binding
obligations of the Company, and are entitled to the
benefits of the Indenture and are enforceable against
the Company in accordance with their terms, except as
enforcement thereof may be limited by bankruptcy,
insolvency (including, without limitation, all laws
relating to fraudulent transfers), reorganization,
moratorium or other similar laws affecting
enforcement of creditors' rights generally or by
general principles of equity (regardless of whether
enforcement is considered in a proceeding in equity
or at law), including without limitation, (a) the
possible unavailability of specific performance,
injunctive relief or any other equitable remedy and
(b) concepts of materiality, reasonableness, good
faith and fair dealing.
(ii) The Indenture, assuming due authorization,
execution and delivery by the parties thereto, and
when duly authorized, executed and delivered by the
parties thereto, will constitute a legal, valid and
binding agreement of the Company and the Guarantor,
enforceable against the Company and the Guarantor in
accordance
with its terms, except as enforcement thereof may be
limited by bankruptcy, insolvency (including, without
limitation, all laws relating to fraudulent
transfers), reorganization, moratorium or other
similar laws affecting enforcement of creditors'
rights generally or by general principles of equity
(regardless of whether enforcement is considered in a
proceeding in equity or at law), including without
limitation, (a) the possible unavailability of
specific performance, injunctive relief or any other
equitable remedy and (b) concepts of materiality,
reasonableness, good faith and fair dealing.
(iii) The Registration Rights Agreement,
assuming due authorization, execution and delivery by
the parties thereto, constitutes a legal, valid and
binding agreement of the Guarantor and the Company
and is enforceable against the Guarantor and the
Company in accordance with its terms, except as
enforcement thereof may be limited by bankruptcy,
insolvency (including, without limitation, all laws
relating to fraudulent transfers), reorganization,
moratorium or other similar laws affecting
enforcement of creditors' rights generally or by
general principles of equity (regardless of whether
enforcement is considered in a proceeding in equity
or at law), including without limitation, (a) the
possible unavailability of specific performance,
injunctive relief or any other equitable remedy and
(b) concepts of materiality, reasonableness, good
faith and fair dealing.
EXHIBIT
E
[Matters to be covered in Opinion of Counsel to the
Trustee to be delivered on the Conversion Date]
1. The Trustee has been duly organized and is
[validly existing under the laws of the State of
_______________/is a national banking association and in
good standing under the laws of the United States of
America].
2. The Indenture has been duly authorized by
all requisite corporate power and other action on the part
of the Trustee, and has been duly executed and delivered
by the Trustee.
3. The Rollover Notes have been duly
authenticated by the Trustee.
EXHIBIT
F
[Form of Rollover Indenture]
UNITED STATIONERS SUPPLY CO.,
as Issuer
UNITED STATIONERS
INC.,
_____________________
and
_____________________,
as Guarantors
AND
_____________________,
as Trustee
____________________ Indenture
Dated as of March __, 1996
_____________________
$130,000,000
Floating Rate Senior Subordinated Notes due
2005
UNITED STATIONERS SUPPLY CO.
Reconciliation and tie between Trust Indenture
Act of 1939 and Indenture, dated as of _______,
1996
Trust Indenture
Act Section Indenture
Section
310(a)(1) 607
(a)(2) 607
(b) 608
312(c) 701
314(a)(4) 1008(a)
(c)(1) 102
(c)(2) 102
(e) 102
315(b) 601
316(a)(last
sentence) 101
("Outstanding")
(a)(1)(A) 502, 512
(a)(1)(B) 513
(b) 508*
(c) 104(d)
317(a)(1) 503
(a)(2) 504
(b) 1003
318(a) 111
TABLE OF CONTENTS
This Table of Contents is not part of the Agreement
to which it is attached but is inserted for convenience of
reference only.
Page
ARTICLE ONE
DEFINITIONS AND OTHER PROVISIONS
OF GENERAL APPLICATION
SECTION 101. Definitions
2
SECTION 102. Compliance Certificates and Opinions
22 SECTION 103. Form of Documents Delivered to
Trustee
23
SECTION 104. Acts of Holders
24
SECTION 105. Notices, etc., to Trustee and
Company
25
SECTION 106. Notice to Holders; Waiver
25
SECTION 107. Effect of Headings and Table of
Contents
26
SECTION 108. Successors and Assigns
26
SECTION 109. Separability Clause
26
SECTION 110. Benefits of Indenture
26
SECTION 111. Governing Law
26
SECTION 112. Legal Holidays
27
SECTION 113. No Recourse Against Others
27
ARTICLE TWO
SECURITY FORMS
SECTION 201. Forms Generally
27
SECTION 202. Restrictive Legends
28
ARTICLE THREE
THE SECURITIES
SECTION 301. Title and Terms
29
SECTION 302. Denominations
31
SECTION 303. Execution, Authentication, Delivery
and Dating
31
SECTION 304. Temporary Securities
32
SECTION 305. Registration, Registration of
Transfer and Exchange
32
SECTION 306. Special Transfer Provisions 34
SECTION 307. Mutilated, Destroyed, Lost and
Stolen Securities 35
SECTION 308. Payment of Interest; Interest Rights
Preserved 35
SECTION 309. Persons Deemed Owners 37
SECTION 310. Cancellation
37
SECTION 311. Computation of Interest
38
ARTICLE FOUR
SATISFACTION AND DISCHARGE
SECTION 401. Satisfaction and Discharge of
Indenture
38
SECTION 402. Application of Trust Money
39
ARTICLE FIVE
REMEDIES
SECTION 501. Events of Default 39
SECTION 502. Acceleration of Maturity; Rescission
and Annulment 41
SECTION 503. Collection of Indebtedness and Suits
for Enforcement by Trustee 42
SECTION 504. Trustee May File Proofs of Claim 43
SECTION 505. Trustee May Enforce Claims Without Possession
of Securities 44
SECTION 506. Application of Money Collected 45
SECTION 507. Limitation on Suits 45
SECTION 508. Unconditional Right of Holders to
Receive Principal, Premium and Interest 46
SECTION 509. Restoration of Rights and Remedies 46
SECTION 510. Rights and Remedies Cumulative 46
SECTION 511. Delay or Omission Not Waiver 47
SECTION 512. Control by Holders 47
SECTION 513. Waiver of Past Defaults 47
SECTION 514. Waiver of Stay or Extension Laws 48
SECTION 515. Undertaking for Costs 48
ARTICLE SIX
THE TRUSTEE
SECTION 601. Notice of Defaults 48
SECTION 602. Certain Rights of Trustee 48
SECTION 603. Trustee Not Responsible for Recitals
or Issuance of Securities 50
SECTION 604. May Hold Securities 51
SECTION 605. Money Held in Trust 51
SECTION 606. Compensation and Reimbursement 51
SECTION 607. Corporate Trustee Required;
Eligibility 52
SECTION 608. Resignation and Removal; Appointment
of Successor 52
SECTION 609. Acceptance of Appointment by
Successor 53
SECTION 610. Merger, Conversion, Consolidation or Succession
to Business 54
ARTICLE SEVEN
HOLDERS LISTS AND REPORTS BY TRUSTEE AND COMPANY
SECTION 701. Disclosure of Names and Addresses of Holders
54
SECTION 702. Reports by Trustee 55
ARTICLE EIGHT
CONSOLIDATION, MERGER, CONVEYANCE, TRANSFER OR LEASE
SECTION 801. Company and Each Guarantor May
Consolidate, etc., Only on Certain Terms
55
SECTION 802. Successor Substituted 57
ARTICLE NINE
SUPPLEMENTAL INDENTURES
SECTION 901. Supplemental Indentures Without
Consent of Holders 58
SECTION 902. Supplemental Indentures with Consent
of Holders 59
SECTION 903. Execution of Supplemental Indentures 60
SECTION 904. Effect of Supplemental Indentures 60
SECTION 905. Conformity with Trust Indenture Act 60
SECTION 906. Reference in Securities to
Supplemental Indentures
60
SECTION 907. Notice of Supplemental Indentures 60
ARTICLE TEN
COVENANTS
SECTION 1001. Payment of Principal, Premium, if
any, and Interest 61
SECTION 1002. Maintenance of Office or Agency 61
SECTION 1003. Money for Security Payments to Be
Held in Trust 61
SECTION 1004. Corporate Existence 63
SECTION 1005. Payment of Taxes and Other Claims 63
SECTION 1006. Maintenance of Properties 64
SECTION 1007. Insurance 64
SECTION 1008. Statement by Officers As to Default 64
SECTION 1009. Provision of Financial Statements 65
SECTION 1010. Purchase of Securities upon Change
in Control 65
SECTION 1011. Limitation on Indebtedness 67
SECTION 1012. Limitation on Restricted Payments 70
SECTION 1013. Limitation on Transactions with Affiliates
73
SECTION 1014. Limitation on Senior Subordinated
Indebtedness 74
SECTION 1015. Limitation on Liens 74
SECTION 1016. Limitation on Sale of Assets 76
SECTION 1017. Limitation on Issuances of
Guarantees of Indebtedness
78
SECTION 1018. Limitation on Subsidiary Capital
Stock 78
SECTION 1019. Limitation on Dividends and Other Payment
Restrictions Affecting Restricted
Subsidiaries 79
SECTION 1020. Waiver of Certain Covenants 80
SECTION 1021. Payment of Incremental Rate Upon
Failure to Register Securities 80
ARTICLE ELEVEN
REDEMPTION OF SECURITIES
SECTION 1101. Right of Redemption 82
SECTION 1102. Applicability of Article 82
SECTION 1103. Election to Redeem; Notice to
Trustee 82
SECTION 1104. Selection by Trustee of Securities
to Be Redeemed 82
SECTION 1105. Notice of Redemption 83
SECTION 1106. Deposit of Redemption Price 84
SECTION 1107. Securities Payable on Redemption
Date 84
SECTION 1108. Securities Redeemed in Part 84
ARTICLE TWELVE
SINKING FUND
SECTION 1201. Mandatory Sinking Fund Payments 85
SECTION 1202. Satisfaction of Sinking Fund Payments with
Securities 85
SECTION 1203. Redemption of Securities for
Sinking Fund 85
ARTICLE THIRTEEN
DEFEASANCE AND COVENANT DEFEASANCE
SECTION 1301. Company's Option to Effect
Defeasance or Covenant
Defeasance 86
SECTION 1302. Defeasance and Discharge 86
SECTION 1303. Covenant Defeasance. 86
SECTION 1304. Conditions to Defeasance or
Covenant Defeasance. 87
ARTICLE FOURTEEN
GUARANTEE OF SECURITIES
SECTION 1401. Note Guarantee. 90
SECTION 1402. Obligations Unconditional 92
SECTION 1403. Notice to Trustee 92
SECTION 1404. This Article Not to Prevent Events
of Default 92
SECTION 1405. Subordination 92
ARTICLE FIFTEEN
SUBORDINATION OF SECURITIES
SECTION 1501. Securities Subordinated to Senior
Indebtedness 93
SECTION 1502. No Payment on Securities in Certain
Circumstances 93
SECTION 1503. Payment over of Proceeds upon
Dissolution, Etc 94
SECTION 1504. Subrogation 96
SECTION 1505. Obligations any Obligor
Unconditional 97
SECTION 1506. Notice to Trustee 98
SECTION 1507. Reliance on Judicial Order or Certificate
of Liquidating Agent 99
SECTION 1508. Trustee's Relation to Senior
Indebtedness 99
SECTION 1509. Subordination Rights Not Impaired
by Acts or Omissions of any Obligor or Holders of
Senior Indebtedness 99
SECTION 1510. Holders Authorize Trustee to
Effectuate Subordination
of Securities 100
SECTION 1511. Not to Prevent Events of Default 100
SECTION 1512. Trustee's Compensation Not
Prejudiced 100
SECTION 1513. No Waiver of Subordination
Provisions 100
SECTION 1514. Payments May Be Paid Prior to
Dissolution 101
SIGNATURES AND TESTIMONIUM 90
Exhibit A - Form of Securities, Trustee's Certificate of
Authentication
Exhibit B - Form of Certificate to be Delivered in Connection
with Transfers
INDENTURE, dated as of March __, 1996 among UNITED
STATIONERS SUPPLY CO., a corporation duly organized and existing
under the laws of the State of Delaware (herein called the
"Company"), having its principal office at 2200 East Golf Road,
Des Plaines, Illinois, United Stationers Inc. ("Holdings"),
_________________________ and _______________________ (each herein
called a "Guarantor"), and
[_______________________________________], a national banking
association, as Trustee (herein called the "Trustee").
RECITALS OF THE COMPANY
The Company has duly authorized the creation of an issue
of Floating Rate Senior Subordinated Notes due 2005 (herein called
the "Initial Securities"), and Floating Rate Senior Subordinated
Notes due 2005 (the "Exchange Securities" and, together with the
Initial Securities, the "Securities"), of substantially the tenor
and amount hereinafter set forth, and to provide therefor the
Company has duly authorized the execution and delivery of this
Indenture.
[Each of] the Guarantor[s] has authorized the making of
the Guarantee pursuant to this Indenture. Upon the issuance of
the Exchange Securities, if any, or the effectiveness of any
Registration Statement (as defined), this Indenture will become
subject to the provisions of the Trust Indenture Act of 1939, as
amended, that are required to be part of this Indenture and shall,
to the extent applicable, be governed by such provisions.
All things necessary have been done to make the
Securities, when executed by the Company and authenticated and
delivered hereunder and duly issued by the Company, the valid
obligations of the Company and to make this Indenture a valid
agreement of the Company and the Guarantor[s], in accordance with
their and its terms.
NOW, THEREFORE, THIS INDENTURE WITNESSETH:
For and in consideration of the premises and the
purchase of the Securities by the Holders (as defined) thereof, it
is mutually covenanted and agreed, for the equal and proportionate
benefit of all Holders of the Securities, as follows:
ARTICLE ONE
DEFINITIONS AND OTHER PROVISIONS
OF GENERAL APPLICATION
SECTION 101. Definitions.
For all purposes of this Indenture, except as otherwise
expressly provided or unless the context otherwise requires:
(a) the terms defined in this Article have the meanings
assigned to them in this Article, and include the plural as
well as the singular;
(b) all other terms used herein which are defined in the
Trust Indenture Act, either directly or by reference therein,
have the meanings assigned to them in the Trust Indenture Act,
and the terms "cash transaction" and "self-liquidating paper,"
as used in the Trust Indenture Act Section 311, shall have the
meanings assigned to them in the rules of the Commission
adopted under the Trust Indenture Act;
(c) all accounting terms not otherwise defined herein
have the meanings assigned to them in accordance with
generally accepted accounting principles, and, except as
otherwise herein expressly provided, the term "generally
accepted accounting principles" with respect to any
computation required or permitted hereunder shall have the
meaning ascribed to "GAAP" in this Article; and
(d) the words "herein", "hereof" and "hereunder" and
other words of similar import refer to this Indenture as a
whole and not to any particular Article, Section or other
subdivision.
"Acquired Indebtedness" means Indebtedness of a Person
(i) existing at the time such Person becomes a Restricted
Subsidiary or (ii) assumed in connection with the acquisition of
assets from such Person. Acquired Indebtedness shall be deemed to
be incurred on the date of the related acquisition of assets from
any Person or the date the acquired Person becomes a Restricted
Subsidiary.
"Affiliate" means, with respect to any specified Person,
(i) any other Person directly or indirectly controlling or
controlled by or under direct or indirect common control with such
specified Person or (ii) any other Person that owns, directly or
indirectly, 10% or more of such specified Person's Capital Stock or
any executive officer or director of any such specified Person or
other Person or, with respect to any natural Person, any person
having a relationship with such Person by blood, marriage or
adoption not more remote than first cousin. For the purposes of
this definition, "control" when used with respect to any specified
Person means the power to direct the management and policies of
such Person, directly or indirectly, whether through ownership of
voting securities, by contract or otherwise; and the terms
"controlling" and "controlled" have meanings correlative to the
foregoing. Notwithstanding any of the foregoing, for purposes of
this Indenture, The Chase Manhattan Corporation and its
subsidiaries shall be deemed not to be an Affiliate of Holdings,
the Company or any Subsidiary.
"Applicable Margin" means (a) during the first Quarterly
Period, 6% and (b) during each subsequent Quarterly Period, the sum
of (x) the Applicable Margin for the immediately
preceding Quarterly Period plus (y) .50%.
"Asset Sale" means any sale, issuance, conveyance,
transfer, lease or other disposition (including, without
limitation, by way of merger, consolidation or Sale and Leaseback
Transaction) (collectively, a "transfer"), directly or indirectly,
in one or a series of related transactions, of (i) any Capital
Stock of any Subsidiary; (ii) all or substantially all of the
properties and assets of any division or line of business of the
Company or any Restricted Subsidiary; or (iii) any other properties
or assets of the Company or any Restricted Subsidiary, other than
in the ordinary course of business. For the purposes of this
definition, the term "Asset Sale" shall not include (x) any
transfer of properties or assets (A) that is governed by Section
801(a) or (B) that is by the Company to any Restricted Wholly Owned
Subsidiary, or by any Restricted Wholly Owned Subsidiary to the
Company or any Restricted Wholly Owned Subsidiary in accordance
with the terms of this Indenture [or (y) transfers of properties or
assets listed on Schedule I to this Indenture.]*
"Average Life to Stated Maturity" means, as of the date
of determination with respect to any Indebtedness, the quotient
obtained by dividing (i) the sum of the products of (a) the number
of years from the date of determination to the date or dates of
each successive scheduled principal payment of such Indebtedness
multiplied by (b) the amount of each such principal payment by (ii)
the sum of all such principal payments.
"Bankruptcy Law" means Title 11, United States Bankruptcy
Code of 1978, as amended, or any similar United States federal or
state 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.
"Base Rate" means, as of any Quarterly Date, a rate per
annum equal to the higher of (a) the Federal Funds Rate for such
Quarterly Date plus 1/2 of 1% and (b) the Prime Rate for such
Quarterly Date.
"Borrowing Base" means, as of any date, an amount equal
to the sum of (a) 80% of the face amount of all accounts receivable
of the Company and its Restricted Subsidiaries as of
such date and (b) 50% of the book value (calculated on a first-in
first-out basis) of all inventory owned by the Company and its
Restricted Subsidiaries as of such date, all calculated on a
consolidated basis and in accordance with GAAP. To the extent that
information is not available as to the amount of accounts
receivable or inventory as of a specific date, the Company may
utilize the most recent available quarterly or annual financial
report for purposes of calculating the Borrowing Base.
"Board of Directors" means either the board of directors
of the Company or any duly authorized committee of that board.
"Board Resolution" means a copy of a resolution
certified by the Secretary or an Assistant Secretary of the Company
to have been duly adopted by the Board of Directors and to be in
full force and effect on the date of such certification, and
delivered to the Trustee.
"Business Day" means each Monday, Tuesday, Wednesday,
Thursday and Friday which is not a day on which banking
institutions in The City of New York are authorized or obligated
by law or executive order to close.
"Capital Lease Obligation" means any obligations of the
Company and its Restricted Subsidiaries on a Consolidated basis
under any capital lease of real or personal property which, in
accordance with GAAP, has been recorded as a capitalized lease
obligation.
"Capital Stock" of any Person means any and all shares,
interests, participations, partnership interests or other
equivalents (however designated) of such Person's capital stock.
"Change of Control" means the occurrence of any of the
following events: (i) any "person" or "group" (as such terms are
used in Sections 13(d) and 14(d) of the Exchange Act), other than
the Permitted Holders, becomes the ultimate "beneficial owner" (as
defined in Rules 13d-3 and 13d-5 under the Exchange Act), directly
or indirectly, of more than 50% of the voting power of the total
outstanding Voting Stock of Holdings or the Company voting as one
class; (ii) during any period of two consecutive years, individuals
who at the beginning of such period constituted the Board of
Directors of Holdings or the Company (together with any new
directors whose election to such Board of Directors or whose
nomination for election by the shareholders of such Person, was
approved by a vote of 66_% of the directors then still in office
who were either directors at the beginning of such period or whose
election or nomination for election was previously so approved)
cease for any reason to constitute a majority of such Board of
Directors then in office; (iii) Holdings or the Company
consolidates with, or merges with or into, another Person or
conveys, transfers, leases or otherwise disposes of all or
substantially all of its assets to any Person, or any corporation
consolidates with, or merges with or into Holdings or the Company,
in any such event pursuant to a transaction in which the
outstanding Voting Stock of Holdings or the Company is converted
into or exchanged for cash, securities or other property, other
than any such transaction where the outstanding Voting Stock of
Holdings or the Company is not converted or exchanged at all
(except to the extent necessary to reflect a change in the
jurisdiction of incorporation of Holdings or the Company) or where
(A) the outstanding Voting Stock of Holdings or the Company is
converted into or exchanged for (x) Voting Stock of the surviving
corporation which is not Redeemable Capital Stock or (y) cash,
securities and other property (other than Capital Stock of the
surviving corporation) in an amount which could be paid by Holdings
or the Company as a Restricted Payment in accordance with Section
1012 (and such amount shall be treated as a Restricted Payment
subject to the provisions of Section 1012) and (B) no "person" or
"group" (other than the Permitted Holders) "beneficially owns"
immediately after such transaction, directly or indirectly, more
than 50% of the voting power of the total outstanding Voting Stock
of the surviving corporation; (iv) Holdings or the Company is
liquidated or dissolved or adopts a plan of liquidation or
dissolution other than in a transaction which complies with the
provisions described under Article Eight; and (v) the failure of
Holdings to "beneficially own" 100% of the voting power of the
total outstanding Voting Stock of the Company.
"Change of Control Offer" has the meaning specified in
Section 1010.
"Change of Control Purchase Date" has the meaning
specified in Section 1010.
"Closing Date" means March __, 1995.
"Code" means the Internal Revenue Code of 1986, as
amended.
"Commission" means the Securities and Exchange
Commission, as from time to time constituted, created under this
Exchange Act, or if at any time after the execution of the
Indenture such Commission is not existing and performing
substantially the same duties as are now assigned to it, then the
body performing such duties at such time.
"Company" means United Stationers Supply Co., a
corporation incorporated under the laws of Illinois, until a
successor Person shall have become such pursuant to Article 8, and
thereafter "Company" shall mean such successor Person.
"Company Request" or "Company Order" means a written
request or order signed in the name of the Company by any one of
the following: its Chairman, its President, any Vice President,
its Treasurer or an Assistant Treasurer, and delivered to the
Trustee.
"Consolidated Fixed Charge Coverage Ratio" of Holdings
means, for any period, the ratio of (a) the sum of Consolidated Net
Income (Loss), Consolidated Interest Expense, Consolidated Income
Tax Expense and Consolidated Non-cash Charges deducted in computing
Consolidated Net Income (Loss) in each case, for such period, of
Holdings and its Restricted Subsidiaries on a Consolidated basis,
all determined in accordance with GAAP to (b) the sum of
Consolidated Interest Expense for such period and cash and non-cash
dividends required to be paid or accrued on any Preferred Stock of
Holdings and its Restricted Subsidiaries during such period;
provided that (i) in making such computation, the Consolidated
Interest Expense attributable to interest on any Indebtedness
computed on a pro forma basis and (A) bearing a floating interest
rate, shall be computed as if the rate in effect on the date of
computation had been the applicable rate for the entire period and
(B) which was not outstanding during the period for which the
computation is being made but which bears at the option of
Holdings, a fixed or floating rate of interest, shall be computed
by applying at the option of Holdings, either the fixed or floating
rate and (ii) in making such computation, the Consolidated Interest
Expense of Holdings and its Restricted Subsidiaries attributable to
interest on any Indebtedness under a revolving credit facility
computed on a pro forma basis shall be computed based upon the
average daily balance of such Indebtedness during the applicable
period.
"Consolidated Income Tax Expense" means, for any period,
the provision for federal, state, local and foreign income taxes of
Holdings and its Restricted Subsidiaries for such period as
determined in accordance with GAAP on a Consolidated basis.
"Consolidated Interest Expense" of Holdings means,
without duplication, for any period, the sum of (a) the interest
expense of Holdings and its Restricted Subsidiaries for such
period, on a Consolidated basis, including, without limitation, (i)
amortization of debt discount (other than debt discount
attributable solely to a discount in the purchase price of
Indebtedness sold with an equity security, to the extent of the
amount of the value reasonably attributed in good faith to such
equity security at the time of such sale and reflected in an
Officer's Certificate delivered promptly thereafter to the
Trustee), (ii) the net cost under Interest Rate Agreements
(including amortization of discounts), (iii) the interest portion
of any deferred payment obligation, (iv) accrued interest and (v)
the amortization of deferred financing costs, plus (b)(i) the
interest component of the Capital Lease Obligations paid, accrued
and/or scheduled to be paid or accrued by Holdings during such
period and (ii) all capitalized interest of Holdings and its
Restricted Subsidiaries [less (c) the amortization of any deferred
financing costs incurred with respect to the issuance of the
Securities or the borrowings under the Senior Bank Facility, to the
extent paid prior to or on the Closing Date], in each case as
determined in accordance with GAAP on a Consolidated basis.
"Consolidated Net Income (Loss)" of Holdings means, for
any period, the Consolidated net income (or loss) of Holdings and
its Restricted Subsidiaries for such period as determined in
accordance with GAAP, adjusted, to the extent included in
calculating such net income (loss), by excluding, without
duplication, (i) all extraordinary gains or losses (less all fees
and expenses relating thereto), (ii) the portion of net income (or
loss) of Holdings and its Restricted Subsidiaries allocable to
minority interests in unconsolidated Persons to the extent that
cash dividends or distributions have not actually been received by
Holdings or one of its Restricted Subsidiaries, (iii) net income
(or loss) of any Person combined with Holdings or any of its
Restricted Subsidiaries on a "pooling of interests" basis
attributable to any period prior to the date of combination, (iv)
any gain or loss, net of taxes, realized upon the termination of
any employee pension benefit plan, (v) net gains (but not losses)
less all fees and expenses relating thereto in respect of
dispositions of assets other than in the ordinary course of
business, (vi) the net income of any Unrestricted Subsidiary,
except to the extent paid to Holdings or any Restricted Subsidiary
in cash as a dividend distribution and (vii) the net income of any
Restricted Subsidiary to the extent that the declaration of
dividends or similar distributions by that Restricted Subsidiary of
that income is not at the time permitted, directly or indirectly,
by operation of the terms of its charter or any agreement,
instrument, judgment, decree, order, statute, rule or governmental
regulations applicable to such Restricted Subsidiary or its
stockholders.
"Consolidated Net Worth" of any Person means the
Consolidated stockholders' equity (excluding Redeemable Capital
Stock) of such Person and its subsidiaries (or, in the case of
Holdings or the Company, the Restricted Subsidiaries), as
determined in accordance with GAAP on a Consolidated basis.
"Consolidated Non-cash Charges" of Holdings means, for
any period, the aggregate depreciation, amortization and other non-
cash charges of Holdings and its Restricted Subsidiaries reducing
the Consolidated Net Income of Holdings and its Restricted
Subsidiaries on a Consolidated basis for such period, as determined
in accordance with GAAP (excluding any non-cash charge which
requires an accrual or reserve for cash charges for any future
period).
"Consolidation" means, with respect to any Person, the
consolidation of the accounts of such Person and each of its
subsidiaries (or, in the case of Holdings or the Company, the
Restricted Subsidiaries) if and to the extent the accounts of such
Person and each of its subsidiaries (or, in the case of Holdings or
the Company, the Restricted Subsidiaries) would normally be
consolidated with those of such Person, all in accordance with
GAAP. The term "Consolidated" shall have a similar meaning.
"Contract Rate" means, for any Quarterly Period, a rate
per annum equal to the lesser of (a) the sum of (i) the Base Rate
as of the Quarterly Date immediately preceding the first day of
such Quarterly Period plus (ii) the Applicable Margin as of such
Quarterly Date plus (iii) during any period when the Incremental
Rate shall be applicable, the Incremental Rate and (b) 20%.
"Corporate Trust Office" means the principal corporate
trust office of the Trustee, at which at any particular time its
corporate trust business shall be administered, which office at the
date of execution of this Indenture is located at _______________,
__________, _____________________, except that with respect to
presentation of Securities for payment or for registration of
transfer or exchange, such term shall mean the office or agency of
the Trustee at which, at any particular time, its corporate agency
business shall be conducted which office shall initially be located
at __________________________________,
____________________________, _________________________.
"Default" means any event which is, or after notice or
passage of time or both would be, an Event of Default.
"Defaulted Interest" has the meaning specified in Section
308.
"Depositary" means The Depository Trust Company, its
nominees and their respective successors.
"Designated Senior Indebtedness" means (i) all Senior
Indebtedness under the Senior Bank Facility and (ii) any other
Senior Indebtedness in a principal amount of at least $50 million,
and which is specifically designated by the Company in the
agreement governing or the instrument evidencing such Senior
Indebtedness as "Designated Senior Indebtedness."
"Employment Agreements" means the employment agreements,
dated the Closing Date, between the Company and each of __________,
__________, and __________.
"Event of Default" has the meaning specified in Section
501.
"Exchange Act" means the Securities Exchange Act of 1934,
as amended.
"Exchange Offer" means the exchange offer that may be
effected pursuant to the Registration Rights Agreement.
"Exchange Securities" has the meaning stated in the first
recital of this Indenture and refers to any Exchange Securities
containing terms substantially identical to the Initial Securities
(except that such Exchange Securities shall not contain terms with
respect to transfer restrictions) that are issued and exchanged for
the Initial Securities pursuant to the Registration Rights
Agreement and this Indenture.
"Fair Market Value" means, with respect to any asset or
property, the sale value that would be obtained in an arm'slength
transaction between an informed and willing seller under no
compulsion to sell and an informed and willing buyer under no
compulsion to buy as determined by the Board of Directors in good
faith and evidenced by a resolution of the Board of Directors.
"Federal Funds Rate" means, as of any Quarterly Date, the
rate per annum (rounded upwards, if necessary, to the nearest 1/100
of 1%) equal to the weighted average of the rates on overnight
Federal funds transactions with members of the Federal
Reserve System arranged by Federal funds brokers on such day, as
published by the Federal Reserve Bank of New York on the Business
Day next succeeding such Quarterly Date, provided that (a) if the
day for which such rate is to be determined is not a Business Day,
the Federal Funds Rate for such day shall be such rate on such
transactions on the next preceding Business Day as so published on
the next succeeding Business Day and (b) if such rate is not so
published for any Business Day, the Federal Funds Rate for such
Business Day shall be the average rate charged to The Chase
Manhattan Bank, N.A. on such Business Day on such transactions as
determined by the Trustee.
"GAAP" or "Generally Accepted Accounting Principles"
means generally accepted accounting principles in the United
States, consistently applied, which are in effect at the time any
given calculation is made or any given financial statement is
prepared.
"Guarantee" means the guarantee by any Guarantor of the
Company's Indenture Obligations pursuant to a guarantee given in
accordance with this Indenture.
"Guaranteed Debt" of any Person means, without
duplication, all Indebtedness of any other Person guaranteed
directly or indirectly in any manner by such Person through an
agreement (i) to pay or purchase such Indebtedness or to advance or
supply funds for the payment or purchase of such Indebtedness, (ii)
to purchase, sell or lease (as lessee or lessor) property, or to
purchase or sell services, primarily for the purpose of enabling
the debtor to make payment of such Indebtedness or to assure the
holder of such Indebtedness against loss, (iii) to supply funds to,
or in any other manner invest in, the debtor (including any
agreement to pay for property or services without requiring that
such property be received or such services be rendered), (iv) to
maintain working capital or equity capital of the debtor, or
otherwise to maintain the net worth, solvency or other financial
condition of the debtor or (v) otherwise to assure a creditor
against loss; provided that the term "guarantee" shall not include
endorsements for collection or deposit, in either case in the
ordinary course of business.
"Guarantor" means Holdings and each Restricted Subsidiary
that is organized under the laws of the United States or any state
or territory thereof, including the District of Columbia, other
than United Business Computers, Inc.
"Holder" means a Person in whose name a Security is
registered in the Security Register.
"Holdings" means United Stationers, Inc., a Delaware
corporation.
"Incremental Rate" shall have the meaning specified in
Section 1021.
"incur" shall have the meaning ascribed thereto in
Section 1011; provided that with respect to any Indebtedness of any
Subsidiary that is owing to the Company or another Subsidiary, (a)
any disposition, pledge or transfer of such Indebtedness to any
Person (other than the Company or a Wholly Owned Subsidiary or a
pledge to lenders under the Senior Bank Facility) shall be deemed
to be an incurrence of such Indebtedness and (b) any transaction
pursuant to which a Wholly Owned Subsidiary (which is an obligor on
Indebtedness permitted by Section 1011(b)(4)) ceases to be a Wholly
Owned Subsidiary shall be deemed to be an incurrence of such
Indebtedness.
For purposes hereof, the "maximum fixed repurchase price"
of any Redeemable Capital Stock which does not have a fixed
repurchase price shall be calculated in accordance with the terms
of such Redeemable Capital Stock as if such Redeemable Capital
Stock were purchased on any date on which Indebtedness shall be
required to be determined pursuant to this Indenture, and if such
price is based upon, or measured by, the Fair Market Value of such
Redeemable Capital Stock, such Fair Market Value to be determined
in good faith by the board of directors of the issuer of such
Redeemable Capital Stock.
"Indebtedness" means, with respect to any Person, without
duplication, (i) all indebtedness of such Person for borrowed money
or for the deferred purchase price of property or services,
excluding any trade payables, but including, without limitation,
all obligations, contingent or otherwise, of such Person in
connection with any letters of credit issued under letter of credit
facilities, acceptance facilities or other similar facilities or in
connection with any agreement to purchase, redeem, exchange,
convert or otherwise acquire for value any Capital Stock of such
Person, or any warrants, rights or options to acquire such Capital
Stock, now or hereafter outstanding, if, and to the extent, any of
the foregoing would appear as a liability upon a balance sheet of
such Person prepared in accordance with GAAP, (ii) all obligations
of such Person evidenced by bonds, notes, debentures or other
similar instruments, (iii) all indebtedness created or arising
under any conditional sale or other title retention agreement with
respect to property acquired by such Person (even if the rights and
remedies of the seller or lender under such agreement in the event
of default are limited to repossession or sale of such property),
but excluding trade payables arising in the ordinary course of
business, (iv) all obligations under Interest Rate Agreements of
such Person, (v) all Capital Lease Obligations of such Person, (vi)
all Indebtedness referred to in clauses (i) through (v) above of
other Persons and all dividends of other Persons, the payment of
which is secured by (or for which the holder of such Indebtedness
has an existing right, contingent or otherwise, to be secured by)
any Lien, upon or with respect to property (including, without
limitation, accounts and contract rights) owned by such Person,
even though such Person has not assumed or become liable for the
payment of such Indebtedness, (vii) all Guaranteed Debt of such
Person and (viii) all Redeemable Capital Stock valued at the
greater of its voluntary or involuntary maximum fixed repurchase
price plus accrued and unpaid dividends. For purposes hereof, the
"maximum fixed repurchase price" of any Redeemable Capital Stock
which does not have a fixed repurchase price shall be calculated in
accordance with the terms of such Redeemable Capital Stock as if
such Redeemable Capital Stock were purchased on any date on which
Indebtedness shall be required to be determined pursuant to Section
1011, and if such price is based upon, or measured by, the Fair
Market Value of such Redeemable Capital Stock, such Fair Market
Value to be determined in good faith by the board of directors of
the issuer of such Redeemable Capital Stock.
"Indenture Obligations" means the obligations of the
Company and any other obligor, including any Guarantor, under this
Indenture or under the Securities to pay principal of, premium, if
any, and interest when due and payable, and all other amounts due
or to become due under or in connection with this Indenture, the
Securities and the performance of all other obligations to the
Trustee and the Holders under this Indenture and the Securities,
according to the terms thereof.
"Initial Holders" means ______________________.
"Initial Securities" has the meaning stated in the first
recital of this Indenture.
"Interest Payment Date" means the Stated Maturity of an
installment of interest on the Securities.
"Interest Rate Agreements" means one or more of the
following agreements which shall be entered into by one or more
financial institutions: interest rate protection agreements
(including, without limitation, interest rate swaps, caps, floors,
collars and similar agreements) and/or other types of interest rate
hedging agreements from time to time.
"Investments" means, with respect to any Person, directly
or indirectly, any advance, loan (including guarantees), or other
extension of credit or capital contribution to (by means of any
transfer of cash or other property to others or any payment for
property or services for the account or use of others), or any
purchase, acquisition or ownership by such Person of any Capital
Stock, bonds, notes, debentures or other securities issued by, any
other Person and all other items that would be classified as
investments on a balance sheet prepared in accordance with GAAP.
In addition, the Fair Market Value of the net assets of any
Restricted Subsidiary at the time such Restricted Subsidiary is
designated an Unrestricted Subsidiary shall be deemed to be an
"Investment" made by the Company in such Unrestricted Subsidiary.
The amount of any non-cash Investment shall be equal to the Fair
Market Value of the assets invested, as determined in good faith by
(i) in the case of any Investment in excess of $500,000, the Board
of Directors of the Company (provided that such determination is
evidenced by a Board Resolution) or (ii) in any other case, an
executive officer of the Company.
"Lien" means any mortgage, charge, pledge, lien
(statutory or otherwise), privilege, security interest,
hypothecation or other encumbrance upon or with respect to any
property of any kind, real or personal, movable or immovable, now
owned or hereafter acquired.
"Management Services Agreements" means the management
services agreements dated the Closing Date between __________ and
__________.
"Maturity" when used with respect to any Security means
the date on which the principal of such Security becomes due and
payable as therein provided or as provided in this Indenture,
whether at Stated Maturity, the Change of Control Purchase Date,
the Repurchase Date or the redemption date and whether by
declaration of acceleration, offer in respect of Excess Proceeds,
Change of Control, call for redemption or otherwise.
"Merger" means the merger of Associated Holdings, Inc.
with and into Holdings and the merger of Associated Stationers,
Inc. with and into the Company, in each case pursuant to the
Agreement and Plan of Merger dated as of February 15, 1995, among
such persons, pursuant to which Holdings was the surviving
corporation and the Company survived as a Wholly Owned Subsidiary
of Holdings.
"Net Cash Proceeds" means (a) with respect to any Asset
Sale by any Person, the proceeds thereof in the form of cash or
Temporary Cash Investments including payments in respect of
deferred payment obligations when received in the form of, or
stock or other assets when disposed for, cash or Temporary Cash
Investments (except to the extent that such obligations are
financed or sold with recourse to the Company or any Restricted
Subsidiary) net of (i) brokerage commissions and other actual fees
and expenses (including fees and expenses of counsel and investment
bankers) related to such Asset Sale, (ii) provisions for all taxes
payable as a result of such Asset Sale, (iii) payments made to
retire Indebtedness where payment of such Indebtedness is secured
by the assets or properties the subject of such Asset Sale, (iv)
amounts required to be paid to any Person (other than the Company
or any Restricted Subsidiary) owning a beneficial interest in the
assets subject to the Asset Sale and (v) appropriate amounts to be
provided by the Company or any Restricted Subsidiary, as the case
may be, as a reserve, in accordance with GAAP, against any
liabilities associated with such Asset Sale and retained by the
Company or any Restricted Subsidiary, as the case may be, after
such Asset Sale, including, without limitation, pension and other
post-employment benefit liabilities, liabilities related to
environmental matters and liabilities under any indemnification
obligations associated with such Asset Sale, all as reflected in an
Officers' Certificate delivered to the Trustee and (b) with respect
to any issuance or sale of Capital Stock or options, warrants or
rights to purchase Capital Stock or Indebtedness or Capital Stock
that have been converted into or exchanged for Capital Stock, the
proceeds of such issuance or sale in the form of cash or Temporary
Cash Investments, including payments in respect of deferred payment
obligations when received in the form of, or stock or other assets
when disposed for, cash or Temporary Cash Investments (except to
the extent that such obligations are financed or sold with recourse
to the Company or any Restricted Subsidiary), net of attorneys'
fees, accountants' fees and brokerage, consultation, underwriting
and other fees and expenses actually incurred in connection with
such issuance or sale and net of taxes paid or payable as a result
thereof.
"Obligor" means the Company and each Guarantor. "Offer"
has the meaning specified in Section 1016. "Offer Date"
has the meaning specified in Section 1016. "Officers'
Certificate" means a certificate signed by
the Chairman, the President or a Vice President, and by the
Treasurer, an Assistant Treasurer, the Secretary or an Assistant
Secretary of the Company, and delivered to the Trustee.
"Opinion of Counsel" means a written opinion of
counsel, who may be counsel for the Company, including an employee
of the Company, and who shall be reasonably acceptable to the
Trustee.
"Outstanding", when used with respect to Securities,
means, as of the date of determination, all Securities theretofore
authenticated and delivered under this Indenture (including without
limitation Secondary Securities), except:
(i) Securities theretofore cancelled by the Trustee or
delivered to the Trustee for cancellation;
(ii) Securities, or portions thereof, for whose payment
or redemption money in the necessary amount has been
theretofore deposited with the Trustee or any Paying Agent
(other than the Company) in trust or set aside and segregated
in trust by the Company (if the Company shall act as its own
Paying Agent) for the Holders of such Securities;
provided that, if such Securities are to be redeemed, notice
of such redemption has been duly given pursuant to this
Indenture or provision therefor satisfactory to the Trustee
has been made;
(iii) Securities, except and only to the extent provided
in Sections 1302 and 1303, with respect to which the Company
has effected defeasance and/or covenant defeasance as provided
in Article Thirteen; and
(iv) Securities which have been paid pursuant to Section
308 or in exchange for or in lieu of which other Securities
have been authenticated and delivered pursuant to this
Indenture;
provided, however, that in determining whether the Holders of the
requisite principal amount of Outstanding Securities have given any
request, demand, authorization, direction, consent, notice or
waiver hereunder, and for the purpose of making the calculations
required by TIA Section 313, Securities owned by the Company or any
other obligor upon the Securities or any Affiliate of the Company
or such other obligor shall be disregarded and deemed not to be
Outstanding, except that, in determining whether the Trustee shall
be protected in making such calculation or in relying upon any such
request, demand, authorization, direction, notice, consent or
waiver, only Securities which the Trustee knows to be so owned
shall be so disregarded. Securities so owned which have been
pledged in good faith may be regarded as Outstanding if the pledgee
establishes to the satisfaction of the Trustee the pledgees right
so to act with respect to such Securities and that the pledgee is
not the Company or any other obligor upon the Securities or any
Affiliate of the Company or such other obligor.
"Pari Passu Indebtedness" means any Indebtedness of the
Company or a Guarantor that is pari passu in right of payment to
the Securities or a Guarantee of the Securities, as the case may
be.
"Paying Agent" means any Person (including the Company
acting as Paying Agent) authorized by the Company to pay the
principal of (and premium, if any, on) or interest on any
Securities on behalf of the Company.
"Permitted Holders" means Wingate Partners, L.P., Wingate
Partners II, L.P., ASI Partners, L.P., Cumberland Capital
Corporation, Good Capital Co. Inc., Boise Cascade Corporation,
Chase Manhattan Investment Holdings, Inc., Whirlpool Financial
Corporation, James Johnson, Michael Rowsey, Daniel Schleppe, Daniel
Bushell and Robert Eberspacher, all such Persons being stockholders
of Holdings on the Closing Date.
"Permitted Indebtedness" shall have the meaning
specified in Section 1011.
"Permitted Investment" means (i) investments in the
Company or any Restricted Wholly Owned Subsidiary or any Person
which, as a result of such Investment, becomes a Restricted Wholly
Owned Subsidiary; (ii) Indebtedness of the Company or a Restricted
Subsidiary described in Section 1011(b)(5) or (6); (iii) Temporary
Cash Investments; (iv) Investments acquired by the Company or any
Restricted Subsidiary in connection with an Asset Sale permitted
under Section 1016 to the extent such Investments are non-cash
proceeds as permitted under such covenant; (v) guarantees of
Indebtedness otherwise permitted herein; (vi) Investments in
existence on the Closing Date; (vii)
customer advances not to exceed $250,000 at any one time
outstanding; (viii) travel and relocation loans and advances made
to employees in the ordinary course of business not to exceed
$200,000 at any one time outstanding; (ix) Investments received in
settlement of defaulted receivables or in connection with the
bankruptcy or reorganization of suppliers and customers and in
connection with the settlement of other disputes with customers and
suppliers arising in the ordinary course of business; (x) deposits
to secure the performance of bids, trade contracts (other than for
Indebtedness), leases, statutory obligations, surety and appeal
bonds, performance bonds and other obligations of a like nature
incurred in the ordinary course of business; (xi) operating deposit
accounts with banks; (xii) obligations under Interest Rate
Agreements; and (x) additional Investments not to exceed $1,000,000
at any one time outstanding.
"Person" means any individual, corporation, limited
liability company, partnership, joint venture, association, joint
stock company, trust, unincorporated organization or government or
any agency or political subdivisions thereof.
"Predecessor Security" of any particular Security means
every previous Security evidencing all or a portion of the same
debt as that evidenced by such particular Security; and, for the
purposes of this definition, any Security authenticated and
delivered under Section 307 in exchange for a mutilated security or
in lieu of a lost, destroyed or stolen Security shall be deemed to
evidence the same debt as the mutilated, lost, destroyed or stolen
Security.
"Preferred Stock" means with respect to any Person, any
and all shares, interests, participations or other equivalents
(however designated) of such Person's preferred stock whether now
outstanding, or issued after the date of this Indenture, and
including, without limitation, all classes and series of preferred
or preference stock.
"Prime Rate" means, as of any Quarterly Date, the prime
commercial lending rate of The Chase Manhattan Bank, N.A., or any
successor thereto as of such Quarterly Date.
"Public Equity Offering" means a bona fide underwritten
sale to the public of Common Stock of the Company or of Holdings,
to the extent that the net cash proceeds thereof are paid to the
Company as a capital contribution, pursuant to a registration
statement (other than Form S-8 or a registration statement relating
to securities issuable by any benefit plan of Holdings, the Company
or any Subsidiary) that is declared effective by the Commission.
"Qualified Capital Stock" of any Person means any and all
Capital Stock of such Person other than Redeemable Capital Stock.
"Quarterly Dates" means the three-month anniversaries of
the Closing Date; provided that if any such date is not a Business
Day the relevant Quarterly Date shall be the next succeeding
Business Day.
"Quarterly Period" means the period beginning on the date
of the initial issuance of the Securities and ending on the first
Quarterly Date and each three-month period commencing on the first
day following the end of the immediately preceding Quarterly
Period.
"Redeemable Capital Stock" means any Capital Stock
that, either by its terms or by the terms of any security into
which it is convertible or exchangeable or otherwise, is or upon
the happening of an event or passage of time would be, required to
be redeemed prior to any Stated Maturity of the principal of the
Securities or is redeemable at the option of the holder thereof at
any time prior to any such Stated Maturity, or is convertible into
or exchangeable for debt securities at any time prior to any such
Stated Maturity at the option of the holder thereof.
"Redemption Date", when used with respect to any
Security to be redeemed, in whole or in part, means the date fixed
for such redemption by or pursuant to this Indenture.
"Redemption Price", when used with respect to any
Security to be redeemed, means the price at which it is to be
redeemed pursuant to this Indenture.
"Registration Rights Agreement" means the Registration
Rights Agreement between the Company and _________________, dated
as of the date hereof, relating to the Securities.
"Registration Statement" means a Registration Statement
as defined in the Registration Rights Agreement.
"Regular Record Date" for the interest payable on any
Interest Payment Date means the ____________ or ____________
(whether or not a Business Day), as the case may be, next
preceding such Interest Payment Date.
"Reorganization Debt Securities" shall mean, with
respect to any Obligor, equity securities or debt securities of
such Person as reorganized or readjusted or of any other company,
trust or organization provided for by a plan of reorganization or
readjustment that expressly gives effect to the subordination of
the Securities to all Senior Indebtedness and provided that, in
the case of any such debt securities (a) such debt securities are
subordinated, to at least the same extent as the Securities, to
the payment of all Senior Indebtedness that will be outstanding
after giving effect to such plan of reorganization or
readjustment, (b) such debt securities shall not be entitled to
the benefits of covenants or defaults materially more beneficial
to the holders of such debt securities than those in effect with
respect to the Senior Indebtedness on the date hereof (or the
Senior Indebtedness, after giving effect to such plan of
reorganization or readjustment) and (c) the agreements and
instruments governing such debt securities shall not provide for
any purchase, redemption, retirement or other acquisition for
value of, or any setting apart any money for a sinking, defeasance
or other analogous fund for the purchase, redemption, retirement
or other acquisition of, or any scheduled payment or prepayment of
the principal of such debt securities prior to the three-month
anniversary of the final scheduled maturity date of the Senior
Indebtedness (as modified by such plan of reorganization or
readjustment).
"Repurchase Date" has the meaning specified in
Section 1016.
"Responsible Officer", when used with respect to the
Trustee, means the chairman or any vice-chairman of the board of
directors, the chairman or any vice-chairman of the executive
committee of the board of directors, the chairman of the trust
committee, the president, any vice president, the secretary, any
assistant secretary, the treasurer, any assistant treasurer, the
cashier, any assistant cashier, any trust officer or assistant
trust officer, the controller or any assistant controller or any other
officer of the Trustee customarily performing functions similar to
those performed by any of the above-designated officers, and also
means, with respect to a particular corporate trust matter, any
other officer to whom such matter is referred because of his
knowledge of and familiarity with the particular subject.
"Restricted Subsidiary" means any Subsidiary other than
an Unrestricted Subsidiary.
"Sale and Leaseback Transaction" means any transaction
or series of related transactions pursuant to which the Company or
a Restricted Subsidiary sells or transfers any property or asset
in connection with the leasing, or the resale against installment
payments, of such property or asset to the seller or transferor.
"Secondary Securities" means the additional Securities
issued or issuable in payment of accrued interest on the
Securities at a rate in excess of 15% per annum on any Interest
Payment Date or any date on which Defaulted Interest in respect
thereof is payable.
"Securities" has the meaning stated in the first recital
of this Indenture and more particularly means any Securities
authenticated and delivered under this Indenture including without
limitation Secondary Securities. For all purposes of this
Indenture, the term "Securities" shall include any Exchange
Securities that are issued and exchanged for any Securities
pursuant to the Registration Rights Agreement and this Indenture
and, for purposes of this Indenture, all Securities and Exchange
Securities shall vote together as one series of Securities under
this Indenture.
"Securities Act" means the Securities Act of 1933, as
amended.
"Security Register" and "Security Registrar" shall have
the respective meanings specified in Section 305.
"Senior Bank Facility" means the Credit Agreement, dated
as of March 30, 1995, among the Company, Holdings, the lenders
named therein and The Chase Manhattan Bank, N.A., as agent, and
any ancillary documents executed in connection therewith, as such
agreements may be amended, renewed, extended, substituted,
refinanced, restructured, replaced, supplemented or otherwise
modified from time to time (including, without limitation, any
successive renewals, extensions, substitutions, refinancings,
restructuring, replacements, supplementations or other
modifications of the foregoing). For purposes of this Indenture,
"Senior Bank Facility" shall include any amendments, renewals,
extensions, substitutions, refinancings, restructuring,
replacements, supplements or any other modifications that increase
the principal amount of the Indebtedness or the commitments to
lend thereunder and have been made in compliance with the
provisions of Section 1011.
"Senior Guarantor Indebtedness" means, with respect to
any Guarantor, the principal of, premium, if any, and interest
(including interest accruing after the filing of a petition
initiating any proceeding under any state, federal or foreign
bankruptcy laws whether or not allowable as a claim in such
proceeding) on any Indebtedness of such Guarantor (except as
otherwise provided in this definition), whether outstanding on the
Closing Date or thereafter created, incurred or assumed,
unless, in the case of any particular Indebtedness, the instrument
creating or evidencing the same or pursuant to which the same is
outstanding expressly provides that such Indebtedness shall not be
senior in right of payment to such Guarantor's Guarantee of the
Securities. Without limiting the generality of the foregoing,
"Senior Guarantor Indebtedness" shall include the principal of
(and premium, if any) and interest (including interest accruing
after the filing of a petition initiating any proceeding under any
state, federal or feign bankruptcy laws whether or not allowable
as a claim in such proceeding) and all other obligations of ever
nature of any Guarantor from time to time owned under the Senior
Bank Facility; provided, however, that any Indebtedness under any
refinancing, refunding or replacement of the Senior Bank Facility
shall not constitute Senior Guarantor Indebtedness to the extent
that the Indebtedness thereunder is by its express terms
subordinate to any other Indebtedness of any Guarantor.
Notwithstanding the foregoing, "Senior Guarantor Indebtedness"
shall not include any of the following (whether or not
constituting Indebtedness herein): (i) Indebtedness evidenced by
the Guarantees of the Securities, (ii) Indebtedness that, by its
express terms, is subordinate or junior in right of payment to any
Indebtedness of any Guarantor, (iii) Indebtedness which when
incurred and without respect to any election under Section 1111(b)
of Title 11 United States Code, is without recourse to any
Guarantor, (iv) Indebtedness which is represented by Redeemable
Capital Stock, (v) any liability for foreign, federal, state,
local or other taxes owed or owing by any Guarantor, (vi)
Indebtedness owed by any Guarantor to a Subsidiary and (vii) any
trade payables.
"Senior Indebtedness" means the principal of, premium,
if any, and interest (including interest accruing after the filing
of a petition initiating any proceeding under any state, federal
or feign bankruptcy law whether or not allowable as a claim in
such proceeding) on any Indebtedness of the Company (except as
otherwise provided in this definition), whether outstanding on the
date hereof or thereafter created, incurred or assumed, unless, in
the case of any particular Indebtedness, the instrument creating
or evidencing the same or pursuant to which the same is
outstanding expressly provides that such Indebtedness shall not be
senior in right of payment to the Notes. Without limiting the
generality of the foregoing, "Senior Indebtedness" shall include
the principal of (and premium, if any) and interest (including
interest accruing after the filing of a petition initiating any
proceeding under any state, federal or foreign bankruptcy laws
whether or not allowable as a claim in such proceeding) and all
other obligations of every nature of the Company from time to time
owed under the Senior Bank Facility; provided, however, that any
Indebtedness under any refinancing, refunding or replacement of
the Senior Bank Facility shall not constitute Senior Indebtedness
to the extent that the Indebtedness thereunder is by its express
terms subordinate to any other Indebtedness of the Company.
Notwithstanding the foregoing, "Senior Indebtedness" shall not
include any of the following (whether or not constituting
Indebtedness herein): (i) Indebtedness evidenced by the
Securities, (ii) Indebtedness that is, by its express terms,
subordinated or junior right of payment to any Indebtedness of the
Company, (iii) Indebtedness which, when incurred and without
respect to any election under Section 1111(b) of Title 11 United
States Code, is without recourse to the Company, (iv) Indebtedness
which is represented by Redeemable Capital Stock, (v) any
liability for foreign, federal, state, local or other taxes owed
or owing by the Company, (vi) Indebtedness of the Company to a
Subsidiary and (vii) any trade payables.
"Senior Subordinated Credit Agreement" means the Senior
Subordinated Credit Agreement, dated as of March 30, 1995 among
the Company, Holdings, the lenders party thereto and The Roebling
Fund, as agent, as amended, modified or supplemented from time to
time.
"Senior Subordinated Obligations" is defined to mean any
principal of, premium, if any, or interest on the Securities
payable pursuant to the terms of the Securities or upon
acceleration, including any amounts received upon the exercise of
rights of rescission or other rights of action (including claims
for damages) or otherwise, to the extent relating to the purchase
price of the Securities or amounts corresponding to such
principal, premium, if any, or interest on the Securities.
"Significant Subsidiary" means, at any date of
determination any Restricted Subsidiary that, together with its
Subsidiaries, (i) for the most recent fiscal year of the Company,
accounted for more than 10% of the Consolidated revenues of the
Company or (ii) as of the end of such fiscal year, was the owner
of more than 10% of the Consolidated assets of the Company, all as
set forth on the most recently available Consolidated financial
statements of the Company for such fiscal year.
"Special Record Date" for the payment of any Defaulted
Interest means a date fixed by the Trustee pursuant to
Section 308.
"Stated Maturity" when used with respect to any
Indebtedness or any installment of interest thereon, means the
dates specified in such Indebtedness as the fixed date on which
the principal of such Indebtedness or such installment of interest
is due and payable.
"Subordinated Indebtedness" means Indebtedness of the
Company or a Guarantor subordinated in right of payment to the
Securities or a Guarantee of the Securities, as the case may be.
"Subsidiary" means any Person a majority of the equity
ownership or the Voting Stock of which is at the time owned,
directly or indirectly, by Holdings or by one or more other
Subsidiaries.
"Temporary Cash Investments" means (i) any evidence of
Indebtedness with a maturity of one year or less and issued by the
United States of America, or an instrumentality or agency thereof
and guaranteed fully as to principal, premium, if any, and
interest by the United States of America, (ii) any certificate of
deposit with a maturity of one year or less and issued by, or a
time deposit of, a commercial banking institution that is a member
of the Federal Reserve System and that has combined capital and
surplus and undivided profits of not less than $500,000,000 whose
debt has a rating, at the time as of which any investment therein
is made, of "P-1" (or higher) according to Moody's Investors
Service, Inc. ("Moody's") or any successor rating agency or "A-1"
(or higher) according to Standard and Poor's Corporation ("S&P")
or any successor rating agency, (iii) commercial paper with a
maturity of one year or less and issued by a corporation (other
than an Affiliate or Subsidiary of Holdings) organized and
existing under the laws of any state of the United States of
America or the District of Columbia with a rating, at the time as
of which any investment therein is made, of "P-1" (or higher)
according to Moody's or "A1" (or higher) according to S&P and (iv)
any money market deposit accounts issued or offered by a domestic
commercial bank having capital and surplus in excess of
$500,000,000.
"Trust Indenture Act" means the Trust Indenture Act of
1939, as amended.
"Unrestricted Subsidiary" means (i) any Subsidiary which
at the time of determination shall be designated an Unrestricted
Subsidiary (as designated by the Board of Directors of the
Company, as provided below), (ii) any Subsidiary of an
Unrestricted Subsidiary, and (iii) [existing foreign
subsidiaries]. The Board of Directors of the Company may designate
any Subsidiary (including any newly acquired or newly formed
Subsidiary) to be an Unrestricted Subsidiary so long as (a)
neither the Company nor any Restricted Subsidiary is directly or
indirectly liable for any Indebtedness of such Subsidiary, (b) no
default with respect to any Indebtedness of such Subsidiary would
permit (upon notice, lapse of time or otherwise) any holder of any
other Indebtedness of the Company or any Restricted Subsidiary to
declare a default on such other Indebtedness or cause the payment
thereof to be accelerated or payable prior to its stated maturity,
(c) neither the Company nor any Restricted Subsidiary has made an
Investment in such Subsidiary unless such Investment was permitted
under, and made in accordance with, Section 1012 and (d) neither
the Company nor any Restricted Subsidiary has a contract,
agreement, arrangement, understanding or obligation of any kind,
whether written or oral, with such Subsidiary other than those
that might be obtained at the time from Persons who are not
Affiliates of the Company. Any such designation by the Board of
Directors of the Company shall be evidenced to the Trustee by
filing a Board Resolution with the Trustee giving effect to such
designation and, for purposes of Section 1012, shall constitute
the making of an Investment in such Unrestricted Subsidiary as
provided under the definition of Investment. The Board of
Directors of the Company may designate any Unrestricted Subsidiary
as a Restricted Subsidiary if immediately after giving effect to
such designation there would be no Default or Event of Default
hereunder and the Company could incur $1.00 of additional
Indebtedness (other than Permitted Indebtedness) pursuant to
Section 1011.
"Voting Stock" means stock of the class or classes
pursuant to which the holders thereof have the general voting
power under ordinary circumstances to elect at least a majority of
the board of directors, managers or trustees of a corporation
(irrespective of whether or not at the time stock of any other
class or classes shall have or might have voting power by reason
of the happening of any contingency).
"Wholly Owned Subsidiary" means a Subsidiary all the
Capital Stock of which (other than directors' qualifying shares or
a de minimus number of shares required, under applicable law, to
be owned by foreign nationals) is owned by the Company or another
Wholly Owned Subsidiary; and "Restricted Wholly Owned Subsidiary"
means a Wholly Owned Subsidiary that is a Restricted Subsidiary.
SECTION 102. Compliance Certificates and Opinions.
Upon any application or request by the Company to the
Trustee to take any action under any provision of this Indenture,
the Company shall furnish to the Trustee an Officers' Certificate
stating that all conditions precedent, if any, provided for in
this Indenture (including any covenant, if compliance therewith
constitutes a condition precedent) relating to the proposed action
have been complied with and an Opinion of Counsel stating that in
the opinion of such counsel all such conditions precedent, if any,
have been complied with, except that in the
case of any such application or request as to which the furnishing
of such documents is specifically required by any provision of
this Indenture relating to such particular application or request,
no additional certificate or opinion need be furnished.
Every certificate with respect to compliance with a
condition or covenant provided for in this Indenture (other than
pursuant to Section 1008(a)) shall include:
(1) a statement that each individual signing such
certificate or opinion has read such covenant or condition
and the definitions herein relating thereto;
(2) a brief statement as to the nature and scope of the
examination or investigation upon which the statements or
opinions contained in such certificate or opinion are based;
(3) a statement that, in the opinion of each such
individual, he or she has made such examination or
investigation as is necessary to enable him to express an
informed opinion as to whether or not such covenant or
condition has been complied with; and
(4) a statement as to whether, in the opinion of each
such individual, such condition or covenant has been complied
with.
SECTION 103. Form of Documents Delivered to Trustee.
In any case where several matters are required to be
certified by, or covered by an opinion of, any specified Person,
it is not necessary that all such matters be certified by, or
covered by the opinion of, only one such Person, or that they be
so certified or covered by only one document, but one such Person
may certify or give an opinion with respect to some matters and
one or more other such Persons as to other matters, and any such
Person may certify or give an opinion as to such matters in one or
several documents.
Any certificate or opinion of an officer of the Company
may be based, insofar as it relates to legal matters, upon a
certificate or opinion of, or representations by, counsel, unless
such officer knows, or in the exercise of reasonable care should
know, that the certificate or opinion or representations with
respect to the matters upon which his certificate or opinion is
based are erroneous. Any such certificate or Opinion of Counsel
may be based, insofar as it relates to factual matters, upon a
certificate or opinion of, or representations by, an officer or
officers of the Company stating that the information with respect
to such factual matters is in the possession of the Company,
unless such counsel has actual knowledge that the certificate or
opinion or representations with respect to such matters are
erroneous.
Where any Person is required to make, give or execute
two or more applications, requests, consents, certificates,
statements, opinions or other instruments under this Indenture,
they may, but need not, be consolidated and form one instrument.
SECTION 104. Acts of Holders.
(a) Any request, demand, authorization, direction,
notice, consent, waiver or other action provided by this Indenture
to be given or taken by Holders may be embodied in and
evidenced by one or more instruments of substantially similar
tenor signed by such Holders in person or by agents duly appointed
in writing; and, except as herein otherwise expressly provided,
such action shall become effective when such instrument or
instruments are delivered to the Trustee and, where it is hereby
expressly required, to the Company. Such instrument or
instruments (and the action embodied therein and evidenced
thereby) are herein sometimes referred to as the "Act" of the
Holders signing such instrument or instruments. Proof of
execution of any such instrument or of a writing appointing any
such agent shall be sufficient for any purpose of this Indenture
and conclusive in favor of the Trustee and the Company, if made in
the manner provided in this Section.
(b) The fact and date of the execution by any Person of
any such instrument or writing may be proved by the affidavit of a
witness of such execution, by an attestation of another authorized
officer or by a certificate of a notary public or other officer
authorized by law to take acknowledgments of deeds, certifying
that the individual signing such instrument or writing
acknowledged to him the execution thereof. Where such execution
is by a signer acting in a capacity other than his individual
capacity, such certificate or affidavit shall also constitute
sufficient proof of authority. The fact and date of the execution
of any such instrument or writing, or the authority of the Person
executing the same, may also be proved in any other manner which
the Trustee deems sufficient.
(c) The principal amount and serial numbers of
Securities held by any Person, and the date of holding the same,
shall be proved by the Security Register.
(d) If the Company shall solicit from the Holders of
Securities any request, demand, authorization, direction, notice,
consent, waiver or other Act, the Company may, at its option, by
or pursuant to Board Resolution, fix in advance a record date for
the determination of Holders entitled to give such request,
demand, authorization, direction, notice, consent, waiver or other
Act, but the Company shall have no obligation to do so.
Notwithstanding TIA Section 316(c), such record date shall be the
record date specified in or pursuant to such Board Resolution,
which shall be a date not earlier than the date 10 days prior to
the first solicitation of Holders generally in connection
therewith and not later than the date such solicitation is
completed. If such a record date is fixed, such request, demand,
authorization, direction, notice, consent, waiver or other Act may
be given before or after such record date, but only the Holders of
record at the close of business on such record date shall be
deemed to be Holders for the purposes of determining whether
Holders of the requisite proportion of Outstanding Securities have
authorized or agreed or consented to such request, demand,
authorization, direction, notice, consent, waiver or other Act,
and for that purpose the Outstanding Securities shall be computed
as of such record date.
(e) Any request, demand, authorization, direction,
notice, consent, waiver or other Act of the Holder of any Security
shall bind every future Holder of the same Security and the Holder
of every Security issued upon the registration of transfer thereof
or in exchange therefor or in lieu thereof in respect of anything
done, omitted or suffered to be done by the Trustee or the Company
in reliance thereon, whether or not notation of such action is
made upon such Security.
SECTION 105. Notices, etc., to Trustee and Company.
Any request, demand, authorization, direction, notice,
consent, waiver or Act of Holders or other document provided or
permitted by this Indenture to be made upon, given or furnished
to, or filed with,
(1) the Trustee by any Holder or by the Company shall
be sufficient for every purpose hereunder if made, given,
furnished or filed in writing to or with the Trustee at its
Corporate Trust Office, Attention: Corporate Trust
Department, or
(2) the Company by the Trustee or by any Holder shall
be sufficient for every purpose hereunder (unless otherwise
herein expressly provided) if in writing and mailed, first-
class postage prepaid, to the Company addressed to it at the
address of its principal office specified in the first
paragraph of this Indenture, or at any other address
previously furnished in writing to the Trustee by the
Company.
SECTION 106. Notice to Holders; Waiver.
Where this Indenture provides for notice of any event to
Holders by the Company or the Trustee, such notice shall be
sufficiently given (unless otherwise herein expressly provided) if
in writing and mailed, first-class postage prepaid, to each Holder
affected by such event, at his address as it appears in the
Security Register, not later than the latest date, and not earlier
than the earliest date, prescribed for the giving of such notice.
In any case where notice to Holders is given by mail, neither the
failure to mail such notice, nor any defect in any notice so
mailed, to any particular Holder shall affect the sufficiency of
such notice with respect to other Holders. Any notice mailed to a
Holder in the manner herein prescribed shall be conclusively
deemed to have been received by such Holder, whether or not such
Holder actually receives such notice. Where this Indenture
provides for notice in any manner, such notice may be waived in
writing by the Person entitled to receive such notice, either
before or after the event, and such waiver shall be the equivalent
of such notice. Waivers of notice by Holders shall be filed with
the Trustee, but such filing shall not be a condition precedent to
the validity of any action taken in reliance upon such waiver.
In case by reason of the suspension of or irregularities
in regular mail service or by reason of any other cause, it shall
be impracticable to mail notice of any event to Holders when such
notice is required to be given pursuant to any provision of this
Indenture, then any manner of giving such notice as shall be
satisfactory to the Trustee shall be deemed to be a sufficient
giving of such notice for every purpose hereunder.
SECTION 107. Effect of Headings and Table of Contents.
The Article and Section headings herein and the Table of
Contents are for convenience only and shall not affect the
construction hereof.
SECTION 108. Successors and Assigns.
All covenants and agreements in this Indenture by the
Company shall bind its successors and assigns, whether so
expressed or not.
SECTION 109. Separability Clause.
In case any provision in this Indenture or in the
Securities shall be invalid, illegal or unenforceable, the
validity, legality and enforceability of the remaining provisions
shall not in any way be affected or impaired thereby.
SECTION 110. Benefits of Indenture.
Nothing in this Indenture or in the Securities, express
or implied, shall give to any Person, other than the parties
hereto, any Paying Agent, any Securities Registrar and their
successors hereunder, and the Holders any benefit or any legal or
equitable right, remedy or claim under this Indenture.
SECTION 111. Governing Law.
This Indenture and the Securities shall be governed by
and construed in accordance with the law of the State of New York
applicable to contracts to be performed entirely in that state.
SECTION 112. Legal Holidays.
In any case where any Interest Payment Date, Redemption
Date, or Stated Maturity or Maturity of any Security shall not be
a Business Day, then (notwithstanding any other provision of this
Indenture or of the Securities) payment of interest or principal
(and premium, if any) need not be made on such date, but may be
made on the next succeeding Business Day with the same force and
effect as if made on the Interest Payment Date, Redemption Date,
or at the Stated Maturity or Maturity; provided that no additional
interest shall accrue for the period from and after such Interest
Payment Date, Redemption Date, Stated Maturity or Maturity, as the
case may be, through such next succeeding Business Day.
SECTION 113. No Recourse Against Others.
A director, officer, employee or stockholder, as such,
of the Company or of a Guarantor shall not have any liability for
any obligations of the Company or a Guarantor under the Securities
or this Indenture or for any claim based on, in respect of or by
reason of such obligations or their creation. By accepting a
Security, each Holder shall waive and release all such liability.
The waiver and release shall be part of the consideration for the
issue of the Securities.
ARTICLE TWO
SECURITY FORMS
SECTION 201. Forms Generally.
The Initial Securities shall be known as the "Floating
Rate Senior Subordinated Securities due 2005" and the Exchange
Securities shall be known as the "Floating Rate Senior
Subordinated Securities due 2005", in each case, of the Company.
The Securities and the Trustee's certificate of authentication
shall be in substantially the forms annexed hereto as Exhibit A,
with such appropriate insertions, omissions, substitutions and
other variations as are required or permitted by this Indenture,
and may have such letters, numbers or other marks of
identification and such legends or endorsements placed thereon as
may be required to comply with the rules of any securities
exchange or the Depositary or as may, consistently herewith, be
determined by the officers executing such Securities, as evidenced
by their execution of the Securities. Any portion of
the text of any Security may be set forth on the reverse thereof,
with an appropriate reference thereto on the face of the Security.
Each Security shall be dated the date of its authentication.
The definitive Securities may be printed, lithographed
or engraved on steel-engraved borders or may be produced in any
other manner, all as determined by the officers of the Company
executing such Securities, as evidenced by their execution of such
Securities.
The terms and provisions contained in the form of the
Securities annexed hereto as Exhibit A shall constitute, and are
hereby expressly made, a part of this Indenture. To the extent
applicable, the Company and the Trustee, by their execution and
delivery of this Indenture, expressly agree to such terms and
provisions and to be bound thereby.
Initial Securities shall be issued in the form of
permanent certificated Securities in registered form in
substantially the form set forth in Exhibit A.
SECTION 202. Restrictive Legends.
Unless and until (i) an Initial Security is sold under
an effective Registration Statement or (ii) an Initial Security is
exchanged for an Exchange Security in connection with an effective
Exchange Offer, in each case pursuant to the Registration Rights
Agreement, each such Initial Security shall bear the following
legend (the "Private Placement Legend") on the face thereof:
THIS SECURITY HAS NOT BEEN REGISTERED
UNDER THE SECURITIES ACT OF 1933, AS AMENDED
(THE "SECURITIES ACT"), OR ANY STATE
SECURITIES LAWS. NEITHER THIS SECURITY NOR
ANY INTEREST OR PARTICIPATION HEREIN MAY BE
REOFFERED, SOLD, ASSIGNED, TRANSFERRED,
PLEDGED, ENCUMBERED OR OTHERWISE DISPOSED OF
IN THE ABSENCE OF SUCH REGISTRATION OR UNLESS
SUCH TRANSACTION IS EXEMPT FROM, OR NOT
SUBJECT TO, THE REGISTRATION REQUIREMENTS OF
THE SECURITIES ACT. THE HOLDER OF THIS
SECURITY BY ITS ACCEPTANCE HEREOF AGREES TO
OFFER, SELL OR OTHERWISE TRANSFER SUCH
SECURITY, PRIOR TO THE DATE WHICH IS THREE
YEARS AFTER THE LATER OF THE ORIGINAL ISSUE
DATE HEREOF AND THE LAST DATE ON WHICH THE
COMPANY OR ANY AFFILIATE OF THE COMPANY WAS
THE OWNER OF THIS SECURITY (OR ANY PREDECESSOR
OF THIS SECURITY) ONLY (A) TO THE COMPANY, (B)
PURSUANT TO A REGISTRATION STATEMENT WHICH HAS
BEEN DECLARED EFFECTIVE UNDER THE SECURITIES
ACT, (C) TO AN INSTITUTIONAL "ACCREDITED
INVESTOR" WITHIN THE MEANING OF SUBPARAGRAPH
(A)(1), (2), (3) OR (7) OF RULE 501 UNDER THE
SECURITIES ACT THAT IS ACQUIRING THIS SECURITY
FOR ITS OWN ACCOUNT, OR FOR THE ACCOUNT OF
SUCH AN INSTITUTIONAL "ACCREDITED INVESTOR,"
FOR INVESTMENT PURPOSES AND NOT WITH A VIEW
TO, OR FOR OFFER OR SALE IN CONNECTION WITH,
ANY DISTRIBUTION IN VIOLATION OF THE
SECURITIES ACT, IN EACH CASE IN A MINIMUM
PRINCIPAL AMOUNT OF $1,000,000, OR (D)
PURSUANT TO ANOTHER AVAILABLE EXEMPTION FROM
THE
REGISTRATION REQUIREMENTS OF THE SECURITIES
ACT, SUBJECT TO THE COMPANY'S AND THE
TRUSTEE'S RIGHT PRIOR TO ANY SUCH OFFER, SALE
OR TRANSFER (i) PURSUANT TO CLAUSES (C) or (D)
TO REQUIRE THE DELIVERY OF AN OPINION OF
COUNSEL, CERTIFICATION AND/OR OTHER
INFORMATION SATISFACTORY TO EACH OF THEM, AND
(ii) IN EACH OF THE FOREGOING CASES (CLAUSES
(A) THROUGH (D)), TO REQUIRE THAT A
CERTIFICATE OF TRANSFER IN THE FORM APPEARING
ON THE OTHER SIDE OF THIS SECURITY IS
COMPLETED AND DELIVERED BY THE TRANSFEROR TO
THE TRUSTEE.
ARTICLE THREE
THE SECURITIES
SECTION 301. Title and Terms.
The aggregate principal amount of Securities which may
be authenticated and delivered under this Indenture is limited to
$[130,000,000], except for Securities authenticated and delivered
upon registration of transfer of, or in exchange for, or in lieu
of, other Securities pursuant to Section 304, 305, 306, 906, 1010,
1016 or 1108.
The Stated Maturity of the Securities shall be
_____________, 2005, and they shall bear interest at the Contract
Rate from __________, 1996, or from the most recent Interest
Payment Date to which interest has been paid or duly provided for,
payable in cash on ____________, 1996 and semiannually thereafter
on __________ and __________ in each year and at said Stated
Maturity, until the principal thereof is paid or duly provided
for; provided that (i) all interest accruing at a rate in excess
of 15% per annum ("Excess Interest") may, at the option of the
Company (but subject to proviso (ii) below), be payable by the
issuance and delivery on the applicable Interest Payment Date of
Secondary Securities in an aggregate principal amount equal to the
amount of Excess Interest, (ii) Secondary Securities shall be
issuable only in denominations of $1,000 and integral multiples
thereof, and any Excess Interest which, after aggregating all
Excess Interest due on any Interest Payment Date to a single
Holder (irrespective of the number of individual Securities
registered in the name of such Holder), would exceed the nearest
whole multiple of $1,000 shall be payable in cash and (iii) during
any period when the rate of interest provided for in Section 503
of this Indenture shall be applicable, interest shall accrue at
said rate and be payable by the Company from time to time in cash,
or in Secondary Securities to the extent provided in provisos (i)
and (ii), upon demand of the Trustee.
Pursuant to and in accordance with the terms of Section
1021, the interest rate borne by the Securities shall be increased
by an amount not to exceed more than one percent per annum in the
aggregate for the periods specified in Section 1021 during which
any Exchange Offer registration process is delayed.
The principal of (and premium, if any, on) and interest
on the Securities shall be payable at the office or agency of the
Company maintained for such purpose as provided in Section 1002;
provided, however, that at the option of the Company interest may
be paid, subject to the next following proviso, by mailing of a
check for cash interest and duly executed certificates for
Secondary Securities, if any, to the addresses of the Persons
entitled hereto as such addresses shall appear on the Security
Register, any certificates for Secondary Securities to be mailed
by registered mail; and provided, further, that any Initial Holder
or its nominee or any Affiliate of such Initial Holder may enter
into a written agreement with the Company whereby the Company
agrees to cause the Trustee to pay all sums and duly executed
certificates for Secondary Securities becoming due on the
Securities for principal, premium and interest in the manner
provided therein or in such other manner as such Holder may
designate to the Company in writing, in all cases without any
presentment or surrender of any Security, and the Trustee will, to
the extent it has received adequate funds and duly executed
certificates for Secondary Securities for such purpose from the
Company, make all such payments in such manner, provided that (1)
an executed counterpart or conformed copy of such agreement shall
be filed with, the Trustee, and (2) such agreement contains the
undertaking of such Holder that it will, prior to disposing of any
Security held by it (or its nominee), make notation thereon of the
amount of all payments of principal previously made thereon and
the date to which interest thereon has been paid, and will present
the same to the Trustee for inspection or submit the same to the
Trustee for such notation, or surrender the same in exchange for a
new Security for the unpaid balance of the principal amount
thereof. The Trustee agrees to act in accordance with any such
agreement so filed with it. The Senior Subordinated Credit
Agreement shall be deemed to constitute such an Agreement and the
Trustee acknowledges filing with it of an executed counterpart or
conformed copy thereof. The Company agrees to indemnify and hold
the Trustee (in its individual capacity and as Trustee) and each
of its officers, directors, attorneys-in-fact and agents harmless
for acting in accordance with any agreement filed with it as
provided in this paragraph.
The Securities shall be redeemable as provided in
Article Eleven.
The Securities shall be subordinated in right of payment
to Senior Indebtedness as provided in Article Fifteen.
SECTION 302. Denominations.
The Securities shall be issuable only in registered form
without coupons and only in denominations of $1,000 and any
integral multiple thereof.
SECTION 303. Execution, Authentication, Delivery and
Dating.
The Securities shall be executed on behalf of the
Company by its Chairman, its President or a Vice President, and
attested by its Secretary, an Assistant Secretary or any Vice
President. The signature of any of these officers on the
Securities may be manual or facsimile signatures of the present or
any future such authorized officer and may be imprinted or
otherwise reproduced on the Securities.
Securities bearing the manual or facsimile signatures of
individuals who were at any time the proper officers of the
Company shall bind the Company, notwithstanding that such
individuals or any of them have ceased to hold such offices prior
to the authentication and delivery of such Securities or did not
hold such offices at the date of such Securities.
At any time and from time to time after the execution
and delivery of this Indenture, the Company may deliver Securities
executed by the Company to the Trustee for authentication,
together with a Company Order for the
authentication and delivery of such Securities, and the Trustee in
accordance with such Company Order shall authenticate and deliver
such Securities.
Each Security shall be dated the date of its
authentication.
No Security shall be entitled to any benefit under this
Indenture or be valid or obligatory for any purpose unless there
appears on such Security a certificate of authentication
substantially in the form provided for herein duly executed by the
Trustee by manual signature of an authorized officer, and such
certificate upon any Security shall be conclusive evidence, and
the only evidence, that such Security has been duly authenticated
and delivered hereunder and is entitled to the benefits of this
Indenture.
In case the Company, pursuant to Article Eight, shall be
consolidated or merged with or into any other Person or shall
convey, transfer, lease or otherwise dispose of its properties and
assets substantially as an entirety to any Person, and the
successor Person resulting from such consolidation, or surviving
such merger, or into which the Company shall have been merged, or
the Person which shall have received a conveyance, transfer, lease
or other disposition as aforesaid, shall have executed an
indenture supplemental hereto with the Trustee pursuant to Article
Eight, any of the Securities authenticated or delivered prior to
such consolidation, merger, conveyance, transfer, lease or other
disposition may, from time to time, at the request of the
successor Person, be exchanged for other Securities executed in
the name of the successor Person with such changes in phraseology
and form as may be appropriate, but otherwise in substance of like
tenor as the Securities surrendered for such exchange and of like
principal amount; and the Trustee, upon Company Request of the
successor Person, shall authenticate and deliver Securities as
specified in such request for the purpose of such exchange. If
Securities shall at any time be authenticated and delivered in any
new name of a successor Person pursuant to this Section in
exchange or substitution for or upon registration of transfer of
any Securities, such successor Person, at the option of the
Holders but without expense to them, shall provide for the
exchange of all Securities at the time Outstanding for Securities
authenticated and delivered in such new name.
SECTION 304. Temporary Securities.
Pending the preparation of definitive Securities, the
Company may execute, and upon Company Order the Trustee shall
authenticate and deliver, temporary Securities which are printed,
lithographed, typewritten, mimeographed or otherwise produced, in
any authorized denomination, substantially of the tenor of the
definitive Securities in lieu of which they are issued and with
such appropriate insertions, omissions, substitutions and other
variations as the officers executing such Securities may
determine, as conclusively evidenced by their execution of such
Securities.
If temporary Securities are issued, the Company will
cause definitive Securities to be prepared without unreasonable
delay. After the preparation of definitive Securities, the
temporary Securities shall be exchangeable for definitive
Securities upon surrender of the temporary Securities at the
office or agency of the Company designated for such purpose
pursuant to Section 1002, without charge to the Holder. Upon
surrender for cancellation of any one or more temporary
Securities, the Company shall execute and the Trustee shall
authenticate and deliver in exchange therefor a like principal
amount of definitive Securities of authorized denominations. Until
so exchanged, the temporary Securities shall in all respects be
entitled to the same benefits under this Indenture as definitive
Securities.
SECTION 305. Registration, Registration of Transfer and
Exchange.
The Company shall cause to be kept at the Corporate
Trust Office of the Trustee a register (the register maintained in
such office and in any other office or agency designated pursuant
to Section 1002 being herein sometimes referred to as the
"Security Register") in which, subject to such reasonable
regulations as it may prescribe, the Company shall provide for the
registration of Securities and of transfers of Securities. The
Security Register shall be in written form or any other form
capable of being converted into written form within a reasonable
time. At all reasonable times, the Security Register shall be
open to inspection by the Trustee. The Trustee is hereby
initially appointed as security registrar (the "Security
Registrar") for the purpose of registering Securities and
transfers of Securities as herein provided.
Upon surrender for registration of transfer of any
Security at the office or agency of the Company designated
pursuant to Section 1002, the Company shall execute, and the
Trustee shall authenticate and deliver, in the name of the
designated transferee or transferees, one or more new Securities
of any authorized denomination or denominations of a like
aggregate principal amount.
At the option of the Holder, Securities may be exchanged
for other Securities of any authorized denomination and of a like
aggregate principal amount, upon surrender of the Securities to be
exchanged at such office or agency. Whenever any Securities are
so surrendered for exchange, the Company shall execute, and the
Trustee shall authenticate and deliver, the Securities which the
Holder making the exchange is entitled to receive; provided that
no exchange of Initial Securities for Exchange Securities shall
occur until the Exchange Offer shall have been declared effective
by the Commission and that the Initial Securities to be exchanged
for the Exchange Securities shall be cancelled by the Trustee.
All Securities issued upon any registration of transfer
or exchange of Securities shall be the valid obligations of the
Company and any Guarantors, evidencing the same debt, and entitled
to the same benefits under this Indenture, as the Securities
surrendered upon such registration of transfer or exchange.
Every Security presented or surrendered for registration
of transfer or for exchange shall (if so required by the Company
or the Security Registrar) be duly endorsed, or be accompanied by
a written instrument of transfer, in form satisfactory to the
Company and the Security Registrar, duly executed by the Holder
thereof or his attorney duly authorized in writing.
No service charge shall be made for any registration of
transfer or exchange or redemption of Securities, but the Company
may require payment of a sum sufficient to cover any tax or other
governmental charge that may be imposed in connection with any
registration of transfer or exchange of Securities, other than
exchanges pursuant to Section 304, 906, 1010, 1016 or 1108 not
involving any transfer.
The Company shall not be required (i) to issue, register
the transfer of or exchange any Security during a period beginning
at the opening of business 15 days before the selection of
Securities to be redeemed under Section 1104 and ending at the
close of business on the day of such mailing of the relevant
notice of redemption, 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 306. Special Transfer Provisions.
Unless and until (i) an Initial Security is sold under
an effective Registration Statement, or (ii) an Initial Security
is exchanged for an Exchange Security in connection with an
effective Exchange Offer, in each case pursuant to the
Registration Rights Agreement, the following provisions shall
apply:
(a) Registration of Transfers. The Registrar shall
register the transfer of any Initial Security, whether or not
such Initial Security bears the Private Placement Legend, if
(x) the requested transfer is at least three years after the
later of the date the Securities were acquired from the
Company or from an Affiliate of the Company or (y) the
proposed transferee has delivered to the Registrar a
certificate substantially in the form of Exhibit B hereto
and, if requested by the Company or the Trustee, an opinion
of counsel satisfactory to each of them.
(b) Private Placement Legend. Upon the transfer,
exchange or replacement of Securities not bearing the Private
Placement Legend, the Registrar shall deliver Securities that
do not bear the Private Placement Legend. Upon the transfer,
exchange or replacement of Securities bearing the Private
Placement Legend, the Registrar shall deliver only Securities
that bear the Private Placement Legend unless there is
delivered to the Registrar an Opinion of Counsel reasonably
satisfactory to the Company and the Trustee to the effect
that neither such legend nor the related restrictions on
transfer are required in order to maintain compliance with
the provisions of the Securities Act.
(c) General. By its acceptance of any Security bearing
the Private Placement Legend, each Holder of such a Security
acknowledges the restrictions on transfer of such Security
set forth in this Indenture and in the Private Placement
Legend and agrees that it will transfer such Security only as
provided in this Indenture.
The Registrar shall retain copies of all letters,
notices and other written communications received pursuant to
Section 306. The Company shall have the right to inspect and make
copies of all such letters, notices or other written
communications at any reasonable time upon the giving of
reasonable written notice to the Registrar.
SECTION 307. Mutilated, Destroyed, Lost and Stolen
Securities.
If (i) any mutilated Security is surrendered to the
Trustee, or (ii) the Company and the Trustee receive evidence to
their satisfaction of the destruction, loss or theft of any
Security, and there is delivered to the Company and the Trustee
(at the expense of the Holder) such security or indemnity as may
be required by them to save each of them harmless, then, in the
absence of notice to the Company or the Trustee that such Security
has been acquired by a bona fide purchaser, the Company shall
execute and upon Company Order the Trustee shall authenticate and
deliver, in exchange for any such mutilated Security or in lieu of
any such destroyed, lost or stolen Security, a new Security of
like tenor and principal amount, bearing a number not
contemporaneously outstanding.
In case any such mutilated, destroyed, lost or stolen
Security has become or is about to become due and payable, the
Company in its discretion may, instead of issuing a new Security,
pay such Security.
Upon the issuance of any new Security under this
Section, the Company may require the payment of a sum sufficient
to cover any tax or other governmental charge that may be imposed
in relation thereto and any other expenses (including the fees and
expenses of the Trustee) connected therewith.
Every new Security issued pursuant to this Section in
lieu of any destroyed, lost or stolen Security shall constitute an
original additional contractual obligation of the Company and any
Guarantor, whether or not the destroyed, lost or stolen Security
shall be at any time enforceable by anyone, and shall be entitled
to all benefits of this Indenture equally and proportionately with
any and all other Securities duly issued hereunder.
The provisions of this Section are exclusive and shall
preclude (to the extent lawful) all other rights and remedies with
respect to the replacement or payment of mutilated, destroyed,
lost or stolen Securities.
SECTION 308. Payment of Interest; Interest Rights
Preserved.
Interest on any Security which is payable, and is
punctually paid or duly provided for, on any Interest Payment Date
shall be paid to the Person in whose name such Security (or one or
more Predecessor Securities) is registered at the close of
business on the Regular Record Date immediately prior to such
Interest Payment Date at the office or agency of the Company
maintained for such purpose pursuant to Section 1002; provided,
however, that each installment of interest may at the Company's
option be paid by mailing a check for such interest, payable to or
upon the written order of the Person entitled thereto pursuant to
Section 308, to the address of such Person as it appears in the
Security Register.
Any interest on any Security which is payable, but is
not punctually paid or duly provided for, on any Interest Payment
Date shall forthwith cease to be payable to the Holder on the
Regular Record Date by virtue of having been such Holder, and such
defaulted interest and (to the extent lawful) interest on such
defaulted interest at the rate borne by the Securities (such
defaulted interest and interest thereon herein collectively called
"Defaulted Interest") may be paid by the Company, at its election
in each case, as provided in clause (1) or (2) below:
(1) The Company may elect to make payment of any
Defaulted Interest to the Persons in whose names the
Securities (or their respective Predecessor Securities) are
registered at the close of business on a Special Record Date
for the payment of such Defaulted Interest, which shall be
fixed in the following manner. The Company shall notify the
Trustee in writing of the amount of Defaulted Interest
proposed to be paid on each Security and the date of the
proposed payment, and at the same time the Company shall
deposit with the Trustee an amount of money equal to the
aggregate amount proposed to be paid in respect of such
Defaulted Interest or shall make arrangements satisfactory to
the Trustee for such deposit prior to the date of the
proposed payment, such money when deposited to be held in
trust for the benefit of the Persons entitled to such
Defaulted Interest as in this clause provided. Thereupon the
Trustee shall fix a Special Record Date for the payment of
such Defaulted Interest which shall be not more than
30 days and not less than 10 days prior to the date of the
proposed payment and not less than 10 days after the receipt
by the Trustee of the notice of the proposed payment. The
Trustee shall promptly notify the Company of such Special
Record Date, and in the name and at the expense of the
Company, shall cause notice of the proposed payment of such
Defaulted Interest and the Special Record Date therefor to be
given in the manner provided for in Section 106, not less
than 10 days prior to such Special Record Date. Notice of
the proposed payment of such Defaulted Interest and the
Special Record Date therefor having been so given, such
Defaulted Interest shall be paid to the Persons in whose
names the Securities (or their respective Predecessor
Securities) are registered at the close of business on such
Special Record Date and shall no longer be payable pursuant
to the following clause (2).
(2) The Company may make payment of any Defaulted
Interest in any other lawful manner not inconsistent with the
requirements of any securities exchange on which the
Securities may be listed, and upon such notice as may be
required by such exchange, if, after notice given by the
Company to the Trustee of the proposed payment pursuant to
this clause, such manner of payment shall not be deemed
impracticable by the Trustee.
Subject to the foregoing provisions of this Section,
each Security delivered under this Indenture upon registration of
transfer of or in exchange for or in lieu of any other Security
shall carry the rights to interest accrued and unpaid, and to
accrue, which were carried by such other Security.
SECTION 309. Persons Deemed Owners.
Prior to the due presentment of a Security for
registration of transfer, the Company, the Trustee and any agent
of the Company or the Trustee may treat the Person in whose name
such Security is registered as the owner of such Security for the
purpose of receiving payment of principal of (and premium, if any,
on) and (subject to Sections 305 and 308) interest on such
Security and for all other purposes whatsoever, whether or not
such Security be overdue, and none of the Company, the Trustee or
any agent of the Company or the Trustee shall be affected by
notice to the contrary.
SECTION 310. Cancellation.
All Securities surrendered for payment, redemption,
registration of transfer or exchange shall, if surrendered to any
Person other than the Trustee, be delivered to the Trustee and
shall be promptly cancelled by it. The Company may at any time
deliver to the Trustee for cancellation any Securities previously
authenticated and delivered hereunder which the Company may have
acquired in any manner whatsoever, and may deliver to the Trustee
(or to any other Person for delivery to the Trustee) for
cancellation any Securities previously authenticated hereunder
which the Company has not issued and sold, and all Securities so
delivered shall be promptly cancelled by the Trustee. If the
Company shall so acquire any of the Securities, however, such
acquisition shall not operate as a redemption or satisfaction of
the Indebtedness represented by such Securities unless and until
the same are surrendered to the Trustee for cancellation. No
Securities shall be authenticated in lieu of or in exchange for
any Securities cancelled as provided in this Section, except as
expressly permitted by this Indenture. All cancelled Securities
held by the Trustee shall be disposed of by the Trustee in
accordance with its customary procedures and certification of
their disposal delivered to the Company unless by Company Order
the Company shall direct that cancelled Securities be returned to
it.
SECTION 311. Computation of Interest.
Interest on the Securities shall be computed on the
basis of a 360-day year of twelve 30-day months.
ARTICLE FOUR
SATISFACTION AND DISCHARGE
SECTION 401. Satisfaction and Discharge of Indenture.
This Indenture shall cease to be of further effect
(except as to surviving rights of registration of transfer or
exchange of the Securities, as expressly provided for herein) as
to all Outstanding Securities when
(1) either
(a) all the Securities theretofore
authenticated and delivered (other than lost, stolen or
destroyed Securities which have been replaced or paid as
provided in Section 307) have been cancelled or have
been delivered to the Trustee for cancellation; or
(b) all Securities not theretofore delivered
to the Trustee for cancellation
(i) have become due and payable, or
(ii) will become due and payable at
their Stated Maturity within one year, or
(iii) are to be called for
redemption within one year under arrangements
satisfactory to the Trustee for the giving of
notice of redemption by the Trustee in the name,
and at the expense, of the Company,
and the Company or any Guarantor has irrevocably deposited or
caused to be deposited with the Trustee funds in an amount
sufficient to pay and discharge the entire Indebtedness on
the Securities not theretofore delivered to the Trustee for
cancellation, including principal of, premium, if any, and
accrued interest at such Stated Maturity or redemption date;
(2) the Company or any Guarantor has paid or caused to
be paid all other sums payable under this Indenture by the
Company and each Guarantor; and
(3) the Company has delivered to the Trustee an
Officers' Certificate and an Opinion of Counsel each stating
that (a) all conditions precedent hereunder relating to the
satisfaction and discharge of this Indenture have been
complied with and (b) such satisfaction and discharge will
not result in a breach or violation of, or constitute a
default under, this Indenture.
SECTION 402. Application of Trust Money.
Subject to the provisions of the last paragraph of
Section 1003, all money deposited with the Trustee pursuant to
Section 401 shall be held in trust and applied by it, in
accordance with the provisions of the Securities and this
Indenture, to the payment, either directly or through any Paying
Agent (including the Company acting as its own Paying Agent) as
the Trustee may determine, to the Persons entitled thereto, of the
principal (and premium, if any) and interest for whose payment
such money has been deposited with the Trustee; but such money
need not be segregated from other funds except to the extent
required by law.
ARTICLE FIVE
REMEDIES
SECTION 501. Events of Default.
"Event of Default", wherever used herein, means any one
of the following events (whatever the reason for such Event of
Default and whether it shall be voluntary or involuntary or be
effected by operation of law or pursuant to any judgment, decree
or order of any court or any order, rule or regulation of any
administrative or governmental body):
(1) there shall be a failure to pay any interest on any
Security when it becomes due and payable, and such failure
shall continue for a period of 30 days;
(2) there shall be a failure to pay the principal of
(or premium, if any, on) any Security at its Maturity (upon
acceleration, optional or mandatory redemption, required
repurchase or otherwise);
(3) (a) there shall be a failure to perform, or breach
of, any covenant or agreement of the Company, Holdings, or
any Guarantor under this Indenture (other than a failure in
the performance, or breach, of a covenant or agreement which
is specifically dealt with in clauses (1) or (2) or in
clauses (b), (c) and (d) of this clause (3)) and such failure
or breach shall continue for a period of 30 days after
written notice has been given, by certified mail, (x) to the
Company by the Trustee or (y) to the Company and the Trustee
by the Holders of at least 25% in aggregate principal amount
of the Outstanding Securities, specifying such failure or
breach and requiring it to be remedied and stating that such
notice is a "Notice of Default" under this Indenture; (b)
there shall be a failure in the performance or breach of the
provisions described in Article Eight; (c) the Company shall
have failed to make or consummate an Offer in accordance with
the provisions of Section 1016; or (d)
the Company shall have failed to make or consummate a Change
of Control Offer in accordance with the provisions of Section
1010;
(4) one or more defaults shall have occurred under any
agreements, indentures or instruments under which the Company
or any Restricted Subsidiary then has outstanding
Indebtedness in excess of $10,000,000 in the aggregate and,
if not already matured at its final maturity in accordance
with its terms, such Indebtedness shall have been
accelerated;
(5) any Guarantee shall for any reason cease to be, or
shall be asserted in writing by any Guarantor, Holdings or
the Company not to be, in full force and effect and
enforceable in accordance with its terms or any Subsidiary
shall fail to Guarantee the Securities as required by Section
1017;
(6) one or more judgments, orders or decrees for the
payment of money in excess of $10,000,000, either
individually or in the aggregate (net of amounts covered by
insurance, bond, surety or similar instrument), shall be
entered against the Company, any Restricted Subsidiary or any
of their respective properties and shall not be discharged
and either (a) any creditor shall have commenced an
enforcement proceeding upon such judgment, order or decree or
(b) there shall have been a period of 60 consecutive days
during which a stay of enforcement of such judgment or order,
by reason of an appeal or otherwise, shall not be in effect;
(7) there shall have been the entry by a court of
competent jurisdiction of (a) a decree or order for relief in
respect of the Company, Holdings or any Significant
Subsidiary in an involuntary case or proceeding under any
applicable Bankruptcy Law or (b) a decree or order adjudging
the Company, Holdings or any Significant Subsidiary bankrupt
or insolvent, or seeking reorganization, arrangement,
adjustment or composition of or in respect of the Company,
Holdings or any Significant Subsidiary under any applicable
federal or state law, or appointing a custodian, receiver,
liquidator, assignee, trustee, sequestrator (or other similar
official) of the Company, Holdings or any Significant
Subsidiary or of any substantial part of their respective
properties, or ordering the winding up or liquidation of
their affairs, and any such decree or order for relief shall
continue to be in effect, or any such other decree or order
shall be unstayed and in effect, for a period of 60
consecutive days; or
(8) (a) the Company, Holdings or any Significant
Subsidiary commences a voluntary case or proceeding under any
applicable Bankruptcy Law or any other case or proceeding to
be adjudicated bankrupt or insolvent, (b) the Company,
Holdings or any Significant Subsidiary consents to the entry
of a decree or order for relief in respect of the Company,
Holdings or any Significant Subsidiary in an involuntary case
or proceeding under any applicable Bankruptcy Law or to the
commencement of any bankruptcy or insolvency case or
proceeding against it, (c) the Company, Holdings or any
Significant Subsidiary files a petition or answer or consent
seeking reorganization or relief under any applicable federal
or state law, (d) the Company, Holdings or any Significant
Subsidiary (x) consents to the filing of such petition or the
appointment of, or taking possession
by, a custodian, receiver, liquidator, assignee, trustee,
sequestrator or similar official of the Company, Holdings or
any Significant Subsidiary or of any substantial part of
their respective properties, (y) makes an assignment for the
benefit of creditors or (z) admits in writing its inability
to pay its debts generally as they become due or (e) the
Company, Holdings or any Significant Subsidiary takes any
corporate action in furtherance of any such actions in this
clause (8).
SECTION 502. Acceleration of Maturity; Rescission and
Annulment.
If an Event of Default (other than as specified in
Section 501(7) or 501(8)) shall occur and be continuing, the
Trustee or the Holders of not less than 25% in aggregate principal
amount of the Securities then Outstanding may, and the Trustee at
the request of such Holders shall, declare all unpaid principal
of, premium, if any, and accrued interest on all the Securities to
be due and payable immediately, by a notice in writing to the
Company (and to the Trustee if given by the Holders of the
Securities); provided that so long as the Senior Bank Facility is
in effect, such declaration shall not become effective until the
earlier of (a) five business days after receipt of such notice of
acceleration from the Holders or the Trustee by the agent under
the Senior Bank Facility or (b) acceleration of the Indebtedness
under the Senior Bank Facility. Thereupon such principal shall
become immediately due and payable, and the Trustee may, at its
discretion, proceed to protect and enforce the rights of the
Holders of Securities by appropriate judicial proceeding. If an
Event of Default specified in Section 501(7) or 501(8) occurs and
is continuing, then all the Securities shall ipso facto become and
be immediately due and payable, in an amount equal to the
principal amount of the Securities, together with accrued and
unpaid interest, if any, to the date the Securities become due and
payable, without any declaration or other act on the part of the
Trustee or any Holder. The Trustee or, if notice of acceleration
is given by the Holders, the Holders shall give notice to the
agent under the Credit Agreement of any such acceleration;
provided that failure to give such notice shall not affect the
validity thereof.
At any time after a declaration of acceleration has been
made, but before a judgment or decree for payment of the money due
has been obtained by the Trustee, the Holders of a majority in
aggregate principal amount of Securities Outstanding, by written
notice to the Company and the Trustee, may rescind and annul such
declaration and its consequences if:
(1) the Company has paid or deposited with the Trustee
a sum sufficient to pay:
(a) all sums paid or advanced by the Trustee
hereunder and the reasonable compensation, expenses,
disbursements and advances of the Trustee, its agents
and counsel,
(b) all overdue interest on all Securities,
and
(c) to the extent that payment of such
interest is lawful, interest upon overdue interest at
the rate borne by the Securities;
(2) all Events of Default, other than the non-payment
of principal of the Securities which have become due solely
by such declaration of acceleration, have been cured or
waived as provided in Section 513; and
(3) the rescission will not conflict with any judgment
or decree.
No such rescission shall affect any subsequent default
or impair any right consequent thereon.
SECTION 503. Collection of Indebtedness and Suits for
Enforcement by Trustee.
The Company covenants that if:
(a) default is made in the payment of any installment
of interest on any Security when such interest becomes due
and payable and such default continues for a period of 30
days, or
(b) default is made in the payment of the principal of
(or premium, if any, on) any Security at the Maturity
thereof,
the Company will, upon demand of the Trustee, pay to the Trustee
for the benefit of the Holders of such Securities, the whole
amount then due and payable on such Securities for principal (and
premium, if any) and interest, and interest on any overdue
principal (and premium, if any) and, to the extent that payment of
such interest shall be legally enforceable, upon any overdue
installment of interest, at the rate borne by the Securities, and,
in addition thereto, such further amount as shall be sufficient to
cover the costs and expenses of collection, including the
reasonable compensation, expenses, disbursements and advances of
the Trustee, its agents and counsel, except costs and expenses
incurred as a result of the Trustee's negligence or bad faith. To
the extent that any interest is required pursuant to Section 301
to be paid by delivery of Secondary Securities, the Company will,
together with the foregoing cash payment, deliver to the Trustee
duly executed certificates for such Secondary Securities in the
requisite aggregate principal amount.
If the Company fails to pay such amounts and deliver
such Secondary Securities forthwith upon such demand, the Trustee,
in its own name as trustee of an express trust, may institute a
judicial proceeding for the collection of the sums and Secondary
Securities so due and unpaid, may prosecute such proceeding to
judgment or final decree and may enforce the same against the
Company, any Guarantor, or any other obligor upon the Securities
and collect the moneys and Secondary Securities adjudged or
decreed to be payable in the manner provided by law out of the
property of the Company, any Guarantor, or any other obligor upon
the Securities, wherever situated.
If an Event of Default occurs and is continuing, the
Trustee may in its discretion proceed to protect and enforce its
rights and the rights of the Holders by such appropriate judicial
proceedings as the Trustee shall deem most effectual to protect
and enforce any such rights, whether for the specific enforcement
of any covenant or agreement in this Indenture or in aid of the
exercise of any power granted herein, or to enforce any other
proper remedy.
SECTION 504. Trustee May File Proofs of Claim.
In case of 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, premium, if any, 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, unless incurred as a
result of the Trustee's negligence or bad faith) and of the
Holders allowed in such judicial proceeding, and
(ii) to collect and receive any moneys or other property
payable or deliverable on any such claims and to distribute
the same;
and any custodian, receiver, assignee, trustee, liquidator,
sequestrator or 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 the
Trustee any amount due it for the reasonable compensation,
expenses, disbursements and advances of the Trustee, its agents
and counsel, unless incurred as a result of the Trustee's
negligence or bad faith, and any other amounts due the Trustee
under Section 606.
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, or to authorize the Trustee to vote in respect of
the claim of any Holder in any such proceeding.
SECTION 505. Trustee May Enforce Claims Without
Possession of Securities.
All rights of action and claims under this Indenture or
the Securities may be prosecuted and enforced by the Trustee
without the possession of any of the Securities or the production
thereof in any proceeding relating thereto, and any such
proceeding instituted by the Trustee shall be brought in its own
name and as trustee of an express trust, and any recovery of
judgment shall, after provision for the payment of the reasonable
compensation, expenses, disbursements and advances of the Trustee,
its agents and counsel, be for the ratable benefit of the Holders
in respect of which such judgment has been recovered.
SECTION 506. Application of Money Collected.
Any money collected by the Trustee pursuant to this
Article shall be applied in the following order, at the date or
dates fixed by the Trustee and, in case of the distribution of
such money on account of principal (or premium, if any) or
interest, upon presentation of the Securities and the notation
thereon of the payment if only partially paid and upon surrender
thereof if fully paid:
FIRST: To the payment of all amounts due the Trustee
under Section 606;
SECOND: To the payment of the amounts then due and
unpaid for principal of (and premium, if any, on,) and
interest on the Securities in respect of which or for the
benefit of which such money has been collected, ratably,
without preference or priority of any kind, according to the
amounts due and payable on such Securities for principal (and
premium, if any) and interest, respectively; and
THIRD: The balance, if any, to the Person or Persons
entitled thereto.
SECTION 507. Limitation on Suits.
No Holder shall have any right to institute any
proceeding, judicial or otherwise, with respect to this Indenture,
or for the appointment of a receiver or trustee, or for any other
remedy hereunder, unless
(1) such Holder has previously given written notice to
the Trustee of a continuing Event of Default;
(2) the Holders of not less than 25% in principal
amount of the Outstanding Securities shall have made written
request to the Trustee to institute proceedings in respect of
such Event of Default in its own name as Trustee hereunder;
(3) such Holder or Holders have offered to the Trustee
reasonable indemnity against the costs, expenses and
liabilities to be incurred in compliance with such request;
(4) the Trustee for 30 days after its receipt of such
notice, request and offer of indemnity has failed to
institute any such proceeding; and
(5) no direction inconsistent with such written request
has been given to the Trustee during such 30-day period by
the Holders of a majority or more in principal amount of the
Outstanding Securities;
it being understood and intended that no one or more Holders shall
have any right in any manner whatever by virtue of, or by availing
of, any provision of this Indenture to affect, disturb or
prejudice the rights of any other Holders, or to obtain or to seek
to obtain priority or preference over any other Holders or to
enforce any right under this Indenture, except in the manner
herein provided and for the equal and ratable benefit of all the
Holders.
SECTION 508. Unconditional Right of Holders to Receive
Principal, Premium and Interest.
Notwithstanding any other provision in this Indenture,
the Holder of any Security shall have the right, which is absolute
and unconditional, to receive payment, as provided herein
(including, if applicable, Article Twelve) and in such Security of
the principal of (and premium, if any, on) and (subject to Section
308) interest on, such Security on the respective Stated
Maturities expressed in such Security (or, in the case of
redemption, on the Redemption Date) and to institute
suit for the enforcement of any such payment, and such rights
shall not be impaired without the consent of such Holder.
SECTION 509. Restoration of Rights and Remedies.
If the Trustee or any Holder has instituted any
proceeding to enforce any right or remedy under this Indenture and
such proceeding has been discontinued or abandoned for any reason,
or has been determined adversely to the Trustee or to such Holder,
then and in every such case, subject to any determination in such
proceeding, the Company, the Trustee and the Holders shall be
restored severally and respectively to their former positions
hereunder and thereafter all rights and remedies of the Trustee
and the Holders shall continue as though no such proceeding had
been instituted.
SECTION 510. Rights and Remedies Cumulative.
Except as otherwise provided with respect to the
replacement or payment of mutilated, destroyed, lost or stolen
Securities in the last paragraph of Section 307, no right or
remedy herein conferred upon or reserved to the Trustee or to the
Holders is intended to be exclusive of any other right or remedy,
and every right and remedy shall, to the extent permitted by law,
be cumulative and in addition to every other right and remedy
given hereunder or now or hereafter existing at law or in equity
or otherwise. The assertion or employment of any right or remedy
hereunder, or otherwise, shall not prevent the concurrent
assertion or employment of any other appropriate right or remedy.
SECTION 511. Delay or Omission Not Waiver.
No delay or omission of the Trustee or of any Holder of
any Security to exercise any right or remedy accruing upon any
Event of Default shall impair any such right or remedy or
constitute a waiver of any such Event of Default or an
acquiescence therein. Every right and remedy given by this
Article or by law to the Trustee or to the Holders may be
exercised from time to time, and as often as may be deemed
expedient, by the Trustee or by the Holders, as the case may be.
SECTION 512. Control by Holders.
The Holders of not less than a majority in principal
amount of the Outstanding Securities shall have the right to
direct the time, method and place of conducting any proceeding for
any remedy available to the Trustee, or exercising any trust or
power conferred on the Trustee, provided that
(1) such direction shall not be in conflict with any
rule of law or with this Indenture,
(2) the Trustee may take any other action deemed proper
by the Trustee which is not inconsistent with such direction,
and
(3) the Trustee need not take any action which might
involve it in personal liability or be unjustly prejudicial
to the Holders not consenting.
SECTION 513. Waiver of Past Defaults.
The Holders of not less than a majority in principal
amount of the Outstanding Securities may on behalf of the Holders
of all the Securities waive any past default hereunder and its
consequences, except a default
(1) in respect of the payment of the principal of (or
premium, if any, on) or interest on any Security, or
(2) in respect of a covenant or provision hereof which
under Article Nine cannot be modified or amended without the
consent of the Holder of each Outstanding Security 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 Event of
Default or impair any right consequent thereon.
SECTION 514. Waiver of Stay or Extension Laws.
The Company and each Guarantor covenants (to the extent
that it may lawfully do so) that it will not at any time insist
upon, or plead, or in any manner whatsoever claim or take the
benefit or advantage of, any stay or extension law wherever
enacted, now or at any time hereafter in force, which may affect
the covenants or the performance of this Indenture; and the
Company and each Guarantor (to the extent that it may lawfully do
so) hereby expressly waives all benefit or advantage of any such
law and covenants that it will not hinder, delay or impede the
execution of any power herein granted to the Trustee, but will
suffer and permit the execution of every such power as though no
such law had been enacted.
SECTION 515. Undertaking for Costs.
In any suit for the enforcement of any right or remedy
under this Indenture or the Securities or in any suit against the
Trustee for any action taken or omitted by it as Trustee, a court
in its discretion may require the filing by any party litigant in
the suit of an undertaking to pay the costs of the suit, and the
court in its discretion may assess reasonable costs, including
reasonable attorneys' fees, 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 or a suit by Holders of more than
10% in principal amount of the Securities.
ARTICLE SIX
THE TRUSTEE
SECTION 601. Notice of Defaults.
Within 45 days after the occurrence of any Default
hereunder, the Trustee shall transmit in the manner and to the
extent provided in TIA Section 313(c), notice of such Default
hereunder known to the Trustee, unless such Default shall have
been cured or waived; provided, however, that, except in the case
of a Default in the payment of the principal of (or premium, if
any, on) or interest on any Security or in the payment of any
sinking fund installment, the Trustee shall be protected in
withholding such notice if and so long as the board of directors,
the executive committee or a trust committee of directors and/or
Responsible Officers of the Trustee in good faith determines that
the withholding of such notice is in the interest of the Holders.
SECTION 602. Certain Rights of Trustee.
Subject to the provisions of TIA Sections 315(a) through
315(d):
(1) the Trustee may rely and shall be protected in
acting or refraining from acting upon any resolution,
certificate, statement, instrument, opinion, report, notice,
request, direction, consent, order, bond, debenture, note,
other evidence of indebtedness or other paper or document
believed by it to be genuine and to have been signed or
presented by the proper party or parties;
(2) any request or direction of the Company mentioned
herein shall be sufficiently evidenced by a Company Request
or Company Order and any resolution of the Board of Directors
may be sufficiently evidenced by a Board Resolution;
(3) whenever in the administration of this Indenture
the Trustee shall deem it desirable that a matter be proved
or established prior to taking, suffering or omitting any
action hereunder, the Trustee (unless other evidence be
herein specifically prescribed) may, in the absence of gross
negligence or bad faith on its part, rely upon an Officers'
Certificate;
(4) the Trustee may consult with counsel and the
written advice of such counsel or any Opinion of Counsel
shall be full and complete authorization and protection in
respect of any action taken, suffered or omitted by it
hereunder in good faith and in reliance thereon;
(5) the Trustee shall be under no obligation to
exercise any of the rights or powers vested in it by this
Indenture at the request or direction of any of the Holders
pursuant to this Indenture, unless such Holders shall have
offered to the Trustee reasonable security or indemnity
against the costs, expenses and liabilities which might be
incurred by it in compliance with such request or direction;
(6) the Trustee shall not be bound to make any
investigation into the facts or matters stated in any
resolution, certificate, statement, instrument, opinion,
report, notice, request, direction, consent, order, bond,
debenture, note, other evidence of indebtedness or other
paper or document, but the Trustee, in its discretion, may
make such further inquiry or investigation into such facts or
matters as it may see fit, and, if the Trustee shall
determine to make such further inquiry or investigation, it
shall be entitled to examine the books, records and premises
of the Company, personally or by agent or attorney;
(7) the Trustee may execute any of the trusts or
powers hereunder or perform any duties hereunder either
directly or by or through agents or attorneys and the Trustee
shall not be responsible for any misconduct or negligence on
the part of any agent or attorney appointed with due care by
it hereunder; and
(8) the Trustee shall not be liable for any action
taken, suffered or omitted by it in good faith and believed
by it to be authorized or within the discretion or rights or
powers conferred upon it by this Indenture.
(9) the Trustee shall not be required to take notice
or be deemed to have notice of any Default under this
Indenture except failure by the Company to cause to be made
any of the payments to the Trustee required to be made by
Article Three hereof unless the Trustee shall be
specifically notified in writing of such default by the
Company, or by Holders of at least 10% in principal amount of
the Outstanding Securities. All notices or the instruments
required by this Indenture to be delivered to the Trustee
must, in order to be effective, be delivered at the Corporate
Trust Office, and in the absence of such notice so delivered
the Trustee may conclusively assume there is no default
except as aforesaid.
(10) if an Event of Default has occurred and is
continuing, the Trustee shall exercise the rights and powers
vested in it by this Indenture, and shall use the same degree
of care and skill in their exercise as a prudent Person would
exercise or use under the circumstances in the conduct of
such Person's own affairs.
The Trustee shall not be required to expend or risk its
own funds or otherwise incur any financial liability in the
performance of any of its duties hereunder, or in the exercise of
any of its rights or powers if it shall have reasonable grounds
for believing that repayment of such funds or adequate indemnity
against such risk or liability is not reasonably assured to it.
SECTION 603. Trustee Not Responsible for Recitals or
Issuance of Securities.
The recitals contained herein and in the Securities,
except for the Trustee's certificates of authentication, shall be
taken as the statements of the Company, and the Trustee assumes no
responsibility for their correctness. The Trustee makes no
representations as to the validity or sufficiency of this
Indenture or of the Securities, except that the Trustee represents
that it is duly authorized to execute and deliver this Indenture,
authenticate the Securities and perform its obligations hereunder
and that any statements made by it in a Statement of Eligibility
and Qualification of Form T-1 supplied to the Company are (or when
delivered, will be) true and accurate, subject to the
qualifications set forth therein. The Trustee shall not be
accountable for the use or application by the Company of
Securities or the proceeds thereof.
SECTION 604. May Hold Securities.
The Trustee, any Paying Agent, any Security Registrar or
any other agent of the Company or of the Trustee, in its
individual or any other capacity, may become the owner or pledgee
of Securities and, subject to TIA Sections 310(b) and 311, may
otherwise deal with the Company with the same rights it would have
if it were not Trustee, Paying Agent, Security Registrar or such
other agent.
SECTION 605. Money Held in Trust.
Money held by the Trustee in trust hereunder need not be
segregated from other funds except to the extent required by law.
The Trustee shall be under no liability for interest on any money
received by it hereunder except as otherwise agreed in writing
with the Company.
SECTION 606. Compensation and Reimbursement.
The Company agrees:
(1) to pay to the Trustee from time to time reasonable
compensation for all services rendered by it hereunder (which
compensation shall not be limited by any provision of
law in regard to the compensation of a trustee of an express
trust);
(2) except as otherwise expressly provided herein, to
reimburse the Trustee upon its request for all reasonable
expenses, disbursements and advances incurred or made by the
Trustee in accordance with any provision of this Indenture
(including the reasonable compensation and the expenses and
disbursements of its agents and counsel), except any such
expense, disbursement or advance as may be attributable to
its negligence or bad faith; and
(3) to indemnify the Trustee for, and to hold it
harmless against, any loss, liability or expense incurred
without negligence or bad faith on its part, arising out of
or in connection with the acceptance or administration of
this trust, including the costs and expenses of defending
itself against any claim or liability in connection with the
exercise or performance of any of its powers or duties
hereunder.
The obligations of the Company under this Section to
compensate the Trustee, to pay or reimburse the Trustee for
expenses, disbursements and advances and to indemnify and hold
harmless the Trustee shall constitute additional indebtedness
hereunder and shall survive the satisfaction and discharge of this
Indenture. As security for the performance of such obligations of
the Company, the Trustee shall have a claim prior to the
Securities upon all property and funds held or collected by the
Trustee as such, except funds held in trust for the payment of
principal of (and premium, if any, on) or interest on particular
Securities.
SECTION 607. Corporate Trustee Required; Eligibility.
There shall at all times be a Trustee hereunder which
shall be eligible to act as Trustee under TIA Section 310(a)(1)
and shall have a combined capital and surplus of at least
$50,000,000. If such corporation publishes reports of condition
at least annually, pursuant to law or to the requirements of
federal, state, territorial or District of Columbia supervising or
examining authority, then for the purposes of this Section, the
combined capital and surplus of such corporation shall be deemed
to be its combined capital and surplus as set forth in its most
recent report of condition so published. If at any time the
Trustee shall cease to be eligible in accordance with the
provisions of this Section, it shall resign promptly in the manner
and with the effect hereinafter specified in this Article.
SECTION 608. Resignation and Removal; Appointment of
Successor.
(a) No resignation or removal of the Trustee and no
appointment of a successor Trustee pursuant to this Article shall
become effective until the acceptance of appointment by the
successor Trustee in accordance with the applicable requirements
of Section 609.
(b) The Trustee may resign at any time by giving
written notice thereof to the Company. If the instrument of
acceptance by a successor Trustee required by Section 609 shall
not have been delivered to the Trustee within 30 days after the
giving of such notice of resignation, the resigning Trustee may
petition any court of competent jurisdiction for the appointment
of a successor Trustee.
(c) The Trustee may be removed at any time by Act of
the Holders of not less than a majority in principal amount of the
Outstanding Securities, delivered to the Trustee and to the
Company.
(d) If at any time:
(1) the Trustee shall fail to comply with the
provisions of TIA Section 310(b) after written request
therefor by the Company or by any Holder who has been a bona
fide Holder of a Security for at least six months, or
(2) the Trustee shall cease to be eligible under
Section 607(a) and shall fail to resign after written request
therefor by the Company or by any Holder who has been a bona
fide Holder of a Security for at least six months, or
(3) the Trustee shall become incapable of acting or
shall be adjudged a bankrupt or insolvent or a receiver of
the Trustee or of its property shall be appointed or any
public officer shall take charge or control of the Trustee or
of its property or affairs for the purpose of rehabilitation,
conservation or liquidation,
then, in any such case, (i) the Company, by a Board Resolution,
may remove the Trustee, or (ii) subject to TIA Section 315(e), any
Holder who has been a bona fide Holder of a Security for at least
six months may, on behalf of himself and all others similarly
situated, petition any court of competent jurisdiction for the
removal of the Trustee and the appointment of a successor Trustee.
(e) If the Trustee shall resign, be removed or become
incapable of acting, or if a vacancy shall occur in the office of
Trustee for any cause, the Company, by a Board Resolution, shall
promptly appoint a successor trustee. If, within one year after
such resignation, removal or incapability, or the occurrence of
such vacancy, a successor trustee shall be appointed by Act of the
Holders of a majority in principal amount of the Outstanding
Securities delivered to the Company and the retiring Trustee, the
successor trustee so appointed shall, forthwith upon its
acceptance of such appointment, become the successor trustee and
supersede the successor trustee appointed by the Company. If no
successor trustee shall have been so appointed by the Company or
the Holders and accepted appointment in the manner hereinafter
provided, any Holder who has been a bona fide Holder of a Security
for at least six months may, on behalf of himself and all others
similarly situated, petition any court of competent jurisdiction
for the appointment of a successor trustee.
(f) The Company shall give notice of each resignation
and each removal of the Trustee and each appointment of a
successor trustee to the Holders of Securities in the manner
provided for in Section 106. Each notice shall include the name
of the successor trustee and the address of its Corporate Trust
Office.
SECTION 609. Acceptance of Appointment by Successor.
Every successor trustee appointed hereunder shall
execute, acknowledge and deliver to the Company and to the
retiring Trustee an instrument accepting such appointment, and
thereupon the resignation or removal of the retiring Trustee shall
become effective and such successor trustee, without any further
act, deed or conveyance, shall become vested with all the
rights, powers, trusts and duties of the retiring Trustee; but, on
request of the Company or the successor trustee, such retiring
Trustee shall, upon payment of its charges, execute and deliver an
instrument transferring to such successor trustee all the rights,
powers and trusts of the retiring Trustee and shall duly assign,
transfer and deliver to such successor trustee all property and
money held by such retiring Trustee hereunder. Upon request of
any such successor trustee, the Company shall execute any and all
instruments for more fully and certainly vesting in and confirming
to such successor trustee all such rights, powers and trusts.
No successor trustee shall accept its appointment unless
at the time of such acceptance such successor trustee shall be
qualified and eligible under this Article.
SECTION 610. Merger, Conversion, Consolidation or
Succession to Business.
Any corporation into which the Trustee may be merged or
converted or with which it may be consolidated, or any corporation
resulting from any merger, conversion or consolidation to which
the Trustee shall be a party, or any corporation succeeding to all
or substantially all of the corporate trust business of the
Trustee, shall be the successor of the Trustee hereunder, provided
such corporation shall be otherwise qualified and eligible under
this Article, without the execution or filing of any paper or any
further act on the part of any of the parties hereto. In case any
Securities shall have been authenticated, but not delivered, by
the Trustee then in office, any successor by merger, conversion or
consolidation to such authenticating Trustee may adopt such
authentication and deliver the Securities so authenticated with
the same effect as if such successor trustee had itself
authenticated such Securities; and in case at that time any of the
Securities shall not have been authenticated, any successor
trustee may, upon receipt of a Company Order, authenticate such
Securities either in the name of any predecessor hereunder or in
the name of the successor trustee; and in all such cases such
certificates shall have the full force which it is anywhere in the
Securities or in this Indenture provided that the certificate of
the Trustee shall have; provided, however, that the right to adopt
the certificate of authentication of any predecessor Trustee or to
authenticate Securities in the name of any predecessor Trustee
shall apply only to its successor or successors by merger,
conversion or consolidation.
ARTICLE SEVEN
HOLDERS LISTS AND REPORTS BY TRUSTEE AND COMPANY
SECTION 701. Disclosure of Names and Addresses of
Holders.
Every Holder of Securities, by receiving and holding the
same, agrees with the Company and the Trustee that none of the
Company or the Trustee or any agent of either of them shall be
held accountable by reason of the disclosure of any such
information as to the names and addresses of the Holders in
accordance with TIA Section 312, regardless of the source from
which such information was derived, and that the Trustee shall not
be held accountable by reason of mailing any material pursuant to
a request made under TIA Section 312(b).
SECTION 702. Reports by Trustee.
Within 60 days after May 15 of each year commencing with
the first May 15 after the first issuance of Securities, the
Trustee shall transmit to the Holders, in the manner and to the
extent provided in TIA Section 313(c), a brief report dated as of
such May 15 if required by TIA Section 313(a).
ARTICLE EIGHT
CONSOLIDATION, MERGER, CONVEYANCE, TRANSFER OR LEASE
SECTION 801. Company and Each Guarantor May
Consolidate, etc., Only on Certain Terms.
(a) The Company shall not, in a single transaction or
through a series of related transactions, consolidate with or
merge with or into any other Person or sell, assign, convey,
transfer, lease or otherwise dispose of all or substantially all
of its properties and assets as an entirety to any Person or group
of affiliated Persons (and the Company will not permit any
Restricted Subsidiary to enter into any such transaction or
transactions if such transaction or transactions, in the
aggregate, would result in a sale, assignment, conveyance,
transfer, lease or disposal of all or substantially all of the
properties and assets of the Company and its Restricted
Subsidiaries on a consolidated basis to any other Person or group
of affiliated Persons) unless at the time and after giving effect
thereto:
(1) either
(i) the Company shall be the continuing
corporation; or
(ii) the Person (if other than the Company)
formed by such consolidation or into which the Company
or such Subsidiary is merged or the Person which
acquires by sale, assignment, conveyance, transfer,
lease or disposition of all or substantially all of the
properties and assets of the Company or such Subsidiary,
as the case may be, substantially as an entirety (the
"Surviving Entity") shall be a corporation duly
organized and validly existing under the laws of the
United States of America, any state thereof or the
District of Columbia and such Person assumes, by a
supplemental indenture in a form reasonably satisfactory
to the Trustee, all the obligations of the Company under
the Securities and this Indenture, and this Indenture
shall remain in full force and effect;
(2) immediately before and immediately after giving
effect to such transaction, no Default or Event of Default
shall have occurred and be continuing;
(3) immediately after giving effect to such transaction
on a pro forma basis, the Consolidated Net Worth of the
Company (or the Surviving Entity other than the Company), is
equal to or greater than the Consolidated Net Worth of the
Company immediately prior to such transaction;
(4) immediately before and immediately after giving
effect to such transaction on a pro forma basis (on the
assumption that the transaction occurred on the first day of
the four-quarter period immediately prior to the consummation
of such transaction with the appropriate adjustments with
respect to the transaction being included
in such pro forma calculation), the Company (or the Surviving
Entity if other than the Company), could incur $1.00 of
additional Indebtedness under Section 1011 (other than
Permitted Indebtedness); and
(5) the Company or the Surviving Entity shall have
delivered, or caused to be delivered, to the Trustee, in form
and substance reasonably satisfactory to the Trustee, an
Officers' Certificate and an Opinion of Counsel, each to the
effect that such consolidation, merger, transfer, sale,
assignment, conveyance, lease or other transaction and the
supplemental indenture in respect thereto comply with this
Indenture and that all conditions precedent herein provided
for relating to such transaction have been complied with.
(b) Each Guarantor shall not, and (except in the case
of Holdings) the Company shall not permit any Guarantor to, in a
single transaction or through a series of related transactions,
merge or consolidate with or into any other corporation (other
than the Company or any Restricted Wholly Owned Subsidiary) or
other entity, sell, assign, convey, transfer, lease or otherwise
dispose of all or substantially all of its properties and assets
on a consolidated basis to any entity (other than the Company or
any Restricted Wholly Owned Subsidiary) unless at the time and
after giving effect thereto:
(1) either
(i) such Guarantor shall be the continuing
corporation; or
(ii) the entity (if other than such Guarantor)
formed by such consolidation or into which such
Guarantor is merged or the entity which acquires by
sale, assignment, conveyance, transfer, lease or
disposition the properties and assets of such Guarantor
shall be a corporation duly organized and validly
existing under the laws of the United States, any state
thereof or the District of Columbia and shall expressly
assume by a supplemental indenture, executed and
delivered to the Trustee, in a form reasonably
satisfactory to the Trustee, all the obligations of such
Guarantor under its Guarantee and this Indenture;
(2) immediately before and immediately after giving
effect to such transaction, no Default or Event of Default
shall have occurred and be continuing; and
(3) such Guarantor shall have delivered to the Trustee
an Officers' Certificate and an Opinion of Counsel in form
and substance reasonably satisfactory to the Trustee, each
stating that such consolidation, merger, sale, assignment,
conveyance, transfer, lease or disposition and such
supplemental indenture comply with this Indenture, and
thereafter all obligations of the predecessor shall
terminate.
provided that the foregoing shall not apply to any Guarantor
(other than Holdings) if (A) immediately after such merger,
consolidation, sale, assignment, conveyance, transfer, lease or
other disposition, such Guarantor and the Person with which such
Guarantor merges or consolidates or the assignee, conveyee,
transferee, lessee or recipient of such other disposition are not
Subsidiaries and (B) Section 1016 hereof is complied with in
connection with such transaction.
SECTION 802. Successor Substituted.
Upon any consolidation of the Company, Holdings or any
other Guarantor with or merger of the Company, Holdings or any
other Guarantor with or into any other corporation or any sale,
assignment, conveyance, transfer, lease or other deposition of the
properties and assets of the Company (or any Guarantor),
substantially as an entirety to any Person in accordance with
Section 801(a) or Section 801(b), the successor Person formed by
such consolidation or into which the Company, Holdings or any
other Guarantor is merged or to which such conveyance, transfer or
lease is made shall succeed to, and be substituted for, and may
exercise every right and power of, the Company or the Guarantor,
as the case may be, under this Indenture with the same effect as
if such successor Person had been named as the Company or the
Guarantor, as the case may be herein, and in the event of any such
conveyance or transfer, the Company (which term shall for this
purpose mean the Person named as the "Company" in the first
paragraph of this Indenture or any successor Person which shall
theretofore become such in the manner described in Section
801(a)), or the Guarantor, as the case may be, except in the case
of a lease, shall be discharged of all obligations and covenants
under this Indenture and the Securities and may be dissolved and
liquidated.
ARTICLE NINE
SUPPLEMENTAL INDENTURES
SECTION 901. Supplemental Indentures Without Consent of
Holders.
Without the consent of any Holders, the Company, when
authorized by a Board Resolution, and the Trustee, at any time and
from time to time, may enter into one or more indentures
supplemental hereto, in form satisfactory to the Trustee, for any
of the following purposes:
(1) to evidence the succession of another Person to the
obligations under this Indenture and the Securities of the
Company or any Guarantor and the assumption by any such
successor of the covenants of the Company and any Guarantor
contained herein and in the Securities; or
(2) to add to the covenants of the Company for the
benefit of the Holders or to surrender any right or power
herein conferred upon the Company; or
(3) to add any additional Events of Default; or
(4) to evidence and provide for the acceptance of
appointment hereunder by a successor trustee pursuant to the
requirements of Section 609; or
(5) to cure any ambiguity, to correct or supplement any
provision herein which may be inconsistent with any other
provision herein, or to make any other provisions with
respect to matters or questions arising under this Indenture;
provided that such action shall not adversely affect the
interests of the Holders in any material respect; or
(6) to comply with any requirement of the Commission in
connection with qualifying this Indenture under the TIA.
SECTION 902. Supplemental Indentures with Consent of
Holders.
With the consent of the Holders of not less than a
majority in principal amount of the Outstanding Securities, by Act
of said Holders delivered to the Company and the Trustee, the
Company, when authorized by a Board Resolution, and the Trustee
may enter into an indenture or indentures supplemental hereto for
the purpose of adding any provisions to or changing in any manner
or eliminating any of the provisions of this Indenture or of
modifying in any manner the rights of the Holders under this
Indenture; provided, however, that no such supplemental indenture
shall, without the consent of the Holder of each Outstanding
Security affected thereby:
(1) change the Stated Maturity of the principal of, or
any installment of interest on, any Security or reduce the
principal amount thereof or the rate of interest thereon or
any premium payable upon the redemption thereof, or change
the coin or currency in which the principal of any Security
or any premium or the interest thereon is payable, or impair
the right to institute suit for the enforcement of any such
payment on or after the Stated Maturity thereof;
(2) amend, change or modify the obligation of the
Company to make and consummate an Offer with respect to any
Asset Sale or Asset Sales in accordance with Section 1016 or
the obligation of the Company to make and consummate a Change
of Control Offer in the event of a Change of Control in
accordance with Section 1010, including amending, changing or
modifying any definitions with respect thereto;
(3) reduce the percentage in principal amount of
Outstanding Securities, the consent of whose Holders is
required for any such supplemental indenture, or the consent
of whose Holders is required for any waiver;
(4) modify any of the provisions of this Section or
Section 513, except to increase the percentage of Outstanding
Securities required for such actions or to provide that
certain other provisions of this Indenture cannot be modified
or waived without the consent of the Holder of each Security
affected thereby;
(5) except as otherwise permitted under Article Eight
consent to the assignment or transfer by the Company or any
Guarantor of any of its rights and obligations under this
Indenture; or
(6) amend or modify any of the provisions of this
Indenture relating to any Guarantee of the Securities in any
manner adverse to the Holders of the Securities or any
Guarantee of the Securities.
It shall not be necessary for any Act of Holders under
this Section to approve the particular form of any proposed
supplemental indenture, but it shall be sufficient if such Act
shall approve the substance thereof.
SECTION 903. Execution of Supplemental Indentures.
In executing, or accepting the additional trusts created
by, any supplemental indenture permitted by this Article or the
modifications thereby of the trusts created by this Indenture, the
Trustee shall be entitled to receive, and shall be fully protected
in relying upon, an Opinion of Counsel stating that the execution
of such supplemental indenture is authorized
or permitted by this Indenture. The Trustee may, but shall not be
obligated to, enter into any such supplemental indenture which
affects the Trustee's own rights, duties or immunities under this
Indenture or otherwise.
SECTION 904. Effect of Supplemental Indentures.
Upon the execution of any supplemental indenture under
this Article, this Indenture shall be modified in accordance
therewith, and such supplemental indenture shall form a part of
this Indenture for all purposes; and every Holder of Securities
theretofore or thereafter authenticated and delivered hereunder
shall be bound thereby.
SECTION 905. Conformity with Trust Indenture Act.
Every supplemental indenture executed pursuant to the
Article shall conform to the requirements of the Trust Indenture
Act as then in effect.
SECTION 906. Reference in Securities to Supplemental
Indentures.
Securities authenticated and delivered after the
execution of any supplemental indenture pursuant to this Article
may, and shall if required by the Trustee, bear a notation in form
approved by the Trustee as to any matter provided for in such
supplemental indenture. If the Company shall so determine, new
Securities so modified as to conform, in the opinion of the
Trustee and the Company, to any such supplemental indenture may be
prepared and executed by the Company and authenticated and
delivered by the Trustee in exchange for Outstanding Securities.
SECTION 907. Notice of Supplemental Indentures.
Promptly after the execution by the Company and the
Trustee of any supplemental indenture pursuant to the provisions
of Section 902, the Company shall give notice thereof to the
Holders of each Outstanding Security affected, in the manner
provided for in Section 106, setting forth in general terms the
substance of such supplemental indenture.
ARTICLE TEN
COVENANTS
SECTION 1001. Payment of Principal, Premium, if any,
and Interest.
The Company covenants and agrees for the benefit of the
Holders that it will duly and punctually pay the principal of (and
premium, if any, on) and interest on the Securities in accordance
with the terms of the Securities and this Indenture.
SECTION 1002. Maintenance of Office or Agency.
The Company will maintain an office or agency where
Securities may be presented or surrendered for payment, where
Securities may be surrendered for registration of transfer or
exchange and where notices and demands to or upon the Company in
respect of the Securities and this Indenture may be served. The
Corporate Trust Office of the Trustee shall be such office or
agency of the Company, unless the Company shall designate and
maintain some other office or agency for one or more of such
purposes. The Company will give prompt written notice to the
Trustee of any change in the location of any such office or
agency. If at any time the Company shall fail to maintain any
such required office or agency or shall fail to furnish the
Trustee with the address thereof, such presentations, surrenders,
notices and demands may be made or served at the Corporate Trust
Office of the Trustee, and the Company hereby appoints the Trustee
as its agent to receive all such presentations, surrenders,
notices and demands.
The Company may also from time to time rescind the above
designation and designate one or more other offices or agencies
where the Securities may be presented or surrendered for any or
all such purposes and may from time to time rescind any such
subsequent designation; provided, however, that no such
designation or rescission shall in any manner relieve the Company
of its obligation to maintain an office or agency for such
purposes. The Company will give prompt written notice to the
Trustee of any such designation or rescission and any change in
the location of any such other office or agency.
SECTION 1003. Money for Security Payments to Be Held in
Trust.
If the Company shall at any time act as its own Paying
Agent, it will, on or before each due date of the principal of
(and premium, if any, on) or interest on any of the Securities,
segregate and hold in trust for the benefit of the Persons
entitled thereto a sum sufficient to pay the principal (and
premium, if any) or interest so becoming due until such sums shall
be paid to such Persons or otherwise disposed of as herein
provided and will promptly notify the Trustee of its action or
failure so to act.
Whenever the Company shall have one or more Paying
Agents for the Securities, it will, on or before each due date of
the principal of (and premium, if any, on), or interest on, any
Securities, deposit with a Paying Agent a sum in same day funds
and duly executed certificates for Secondary Securities sufficient
to pay the principal (and premium, if any) or interest so becoming
due, such sum and certificates for Secondary Securities to be held
in trust for the benefit of the Persons entitled to such
principal, premium or interest, and (unless such Paying Agent is
the Trustee) the Company will promptly notify the Trustee of such
action or any failure so to act.
The Company will cause each Paying Agent (other than the
Trustee) to execute and deliver to the Trustee an instrument in
which such Paying Agent shall agree with the Trustee, subject to
the provisions of this Section, that such Paying Agent will:
(1) hold all sums and certificates for Secondary
Securities held by it for the payment of the principal of
(and premium, if any, on) or interest on Securities in trust
for the benefit of the Persons entitled thereto until such
sums and certificates for Secondary Securities shall be paid
to such Persons or otherwise disposed of as herein provided;
(2) give the Trustee notice of any default by the
Company (or any other obligor upon the Securities) in the
making of any payment of principal (and premium, if any) or
interest; and
(3) at any time during the continuance of any such
default, upon the written request of the Trustee, forthwith
pay to the Trustee all sums and certificates for Secondary
Securities so held in trust by such Paying Agent.
The Company may at any time, for the purpose of
obtaining the satisfaction and discharge of this Indenture or for
any other purpose, pay, or by Company Order direct any Paying
Agent to pay, to the Trustee all sums and certificates for
Secondary Securities held in trust by the Company or such Paying
Agent, such sums and certificates for Secondary Securities to be
held by the Trustee upon the same trusts as those upon which such
sums were held by the Company or such Paying Agent; and, upon such
payment by any Paying Agent to the Trustee, such Paying Agent
shall be released from all further liability with respect to such
sums.
Any money and certificates for Secondary Securities
deposited with the Trustee or any Paying Agent, or then held by
the Company, in trust for the payment of the principal of (and
premium, if any, on) or interest on any Security and remaining
unclaimed for two years after such principal (and premium, if any)
or interest has become due and payable shall be paid to the
Company on Company Request, or (if then held by the Company) shall
be discharged from such trust; and the Holder of such Security
shall thereafter, as an unsecured general creditor, look only to
the Company for payment thereof, and all liability of the Trustee
or such Paying Agent with respect to such trust money and
certificates for Secondary Securities, and all liability of the
Company as trustee thereof, shall thereupon cease; provided,
however, that the Trustee or such Paying Agent, before being
required to make any such repayment, may at the expense of the
Company cause to be published once, in a newspaper published in
the English language, customarily published on each Business Day
and of general circulation in the Borough of Manhattan, The City
of New York, reasonable notice under the circumstances that such
money and certificates for Secondary Securities remain unclaimed
and that, after a date specified therein, which shall not be less
than 30 days from the date of such publication, any unclaimed
balance of such money then remaining will be repaid to the
Company.
SECTION 1004. Corporate Existence.
Subject to Article Eight, and as long as any Securities
remain Outstanding, the Company will do or cause to be done all
things necessary to preserve and keep in full force and effect the
corporate existence, rights (charter and statutory) and franchises
of the Company and each Restricted Subsidiary; provided, however,
that the Company shall not be required to preserve any such right
or franchise if the Board of Directors shall determine that the
preservation thereof is no longer desirable in the conduct of the
business of the Company and its Subsidiaries as a whole and that
the loss thereof is not disadvantageous in any material respect to
the Holders. This Section 1004 shall not prohibit the Company
from taking any action otherwise permitted by, and made in
accordance with, the provisions of this Indenture.
SECTION 1005. Payment of Taxes and Other Claims.
The Company will pay or discharge or cause to be paid or
discharged, before the same shall become delinquent, (a) all
taxes, assessments and governmental charges levied or imposed upon
the Company or any Restricted Subsidiary or upon the income,
profits or property of the Company or any Restricted Subsidiary
and (b) all lawful claims for labor, materials and supplies,
which, if unpaid, might by law become a lien upon the property of
the Company or any Restricted Subsidiary; provided, however, that
the Company shall not be required to pay or discharge or cause to
be paid or discharged any such tax, assessment, charge or claim
whose amount, applicability or validity is being contested in good
faith by appropriate proceedings.
SECTION 1006. Maintenance of Properties.
The Company will cause all properties owned by the
Company or any Restricted Subsidiary or used or held for use in
the conduct of its business or the business of any Restricted
Subsidiary to be maintained and kept in good condition, repair and
working order and supplied with all necessary equipment and will
cause to be made all necessary repairs, renewals, replacements,
betterments and improvements thereof, all as in the judgment of
the Company may be necessary so that the business carried on in
connection therewith may be properly and advantageously conducted
at all times; provided, however, that nothing in this Section
shall prevent the Company from discontinuing the maintenance of
any of such properties if such discontinuance is, in the judgment
of the Company, desirable in the conduct of its business or the
business of any Restricted Subsidiary and not disadvantageous in
any material respect to the Holders.
SECTION 1007. Insurance.
The Company will at all times keep all of its and its
Restricted Subsidiaries' properties which are of an insurable
nature insured with insurers, believed by the Company to be
responsible, against loss or damage to the extent that property of
similar character is usually so insured by corporations similarly
situated and owning like properties.
SECTION 1008. Statement by Officers As to Default.
(a) The Company will deliver to the Trustee, within 120
days after the end of each fiscal year, a brief certificate from
the principal executive officer, principal financial officer or
principal accounting officer as to his or her knowledge of the
Company's compliance with all conditions and covenants under this
Indenture. Such certificate shall state that such officer has
reviewed this Indenture and believes that either (a) the Company
and Guarantors are in compliance with terms thereof or (b) the
Company and Guarantors are not in compliance with terms thereof.
For purposes of this Section 1008(a), such compliance shall be
determined without regard to any period of grace or requirement of
notice under this Indenture.
(b) When any Default has occurred and is continuing
under this Indenture, or if the trustee for or the holder of any
other evidence of Indebtedness of the Company or any Restricted
Subsidiary gives any notice or takes any other action with respect
to a claimed default (other than with respect to Indebtedness in
the principal amount of less than $1,000,000), the Company shall
deliver to the Trustee by registered or certified mail or by
telegram, telex or facsimile transmission an Officers' Certificate
specifying such event, notice or other action within five Business
Days of its occurrence.
SECTION 1009. Provision of Financial Statements.
Whether or not the Company is subject to Section 13(a)
or 15(d) of the Exchange Act, the Company will, to the extent
permitted under the Exchange Act, file with the Commission the
annual reports, quarterly reports and other documents which the
Company would have been required to file with the Commission
pursuant to such Sections 13(a) or 15(d) if the Company were so
subject, such documents to be filed with the Commission on or
prior to the respective dates (the "Required Filing Dates") by
which the Company would have been required so to file such
documents if the Company were so subject.
The Company will also in any event (a) within 15 days of
each Required Filing Date (1) transmit by mail to all Holders, as
their names and addresses appear in the Security Register without
cost to such Holders and (2) file with the Trustee copies of the
annual reports, quarterly reports and other documents which the
Company would have been required to file with the Commission
pursuant to Section 13(a) or 15(d) of the Exchange Act if the
Company were subject to such Sections and (b) if filing such
documents by the Company with the Commission is not permitted
under the Exchange Act, promptly upon written request and payment
of the reasonable cost of duplication and delivery, supply copies
of such documents to any prospective Holder at the Company's cost.
SECTION 1010. Purchase of Securities upon Change in
Control.
(a) If a Change of Control shall occur at any time,
then the Company shall be obligated to make an offer to purchase
all of the Outstanding Securities (a "Change of Control Offer")
and the Company shall purchase all of the then Outstanding
Securities validly tendered pursuant to such Change of Control
Offer, in whole or in part in integral multiples of $1,000, at a
purchase price (the "Change of Control Purchase Price") in cash in
an amount equal to 101% of the principal amount of such
Securities, plus accrued and unpaid interest, if any, to the date
of purchase (the "Change of Control Purchase Date"), pursuant to
the procedures set forth in paragraphs (b), (c) and (d) of this
Section.
(b) Within 15 days following
any Change of Control, the Company
shall notify the Trustee thereof and
shall give to each Holder of the
Securities in the manner provided in
Section 106, a notice stating:
(1) that a Change of Control has occurred and that such
Holder has the right to require the Company to repurchase
such Holder's Securities at the Change of Control Purchase
Price;
(2) the Change of Control Purchase Price and the Change
of Control Purchase Date, which shall be a Business Day no
earlier than 30 days nor later than 60 days from the date
such notice is mailed, or such later date as is necessary to
comply with requirements under the Exchange Act;
(3) that any Security not tendered will continue to
accrue interest;
(4) that, unless the Company defaults in the payment of
the purchase price, any Securities accepted for payment
pursuant to the Change of Control Offer shall cease to accrue
interest after the Change of Control Purchase Date; and
(5) the procedures that a Holder must follow to accept
a Change of Control Offer or to withdraw such acceptance.
(c) Holders electing to have Securities purchased will
be required to surrender such Securities with an appropriate
execution form duly executed to the Company at the address
specified in the notice at least 10 Business Days prior to the
Purchase Date. Holders will be entitled to withdraw their
election if the Company receives, not later than three Business
Days prior to the Purchase Date, a telegram, telex, facsimile
transmission or letter setting forth the name of the Holder, the
principal amount of the Securities delivered for purchase by the
Holder as to which his election is to be withdrawn and a statement
that such Holder is withdrawing his election to have such
Securities purchased. Holders whose Securities are purchased only
in part will be issued new Securities equal in principal amount to
the unpurchased portion of the Securities surrendered.
(d) The Company and Holdings will comply with any
applicable tender offer rules, including Rule 14e-1 under the
Exchange Act, and any other applicable securities laws or
regulations in connection with a Change of Control Offer. To the
extent that the provisions of any securities laws or regulations
conflict with provisions of this Section, the Company shall comply
with the applicable securities laws and regulations and shall not
be deemed to have breached its obligations under this Section by
virtue thereof.
(e) Holdings will not, and will not permit any
Subsidiary to, create or permit to exist or become effective any
restriction (other than restrictions in effect on the Closing Date
with respect to Indebtedness outstanding on the Closing Date and
refinancings thereof) that would materially impair the ability of
the Company to make a Change of Control Offer to purchase the
Securities or, if such Change of Control Offer is made, to pay for
the Securities tendered for purchase.
SECTION 1011. Limitation on Indebtedness.
(a) The Company will not, and will not permit any of
its Restricted Subsidiaries to, create, issue, assume, incur,
guarantee, or otherwise in any manner become directly or
indirectly liable for (collectively, "incur") any Indebtedness
(including any Acquired Indebtedness); provided that the Company
may incur Indebtedness (including any Acquired Indebtedness) if
(A) the Consolidated Fixed Charge Coverage Ratio of Holdings for
the four full fiscal quarters immediately preceding the incurrence
of such Indebtedness taken as one period (and after giving pro
forma effect to (i) the incurrence of such Indebtedness and the
application of the net proceeds therefrom, including to refinance
other Indebtedness, as if such Indebtedness was incurred, and the
application of such proceeds occurred, at the beginning of such
four-quarter period; (ii) the incurrence, repayment or retirement
of any other Indebtedness by the Company and its Restricted
Subsidiaries since the first day of such four-quarter period as if
such Indebtedness was incurred, repaid or retired at the beginning
of such four-quarter period (except that, in making such
computation, the amount of Indebtedness outstanding under any
revolving credit facility shall be computed based upon the average
daily balance of such Indebtedness during such four-quarter
period); (iii) in the case of Acquired Indebtedness, the related
acquisition as if such acquisition occurred at the beginning of
such four-quarter period; and (iv) any acquisition or disposition
by the Company or its Restricted Subsidiaries of any company or
any business or any assets out of the ordinary course of business,
whether by merger, stock purchase or sale or asset purchase or
sale, as if such acquisition or disposition, as the case may be,
occurred at the
beginning of such four-quarter period, and any related incurrence
or repayment of Indebtedness, in each case since the first day of
such four-quarter period, assuming such acquisition or disposition
had been consummated on the first day of such four-quarter period)
is 3.00:1.00 and (B) if such Indebtedness is Subordinated
Indebtedness, such Indebtedness shall have an Average Life to
Stated Maturity longer than the Average Life to Stated Maturity of
the Securities and a final Stated Maturity of principal later than
the final Stated Maturity of principal of the Securities.
(b) The foregoing limitation will not apply to the
incurrence of any of the following (collectively, "Permitted
Indebtedness"):
(1) (i) Indebtedness of the Company under the term
loan portions of the Senior Bank Facility at any time in an
aggregate principal amount not to exceed an amount equal to
$200,000,000 minus all principal amounts actually repaid
under the term loan portions of the Senior Bank Facility
(including amounts repaid pursuant to Section 1016 hereof)
and (ii) Indebtedness of the Company outstanding under the
revolving credit portion of the Senior Bank Facility at any
time in an aggregate amount equal to the greater of (I) the
Borrowing Base and (II) $300,000,000;
(2) subject to Section 1017, Guarantees by Restricted
Subsidiaries of Indebtedness of the Company; provided that
such Indebtedness of the Company is incurred in compliance
with the provisions of this Indenture;
(3) Indebtedness of the Company pursuant to the
Securities and Indebtedness of any Guarantor pursuant to its
Guarantee of the Securities;
(4) Indebtedness of the Company outstanding on the
Closing Date;
(5) Indebtedness of the Company owing to a Restricted
Wholly Owned Subsidiary, provided that any such Indebtedness
(i) is made pursuant to an intercompany note in the form
attached hereto and (ii) is subordinated in right of payment
to the prior payment and performance of the Company's
obligations under the Securities, if applicable; provided
further that (A) any disposition, pledge or transfer of any
such Indebtedness to a Person (other than a disposition,
pledge or transfer to a Restricted Wholly Owned Subsidiary or
a pledge to or for the benefit of any holder of Senior
Indebtedness) or (B) any transaction to which such Restricted
Wholly Owned Subsidiary ceases to be a Restricted Wholly
Owned Subsidiary shall be deemed to be an incurrence of such
Indebtedness by the Company not permitted by this clause (5);
(6) Indebtedness of a Restricted Wholly Owned
Subsidiary owing to the Company or to a Restricted Wholly
Owned Subsidiary; provided that, with respect to Indebtedness
owing to any Restricted Wholly Owned Subsidiary, (i) any such
Indebtedness is made pursuant to an intercompany note in the
form attached hereto and (ii) any such Indebtedness shall be
subordinated in right of payment to the payment and
performance of such Subsidiary's obligations under its
Guarantee of the Securities, if applicable; provided further
that (A) any disposition, pledge or transfer of any such
Indebtedness to a Person (other than a disposition, pledge or
transfer to the Company
or a Restricted Wholly Owned Subsidiary or a pledge to or for
the benefit of any holder of Senior Indebtedness) shall be
deemed to be an incurrence of such Indebtedness by the
obligor not permitted by this clause (6), and (B) any
transaction pursuant to which any Restricted Wholly Owned
Subsidiary, which has Indebtedness owing to the Company or
any other Restricted Wholly Owned Subsidiary, ceases to be a
Restricted Wholly Owned Subsidiary shall be deemed to be an
incurrence of Indebtedness by such Subsidiary that is not
permitted by this clause (6);
(7) any renewals, extensions, substitutions,
refundings, refinancings or replacements (collectively, a
"refinancing") of any Indebtedness described in clauses (3)
and (4) of this paragraph (b) (including any successive
refinancings), so long as the aggregate principal amount of
Indebtedness represented thereby is not increased by such
refinancing, except by an amount equal to the lesser of (i)
the stated amount of any premium, interest or other payment
required to be paid in connection with such a refinancing
pursuant to the terms of the Indebtedness being refinanced or
(ii) the amount of premium, interest or other payment
actually paid at such time to refinance the Indebtedness,
plus, in either case, the amount of expenses incurred in
connection with such refinancing; provided that in the case
of Pari Passu Indebtedness or Subordinated Indebtedness, (A)
such new Indebtedness does not have a shorter Average Life to
Stated Maturity or a final Stated Maturity of principal
earlier than the Indebtedness being refinanced, (B) in the
case of Pari Passu Indebtedness, such new Indebtedness is
pari passu with, or subordinated to, the Securities and (C)
in the case of Subordinated Indebtedness, such new
Indebtedness is subordinated to the Securities at least to
the same extent as the Indebtedness being refinanced; and
provided further that in no event may Indebtedness of the
Company be refinanced with Indebtedness of any Restricted
Subsidiary pursuant to this clause (7);
(8) Indebtedness of the Company consisting of
Capitalized Lease Obligations or purchase money obligations,
in addition to that described in clauses (1) through (7) of
this paragraph (b), not to exceed $10,000,000 outstanding at
any one time in the aggregate;
(9) other Indebtedness of the Company (whether or not
constituting purchase money obligations or Capitalized Lease
Obligations) not to exceed $20,000,000 at any one time
outstanding; and
(10) Indebtedness of the Company consisting of Interest
Rate Agreements designed to protect the Company from, or
control the exposure of the Company to, fluctuations in
interest rates in respect of Indebtedness; provided that the
maximum liability of the Company thereunder is not increased
beyond the principal amount of the related Indebtedness.
SECTION 1012. Limitation on Restricted Payments.
(a) The Company will not, and will not permit any
Restricted Subsidiary to, directly or indirectly:
(1) declare or pay any dividend on, or make any
distribution to holders of, any shares of its Capital Stock
(other than (I) dividends or distributions payable solely in
shares of its Qualified Capital Stock or in options, warrants
or other rights to acquire such Qualified Capital
Stock and (II) dividends and distributions paid to the
Company);
(2) purchase, redeem or otherwise acquire or retire for
value, directly or indirectly, any shares of the Capital
Stock of Holdings, the Company or any Restricted Subsidiary
(other than any Restricted Wholly Owned Subsidiary) or
options, warrants or other rights to acquire such Capital
Stock;
(3) make any principal payment on, or repurchase,
redeem, defease, retire or otherwise acquire for value, prior
to the relevant scheduled principal payment, sinking fund or
maturity, or Subordinated Indebtedness; or
(4) make any Investment in any Person, including,
without limitation, any Unrestricted Subsidiary (other than
any Permitted Investments)
(any of the foregoing actions described in clauses (1) through
(4), collectively, "Restricted Payments") unless after giving
effect to the proposed Restricted Payment (the amount of any such
Restricted Payment, if other than cash, as determined in good
faith by the Board of Directors of the Company, such determination
to be conclusive and evidenced by a Board Resolution), (A) no
Default or Event of Default shall have occurred and be continuing
and such Restricted Payment shall not cause or constitute any of
the foregoing; (B) immediately before and immediately after giving
effect to such transaction on a pro forma basis, the Company could
incur $1.00 of additional Indebtedness (other than Permitted
Indebtedness) under
Section 1011(a); and (C) the aggregate amount of all such
Restricted Payments declared or made after the Closing Date
(including such Restricted Payment) does not exceed the sum of:
(I) 25% of the aggregate cumulative Consolidated Net
Income (or, if such aggregate cumulative Consolidated Net
Income shall be a loss, minus 100% of such loss) of Holdings
accrued on a cumulative basis during the period (taken as one
accounting period) beginning on the date of the Merger and
ending on the last day of the Company's last fiscal quarter
ending prior to the date of the Restricted Payment;
(II) the aggregate Net Cash Proceeds received after the
Closing Date by the Company from the issuance or sale (other
than to any of its Subsidiaries) of its shares of Qualified
Capital Stock or any options, warrants or rights to purchase
such shares of Qualified Capital Stock (less the value of any
equity security referred to (and determined in accordance
with) the parenthetical in clause (a)(i) of the definition of
Consolidated Interest Expense;
(III) the aggregate Net Cash Proceeds received after the
Closing Date by the Company (other than from any of its
Subsidiaries) upon the exercise of any options, warrants or
rights to purchase shares of Qualified Capital Stock of the
Company;
(IV) the aggregate Net Cash Proceeds received after the
Closing Date by the Company from Indebtedness of the Company
or Redeemable Capital Stock of the Company that have been
converted into or exchanged for Qualified Capital Stock of
the Company (or rights to purchase such Qualified Capital
Stock), to the extent such Indebtedness of the Company or
Redeemable Capital Stock of the Company was originally
incurred or issued for cash, plus the aggregate Net Cash
Proceeds received by the Company at the time of such
conversion or exchange;
(V) without duplication of any of the foregoing, 100%
of the aggregate Net Cash Proceeds received by the Company as
a capital contribution from Holdings; plus
(VI) to the extent not included in Consolidated Net
Income, the net reduction (received by the Company or any
Restricted Subsidiary in cash) in Investments (other than
Permitted Investments) made by the Company and the Restricted
Subsidiaries since the Closing Date, not to exceed, in the
case of any Investments in any Person, the amount of
Investments (other than Permitted Investments) made by the
Company and Restricted Subsidiaries in such Person since the
Closing Date.
(b) Notwithstanding the foregoing, and in the case of
clauses (2), (3), (4), (5), (6), (7) and (8) below, so long as
there is no Default or Event of Default continuing, the foregoing
provisions shall not prohibit the following actions:
(1) the payment of any dividend within 60 days after
the date of declaration thereof, if at such date of
declaration such payment would be permitted by the provisions
of paragraph (a) of this Section 1012 (such payment shall be
deemed to have been paid on such date of declaration for
purposes of the calculation required by paragraph (a) of this
Section 1012);
(2) the repurchase, redemption, or other acquisition or
retirement of any shares of any class of Capital Stock of the
Company or warrants, options or other rights to acquire such
stock in exchange for, or out of the Net Cash Proceeds of, a
substantially concurrent issue and sale (other than to a
Subsidiary) for cash of, any Qualified Capital Stock of the
Company or warrants, options or other rights to acquire such
stock;
(3) any repurchase, redemption, defeasance, retirement,
refinancing or acquisition for value or payment of principal
of any Subordinated Indebtedness or Pari Passu Indebtedness
in exchange for, or out of the net proceeds of, a
substantially concurrent issuance and sale (other than to a
Subsidiary) for cash of any Qualified Capital Stock of the
Company or warrants, options or other rights to acquire such
stock;
(4) the repurchase, redemption, defeasance, retirement
or other acquisition for value or payment of principal of any
Subordinated Indebtedness through the issuance of
Indebtedness permitted by clause (6) of paragraph (b) of
Section 1011;
(5) the repurchase, redemption, acquisition or
retirement of shares of Capital Stock of Holdings or options
to purchase such shares, held by officers or employees or
former officers or employees of Holdings and the Subsidiaries
(or their estates or beneficiaries), other than Permitted
Holders (or their estates or beneficiaries), upon death,
disability, retirement, or termination of employment,
pursuant to the terms of any employee stock option or stock
purchase plan or agreement under which such shares were
acquired; provided that the aggregate consideration paid for
all such shares following the date hereof does not exceed
$600,000 in any fiscal year of the Company; and provided
further that the amount by which $600,000 exceeds the amount
so used in any fiscal year of the Company shall be available
to be so used in subsequent fiscal years of the Company;
(6) payments to Holdings to the extent used by Holdings
to pay its operating and administrative expenses including,
without limitation, directors' fees, legal and audit
expenses, Commission compliance expenses and corporate
franchise and other taxes, not to exceed $750,000 in any
fiscal year of the Company;
(7) payments to Holdings, not to exceed $250,000 in the
aggregate after the Closing Date, to the extent used by,
Holdings to make cash payments to holders of its Capital
Stock in lieu of the issuance of fractional shares of Capital
Stock and to redeem or repurchase stock purchase or similar
rights issued as a shareholder rights device; and
(8) payments to Holdings of up to $1,000,000 in any
fiscal year of the Company to the extent used by Holdings to
satisfy its payment obligations under the Management Services
Agreements, as in effect on the Closing Date.
The actions described in clauses (1) through (3) and clauses (5)
through (7) of this paragraph (b) shall be Restricted Payments
that shall be permitted to be taken in accordance with this
paragraph (b) but shall reduce the amount that would otherwise be
available for Restricted Payments under clause (C) of paragraph
(a) of this Section 1012 (provided that any dividend paid pursuant
to clause (1) of this paragraph (b) shall reduce the amount that
would otherwise be available under clause (C) of paragraph (a) of
this Section 1012 when declared, but not also when paid pursuant
to such clause (1)) and the actions described in clauses (4) and
(8) of this paragraph (b) shall be Restricted Payments that shall
be permitted to be taken in accordance with this paragraph and
shall not reduce the amount that would otherwise be available for
Restricted Payments under clause (C) of paragraph (a).
SECTION 1013. Limitation on Transactions with
Affiliates.
The Company will not, and will not permit any of its
Restricted Subsidiaries to, directly or indirectly, enter into or
suffer to exist any transaction or series of related transactions
(including, without limitation, the sale, purchase, exchange or
lease of assets or property or the rendering of any services) with
any Affiliate of the Company (other than a Restricted Wholly Owned
Subsidiary) or any holder of 10% or more of any class of Capital
Stock of Holdings, the Company or any Subsidiary or any Affiliate
of any such Person or any Unrestricted Subsidiary, unless:
(1) such transaction or series of transactions is in
writing on terms that are no less favorable to the Company or
such Restricted Subsidiary, as the case may be, than would be
available in a comparable transaction in arm's-length
dealings with an unrelated third party;
(2) with respect to any such transaction or series of
transactions involving aggregate payments in excess of
$1,000,000, the Company delivers an Officers' Certificate to
the Trustee certifying that such transaction or series of
related transactions complies with clause (1) above and such
transaction or series of related transactions has been
approved by the Board of Directors of the Company; and
(3) with respect to a transaction or series of related
transactions involving aggregate value in excess of
$5,000,000, the Company delivers to the Trustee an opinion of
an independent investment banking firm of national standing
stating that the transaction or series of transactions is
fair to the Company or such Restricted Subsidiary from a
financial point of view.
The foregoing shall not apply to the performance of obligations
under the Management Service Agreements [and the Employment
Agreements], in each case as in effect on the Closing Date.
SECTION 1014. Limitation on Senior Subordinated
Indebtedness.
The Company and each Guarantor will not, directly or
indirectly, incur or otherwise permit to exist any Indebtedness
that is subordinate in right of payment to any Indebtedness of the
Company or such Guarantor, as the case may be, unless such
Indebtedness is also pari passu with the Securities or the
Guarantee of the Securities by such Guarantor, as the case may be,
or subordinate in right of payment to the Securities or such
Guarantee of the Securities to at least the same extent as the
Securities or such Guarantee are subordinate in right of payment
to Senior Indebtedness or Senior Guarantor Indebtedness, as the
case may be, as set forth herein.
SECTION 1015. Limitation on Liens.
The Company will not, and will not permit any Restricted
Subsidiary to, directly or indirectly, incur, assume or suffer to
exist any Lien of any kind upon any of its property or assets
(including any shares of Capital Stock or Indebtedness of any
Restricted Subsidiary), owned on the date hereof or acquired after
the date hereof, or any income or profits therefrom, except if the
Securities (or the Guarantee of the Securities, in the case of
Liens on properties or assets of a Restricted Subsidiary that is a
Guarantor) and all other amounts due hereunder and under the
Securities are directly secured equally and ratably with (or prior
to in the case of Liens with respect to Subordinated Indebtedness)
the obligation or liability secured by such Lien, excluding,
however, from the operation of the foregoing any of the following:
(a) any Lien existing as of the Closing Date;
(b) any Lien arising by reason of (i) any judgment,
decree or order of any court, so long as such Lien is
adequately bonded and any appropriate legal proceedings which
may have been duly initiated for the review of such judgment,
decree or order shall not have been finally terminated or the
period within which such proceedings may be initiated shall
not have expired; (ii) taxes, assessments or other
governmental charges not yet delinquent or which are being
contested in good faith; (iii) security for payment of
workers' compensation or other insurance; (iv) good faith
deposits in connection with tenders, leases or contracts
(other than contracts for the payment of money); (v) zoning
restrictions, easements, licenses, reservations, provisions,
covenants, conditions, waivers, restrictions on the use of
property or minor irregularities of title (and with respect
to leasehold interests, mortgages, obligations, liens and
other encumbrances incurred, created, assumed or permitted to
exist and arising by, through or under a landlord or owner of
the leased property, with or without
consent of the lessee), none of which materially impairs the
use of any property or assets material to the operation of
the business of the Company or any Restricted Subsidiary or
the value of such property or assets for the purpose of such
business; (vi) deposits to secure public or statutory
obligations, or in lieu of surety or appeal bonds with
respect to matters not yet finally determined and being
contested in good faith by negotiations or by appropriate
proceedings which suspend the collection thereof; or (vii)
operation of law in favor of mechanics, materialmen,
laborers, employees or suppliers, incurred in the ordinary
course of business for sums which are not yet delinquent or
are being contested in good faith by negotiations or by
appropriate proceedings which suspend the collection thereof;
(c) any Lien now or hereafter existing on property of
the Company or any Guarantor securing Senior Indebtedness or
Senior Guarantor Indebtedness, as the case may be, of such
Person in each case which Indebtedness was incurred in
compliance with the terms of this Indenture;
(d) any Lien securing Acquired Indebtedness created
prior to (and not created in connection with, or in
contemplation of) the incurrence of such Indebtedness by the
Company which Indebtedness is permitted under Section 1011;
provided that any such Lien only extends to the assets that
were subject to such Lien securing such Acquired Indebtedness
prior to the related acquisition; and
(e) any extension, renewal, refinancing or replacement,
in whole or in part, of any Lien described in the foregoing
clauses (a) through (d) so long as the amount of property or
assets subject to such Lien is not increased thereby.
SECTION 1016. Limitation on Sale of Assets.
(a) The Company will not, and will not permit any of
its Restricted Subsidiaries to, directly or indirectly, consummate
an Asset Sale unless (i) at least 75% of the proceeds from such
Asset Sale are received in cash and (ii) the Company or such
Restricted Subsidiary receives consideration at the time of such
Asset Sale at least equal to the Fair Market Value of the shares
or assets sold.
(b) If all or a portion of the Net Cash Proceeds of any
Asset Sale are not required to be applied to repay permanently any
Senior Indebtedness or Senior Guarantor Indebtedness then
outstanding as required by the terms thereof, and the Company
determines not to apply such Net Cash Proceeds to the permanent
prepayment of such Senior Indebtedness or Senior Guarantor
Indebtedness or if no such Senior Indebtedness or Senior Guarantor
Indebtedness is then outstanding, then the Company may, within 12
months of the Asset Sale, invest (or enter into a written, legally
binding agreement to invest, provided that the investment provided
for in such commitment is actually made within 24 months of the
Asset Sale) the Net Cash Proceeds in other properties and assets
that will be used in the businesses of the Company existing on the
date hereof. The amount of such Net Cash Proceeds neither used to
permanently repay or prepay unsubordinated Indebtedness or
unsubordinated Guarantor Indebtedness nor used or invested as set
forth constitutes "Excess Proceeds."
(c) When the aggregate amount of Excess Proceeds
equals $10,000,000 or more, the Company shall, within 15 Business
Days, apply the Excess Proceeds to the repayment of the Securities
and any Pari Passu Indebtedness required to be repurchased under
the instrument governing such Pari Passu Indebtedness as follows:
(i) the Company shall make an offer (an "Offer") to purchase, for
cash, at 100% of the principal amount thereof, plus accrued and
unpaid interest to the repurchase date (the "Repurchase Date") all
Securities then outstanding in accordance with the procedures set
forth in this Indenture the maximum principal amount (expressed as
a multiple of $1,000) of Securities that may be purchased out of
an amount (the "Security Amount") equal to the product of such
Excess Proceeds multiplied by a fraction, the numerator of which
is the outstanding principal amount of the Securities, and the
denominator of which is the sum of the outstanding principal
amount of the Securities and such Pari Passu Indebtedness (subject
to proration in the event such amount is less than the aggregate
principal and accrued and unpaid interest to the Repurchase Date
of all Securities tendered) and (ii) to the extent required by
such Pari Passu Indebtedness, the Company shall make an offer to
purchase or if, required by the terms of such Pari Passu
Indebtedness, otherwise repurchase or redeem Pari Passu
Indebtedness (a "Pari Passu Repayment") in an amount (the "Pari
Passu Debt Amount") equal to the excess of the Excess Proceeds
over the Security Amount; provided that in no event shall the Pari
Passu Debt Amount exceed the principal amount of such Pari Passu
Indebtedness plus the amount of any premium, if any, and accrued
and unpaid interest required to be paid to repurchase such Pari
Passu Indebtedness. To the extent that the aggregate principal
amount of and accrued but unpaid interest with respect to the
Securities tendered pursuant to the Offer is less than the
Security Amount relating thereto or the aggregate amount of Pari
Passu Indebtedness that is purchased is less than the Pari Passu
Debt Amount, the Company shall use such amount for any purpose not
prohibited by this Indenture. Upon completion of the purchase of
all the Securities tendered pursuant to an Offer and the purchase
of the Pari Passu Indebtedness pursuant to a Pari Passu Repayment,
the amount of Excess Proceeds, if any, shall be reset at zero.
(d) Holdings and the Company shall comply with any
applicable tender offer rules, including Rule 14e-1 under the
Exchange Act, and any other applicable securities laws or
regulations in connection with an Offer. To the extent that the
provisions of any securities laws or regulations conflict with
provisions of this Section, Holdings and the Company shall comply
with the applicable securities laws and regulations and shall not
be deemed to have breached their obligations under this Section by
virtue thereof.
(e) Holdings will not, and will not permit any
Subsidiary to, create or permit to exist or become effective any
consensual restriction (other than restrictions not more
restrictive than those in effect under Indebtedness outstanding on
the date of this Indenture) that would materially impair the
ability of the Company to comply with the provisions of this
Section 1016.
SECTION 1017. Limitation on Issuances of Guarantees of
Indebtedness.
(a) The Company will not permit any Restricted
Subsidiary to incur any Guaranteed Debt, other than Guaranteed
Debt in respect of Senior Indebtedness of the Company; provided
that, concurrently with the incurrence of such Guaranteed Debt by
any Restricted Subsidiary, the Restricted Subsidiary incurring
such Guaranteed Debt shall execute a supplemental indenture
setting forth such Restricted Subsidiary's senior subordinated
guarantee of the Securities, such guarantee to be on the same
terms as Holdings' guarantee of the Securities. Neither the
Company nor any Guarantor shall be required to make a notation on
the Securities or the Guarantees to reflect such Guarantee. In
connection with such Guarantee of the Securities, such Restricted
Subsidiary shall waive, and agree that it will not in any manner
whatsoever claim or take the benefit or advantage of, any rights
or reimbursement, indemnity or subrogation or any other rights
against the Company or any Guarantor as a result of any payment by
such Restricted Subsidiary with respect to such Guaranteed Debt.
(b) Holdings will not incur any Guaranteed Debt with
respect to any Pari Passu Indebtedness or Subordinated
Indebtedness unless such Guaranteed Debt is subordinated (at least
to the extent that Notes are subordinated in right of payment to
Senior Indebtedness) in right of payment to (or, in the case of
Guaranteed Debt with respect to Pari Passu Indebtedness, is pari
passu in right of payment with) Holdings' Guarantee of the Notes.
(c) The Company will cause each of its domestic
Restricted Subsidiaries, other than United Business Computers,
Inc. promptly upon becoming a Restricted Subsidiary, to execute a
supplemental indenture providing for a Guarantee of the Securities
on the same terms as Holdings' Guarantee of the Securities,
including, without limitation, the waiver and agreement referred
to in the last sentence of paragraph (a) above.
SECTION 1018. Limitation on Subsidiary Capital Stock.
The Company will not transfer, and will not permit the
transfer or issuance of, any Capital Stock of any Restricted
Subsidiary (including options, warrants or other rights to
purchase shares of such Capital Stock) except for:
(a) Capital Stock issued to and held by the Company or
a Restricted Wholly Owned Subsidiary; and
(b) Capital Stock issued by a Person prior to the time
(i) such Person becomes a Restricted Subsidiary, (ii) such
Person merges with or into a Restricted Subsidiary or (iii) a
Restricted Subsidiary merges with or into such Person;
provided that such Capital Stock was not issued or incurred
by such Person in anticipation of the type of transaction
contemplated by subclause (i), (ii) or (iii). The foregoing
shall not prohibit the pledge of any shares of Capital Stock
permitted under Section 1015.
SECTION 1019. Limitation on Dividends and Other Payment
Restrictions Affecting Restricted Subsidiaries.
The Company will not, and will not permit any
Restricted Subsidiary to, directly or indirectly, create or
otherwise cause or suffer to exist or become effective any
encumbrance or restriction on the ability of any Restricted
Subsidiary to:
(a) pay dividends, in cash or otherwise, or make any
other distribution on or in respect of its Capital Stock;
(b) pay any Indebtedness owed to the Company or any
other Subsidiary;
(c) make any loans or advances to, or Investments in,
the Company or any other Restricted Subsidiary; or
(d) transfer any of its properties or assets to the
Company or any other Restricted Subsidiary, except in any
such case:
(1) any encumbrance or restriction pursuant
to an agreement in effect on the Closing Date;
(2) any encumbrance or restriction, with
respect to a Person that becomes a Subsidiary after the
Closing Date, in existence at the time such Person
becomes a Subsidiary and not incurred in connection
with, or in contemplation of, such Person becoming a
Subsidiary;
(3) any encumbrance or restriction existing
under any agreement that extends, renews, refinances or
replaces the agreements containing the encumbrances or
restrictions in the foregoing clauses (1) and (2), or in
this clause (3), provided that the terms and conditions
of any such encumbrances or restrictions are not
materially less favorable to the Holders of the
Securities than those under or pursuant to the agreement
so extended, renewed, refinanced or replaced;
(4) any encumbrance or restriction created
pursuant to an asset sale agreement, stock sale
agreement or similar instrument pursuant to a bona fide
Asset Sale, the proceeds of which are applied as
provided under this Indenture is to be consummated, so
long as such restriction or encumbrance shall apply only
to the assets subject to such Asset Sale and shall be
effective only for a period from the execution and
delivery of such agreement or instrument through the
earlier of the consummation of such Asset Sale or the
termination of such agreement or instrument;
(5) customary non-assignment provisions of
any lease governing any leasehold interest of the
Company or any Restricted Subsidiaries; and
(6) any encumbrance or restriction existing
under or by reason of applicable law.
SECTION 1020. Waiver of Certain Covenants.
The Company may omit in any particular instance to
comply with any term, provision or condition set forth in Sections
1008 through 1019, inclusive, if before or after the time for such
compliance the Holders of at least a majority in principal amount
of the Outstanding Securities, by Act of such Holders, waive such
compliance in such instance with such term, provision or
condition, but no such waiver shall extend to or affect such term,
provision or condition except to the extent so expressly waived,
and, until such waiver shall become effective, the obligations of
the Company and the duties of the Trustee in respect of any such
term, provision or condition shall remain in full force and
effect.
SECTION 1021. Payment of Incremental Rate Upon Failure
to Register Securities.
If the Company shall default in any obligation under the
Registration Rights Agreement to effect the Exchange Offer
(as defined thereunder) or to prepare and file with the Commission
under said Agreement a registration statement with respect to the
Securities under the Securities Act for disposition under the
Securities Act, or such registration statement shall fail to
become effective, from and after the date on which such Exchange
Offer or registration statement was to become effective (the
"Scheduled Effective Date"), there shall accrue, and the Company
shall pay to each Holder of a Security, additional interest on the
aggregate outstanding principal amount of the Securities held by
such Holder at the applicable Special Rate (as hereinafter
defined) as follows:
(a) if the Exchange Offer or such registration
statement does not become effective by the Scheduled
Effective Date, the rate at which there shall accrue and the
Company shall pay additional interest on the Securities,
effective on and after the first day after the Scheduled
Effective Date, shall be equal to 1/4% per annum;
(b) if the Exchange Offer or such registration
statement is not declared effective on the 91st day after the
Scheduled Effective Date, the rate at which there shall
accrue and the Company shall pay additional interest on the
Securities, effective on and after such 91st day, shall be
equal to 1/2% per annum;
(c) if the Exchange Offer or such registration
statement is not declared effective on the 181st day after
the Scheduled Effective Date, the rate at which there shall
accrue and the Company shall pay additional interest on the
Securities, effective on and after such 181st day, shall be
equal to 3/4% per annum; and
(d) if the Exchange Offer or such registration
statement is not declared effective on the 271st day after
the Scheduled Effective Date, the rate at which there shall
accrue and the Company shall pay additional interest on the
Securities, effective on and after such 271st day, shall be
equal to 1% per annum.
The interest rate referred to in the preceding sentence shall be
herein called the "Incremental Rate". Interest on the Securities
shall cease to accrue and be payable pursuant to this Section 1021
on the date the applicable Exchange Offer or registration
statement, as the case may be, is declared effective by the
Commission. The Company shall notify the Trustee immediately
after the occurrence of each and every event which pursuant to
this Section 1021 results in any obligation to pay interest at the
Incremental Rate, or any increase or decrease thereof.
ARTICLE ELEVEN
REDEMPTION OF SECURITIES
SECTION 1101. Right of Redemption.
The Securities will be subject to redemption at any
time, at the option of the Company, in whole or in part, on not
less than 30 nor more than 60 days' prior notice in amounts of
$1,000 or an integral multiple thereof at 100% of the principal
amount, in each case, together with accrued and unpaid interest,
if any, to the Redemption Date (subject to the right of holders
of record on Regular Record Dates to receive interest due on a
Redemption Date occurring after a Regular Record Date and on or
prior to an Interest Payment Date); provided that immediately
after giving effect to each such redemption prior to the issuance
of the Exchange Securities or the effectiveness of a Registration
Statement, at least $65,000,000 aggregate principal amount of the
Securities remain outstanding.
SECTION 1102. Applicability of Article.
Redemption of Securities at the election of the Company
or otherwise, as permitted or required by any provision of this
Indenture, shall be made in accordance with such provision and
this Article.
SECTION 1103. Election to Redeem; Notice to Trustee.
The election of the Company to redeem any Securities
pursuant to Section 1101 shall be evidenced by a Board Resolution.
In case of any redemption at the election of the Company, the
Company shall, at least 60 days prior to the Redemption Date fixed
by the Company (unless a shorter notice shall be satisfactory to
the Trustee), notify the Trustee of such Redemption Date and of
the principal amount of Securities to be redeemed and shall
deliver to the Trustee such documentation and records as shall
enable the Trustee to select the Securities to be redeemed
pursuant to Section 1104.
SECTION 1104. Selection by Trustee of Securities to Be
Redeemed.
If less than all the Securities are to be redeemed, the
particular Securities to be redeemed or portions thereof to be
redeemed pro rata shall be selected not more than 60 days prior to
the Redemption Date by the Trustee, from the Outstanding
Securities not previously called for redemption by lot or by any
other method as the Trustee shall deem fair and reasonable
consistent with the requirements of the Depositary and which may
provide for the selection for redemption of portions of the
principal of Securities; provided, however, that no such partial
redemption shall reduce the portion of the principal amount of a
Security not redeemed to less than $1,000.
The Trustee shall promptly notify the Company in writing
of the Securities selected for redemption and, in the case of any
Securities selected for partial redemption, the principal amount
thereof to be redeemed.
For all purposes of this Indenture, unless the context
otherwise requires, all provisions relating to redemption of
Securities shall relate, in the case of any Security redeemed or
to be redeemed only in part, to the portion of the principal
amount of such Security which has been or is to be redeemed.
SECTION 1105. Notice of Redemption.
Notice of redemption shall be given in the manner
provided for in Section 106 not less than 30 nor more than 60
days, prior to the Redemption Date, to each Holder of Securities
to be redeemed.
All notices of redemption shall state:
(1) the Redemption Date,
(2) the Redemption Price,
(3) if less than all Outstanding Securities are to be
redeemed, the identification (and, in the case of a partial
redemption, the principal amounts) of the particular
Securities to be redeemed,
(4) that on the Redemption Date the Redemption Price
(together with accrued interest, if any, to the Redemption
Date payable as provided in Section 1107) will become due and
payable upon each such Security, or the portion thereof, to
be redeemed, and that interest thereon will cease to accrue
on and after said date, and
(5) the place or places where such Securities are to be
surrendered for payment of the Redemption Price.
Notice of redemption of Securities to be redeemed at the
election of the Company shall be given by the Company or, at the
Company's request, by the Trustee in the name and at the expense
of the Company.
SECTION 1106. Deposit of Redemption Price.
Prior to any Redemption Date, the Company shall deposit
with the Trustee or with a Paying Agent (or, if the Company is
acting as its own Paying Agent, segregate and hold in trust as
provided in Section 1003) an amount of money sufficient to pay the
Redemption Price of, and accrued interest on, all the Securities
which are to be redeemed on that date.
SECTION 1107. Securities Payable on Redemption Date.
Notice of redemption having been given as aforesaid, the
Securities so to be redeemed shall, on the Redemption Date, become
due and payable at the Redemption Price therein specified
(together with accrued interest, if any, to the Redemption Date),
and from and after such date (unless the Company shall default in
the payment of the Redemption Price and accrued interest) such
Securities shall cease to bear interest. Upon surrender of any
such Security for redemption in accordance with said notice, such
Security shall be paid by the Company at the Redemption Price,
together with accrued interest, if any, to the Redemption Date;
provided, however, that installments of interest whose Stated
Maturity is on or prior to the Redemption Date shall be payable to
the Holders of such Securities, or one or more Predecessor
Securities, registered as such at the close of business on the
relevant Record Dates according to their terms and the provisions
of Section 308.
If any Security called for redemption shall not be so
paid upon surrender thereof for redemption, the principal (and
premium, if any) shall, until paid, bear interest from the
Redemption Date at the rate borne by the Securities.
SECTION 1108. Securities Redeemed in Part.
Any Security which is to be redeemed only in part shall
be surrendered at the office or agency of the Company maintained
for such purpose pursuant to Section 1002 (with, if the Company or
the Trustee so requires, due endorsement by, or a written
instrument of transfer in form satisfactory to the Company and the
Trustee duly executed by, the Holder thereof or such Holders
attorney duly authorized in writing), and the Company shall
execute, and the Trustee shall authenticate and deliver to the
Holder of such Security without service charge, a new Security or
Securities, of any authorized denomination as requested by such
Holder, in aggregate principal amount equal to and in exchange for
the unredeemed portion of the principal of the Security so
surrendered.
ARTICLE TWELVE
SINKING FUND
SECTION 1201. Mandatory Sinking Fund Payments.
As a mandatory sinking fund for the retirement of the
Securities, the Company will pay to the Trustee, on ___________,
2004, an amount in same day funds sufficient to redeem on such
date one-half (rounded up to the nearest $1,000) in aggregate
principal amount of Securities Outstanding at a redemption price
equal to 100% of the principal amount thereof, together with
accrued interest to the Redemption Date. Except to the extent
expressly provided in Section 1202, Securities acquired or
redeemed by the Company (other than through operation of the
sinking fund) may not be credited against the sinking fund
retirement. Such sinking fund payment shall be applied to the
redemption of Securities on ______________, 2004 as herein
provided.
SECTION 1202. Satisfaction of Sinking Fund Payments
with Securities.
In the event that any Securities are registered for sale
and sold under the Securities Act of 1933, the Company
(a) may deliver Outstanding Securities (other than any previously
called for redemption) and (b) may apply as a credit Securities
which have been redeemed pursuant to Sections 1101 and 1102, in
each case in satisfaction of all or any part of the sinking fund
payment required to be made pursuant to Section 1201, provided
that the amount of such credit shall not exceed, and shall be
applied solely to, that portion of the aggregate sinking fund
payment allocated pursuant to the second paragraph of
Section 1105 to the registered Securities (as said term is defined
in said paragraph), and shall not be used as a credit against the
portion of such payment allocated to Securities other than such
registered Securities. Each such Security shall be received and
credited for such purpose by the Trustee, subject to the proviso
to the immediately preceding sentence, at the Redemption Price
specified in Section 1201 for redemption through operation of the
sinking fund and the amount of such sinking fund payment shall be
reduced accordingly.
SECTION 1203. Redemption of Securities for Sinking
Fund.
On or before _________, 2004, the Company will deliver
to the Trustee an Officers' Certificate specifying the portion of
the sinking fund payment due on such Redemption Date, if any,
which is to be satisfied by payment of cash and the portion
thereof, if any, which is to be satisfied by delivering and
crediting Securities pursuant to Section 1202 and will also
deliver, if not previously delivered, to the Trustee any
Securities to be so delivered. Before ______________, 2004, the
Trustee shall select the Securities to be redeemed on __________,
2004, in the manner specified in Section 1104. The Trustee shall
cause notice of the redemption thereof to be given in the name of
and at the expense of the Company in the manner provided in
Section 1105. Such notice having been duly given, the redemption
of such Securities shall be made upon the terms and in the manner
stated in Sections 1107 and 1108.
ARTICLE THIRTEEN
DEFEASANCE AND COVENANT DEFEASANCE
SECTION 1301. Company's Option to Effect Defeasance or
Covenant Defeasance.
The Company may, at its option and at any time, elect to
have either Section 1302 or Section 1303 be applied to all
Outstanding Securities upon compliance with the conditions set
forth below in this Article Thirteen.
SECTION 1302. Defeasance and Discharge.
Upon the Company's exercise under Section 1301 of the
option applicable to this Section 1302, the Company and the
Guarantors shall be deemed to have been discharged from their
respective obligations with respect to all the Outstanding
Securities on the date the conditions set forth in Section 1304
are satisfied (hereinafter, "defeasance"). For this purpose, such
defeasance means that the Company shall be deemed to have paid and
discharged the entire indebtedness represented by Outstanding
Securities except for (i) the rights of Holders of Outstanding
Securities to receive payments in respect of the principal of,
premium, if any, and interest on such Securities when such
payments are due, (ii) the Company's obligations with respect to
the Securities concerning issuing temporary Securities,
registration of Securities, mutilated, destroyed, lost or stolen
Securities, and the maintenance of an office or agency for payment
and money for security payments held in trust, (iii) the rights,
powers, trusts, duties and immunities of the Trustee, and (iv)
this Article Thirteen.
SECTION 1303. Covenant Defeasance.
Upon the Company's exercise under Section 1301 of the
option applicable to this Section 1303, the Company and the
Guarantors shall be released from their respective obligations
under any covenant in Section 801 and in Sections 1008 through
1019 with respect to the Outstanding Securities on and after the
date the conditions set forth below are satisfied (hereinafter,
"covenant defeasance"), and the Securities shall thereafter be
deemed not to be "Outstanding" for the purposes of any direction,
waiver, consent or declaration or Act of Holders (and the
consequences of any thereof) in connection with such covenants,
but shall continue to be deemed "Outstanding" for all other
purposes hereunder. For this purpose, such covenant defeasance
means that, with respect to the Outstanding Securities, the
Company and the Guarantors may omit to comply with and shall have
no liability in respect of any term, condition or limitation set
forth in any such covenant, whether directly or indirectly, by
reason of any reference elsewhere herein to any such covenant or
by reason of any reference in any such covenant to any other
provision herein or in any other document and such omission to
comply shall not constitute a Default or an Event of Default under
Section 501(3) or Section 501(5), but, except as specified above,
the remainder of this Indenture and such Securities shall be
unaffected thereby.
SECTION 1304. Conditions to Defeasance or Covenant
Defeasance.
The following shall be the conditions to application of
either Section 1302 or Section 1303 to the Outstanding Securities:
(1) The Company shall irrevocably have deposited or
caused to be deposited with the Trustee (or another trustee
satisfying the requirements of Section 607 who shall agree
to comply with the provisions of this Article Thirteen
applicable to it) as trust funds in trust for the purpose of
making the following payments, specifically pledged as
security for, and dedicated solely to, the benefit of the
Holders of such Securities, (A) cash in United States dollars
in an amount, or (B) U.S. Government Obligations which
through the scheduled payment of principal and interest in
respect thereof in accordance with their terms will provide,
not later than one day before the due date of any payment,
money in an amount, or (C) a combination thereof, sufficient,
in the opinion of a nationally recognized firm of independent
public accountants expressed in a written certification
thereof delivered to the Trustee, to pay and discharge, and
which shall be applied by the Trustee (or other qualifying
trustee) to pay and discharge, the principal of (and premium,
if any, on) and interest on the Outstanding Securities on the
Stated Maturity (or Redemption Date, if applicable) of such
principal (and premium, if any) or installment of principal
(such date being referred to as the "Defeasance Redemption
Date")); provided that the Trustee shall have been
irrevocably instructed to apply such money or the proceeds of
such U.S. Government Obligations to said payments with
respect to the Securities. Before such a deposit, the
Company may give to the Trustee, in accordance with Section
1103 hereof, a notice of its election to redeem all of the
Outstanding Securities at a future date in accordance with
Article Eleven hereof, which notice shall be irrevocable.
Such irrevocable redemption notice, if given, shall be given
effect in applying the foregoing. For this purpose, "U.S.
Government Obligations" means securities that are (x) direct
obligations of the United States of America for the timely
payment of which its full faith and credit is pledged or (y)
obligations of a Person controlled or supervised by and
acting as an agency or instrumentality of the United States
of America the timely payment of which is unconditionally
guaranteed as a full faith and credit obligation by the
United States of America, which, in either case, are not
callable or redeemable at the option of the issuer thereof,
and shall also include a depository receipt issued by a bank
(as defined in Section 3(a)(2) of the Securities Act of 1933,
as amended), as custodian with respect to any such U.S.
Government Obligation or a specific payment of principal of
or interest on any such U.S. Government Obligation held by
such custodian for the account of the holder of such
depository receipt, provided that (except as required by law)
such custodian is not authorized to make any deduction from
the amount payable to the holder of such depository receipt
from any amount received by the custodian in respect of the
U.S. Government Obligation or the specific payment of
principal of or interest on the U.S. Government Obligation
evidenced by such depository receipt.
(2) No Default or Event of Default with respect to the
Securities shall have occurred and be continuing on the date
of such deposit or, with respect to Section 501(7) or Section
501(8), at any time during the period ending on the 91st day
after the date of deposit.
(3) Such defeasance or covenant defeasance shall not
cause the Trustee to have a conflicting interest with respect
to any securities of the Company or any Guarantor.
(4) Such defeasance or covenant defeasance shall not
result in a breach or violation of, or constitute a default
under, this Indenture.
(5) In the case of an election under Section 1302, the
Company shall have delivered to the Trustee an opinion of
counsel to the effect that (A) the Company has received from,
or there has been published by, the Internal Revenue Service
a ruling or (B) since the date of this Indenture, there has
been a change in the applicable federal income tax law, in
either case, to the effect that, and based thereon such
opinion of counsel in the United States shall confirm that,
the Holders of the Outstanding Securities will not recognize
income, gain or loss for federal income tax purposes as a
result of such defeasance and will be subject to federal
income tax on the same amounts, in the same manner and at the
same times as would have been the case if such covenant
defeasance had not occurred.
(6) In the case of an election under Section 1303, the
Company shall have delivered to the Trustee an opinion of
independent counsel in the United States to the effect that
the Holders of the Outstanding Securities will not recognize
income, gain or loss for federal income tax purposes as a
result of such covenant defeasance and will be subject to
federal income tax on the same amounts, in the same manner
and at the same times as would have been the case if such
covenant defeasance had not occurred.
(7) The Company shall have delivered to the Trustee an
Opinion of Counsel to the effect that after the 123rd day
following the deposit, the trust funds will not be subject to
avoidance under any applicable bankruptcy, insolvency,
reorganization or similar laws affecting creditors' rights
generally.
(8) the Company shall have delivered to the Trustee an
Officers' Certificate stating that the deposit was not made
by the Company with the intent of preferring the Holders of
the Securities or any Guarantee over the other creditors of
the Company or any Guarantor with the intent of defeating,
hindering, delaying or defrauding creditors of the Company,
any Guarantor or others;
(9) No event or condition shall exist that would
prevent the Company from making payments of principal of,
premium, if any, and interest on the Securities on the date
of such deposit or at any time ending on the 91st day after
the date of such deposit; and
(10) The Company shall have delivered to the Trustee an
Officers' Certificate and an Opinion of Counsel, which, taken
together, state that all conditions precedent provided for
relating to either the defeasance under Section 1302 or the
covenant defeasance under Section 1303 (as the case may be)
have been complied with.
ARTICLE FOURTEEN
GUARANTEE OF SECURITIES
SECTION 1401. Note Guarantee.
Subject to the provisions of this Article Fourteen,
[each of the] Guarantors hereby, jointly and severally, fully,
unconditionally and irrevocably guarantees to each Holder and to
the Trustee on behalf of the Holders: (i) the due and punctual
payment of the principal of, premium, if any, on and interest on
each Security, when and as the same shall become due and payable,
whether at maturity, by acceleration or otherwise, the due and
punctual payment of interest on the overdue principal of and
interest, if any, on the Securities, to the extent lawful, and the
due and punctual performance of all other obligations of the
Company to the Holders or the Trustee, all in accordance with the
terms of such Security and this Indenture and (ii) in the case of
any extension of time of payment or renewal of any Securities or
any of such other obligations, that the same will be promptly paid
in full when due or performed in accordance with the terms of the
extension or renewal, at Stated Maturity, by acceleration or
otherwise, provided that this Guarantee shall not be enforceable
against [any] Guarantor in an amount in excess of the net worth of
[such] Guarantor at the time that determination of such net worth
is, under applicable law, relevant to the enforceability of such
Note Guarantee. Such net worth shall include any claim of such
Guarantor against the Company for reimbursement and any claim
against any other Guarantor for contribution. [Each of] the
Guarantor[s] hereby waives diligence, presentment, demand of
payment, filing of claims with a court in the event of merger or
bankruptcy of the Company, any right to require a proceeding first
against the Company, the benefit of discussion, protest or notice
with respect to any such Security or the debt evidenced thereby
and all demands whatsoever (except as specified above), and
covenants that this Guarantee will not be discharged as to any
such Security except by payment in full of the principal thereof
and interest thereon and as provided in Section 401 and Section
1302 or in the event of a transaction in compliance with Section
801(b)(1)(ii).
The maturity of the obligations Guaranteed hereby may be
accelerated as provided in Article Five for the purposes of this
Article Fourteen. In the event of any declaration of acceleration
of such obligations as provided in Article Five, such obligations
(whether or not due and payable) shall forthwith become due and
payable by the Guarantor[s] for the purpose of this Article
Fourteen. In addition, without limiting the foregoing provisions,
upon the effectiveness of an acceleration under Article Five, the
Trustee shall promptly make a demand for payment on the Securities
under the Guarantee provided for in this Article Fourteen.
If the Trustee or the Holder of any Security is
required by any court or otherwise to return to the Company or any
Guarantor, or any custodian, receiver, liquidator, trustee,
sequestrator or other similar official acting in relation to the
Company or such Guarantor, any amount paid to the Trustee or such
Holder in respect of a Security, this Guarantee, to the extent
theretofore discharged, shall be reinstated in full force and
effect. Each of the Guarantors further agrees, to the fullest
extent that it may lawfully do so, that, as between it, on the one
hand, and the Holders and the Trustee, on the other hand, the
maturity of the obligations Guaranteed hereby may be accelerated
as provided in Article Five hereof for the purposes of this
Guarantee, notwithstanding any stay, injunction or other
prohibition extant under any applicable bankruptcy law preventing
such acceleration in respect of the obligations Guaranteed hereby.
Each of the Guarantors hereby irrevocably waives any
claim or other rights which it may now or hereafter acquire
against the Company or any other Guarantor that arise from the
existence, payment, performance or enforcement of its obligations
under this Note Guarantee and this Indenture, including, without
limitation, any right of subrogation, reimbursement, exoneration,
contribution, indemnification, any right to participate in any
claim or remedy of the Holders against the Company or any
Guarantor or any collateral which any such Holder or the Trustee
on behalf of such Holder hereafter acquires, whether or not such
claim, remedy or right arises in equity, or under contract,
statute or common law, including, without limitation, the right to
take or receive from the Company or a Guarantor, directly or
indirectly, in cash or other property or by set-off or in any
other manner, payment or security on account of such claim or
other rights. If any amount shall be paid to a Guarantor in
violation of the preceding sentence and the principal of, premium,
if any, and accrued interest on the Securities shall not have been
paid in full, such amount shall be deemed to have been paid to
such Guarantor for the benefit of, and held in trust for the
benefit of, the Holders, and shall forthwith be paid to the
Trustee for the benefit of the Holders to be credited and applied
upon the principal of, premium, if any, and accrued interest on
the Securities. Each of the Guarantors acknowledges that it will
receive direct and indirect benefits from the issuance of the
Securities pursuant to this Indenture and that the waivers set
forth in this Section 1401 are knowingly made in contemplation of
such benefits.
The Note Guarantee set forth in this Section 1401 shall
not be valid or become obligatory for any purpose with respect to
a Security until the certificate of authentication on such
Security shall have been signed by or on behalf of the Trustee.
SECTION 1402. Obligations Unconditional.
Except as provided in Section 1401, nothing contained in
this Article Fourteen or elsewhere in this Indenture or in the
Securities is intended to or shall impair, as among [any]
Guarantor and the holders of the Securities, the obligation of
such Guarantor, which is absolute and unconditional, upon failure
by the Company, to pay to the holders of the Securities the
principal of, premium, if any, and interest on the Securities as
and when the same shall become due and payable in accordance with
their terms, or is intended to or shall affect the relative rights
of the holders of the Securities and creditors of [such]
Guarantor, nor shall anything herein or therein prevent the holder
of any Security or the Trustee on their behalf from exercising all
remedies otherwise permitted by applicable law upon default under
this Indenture.
Without limiting the foregoing, nothing contained in
this Article Fourteen will restrict the right of the Trustee or
the holders of the Securities to take any action to declare the
Guarantee to be due and payable prior to the Stated Maturity of
the Securities pursuant to Section 502 or to pursue any rights or
remedies hereunder.
SECTION 1403. Notice to Trustee.
[A] Guarantor shall give prompt written notice to the
Trustee of any fact known to [such] Guarantor which prohibits the
making of any payment to or by the Trustee in respect of the
Guarantee pursuant to the provisions of this Article Fourteen
other than any agreement in effect on the date hereof.
SECTION 1404. This Article Not to Prevent Events of
Default.
The failure to make a payment on account of principal
of, premium, if any, or interest on the Securities by reason of
any provision of this Article Fourteen will not be construed as
preventing the occurrence of an Event of Default.
SECTION 1405. Subordination. The obligations of the
Guarantor[s] under this Article Fourteen are expressly subordinate
to all Senior Indebtedness as provided in Article Fifteen.
ARTICLE FIFTEEN
SUBORDINATION OF SECURITIES
SECTION 1501. Securities Subordinated to Senior
Indebtedness. Each Obligor and the Trustee each covenants and
agrees and each Holder, by its acceptance of a Security, likewise
covenant and agree that all Securities shall be issued subject to
the provisions of this Article Fifteen; and each Person holding
any Security, whether upon original issue or upon transfer,
assignment or exchange thereof, accepts and agrees that Senior
Subordinated Obligations shall, to the extent and in the manner
set forth in this Article Fifteen, be subordinated in right of
payment to the prior payment in full, in cash, of all amounts
payable under Senior Indebtedness, including, without limitation,
such Obligor's obligations under the Senior Credit Facilities
(including any interest accruing subsequent to an event specified
in Sections 501(8) and 501(9) of this Indenture, whether or not
such interest is an allowed claim enforceable against the debtor
under the United States Bankruptcy Code).
SECTION 1502. No Payment on Securities in Certain
Circumstances. (a) No direct or indirect payment by or on behalf
of any Obligor of Senior Subordinated Obligations, whether
pursuant to the terms of the Securities or upon acceleration or
otherwise, shall be made if, at the time of such payment, there
exists a default in the payment of all or any portion of the
obligations on any Designated Senior Indebtedness, and such
default shall not have been cured or waived or the benefits of
this sentence waived by or on behalf of the holders of such
Designated Senior Indebtedness.
(b) During the continuance of any other event of
default with respect to any Designated Senior Indebtedness
pursuant to which the maturity thereof may be accelerated and (A)
upon receipt by the Trustee of written notice from the agent with
respect thereto (the "Agent"), or (B) if such event of default
under any Designated Senior Indebtedness results from the
acceleration of the Securities, from and after the date of such
acceleration, no such payment (other than a payment of equity
securities or debt securities meeting the requirements of clauses
(a) through (b) of the definition of "Reorganization Debt
Securities" hereunder and agreed to by the holders of Designated
Senior Indebtedness) may be made by or on behalf of any Obligor
upon or in respect of the Securities for a period (a "Payment
Blockage Period") commencing on the earlier of the date of receipt
of such notice or the date of such acceleration and ending 179
days thereafter (unless such Payment Blockage Period shall be
terminated by written notice to the Trustee from the Agent or the
holders of at least a majority of the aggregate principal amount
of the Designated Senior Indebtedness initiating such Payment
Blockage Period, such event of default has been cured or waived or
such Designated Senior Indebtedness shall have been discharged or
paid in full in cash or in any manner acceptable to the holders of
such Designated Senior Indebtedness). Not more than one Payment
Blockage Period pursuant to this Section 1502(b) may be commenced
with respect to the securities during any period of 360
consecutive days. Notwithstanding anything in this Indenture to
the contrary, there must be 180 consecutive days in any 365-day
period in which no Payment Blockage Period is in effect. For all
purposes of this Section 1502(b), no event of default that existed
or was
continuing (it being acknowledged that any subsequent action that
would give rise to an event of default pursuant to any provision
under which an event of default previously existed or was
continuing shall constitute a new event of default for this
purpose) on the date of the commencement of any Payment Blockage
Period with respect to the Designated Senior Indebtedness
initiating such Payment Blockage Period shall be, or shall be
made, the basis for the commencement of a second Payment Blockage
Period by the representative for, or the holders of, such
Designated Senior Indebtedness, whether or not within a period of
360 consecutive days, unless such event of default shall have been
cured or waived for a period of not less than 90 consecutive days.
(c) In the event that, notwithstanding the foregoing,
any payment shall be received by the Trustee or any Holder when
such payment is prohibited by Section 1502(a) or 1502(b) of this
Indenture, the Trustee shall promptly notify the holders of Senior
Indebtedness of such prohibited payment and such payment shall be
held in trust for the benefit of, and shall be paid over or
delivered to, the holders of Senior Indebtedness or their
respective representatives, or to the trustee or trustees under
any indenture pursuant to which any of such Senior Indebtedness
may have been issued, as their respective interests may appear,
but only to the extent that, upon notice from the Trustee to the
holders of Senior Indebtedness that such prohibited payment has
been made, the holders of the Senior Indebtedness (or their
representative or representatives or a trustee) within 30 days of
receipt of such notice from the Trustee notify the Trustee of the
amounts then due and owing on the Senior Indebtedness, if any, and
only the amounts specified in such notice to the Trustee shall be
paid to the holders of Senior Indebtedness and any excess above
such amounts due and owing on Senior Indebtedness shall be paid to
the Company.
SECTION 1503. Payment over of Proceeds upon
Dissolution, Etc. (a) Upon any payment or distribution of assets
or securities of any Obligor, of any kind or character, whether in
cash, property or securities, upon any dissolution or winding up
or total or partial liquidation or reorganization of any Obligor,
whether voluntary or involuntary or in bankruptcy, insolvency,
receivership or other proceedings, all amounts due or to become
due upon all Senior Indebtedness (including any interest accruing
subsequent to an event specified in Sections 501(8) and 501(9) of
this Indenture, whether or not such interest is an allowed claim
enforceable against the debtor under the United States Bankruptcy
Code) shall first be paid in full, in cash, before the Holders or
the Trustee on behalf of the Holders shall be entitled to receive
any payment by such Obligor on account of Senior Subordinated
Obligations, or any payment to acquire any of the Securities for
cash, property or securities, or any distribution with respect to
the Securities of any cash, property or securities. Before any
payment may be made by, or on behalf of, any Obligor of any Senior
Subordinated Obligations upon any such dissolution, winding up,
liquidation or reorganization, any payment or distribution of
assets or securities of such Obligor of any kind or character,
whether in cash, property or securities, to which the Holders or
the Trustee on behalf of the Holders would be entitled, but for
the provisions of this Article Fifteen, shall be made by such
Obligor or by any receiver, trustee in bankruptcy, liquidating
trustee, agent or other similar Person making such payment or
distribution, or by the Holders or the Trustee if received by them
or it, directly to the holders of Senior Indebtedness (pro rata to
such holders on the basis of the respective amounts of Senior
Indebtedness held by such holders) or their
representatives, or to any trustee or trustees under any other
indenture pursuant to which any such Senior Indebtedness may have
been issued, as their respective interests appear, to the extent
necessary to pay all such Senior Indebtedness in full in cash,
after giving effect to any concurrent payment, distribution or
provision therefor to or for the holders of such Senior
Indebtedness.
(b) To the extent any payment of Senior Indebtedness
(whether by or on behalf of any Obligor, as proceeds of security
or enforcement of any right of setoff or otherwise) is declared to
be fraudulent or preferential, set aside, or required to be paid
to any receiver, trustee in bankruptcy, liquidating trustee, agent
or other similar Person under any bankruptcy, insolvency,
receivership, fraudulent conveyance or similar law, then if such
payment is recovered by, or paid over to, such receiver, trustee
in bankruptcy, liquidating trustee, agent or other similar Person,
the Senior Indebtedness or part thereof originally intended to be
satisfied shall be deemed to be reinstated and outstanding as if
such payment had not occurred. To the extent the obligation to
repay any Senior Indebtedness is declared to be fraudulent,
invalid, or otherwise set aside under any bankruptcy, insolvency,
receivership, fraudulent conveyance or similar law, then the
obligation so declared fraudulent, invalid or otherwise set aside
(and all other amounts that would come due with respect thereto
had such obligation not been so affected) shall be deemed to be
reinstated and outstanding as Senior Indebtedness for all purposes
hereof as if such declaration, invalidity or setting aside had not
occurred.
(c) In the event that, notwithstanding the foregoing
provision prohibiting such payment or distribution, any payment or
distribution of assets or securities of any Obligor of any kind or
character, whether in cash, property or securities, shall be
received by the Trustee or any Holder at a time when such payment
or distribution is prohibited by Section 1503(a) of this Indenture
and before all obligations in respect of Senior Indebtedness are
paid in full in cash, such payment of distribution shall be
received and held in trust for the benefit of, and shall be paid
over or delivered to, the holders of Senior Indebtedness (pro rata
to such holders on the basis of the respective amount of Senior
Indebtedness held by such holders) or their representatives or to
the trustee or trustees under any other indenture pursuant to
which any such Senior Indebtedness may have been issued, as their
respective interests appear, for application to the payment of
Senior Indebtedness remaining unpaid until all such Senior
Indebtedness has been paid in full in cash, after giving effect to
any concurrent payment, distribution or provision therefor to or
for the holders of such Senior Indebtedness.
(d) For purposes of this Section 1503, the words "cash,
property or securities" shall not be deemed to include, so long as
the effect of this clause is not to cause the Securities to be
treated in any case or proceeding or similar event described in
this Section 1503 as part of the same class of claims as the
Senior Indebtedness or any class of claims pari passu with, or
senior to, the Senior Indebtedness for any payment or
distribution, Reorganization Debt Securities; provided that (1) if
a new corporation results from such reorganization or
readjustment, such corporation assumes the Senior Indebtedness and
(2) the rights of the holders of the Senior Indebtedness are not,
without the consent of such holders, altered by such
reorganization or readjustment. The consolidation of any Obligor
with, or the merger of any Obligor with or into, another
corporation or the liquidation or dissolution of such Obligor
following the sale, conveyance, transfer, lease or other
disposition of all or substantially all of its property and assets
to another corporation upon the terms and conditions provided in
Article Eight of this Indenture shall not be deemed a dissolution,
winding up, liquidation or reorganization for the purposes of this
Section 1503 if such other corporation shall, as a part of such
consolidation, merger, sale, conveyance, transfer, lease or other
disposition, comply with the conditions stated in Article Eight of
this Indenture.
SECTION 1504. Subrogation. (a) Upon the payment in
full of all Senior Indebtedness in cash, the Holders shall be
subrogated to the rights of the holders of Senior Indebtedness to
receive payments or distributions of cash, property or securities
of each Obligor made on such Senior Indebtedness until the
principal of, premium, if any, and interest on the Securities
shall be paid in full; and, for the purposes of such subrogation,
no payments or distributions to the holders of the Senior
Indebtedness of any cash, property or securities to which the
Holders or the Trustee on their behalf would be entitled except
for the provisions of this Article Fifteen, and no payment
pursuant to the provisions of this Article Fifteen to the holders
of Senior Indebtedness by Holders or the Trust on their behalf
shall, as between any Obligor, its creditors other than holders of
Senior Indebtedness, and the Holders, be deemed to be a payment by
such Obligor to or on account of the Senior Indebtedness. It is
understood that the provisions of this Article Fifteen are
intended solely for the purpose of defining the relative rights of
the Holders, on the one hand, and the holders of the Senior
Indebtedness, on the other hand.
(b) If any payment or distribution to which the Holders
would otherwise have been entitled but for the provisions of this
Article Fifteen shall have been applied, pursuant to the
provisions of this Article Fifteen, to the payment of all amounts
payable under Senior Indebtedness, then, and in such case, the
Holders shall be entitled to receive from the holders of such
Senior Indebtedness any payments or distributions received by such
holders of Senior Indebtedness in excess of the amount required to
make payment in full, in cash, of such Senior Indebtedness of such
holders.
SECTION 1505. Obligations any Obligor Unconditional.
(a) Nothing contained in this Article Fifteen or elsewhere in
this Indenture or in the Securities is intended to or shall
impair, as among the Obligors and the Holders, the obligation of
the Company, which is absolute and unconditional, to pay to the
Holders the principal of, premium, if any, and interest on the
Securities as and when the same shall become due and payable in
accordance with their terms or the obligations of the Guarantors
under Article Fourteen, or is intended to or shall affect the
relative rights of the Holders and creditors of any Obligor other
than the holders of the Senior Indebtedness, nor shall anything
herein or therein prevent the Holders or the Trustee on their
behalf from exercising all remedies otherwise permitted by
applicable law upon default under this Indenture, subject to the
rights, if any, under this Article Fifteen of the holders of the
Senior Indebtedness.
(b) Without limiting the generality of the foregoing,
nothing contained in this Article Fifteen will restrict the right
of the Trustee or the Holders to take any action to declare the
Securities to be due and payable prior to their Stated Maturity
pursuant to Section 501 of this Indenture or to pursue any rights
or remedies hereunder; provided, however, that all Senior
Indebtedness then due and payable or thereafter declared to be
due and payable shall first be paid in full, in cash, before the
Holders or the Trustee are entitled to receive any direct or
indirect payment from any Obligor of Senior Subordinated
Obligations.
SECTION 1506. Notice to Trustee. The Company shall
give prompt written notice to the Trustee of any fact known to the
Company that would prohibit the making of any payment to or by the
Trustee in respect of the Securities pursuant to the provisions of
this Article Fifteen. The Trustee shall not be charged with
knowledge of the existence of any default or event of default with
respect to any Senior Indebtedness or of any other facts that
would prohibit the making of any payment to or by the Trustee
unless and until the Trustee shall have received notice in writing
at its Corporate Trust Office to that effect signed by an Officer
of the Company, or by a holder of Senior Indebtedness, holder of
Senior Notes, or trustee or agent therefor; and prior to the
receipt of any such written notice, the Trustee shall, subject to
Article Six, be entitled to assume that no such facts exist;
provided that, if the Trustee shall not have received the notice
provided for in this Section 1506 at least two Business Days prior
to the date upon which, by the terms of this Indenture, any monies
shall become payable for any purpose (including, without
limitation, the payment of the principal of, premium, if any, or
interest on any Security), then, notwithstanding anything herein
to the contrary, the Trustee shall have full power and authority
to receive any monies from the Company and to apply the same to
the purpose for which they were received, and shall not be
affected by any notice to the contrary that may be received by it
on or after such prior date except for an acceleration of the
Securities prior to such application. Nothing contained in this
Section 1506 shall limit the right of the holders of Senior
Indebtedness to recover payments as contemplated by this Article
Fifteen. The foregoing shall not apply if the Paying Agent is the
Company. The Trustee shall be entitled to rely on the delivery to
it of a written notice by a Person representing himself or itself
to be a holder of any Senior Indebtedness (or a trustee on behalf
of, or other representative of, such holder) to establish that
such notice has been given by a holder of such Senior Indebtedness
or a trustee or representative on behalf of any such holder.
(b) In the event that the Trustee determines in good
faith that any evidence is required with respect to the right of
any Person as a holder of Senior Indebtedness to participate in
any payment or distribution pursuant to this Article Fifteen, the
Trustee may request such Person to furnish evidence to the
reasonable satisfaction of the Trustee as to the amount of Senior
Indebtedness held by such Person, the extent to which such Person
is entitled to participate in such payment or distribution and any
other facts pertinent to the rights of such Person under this
Article Fifteen and, if such evidence is not furnished to the
Trustee, the Trustee may defer any payment to such Person pending
judicial determination as to the right of such Person to receive
such payment.
SECTION 1507. Reliance on Judicial Order or
Certificate of Liquidating Agent. Upon any payment or
distribution of assets or securities referred to in this Article
Fifteen, the Trustee and the Holders shall be entitled to rely
upon any order or decree made by any court of competent
jurisdiction in which bankruptcy, dissolution, winding up,
liquidation or reorganization proceedings are pending, or upon a
certificate of the receiver, trustee in bankruptcy, liquidating
trustee, agent or other similar Person making such payment or
distribution, delivered to the Trustee or to the Holders for the
purpose of ascertaining the persons entitled to participate in
such distribution, the holders of the Senior Indebtedness and
other Indebtedness of the applicable Obligor, the amount hereof or
payable thereon, the amount or amounts paid or distributed thereon
and all other facts pertinent thereto or to this Article Fifteen.
SECTION 1508. Trustee's Relation to Senior
Indebtedness. (a) The Trustee and any Paying Agent shall be
entitled to all the rights set forth in this Article Fifteen with
respect to any Senior Indebtedness that may at any time be held by
it in its individual or any other capacity to the same extent as
any other holder of Senior Indebtedness and nothing in this
Indenture shall deprive the Trustee or any Paying Agent of any of
its rights as such holder.
(b) With respect to the holders of Senior Indebtedness,
the Trustee undertakes to perform or to observe only such of its
covenants and obligations as are specifically set forth in this
Article Fifteen, and no implied covenants or obligations with
respect to the holders of Senior Indebtedness shall be read into
this Indenture against the Trustee. The Trustee shall not be
deemed to owe any fiduciary duty to the holders of Senior
Indebtedness (except as provided in Sections 1502(c) and 1503(c)
of this Indenture) and shall not be liable to any such holders if
the Trustee shall in good faith mistakenly pay over or distribute
to Holders of Securities or to any Obligor or to any other person
cash, property or securities to which any holders of Senior
Indebtedness shall be entitled by virtue of this Article Fifteen
or otherwise.
SECTION 1509. Subordination Rights Not Impaired by Acts
or Omissions of any Obligor or Holders of Senior Indebtedness. No
right of any present or future holders of any Senior Indebtedness
to enforce subordination as provided in this Article Fifteen will
at any time in any way be prejudiced or impaired by any act or
failure to act on the part of any Obligor or by any act of failure
to act, in good faith, by any such holder, or by any noncompliance
by any Obligor with the terms of this Indenture, regardless of any
knowledge thereof that any such holder may have or otherwise be
charged with. The provisions of this Article Fifteen are intended
to be for the benefit of, and shall be enforceable directly by,
the holders of Senior Indebtedness.
SECTION 1510. Holders Authorize Trustee to Effectuate
Subordination of Securities. Each Holder by his acceptance of any
Securities authorizes and expressly directs the Trustee on his
behalf to take such action as may be necessary or appropriate to
effectuate the subordination provided in this Article Fifteen, and
appoints the Trustee his attorney-in-fact for such purposes,
including, in the event of any dissolution, winding up,
liquidation or reorganization of any Obligor (whether in
bankruptcy, insolvency, receivership, reorganization or similar
proceedings or upon an assignment for the benefit of creditors or
otherwise) tending towards liquidation of the property and assets
of such Obligor, the filing of a claim for the unpaid balance of
its Securities in the form required in those proceedings. If the
Trustee does not file a proper claim or proof of indebtedness in
the form required in such proceeding at least 30 days before the
expiration of the time to file such claim or claims, each holder
of Senior Indebtedness is hereby authorized to file an appropriate
claim for and on behalf of the Holders.
SECTION 1511. Not to Prevent Events of Default. The
failure to make a payment on account of principal of, premium, if
any, or interest on the Securities by reason of any provision of
this Article Fifteen will not be construed as preventing the
occurrence of an Event of Default.
SECTION 1512. Trustee's Compensation Not Prejudiced.
Nothing in this Article Fifteen will apply to amounts due to the
Trustee pursuant to other sections of this Indenture.
SECTION 1513. No Waiver of Subordination Provisions.
Without in any way limiting the generality of Section 1509, the
holders of Senior Indebtedness may, at any time and from time to
time, without the consent of or notice to the Trustee or the
Holders, without incurring responsibility to the Holders and
without impairing or releasing the subordination provided in this
Article Fifteen or the obligations hereunder of the Holders to the
holders of Senior Indebtedness, do any one or more of the
following: (a) change the manner, place or terms of payment or
extend the time of payment of, or renew or alter, Senior
Indebtedness or any instrument evidencing the same or any
agreement under which Senior Indebtedness is outstanding or
secured; (b) sell, exchange, release or otherwise deal with any
property pledged, mortgaged or otherwise securing Senior
Indebtedness; (c) release any Person liable in any manner for the
collection of Senior Indebtedness; and (d) exercise or refrain
from exercising any rights against any Obligor and any other
Person.
SECTION 1514. Payments May Be Paid Prior to
Dissolution. Nothing contained in this Article Fifteen or
elsewhere in this Indenture shall prevent (i) the Company, except
under the conditions described in Section 1502 or 1503 of this
Indenture, from making payments of principal of, premium, if any,
and interest on the Securities, or from depositing with the
Trustee any money for such payments, or (ii) the application by
the Trustee of any money deposited with it for the purpose of
making such payments of principal of, premium, if any, and
interest on the Securities to the holders entitled thereto unless,
at least two Business Days prior to the date upon which such
payment becomes due and payable, the Trustee shall have received
the written notice provided for in Section 1502(b) of this
Indenture (or there shall have been an acceleration of the
Securities prior to such application) or in Section 1506 of this
Indenture. Each Obligor shall give prompt written notice to the
Trustee of any dissolution, winding up, liquidation or
reorganization of such Obligor.
IN WITNESS WHEREOF, the parties hereto have caused this
Indenture to be duly executed, and their respective corporate
seals to be hereunto affixed and attested, all as of the day and
year first above written.
UNITED STATIONERS SUPPLY CO.,
as Issuer
By:______________________________
Title:
Attest:
Title:
UNITED STATIONERS INC.,
as Guarantor
By:______________________________
Title:
Attest:
Title:
________________________,
as Guarantor
By:______________________________
Title:
Attest:
Title:
Exhibit A
[FACE OF SECURITY]
UNITED STATIONERS SUPPLY CO. Floating
Rate Senior Subordinated Note due 2005
CUSIP
No. $
UNITED STATIONERS SUPPLY CO., a Delaware corporation
(the "Company", which term includes any successor under the
Indenture hereinafter referred to), for value received, promises
to pay to , or its registered assigns, the principal
sum of [One hundred thirty million dollars ($130,000,000)], on
____________, 2005.
Initial Interest Rate: ___% per annum.
Interest Payment
Dates: __________
and __________ of each
year commencing
__________, 1995.
Regular Record Dates:
___________ and __________
of each year.
Reference is hereby made to the further provisions of
this Security set forth on the reverse hereof, which further
provisions shall for all purposes have the same effect as if set
forth at this place.
IN WITNESS WHEREOF, the Company has caused this
Security to be signed manually or by facsimile by its duly
authorized officers.
Date: UNITED STATIONERS SUPPLY CO.
By:
Title:
Attest:
Title:
(Form of Trustee's Certificate of Authentication)
This is one of the Floating Rate Senior Subordinated Notes due
2005 described in the within-mentioned Indenture.
__________________________
____________, as Trustee
By:
Authorized Signatory
[REVERSE SIDE OF SECURITY]
UNITED STATIONERS SUPPLY CO.
Floating Rate Senior Subordinated Note due 2005
1. Principal and Interest.
The Company will pay the principal of this Security on
__________, 2005.
The Company promises to pay interest on the principal
amount of this Security on each Interest Payment Date, as set
forth below, at the Contract Rate (as defined below); provided
that (i) all interest accruing at a rate in excess of 15% per
annum ("Excess Interest") may, at the option of the Company (but
subject to proviso (ii) below), be payable by the issuance and
delivery on the applicable Interest Payment Date of Secondary
Securities in an aggregate principal amount equal to the amount of
Excess Interest, (ii) Secondary Securities shall be issuable only
in denominations of $1,000 and integral multiples thereof, and any
Excess Interest which, after aggregating all Excess Interest due
on any Interest Payment Date to a single Holder (irrespective of
the number of individual Securities registered in the name of such
Holder), would exceed the nearest whole multiple of $1,000 shall
be payable in cash and (iii) during any period when the rate of
interest provided for in Section 503 of this Indenture shall be
applicable, interest shall accrue at said rate and be payable by
the Company from time to time in cash, or in Secondary Securities
to the extent provided in provisos (i)
and (ii), upon demand of the Trustee.
Interest will be payable semiannually (to the holders of
record of the Securities (or any predecessor Securities) at the
close of business on the ___________ or __________ immediately
preceding the Interest Payment Date) on each Interest Payment
Date, commencing __________, 1996.
Interest on this Security will accrue from the most
recent date to which interest has been paid [on this Security or
the Security surrendered in exchange herefor]* or, if no interest
has been paid, from ___________, 1996; provided that, if there is
no existing default in the payment of interest and if this
Security is authenticated between a Regular Record Date referred
to on the face hereof and the next succeeding Interest Payment
Date, interest shall accrue from such Interest Payment Date.
Interest will be computed on the basis of a 360-day year of twelve
30-day months.
The Company shall pay interest on overdue principal and
premium, if any, and interest on overdue installments of interest,
to the extent lawful, at a rate per annum equal to the rate of
interest applicable to the Securities.
As used herein, the following capitalized terms shall
have the following meanings:
"Applicable Margin" means (a) during the first Quarterly
Period, 6% and (b) during each subsequent Quarterly Period, the
sum of (x) the Applicable Margin for the immediately preceding
Quarterly Period plus (y) .50%.
"Base Rate" means, as of any Quarterly Date, a rate per
annum equal to the higher of (a) the Federal Funds Rate for such
Quarterly Date plus 1/2 of 1% and (b) the Prime Rate for such
Quarterly Date.
"Contract Rate" means, for any Quarterly Period, a rate
per annum equal to the lesser of (a) the sum of (i) the Base Rate
as of the Quarterly Date immediately preceding the first day of
such Quarterly Period plus (ii) the Applicable Margin as of such
Quarterly Date plus (iii) the Incremental Rate (as defined in
Section 1021 of the Indenture) and (b) 20%.
"Federal Funds Rate" means, as of any Quarterly Date,
the rate per annum (rounded upwards, if necessary, to the nearest
1/100 of 1%) equal to the weighted average of the rates on
overnight Federal funds transactions with members of the Federal
Reserve System arranged by Federal funds brokers on such day, as
published by the Federal Reserve Bank of New York on the Business
Day next succeeding such Quarterly Date, provided that (a) if the
day for which such rate is to be determined is not a Business Day,
the Federal Funds Rate for such day shall be such rate on such
transactions on the next preceding Business Day as so published on
the next succeeding Business Day and (b) if such rate is not so
published for any Business Day, the Federal Funds Rate for such
Business Day shall be the average rate charged to The Chase
Manhattan Bank, N.A. on such Business Day on such transactions as
determined by the Trustee.
"Prime Rate" means, as of any Quarterly Date, the rate
of interest from time to time announced by The Chase Manhattan
Bank, N.A., or any successor thereto, at its principal office as
its prime commercial lending rate on such Quarterly Date.
"Quarterly Dates" means ___________, _______,
___________ and _________; provided that if any such date is not
a Business Day the relevant Quarterly Date shall be the next
succeeding Business Day.
"Quarterly Period" means the period beginning on the
date hereof and ending on and including the first Quarterly Date
occurring after the date hereof and each three-month period
commencing on the first day following the end of the immediately
preceding Quarterly Period.
2. Method of Payment.
The Company will pay interest (except defaulted
interest) on the principal amount of the Securities on each
__________ and __________ to the persons who are holders
(as reflected in the Security Register at the close of business on
the __________ and ___________ immediately preceding the Interest
Payment Date), in each case, even if the Security is cancelled on
registration of transfer or registration of exchange after such
record date; provided that, with respect to the payment of
principal, the Company will make payment to the Holder that
surrenders this Security to any Paying Agent on or after
___________, 2005.
The Company will pay principal, premium, if any, 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 its
check payable in such money. The Company may mail an interest
check to a Holder's registered address (as reflected in the
Security Register). If a payment date is a date other than a
Business Day at a place of payment, payment may be made at that
place on the next succeeding day that is a Business Day and no
interest shall accrue for the intervening period.
3. Paying Agent and Registrar.
Initially, the Trustee will act as Paying Agent and
Registrar. The Company may change any Paying Agent or Registrar
upon written notice thereto. The Company, any Subsidiary or any
Affiliate of any of them may act as Paying Agent, Registrar or co
registrar.
4. Indenture; Limitations.
The Company issued the Securities under an Indenture
dated as of ____________, 1996 (the "Indenture"), between the
Company, and ____________________________________________________
_______________________, as trustee (the "Trustee"). Capitalized
terms herein are used as defined in the Indenture unless otherwise
indicated. 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. The Securities are subject to all such terms,
and Holders are referred to the Indenture and the Trust Indenture
Act for a statement of all such terms. To the extent permitted by
applicable law, in the event of any inconsistency between the terms
of this Security and the terms of the Indenture, the terms of the
Indenture shall control.
The Securities are general unsecured obligations of the
Company. The Indenture limits the aggregate principal amount of
the Securities to [$130,000,000].
5. Guarantee.
The payment of principal and interest on the Notes is
guaranteed on a senior subordinated basis by the Guarantors
pursuant to Article 14 of the Indenture.
6. Redemption.
Optional Redemption. The Securities may be redeemed at
the option of the Company, in whole or in part, at any time and
from time to time, at the principal amount hereof, plus accrued
and unpaid interest, if any, to the Redemption Date (subject to
the right of Holders of record on the Regular Record Date to
receive interest due on a Redemption Date occurring after a
Regular Record Date and on or prior to an Interest Payment Date).
7. Repurchase upon a Change in Control and Asset Sales.
(a) Upon the occurrence of a Change of Control, the
Company is obligated to make an offer to purchase all outstanding
Securities at a redemption price of 101% of the principal amount
thereof, plus accrued and unpaid interest, if any, to the date of
purchase and (b) upon Asset Sales, the Company may be obligated to
make offers to purchase Securities with a portion of the Net Cash
Proceeds of such Asset Sales at a redemption price of 100% of the
principal amount thereof plus accrued and unpaid interest, if any,
to the date of purchase.
8. Denominations; Transfer; Exchange.
The Securities are in registered form without coupons,
in denominations of $1,000 and multiples of $1,000 in excess
thereof. A Holder may register the transfer or exchange of
Securities in accordance with the Indenture. The Registrar may
require a Holder, among other things, to furnish appropriate
endorsements and transfer documents and to pay any taxes and fees
required by law or permitted by the Indenture. The Registrar need
not register the transfer or exchange of any Securities selected
for redemption (except the unredeemed portion of any Security
being redeemed in part). Also, it need not register the transfer
or exchange of any Securities for a period of 15 days before a
selection of Securities to be redeemed is made.
9. Persons Deemed Owners.
A Holder may be treated as the owner of a Security for
all purposes.
10. Unclaimed Money.
If money for the payment of principal, premium, if any,
or interest remains unclaimed for two years, the Trustee and the
Paying Agent will pay the money back to the Company at its
request. After that, Holders entitled to the money must look to
the Company for payment, unless an abandoned property law
designates another Person, and all liability of the Trustee and
such Paying Agent with respect to such money shall cease.
11. Discharge Prior to Redemption or Maturity.
If the Company irrevocably deposits, or causes to be
deposited, with the Trustee money or U.S. Government Obligations
sufficient to pay the then outstanding principal of, premium, if
any, and accrued interest on the Securities (a) to redemption or
maturity, the Company will be discharged from the Indenture and
the Securities, except in certain circumstances for certain
sections thereof, and (b) to the Stated Maturity, the Company will
be discharged from certain covenants set forth in the Indenture.
12. Amendment; Supplement; Waiver.
Subject to certain exceptions, the Indenture or the
Securities may be amended or supplemented with the consent of the
Holders of at least a majority in aggregate principal amount of
the Securities then outstanding, and any existing default or
compliance with any provision may be waived with the consent of
the Holders of a majority in aggregate principal amount of the
Securities then outstanding. Without notice to or the consent of
any Holder, the parties thereto may amend or supplement the
Indenture or the Securities to, among other things, cure any
ambiguity, defect or inconsistency and make any change that does
not materially adversely affect the rights of any Holder.
13. Restrictive Covenants.
The Indenture contains certain covenants, including,
without limitation, covenants with respect to the following
matters: (i) Indebtedness; (ii) Restricted Payments;
(iii) issuances and sales of Subsidiary stock; (iv) transactions
with Affiliates; (v) Liens; (vi) guarantees of Indebtedness by
Subsidiaries; (vii) disposition of proceeds of Asset Sales; (viii)
dividends and other payment restrictions affecting Subsidiaries;
(ix) transfer of assets to Subsidiaries; (x) merger and certain
transfers of assets; (xi) Subsidiary Capital Stock; and (xii)
subordinated Indebtedness. Within 120 days after the end of each
fiscal year and within 45 days after each fiscal quarter, the
Company must report to the Trustee on compliance with such
limitations.
14. Successor Persons.
When a successor person or other entity assumes all the
obligations of its predecessor under the Securities and the
Indenture, the predecessor person will be released from those
obligations.
15. Remedies for Events of Default.
If an Event of Default, as defined in the Indenture,
occurs and is continuing, the Trustee or the Holders of not less
than 25% in principal amount of the Securities then outstanding
may declare all the Securities to be immediately due and payable.
If a bankruptcy or insolvency default with respect to the Company
any Guarantor on any Subsidiary occurs and is continuing, the
Securities automatically become immediately due and payable.
Holders may not enforce the Indenture or the Securities except as
provided in the Indenture. The Trustee may require indemnity
satisfactory to it before it enforces the Indenture or the
Securities. Subject to certain limitations, Holders of at least a
majority in principal amount of the Securities then outstanding
may direct the Trustee in its exercise of any trust or power.
16. Subordination.
The payment of the Securities will, to the extent set
forth in the Indenture, be subordinated in right of payment to the
prior payment in full, in cash, of all Senior Indebtedness.
17. Trustee Dealings with Company.
The Trustee under the Indenture, in its individual or
any other capacity, may become the owner or pledgee of Securities
and may make loans to, accept deposits from, perform services for,
and otherwise deal with, the Company and its Affiliates as if it
were not the Trustee.
18. Authentication.
This Security shall not be valid until the Trustee signs
the certificate of authentication on the other side of this
Security.
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 U/G/M/A (= Uniform Gifts to Minors Act).
The Company will furnish to any Holder upon written
request and without charge a copy of the Indenture. Requests may
be made to _____________________________.
[FORM OF TRANSFER NOTICE]
FOR VALUE RECEIVED the undersigned registered holder
hereby sell(s), assign(s) and transfer(s) unto
Insert Taxpayer Identification No.
(Please print or typewrite name and address including zip code of
assignee)
the within Security and all rights thereunder, hereby irrevocably
constituting and appointing
attorney to transfer such Security on the books of the Company
with full power of substitution in the premises.
[THE FOLLOWING PROVISION TO BE INCLUDED
ON ALL CERTIFICATES
EXCEPT PERMANENT OFFSHORE PHYSICAL
CERTIFICATES]
In connection with any transfer of this Security
occurring prior to the date which is the earlier of the date of an
effective Registration Statement or _________, 1999, the
undersigned confirms that without utilizing any general
solicitation or general advertising that documents are being
furnished which comply with the conditions of transfer set forth
in this Security and the Indenture.
Date:
NOTICE: The signature to this
assignment must correspond with
the name as written upon the
face of the withinmentioned
instrument in every particular,
without alteration or any
change whatsoever.
Signature Guarantee:
OPTION OF HOLDER TO ELECT PURCHASE
If you wish to have this Security purchased by the
Company pursuant to Section 1010 or Section 1016 of the Indenture,
check the Box: [ ].
If you wish to have a portion of this Security purchased
by the company pursuant to Section 1010 or Section 1016 of the
Indenture, state the amount (in original principal amount) below:
$ .
Date:
Your Signature:
(Sign exactly as your name appears on the other side of this
Security)
Signature Guarantee:
Exhibit B
Form of Certificate to Be
Delivered in Connection with
Transfers
, ____
United Stationers Supply Co.
2200 East Golf Road
Des Plaines, Illinois 60016-1267
[Trustee
Address]
Re: United Stationers Supply
Co.
(the "Company") Floating
Rate
Senior Subordinated Notes
due 2005 (the "Securities")
Ladies and Gentlemen:
In connection with our proposed purchase of $
aggregate principal amount of the Securities:
1. We understand that the Securities have not
been registered under the Securities Act of 1933, as
amended (the "Securities Act), and may not be sold
except as permitted in the following sentence. We agree
on our own behalf and on behalf of any investor account
for which we are purchasing the Securities to offer,
sell or otherwise transfer such Securities prior to the
date which is three years after the later of the date of
original issue and the last date on which the Company or
any affiliate of the Company was the owner of such
Securities, or any predecessor thereto
(the "Resale Restriction Termination Date") only (a) to
the Company, (b) pursuant to a registration statement
which has been declared effective under the Securities
Act, (c) to an institutional "accredited investor"
within the meaning of subparagraph (a)(1), (2), (3) or
(7) of Rule 501 under the Securities Act that is
acquiring the Securities for its own account or for the
account of such an institutional "accredited investor"
for investment purposes and not with a view to, or for
offer or sale in connection with, any distribution
thereof in violation of the Securities Act or
(d) pursuant to any other available exemption from the
registration requirements of the Securities Act, subject
in each of the foregoing cases to any requirement of law
that the disposition of our property and the property of
such investor account or accounts be at all times within
our or their control and to compliance with any
applicable state securities laws. The foregoing
restrictions on resale will not apply subsequent to the
Resale Restriction Termination Date. If any resale or
other transfer of the Securities is proposed to be made
pursuant to clause (c) above prior to the Resale
Restriction Termination Date, the transferor shall
deliver a letter from the transferee substantially in
the form of this letter to the Trustee, which shall
provide, among other things, that the transferee is an
institutional "accredited investor" within the meaning
of subparagraph (a)(1), (2), (3) or (7) or Rule 501
under the Securities Act and that it is acquiring such
Securities for investment purposes and not for
distribution in violation of the Securities Act. We
acknowledge that the Company and the Trustee reserve the
right prior to any offer, sale or other transfer prior
the Resale Restriction Termination Date of the
Securities pursuant to clauses (c) and (d) above to
require the delivery of an opinion of counsel,
certifications and/or other information satisfactory to
the Company and the Trustee.
2. We are an institutional "accredited investor"
(as defined in Rule 501(a)(1), (2), (3) or (7) of
Regulation D under the Securities Act) purchasing for
our own account or for the account of such an
institutional "accredited investor," and we are
acquiring the Securities for investment purposes and not
with a view to, or for offer or sale in connection with,
any distribution in violation of the Securities Act and
we have such knowledge and experience in financial and
business matters as to be capable of evaluating the
merits and risks of our investment in the Securities,
and we and any accounts for which we are acting are each
able to bear the economic risk of our or its investment.
3. We are acquiring the Securities purchased by
us for our own account or for one or more accounts as to
each of which we exercise sole investment discretion.
4. You are entitled to rely upon this letter and
you are irrevocably authorized to produce this letter or
a copy hereof to any interested party in any
administrative or legal proceeding or official inquiry
with respect to the matters covered hereby.
Very truly yours,
By:
(NAME OF PURCHASER)
Date:
Upon transfer, the Securities should be registered
in the name of the new beneficial owner as follows:
Name:
Address:
Taxpayer ID Number:
EXHIBIT G
[Form of Registration Rights Agreement]
IIIIIIIIIIIIIIIIIIIIIIIIIIIIIIIIIIIIIIIIIIIIIIIIIIIIIIIIIIII IIIII
UNITED STATIONERS SUPPLY CO.
and
UNITED STATIONERS INC.
________________________________
REGISTRATION RIGHTS AGREEMENT
Dated as of March __, 1996
_________________________________
IIIIIIIIIIIIIIIIIIIIIIIIIIIIIIIIIIIIIIIIIIIIIIIIIIIIIIIIIIII IIIIII
TABLE OF CONTENTS
This Table of Contents is not part of the Agreement to
which it is attached but is inserted for convenience only.
Page
No.
1. Definitions 2
2. Exchange Rights 3
3. Demand Registrations 4
4. Registration Procedures 5
5. Registration Expenses 9
6. Indemnification 10
7. Limitations on Sale or Distribution of
Other Securities 13
8. Rule 144 14
9. Nominees for Beneficial Owners 14
10. Indenture 14
11. Miscellaneous 14
(a) Notices 14
(b) Entire Agreement 15
(d) Successors and Assigns 15
(e) Headings 15
(f) Invalid Provisions 15
(g) Remedies 16
(h) Governing Law 16
(i) Counterparts 16
REGISTRATION RIGHTS AGREEMENT dated as of March
__, 1996, among: UNITED STATIONERS SUPPLY CO., a
corporation duly organized and validly existing under the
laws of the State of Illinois (together with its successors
and assigns, the "Company"); UNITED STATIONERS INC., a
corporation duly organized and validly existing under the
laws of the State of Delaware (together with its successors
and assigns, the "Guarantor"); and [NAME OF INITIAL HOLDERS],
and any other holder from time to time of the
Rollover Notes (as defined below);
WHEREAS, each of the Company (as successor by
merger to Associated Stationers, Inc. ("Associated")); the
Guarantor (as successor by merger to Associated Holdings,
Inc. ("Holdings")) and The Roebling Fund are parties to a
Senior Subordinated Credit Agreement dated as of March 30,
1995 (the "Senior Subordinated Credit Agreement") pursuant to
which the Lenders (as defined in the Senior Subordinated
Credit Agreement) made loans to Associated (the "Bridge
Loans") in an aggregate principal amount of $130,000,000 to
provide financing for the acquisition by Holdings of up to
17,201,839 United Shares (as defined below), representing as
of such date approximately 92.5% of the issued and
outstanding United Shares, and for certain related purposes;
WHEREAS, following the purchase of United Shares
pursuant to the Tender Offer (as defined in the Senior
Subordinated Credit Agreement), Holdings merged with and into
the Guarantor with the result that the Guarantor survived
such merger and Associated merged with and into the Company
with the result that the Company survived such merger;
WHEREAS, if the Company shall not have repaid the
Bridge Loans within 365 days of the Closing Date (as defined
in the Senior Subordinated Credit Agreement), the Company
shall have the right, subject to the terms and conditions of
the Senior Subordinated Credit Agreement, to repay such
Bridge Loans through the issuance to the Lenders of Senior
Subordinated Notes due 2005 (the "Initial Securities"), in an
aggregate principal amount equal to the aggregate principal
amount of the Bridge Loans, issued under an Indenture, dated
as of the date hereof, between the Company, the Guarantor and
___________, as Trustee (the "Indenture");
WHEREAS, the Senior Subordinated Credit Agreement
requires the Company to enter into this Agreement with such
Lenders as a condition precedent to the repayment of such
Bridge Loans through the issuance to the Lenders of such
Initial Securities;
NOW, THEREFORE, in consideration of the mutual
covenants and agreements set forth in this Agreement, and for
other good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, the parties
hereto agree as follows:
1. Definitions. Except as otherwise specifically
indicated, the following terms will have the following
meanings for all purposes of this Agreement:
"Affiliate" shall mean, in respect of any Person
(the "Relevant Person"), any other Person that directly or
indirectly controls, or is under common control with, or is
controlled by, the Relevant Person and, if such other Person
is an individual, any member of the immediate family
(including parents, spouse, children and siblings) of such
individual and any trust whose principal beneficiary is such
individual or one or more members of such immediate family
and any Person who is controlled by any such member or trust.
As used in this definition, "control" (including, with its
correlative meanings, "controlled by" and "under common
control with") shall mean possession, directly or indirectly,
of power to direct or cause the direction of management or
policies (whether through ownership of
securities or partnership or other ownership interests, by
contract or otherwise), provided that, in any event, any
Person that owns directly or indirectly securities having 5%
or more of the voting power for the election of directors or
other governing body of a corporation or 5% or more of the
partnership or other ownership interests of any other Person
(other than as a limited partner of such other Person) will
be deemed to control such corporation or other Person.
Notwithstanding the foregoing, (a) no individual shall be an
Affiliate of any Relevant Person solely by reason of his or
her being a director, officer or employee of such Relevant
Person or any of its Subsidiaries, (b) none of the
Subsidiaries of the Guarantor shall be Affiliates of the
Guarantor or of any other Subsidiary of the Guarantor, (c)
the Guarantor shall not be an Affiliate of any of its
Subsidiaries and (d) neither the Agent nor any Lender shall
be an Affiliate of the Guarantor or of any Subsidiary of the
Guarantor.
"Commission" means the United States Securities and
Exchange Commission, or any successor governmental agency or
authority.
"Exchange Act" means the Securities Exchange Act of
1934, as amended, and the rules and regulations promulgated
thereunder.
"Exchange Offer" has the meaning given to such term
in Section 2 hereof.
"Exchange Securities" has the meaning given to such
term in the Indenture.
"Holders" has the meaning given to such term in the
Indenture.
"Majority Holders" means Holders (other than the
Company, the Guarantor and their respective Affiliates)
holding at least a majority of the aggregate unpaid principal
amount of the Registrable Securities.
"Person" means any individual, corporation,
company, voluntary association, partnership, joint venture,
trust, unincorporated organization or government (or any
agency, instrumentality or political subdivision thereof).
"Registrable Securities" means the Initial
Securities (but not any Exchange Securities) until in the
case of any such Initial Security (i) a Registration
Statement covering such Initial Security has been declared
effective by the Commission and such Initial Security has
been disposed of in accordance with such effective
Registration Statement, (ii) such Initial Security is sold in
compliance with Rule 144 or (iii) such Initial Security
ceases to be outstanding.
"Registration Demand" has the meaning given to such
term in Section 2 hereof.
"Registration Statement" means any registration
statement of the Company that covers any of the Registrable
Securities pursuant to the provisions of this Agreement,
including the prospectus included therein, amendments and
supplements to such registration statement, including post
effective amendments, and all exhibits and all material
incorporated by reference in such registration statement.
"Requisite Amount" means [25% of the aggregate
principal amount of the Initial Securities outstanding upon
the initial issuance thereof].
"Rule 144" means Rule 144 under the Securities Act,
as such Rule may be amended from time to time, and any
successor provision thereof.
"Rule 415" means Rule 415 under the Securities Act,
as such Rule may be amended from time to time, and any
successor provision thereof.
"Securities Act" means the Securities Act of 1933,
as amended, and the rules and regulations promulgated
thereunder.
"Trustee" means the trustee under the Rollover
Indenture.
"United Shares" means the shares of common stock,
$0.10 par value, of United.
2. Exchange Rights. The Holders of at least the
Requisite Amount of the Registrable Securities may require
the Company and the Guarantor to file with the Commission an
offer to exchange any and all of the Initial Securities held
by such Holders for Exchange Securities (an "Exchange
Demand"). The Company shall promptly give written notice of
such Exchange Demand to all Holders and thereupon, as
promptly as practicable and in no event later than 90 days
after the Company receives a Registration Demand, shall file
with the Commission an offer to exchange (the "Exchange
Offer"), on an appropriate form and in compliance with all
applicable tender offer rules and regulations under the
Exchange Act, any and all of the Initial Securities held by
such Holders making such Exchange Demand and by any other
Holders who shall have requested the exchange of their
Initial Securities pursuant to such Exchange Offer within 30
days after receipt of such written notice from the Company,
in each case for Exchange Securities and to use their best
efforts to have the Exchange Offer declared effective as
promptly as practicable; provided that the Company and the
Guarantor may delay such obligation to effect such Exchange
Offer for a period of up to 60 days from the date of the
Exchange Demand, if, in their reasonable judgment, effecting
such registration is not in the Company's best economic
interests prior to the expiration of such period, and
provided, further, if after conferring with counsel, the
Company and the Guarantor reasonably determine in good faith
that (i) the Exchange Securities would not, upon receipt, be
tradeable by each Holder who can make the representations in
Section 2(b) hereof and who is not an Affiliate of the
Company without restriction under the Securities Act and the
Exchange Act and without material restrictions under
applicable blue sky or state securities laws or (ii) the
Commission is unlikely to permit the Exchange Offer to be
declared effective prior to the date 120 days after the
Company has received such demand, then the Company and the
Guarantor shall promptly deliver to the Holders and the
Trustee notice thereof and shall thereafter file a
Registration Statement pursuant to Section 3 hereof. The
parties hereto agree that, following the delivery of such
notice, neither the Company nor the Guarantor shall have any
further obligation under this Section 2(a).
(b) Representations of the Holders. Each Holder
shall be deemed by its acceptance of an Exchange Security (i)
to represent that any Exchange Securities received by it will
be acquired in the ordinary course of its business and that
at the time of the consummation of the Exchange Offer, such
Holder will have no arrangement or understanding with any
person to participate in the distribution of the Exchange
Securities and (ii) to acknowledge that if it participates in
the Exchange Offer for the purpose of distributing Exchange
Securities, such Holder cannot rely on the position
enunciated by the Commission in the Exxon Capital Holdings
Corporation no-action letter or inter pretive letters to
similar effect and must comply with the registration and
prospectus delivery requirements of the Securities Act in
connection with a secondary resale.
3. Demand Registrations. The Holder or Holders
of not less than the Requisite Amount of the Registrable
Securities shall have the right on not more than three
occasions to require the Company and the Guarantor, upon
request, to register all Registrable Securities held by such
Holder or Holders then outstanding for disposition on a
delayed or continuous basis pursuant to Rule 415 of the
Securities Act (which request shall state the intended method
of disposition by such Holder or Holders). Upon receipt of
such request, the Company shall promptly give written notice
of such requested registration to all Holders of Registrable
Securities, and thereupon the Company and the Guarantor shall
use their best efforts to effect the registration under the
Securities Act of all Registrable Securities of the Holders
making such request and of all other Holders who shall have
requested the registration of Registrable Securities held by
such Holders within 30 days of such notice from the Company,
in each case within 120 days of receipt of such request (the
"Scheduled Registration Date"), for disposition in accordance
with the intended method of disposition stated in such
request, all to the extent requisite to permit the
disposition of the Registrable Securities by the Holders
thereof.
4. Registration Procedures. In connection with
the Company and the Guarantor's obligations to use their best
efforts to effect or cause, as the case may be, the
registration of the Registrable Securities under the
Securities Act as provided in Section 3 at the times and
under circumstances therein specified, the Company and the
Guarantor shall comply with the provisions of Section 11
below and will, as expeditiously as possible in connection
with such registration and any disposition pursuant thereto:
(A) prepare and file with the Commission a
registration statement with respect to such Registrable
Securities as required by Section 3 and use their best
efforts to cause such registration statement to become
and remain effective until the final maturity date of
the Securities or, if sooner, the date on which all such
Registrable Securities shall have been sold pursuant to
an effective registration statement or the date on which
no such Registrable Securities remain outstanding;
(B) prepare and file with the Commission such
amendments and supplements to such registration
statement and the prospectus used in connection
therewith, and to prepare and file such other documents,
as may be necessary to keep such
registration statement and prospectus, respectively,
effective for the period described in Subsection (A)
above and to comply with the provisions of the
Securities Act with respect to the sale or other
disposition of all securities covered by such
registration statement during such period in accordance
with the intended methods of disposition by the seller
or sellers thereof set forth in such registration
statement;
(C) furnish to each seller of such Registrable
Securities and each underwriter of the securities being
sold by such seller such number of copies of such
registration statement and of each such amendment and
supplement thereto (in each case including all
exhibits), such number of copies of the prospectus
included in such registration statement (including each
preliminary prospectus), such reasonable number of
copies of the prospectus which may be filed pursuant to
Rule 424 (or any similar or successor provision) under
the Securities Act, and such reasonable number of copies
of any amendments or supplements to any prospectus, in
conformity with the requirements of the Securities Act,
and such other documents, as such seller and underwriter
may reasonably request in order to facilitate the public
sale or other disposition of the Registrable Securities
owned by such seller;
(D) use their best efforts to register or qualify
such Registrable Securities under such other securities
or blue sky laws of such jurisdictions as any seller and
each underwriter of the securities being sold by such
seller shall reasonably request, and do any and all
other acts and things which may be necessary or
advisable to enable such seller and underwriter to
consummate the disposition in such jurisdictions of such
Registrable Securities owned by such seller, except that
neither the Company nor the Guarantor shall for any such
purpose be required to qualify generally to do business
as a foreign corporation in any jurisdiction wherein it
would not but for the requirements of this Subsection
(D) be obligated to be qualified, to subject itself to
taxation in any such jurisdiction or to consent to
general service of process in any such jurisdiction;
(E) use their best efforts to cause such
Registrable Securities to be registered with or approved
by such other governmental agencies or authorities as
may be necessary to enable the seller or sellers thereof
to consummate the disposition of such Registrable
Securities;
(F) notify each prospective seller of any such
Registrable Securities, at any time when a prospectus
relating thereto is required to be delivered under the
Securities Act, immediately upon the Company or the
Guarantor's becoming aware that the prospectus then
available for use and any amendment or supplement
thereto (including any documents incorporated by
reference in any of the foregoing) includes an untrue
statement of a material fact or omits to state any
material fact required to be stated therein or necessary
to make the statements therein not misleading in the
light of the circumstances then existing, and promptly
prepare and furnish to such seller and each
underwriter a reasonable number of copies of a
prospectus supplemented or amended so that, as
thereafter delivered to the purchasers of such
Registrable Securities, such prospectus shall not
include an untrue statement of a material fact or omit
to state a material fact required to be stated therein
or necessary to make the statements therein not
misleading in the light of the circumstances then
existing;
(G) otherwise use their best efforts to comply
with all applicable rules and regulations of the
Commission, and make available to their respective
security holders, as soon as reasonably practicable, an
earning statement covering the period of at least twelve
months, but not more than eighteen months, beginning
with the first day of the Company's first fiscal quarter
after the effective date of the registration statement,
which earning statement shall satisfy the provisions of
Section 11(a) of the Securities Act;
(H) enter into such agreements (including, without
limitation, one or more underwriting agreements in
customary form) and take such other actions as sellers
of a majority of the aggregate outstanding principal
amount of such Registrable Securities shall reasonably
request in order to expedite or facilitate the
disposition of such Registrable Securities (including,
without limitation, taking such actions as are necessary
to cause the Registrable Securities to be eligible for
clearance and settlement through The Depository Trust
Company), provided that the selection of any managing
underwriter or underwriters by such sellers shall
require the consent of the Company and the Guarantor,
which consent shall not be unreasonably withheld;
(I) obtain opinions from counsel to the Company
and the Guarantor counsel and "cold comfort" letters
from the independent public accountants of the Company
and the Guarantor in customary form and covering such
matters of the type customarily covered by such opinions
and "cold comfort" letters as the seller or sellers of a
majority of the aggregate outstanding principal amount
of such Registrable Securities shall reasonably request;
(J) make available for inspection, at reasonable
times and upon adequate notice, by any seller of such
Registrable Securities covered by such registration
statement, by any underwriter participating in any
disposition to be effected pursuant to such registration
statement and by any attorney, accountant or other agent
retained by any such seller or any such underwriter
(collectively, the "Inspectors"), all pertinent
financial and other records, pertinent corporate
documents and properties of the Company and the
Guarantor (collectively, the "Records"), and cause all
of the respective officers and directors of the Company
and the Guarantor to supply all information reasonably
requested by any Inspector in connection with such
registration statement; provided that Records which the
Company or the Guarantor determines, in good faith, to
be confidential and which it notifies the Inspectors are
confidential shall not be disclosed by
the Inspectors unless (i) the disclosure of such Records
is necessary to avoid or correct a misstatement or
omission of a material fact in the registration
statement, (ii) the release of such Records is ordered
pursuant to a subpoena or other order from a court of
competent jurisdiction or (iii) the information in such
Records has been made generally available to the public;
(K) permit any holder of Registrable Securities
which holder, in the sole and exclusive judgment,
exercised in good faith, of such holder, might be deemed
to be a controlling person of the Company or the
Guarantor, to participate in the preparation of such
registration or comparable statement and to require the
insertion therein of material, furnished to the Company
and the Guarantor in writing, which in the judgment of
any such holder, as aforesaid, should be included; and
(L) upon the written request of the holders of a
majority of the aggregate outstanding principal amount
of the principal of such Registrable Securities, use
their best efforts (i) to cause all such Registrable
Securities covered by such registration statement to be
listed on a national securities exchange (if such
Registrable Securities are not already so listed) and on
each additional national securities exchange on which
similar securities issued by the Company are then
listed, if the listing of such Registrable Securities is
then permitted under the rules of such exchange, or (ii)
to secure designation of all such Registrable Securities
covered by such registration statement as a NASDAQ
"national market system security" within the meaning of
Rule 11Aa2-1 of the Commission or, failing that, to
secure NASDAQ authorization for such Registrable
Securities and, without limiting the generality of the
foregoing, to arrange for at least two market makers to
register as such with respect to such Registrable
Securities with the National Association of Securities
Dealers.
Each holder of Registrable Securities shall be deemed to have
agreed by acquisition of such Registrable Securities that
upon receipt of any notice from the Company or the Guarantor
of the happening of any event of the kind described in
Subsection (F) above, such holder will forthwith discontinue
such holder's disposition of Registrable Securities pursuant
to the registration statement covering such Registrable
Securities until such holder's receipt of the copies of the
supplemented or amended prospectus contemplated by said
Subsection and, if so directed by the Company or the
Guarantor, will deliver to the Company and the Guarantor (at
the Company's expense) all copies, other than permanent file
copies, then in such holder's possession of the prospectus
covering such Registrable Securities current at the time of
receipt of such notice.
If any such registration or comparable statement
refers to any holder by name or otherwise as the holder of
any securities of the Company then (whether or not in the
sole and exclusive judgment, exercised in good faith, of such
holder, such holder is or might be deemed to be a controlling
person of the Company), such holder shall have the right to
require (i) the insertion therein of language, in form and
substance satisfactory to such holder and
presented to the Company in writing, to the effect that the
holding by such holder of such securities is not to be
construed as a recommendation by such holder of the
investment quality of the Company's securities covered
thereby and that such holding does not imply that such holder
will assist in meeting any future financial requirements of
the Company, or (ii) in the event that such reference to such
holder by name or otherwise is not required by the Securities
Act or any similar Federal statute or any rule, regulation or
interpretation promulgated under either said Act or any such
statute then in force, the deletion of the reference to such
holder.
If (i) any registration under Section 3 which is
proposed by the Company and the Guarantor to be on Form S-3
(or any similar short-form registration statement which is a
successor to Form S-3) shall be proposed in connection with
an underwritten public offering, and (ii) the managing
underwriters shall advise the Company in writing that in
their good faith opinion the use of another permitted form is
of material importance to the success of the offering, then
such registration shall be on such other permitted form.
5. Registration Expenses. The Company shall,
whether or not any registration pursuant to this Agreement
shall become effective, from time to time promptly upon
receipt of bills or invoices relating thereto, pay all
expenses incident to its performance of or compliance with
this Agreement, including without limitation all registration
and filing fees, fees and expenses of compliance with
securities or blue sky laws, rating agency fees, printing
expenses, messenger and delivery expenses, fees and
disbursements of counsel for the Company and all independent
public accountants (including the expenses of any audit
and/or "cold comfort" letter) and other Persons retained by
the Company or the Guarantor, and reasonable fees and
disbursements of the counsel or firm of counsel chosen by the
holders of a majority of the aggregate outstanding principal
amount of the principal of the Registrable Securities covered
by the registration in question, and any fees and
disbursements of underwriters customarily paid by issuers or
sellers of securities (excluding underwriting commissions and
discounts). In all cases, any expenses in respect of
allocation of personnel of the Company or the Guarantor or
other general overhead expenses of the Company and the
Guarantor or other expenses for the preparation of financial
statements or other data normally prepared by the Company or
the Guarantor in the ordinary course of its business shall be
borne by the Company and the Guarantor as applicable.
6. Indemnification. The Company and the
Guarantor hereby indemnify, to the extent permitted by law,
each holder of a Registrable Security, its officers and
directors or general and limited partners (and officers and
directors thereof) and, if such holder is a portfolio or an
investment fund, its investment advisers and/or agents, and
each Person, if any, who controls such holder within the
meaning of Section 15 of the Securities Act, against all
losses, claims, damages, liabilities (or proceedings in
respect thereof) and expenses (under the Securities Act or
common law or otherwise), joint or several, caused by any
untrue statement or alleged untrue statement of a material
fact contained in any registration statement or prospectus
(and as amended or supplemented if the Company or the
Guarantor shall have furnished any amendments or supplements
thereto) or any preliminary prospectus or caused by any
omission or alleged omission to state therein a material fact
required to be stated therein or necessary to make the
statements therein not misleading, except insofar as such
losses, claims, damages, liabilities (or proceedings in
respect thereof) or expenses are caused by any untrue
statement or alleged untrue statement contained in or by any
omission or alleged omission from information furnished in
writing to the Company or the Guarantor by such holder
expressly for use therein. If any offering pursuant to any
registration statement provided for under this Agreement is
made through underwriters, the Company and the Guarantor
agree to enter into an underwriting agreement in customary
form with such underwriters and to indemnify such
underwriters, their officers and directors, if any, and each
Person, if any, who controls such underwriters within the
meaning of Section 15 of the Securities Act to the same
extent as hereinbefore provided with respect to the
indemnification of the holders of Registrable Securities;
provided that neither the Company nor the Guarantor shall be
required to indemnify any such underwriter, or any officer or
director of such underwriter or any Person who controls such
underwriter within the meaning of Section 15 of the
Securities Act, to the extent that the loss, claim, damage,
liability (or proceedings in respect thereof) or expense for
which indemnification is claimed results from such
underwriter's failure to send or to give a copy of the
amended or supplemented final prospectus to the Person
asserting an untrue statement or alleged untrue statement or
omission or alleged omission at or prior to the written
confirmation of the sale of Registrable Securities to such
Person if such statement or omission was corrected in such
amended or supplemented final prospectus prior to such
written confirmation and the underwriter was given notice of
the availability of such amended or supplemented final
prospectus. In connection with any registration statement in
which a holder of a Registrable Security is participating,
each such holder will furnish to the Company and the
Guarantor in writing such information as shall be reasonably
requested by the Company or the Guarantor for use in any such
registration statement or prospectus and will indemnify, to
the extent permitted by law, the Company and the Guarantor,
their respective officers and directors and each Person, if
any, who controls the Company or the Guarantor within the
meaning of Section 15 of the Securities Act, against any
losses, claims, damages, liabilities (or proceedings in
respect thereof) and expenses (under the Securities Act or
common law or otherwise) resulting from any untrue statement
or alleged untrue statement of a material fact or any
omission or alleged omission of a material fact required to
be stated in the registration statement or prospectus or
preliminary prospectus or any amendment thereof or supplement
thereto or necessary to make the statements therein not
misleading, but only to the extent that such untrue statement
is contained in or such omission is from information so
furnished in writing by such holder expressly for use
therein; provided, however, that such holder's obligations
hereunder shall be limited to an amount equal to the net
proceeds received by such holder of a Registrable Security to
such registration statement. If the offering pursuant to any
such registration statement is made through underwriters,
each such holder agrees to enter into an underwriting
agreement in customary form with such underwriters, and to
indemnify such underwriters, their officers and directors, if
any, and each Person, if any, who
controls such underwriters within the meaning of Section 15
of the Securities Act to the same extent as hereinbefore
provided with respect to indemnification by such holder of
the Company and the Guarantor, but subject to the same
limitation as hereinbefore provided with respect to
indemnification by the Company and the Guarantor of such
underwriters, officers and directors and Persons. Any Person
entitled to indemnification under the provisions of this
Section 6 shall (a) give prompt notice to the indemnifying
party of any claim with respect to which it seeks
indemnification and (b) unless in such indemnified party's
reasonable judgment a conflict of interest between such
indemnified and indemnifying parties may exist in respect of
such claim, permit such indemnifying party to assume the
defense of such claim, with counsel reasonably satisfactory
to the indemnified party; and if such defense is so assumed,
such indemnifying party shall not enter into any settlement
without the consent of the indemnified party if such
settlement attributes liability to the indemnified party and
such indemnifying party shall not be subject to any liability
for any settlement made without its consent (which shall not
be unreasonably withheld); and any underwriting agreement
entered into with respect to any registration statement
provided for under this Agreement shall so provide. In the
event an indemnifying party shall not be entitled, or elects
not, to assume the defense of a claim, such indemnifying
party shall not be obligated to pay the fees and expenses of
more than one counsel or firm of counsel for all parties
indemnified by such indemnifying party in respect of such
claim, unless in the reasonable judgment of any such
indemnified party a conflict of interest may exist between
such indemnified party and any other of such indemnified
parties in respect to such claim. Such indemnity shall remain
in full force and effect regardless of any investigation made
by or on behalf of a participating holder of Registrable
Securities, its officers, directors or any Person, if any,
who controls such holder as aforesaid, and shall survive the
transfer of such securities by such holder.
If for any reason the foregoing indemnity is
unavailable, or is insufficient to hold harmless, an
indemnified party, then the indemnifying party shall
contribute to the amount paid or payable by the indemnified
party as a result of such losses, claims, damages,
liabilities or expenses (i) in such proportion as is
appropriate to reflect the relative benefits received by the
indemnifying party on the one hand and the indemnified party
on the other or (ii) if the allocation provided by clause (i)
above is not permitted by applicable law or provides a lesser
sum to the indemnified party than the amount hereinafter
calculated, in such proportion as is appropriate to reflect
not only the relative benefits received by the indemnifying
party on the one hand (taking into consideration the fact
that the provision of the registration rights hereunder is a
material inducement to the Holder to purchase the Registrable
Securities) and the indemnified party on the other but also
the relative fault of the indemnifying party and the
indemnified party as well as any other relevant equitable
considerations. Notwithstanding the foregoing, (x) no holder
of Registrable Securities shall be required to contribute any
amount in excess of the amount such holder would have been
required to pay to an indemnified party if the indemnity
under the first paragraph of this Section 6 was available and
(y) no underwriter, if any, shall be required to contribute
any
amount in excess of the amount by which the total price at
which the Registrable Securities underwritten by it and
distributed to the public were offered to the public exceeds
the amount of any damages which such underwriter has
otherwise been required to pay by reason of such untrue or
alleged untrue statement or omission or alleged omission. No
Person guilty of fraudulent misrepresentation (within the
meaning of Section 11(f) of the Securities Act) shall be
entitled to contribution from any Person who was not guilty
of such fraudulent misrepresentation. The obligation of any
underwriters to contribute pursuant to this Section 6 shall
be several in proportion to their respective underwriting
commitments and not joint.
An indemnifying party shall make payments of all
amounts required to be made pursuant to the foregoing
provisions of this Section 6 to or for the account of the
indemnified party from time to time promptly upon receipt of
bills or invoices relating thereto or when otherwise due and
payable.
7. Limitations on Sale or Distribution of Other
Securities. If any proposed sale of Registrable Securities
shall be in connection with an underwritten public offering,
each holder of Registrable Securities shall be deemed to have
agreed by acquisition of such Registrable Securities not to
effect any public sale or distribution, including any sale
pursuant to Rule 144, of any Registrable Securities, and to
use such holder's best efforts not to effect any such public
sale or distribution of any other debt security of the
Company or of any security convertible into or exchangeable
or exercisable for any debt security of the Company (other
than as part of such underwritten public offering) within
seven days before or 90 days after the effective date of such
registration statement (and the Company hereby also so agrees
and agrees to cause each holder of any debt security, or of
any security convertible into or exchangeable or exercisable
for any debt security of the Company purchased from the
Company at any time after the date hereof other than in a
public offering so to agree).
The Company will not
(a) effect any other registration (an "Other
Registration") of any of its debt securities under the
Securities Act (other than in accordance with a
registration on Form S-8, Form S-14 or Form S-15 or any
similar form which is a successor to any of said Forms),
whether or not for sale for its own account, or
(b) if the Company shall have registered any of
its debt securities for sale on a delayed or continuous
basis under an Other Registration which is already on
file with the Commission, effect for itself, or permit
any others to effect for themselves, any offer or sale
of any of such securities under said Other Registration,
unless
(x) a period of 90 days shall have elapsed from
the date upon which any registration statement filed
pursuant to Section 3 became effective, and
(y) a period of 45 days shall have elapsed
following any notice (a "Delay Notice") given by a
holder or holders of any Registrable Securities not yet
sold pursuant to said registration stating that such
holder or holders propose a firm commitment underwriting
for not less than $__________ outstanding aggregate
principal amount of Registrable Securities.
The Company will not effect an Other Registration
in any event except upon notice to the Trustee given not less
than 15 days prior to the filing of the registration
statement in respect of such Other Registration.
8. Rule 144. The Company and the Guarantor
covenant that it will timely file the reports required to be
filed by it under the Securities Act or the Exchange Act
(including but not limited to the reports under Sections 13
and 15(d) of the Exchange Act referred to in subparagraph
(c)(1) of Rule 144 and the rules and regulations adopted by
the Commission thereunder, and will take such further action
as any holder of Registrable Securities may reasonably
request, all to the extent required from time to time to
enable such holder to sell Registrable Securities without
registration under the Securities Act within the limitation
of the exemptions provided by (i) Rule 144, as such Rule may
be amended from time to time, or (ii) any similar rule or
regulation hereafter adopted by the Commission. Upon the
request of any holder of Registrable Securities, the Company
and the Guarantor will deliver to such holder a written
statement as to whether it has complied with such
requirements.
9. Nominees for Beneficial Owners. In the event
that Registrable Securities are held by a nominee for the
beneficial owner thereof, the beneficial owner thereof may,
at its option and by written notice to the Company and the
Guarantor from such owner and nominee, be treated as the
holder of such Registrable Securities for purposes of any
request or other action by any Holder or Holders of
Registrable Securities pursuant to this Agreement (or any
determination of the aggregate principal amount of the
principal of Registrable Securities held by any Holder or
Holders of Registrable Securities contemplated by this
Agreement).
10. Indenture. The Company and the Guarantor will
cause the Indenture to be qualified under the Trust Indenture
Act of 1939, as then in effect, not later than the effective
date of the Exchange Offer or any registration statement
relating to the registration of Registrable Securities under
this Agreement and shall provide to the holder or holders of
the Registrable Securities, not later than the effective date
of the Exchange Offer or any registration statement relating
to any registration of Registrable Securities under this
Agreement, an opinion of counsel, in form and substance
satisfactory to such holders, as to the due qualification of
the Indenture under the Trust Indenture Act of 1939, as then
in effect. The Company and the Guarantor will pay all
reasonable fees and expenses in connection with the
transactions referred to in this Section 10.
11. Miscellaneous.
(a) Notices. All notices, requests and other
communications hereunder must be in writing and will be
deemed to have been duly given only if delivered personally
or by facsimile transmission or mailed (first class postage
prepaid) to the parties at the following addresses or
facsimile numbers:
If to a Holder, to the address of such
Holder set forth in the register maintained by the
Trustee pursuant to the Indenture; and
If to the Company, to:
If to the Guarantor, to:
All such notices, requests and other communications will (i)
if delivered personally to the address as provided in this
Section, be deemed given upon delivery, (ii) if delivered by
facsimile transmission to the facsimile number as provided in
this Section, be deemed given upon receipt, and (iii) if
delivered by mail in the manner described above to the
address as provided in this Section, be deemed given upon
receipt (in each case regardless of whether such notice,
request or other communication is received by any other
Person to whom a copy of such notice is to be delivered
pursuant to this Section). Any party from time to time may
change its address, facsimile number or other information for
the purpose of notices to that party by giving notice
specifying such change to the other parties hereto.
(b) Entire Agreement. This Agreement supersedes
all prior discussions and agreements between the parties with
respect to the subject matter hereof, and contains the sole
and entire agreement between the parties hereto with respect
to the subject matter hereof.
(c) Amendments, Etc. Any provision of this
Agreement may be modified or supplemented only by an
instrument in writing signed by the Company, the Guarantor
and the Majority Holders.
(d) Successors and Assigns. This Agreement is
binding upon, inures to the benefit of and is enforceable by
the parties hereto and their respective successors and
assigns.
(e) Headings. The headings used in this
Agreement have been inserted for convenience of reference
only and do not define or limit the provisions hereof.
(f) Invalid Provisions. If any provision of this
Agreement is held to be illegal, invalid or unenforceable
under any present or future law, and if the rights or
obligations of any party hereto under this Agreement will not
be materially and adversely affected thereby, (i) such
provision will be fully severable, (ii) this Agreement will
be construed and enforced as if such illegal, invalid or
unenforceable provision had never comprised a part hereof,
(iii) the remaining provisions of this Agreement will remain
in full force and effect and will not be affected by the
illegal, invalid or unenforceable provision or by its
severance herefrom and (iv) in lieu of such illegal, invalid
or unenforceable provision, there will be added
automatically as a part of this Agreement a legal, valid and
enforceable provision as similar in terms to such illegal,
invalid or unenforceable provision as may be possible.
(g) Remedies. Except as otherwise expressly
provided for herein, no remedy conferred by any of the
specific provisions of this Agreement is intended to be
exclusive of any other remedy, and each and every remedy
shall be cumulative and shall be in addition to every other
remedy given hereunder or now or hereafter existing at law or
in equity or by statute or otherwise. The election of any
one or more remedies by any party hereto shall not constitute
a waiver by any such party of the right to pursue any other
available remedies.
Damages in the event of breach of this Agreement by
a party hereto or any other Holder would be difficult, if not
impossible, to ascertain, and it is therefore agreed that
each such Person, in addition to and without limiting any
other remedy or right it may have, will have the right to an
injunction or other equitable relief in any court of
competent jurisdiction, enjoining any such breach, and
enforcing specifically the terms and provisions hereof and
the Company, the Guarantor and each Holder, by its
acquisition of Initial Securities, hereby waives any and all
defenses it may have on the ground of lack of jurisdiction or
competence of the court to grant such an injunction or other
equitable relief. The existence of this right will not
preclude any such Person from pursuing any other rights and
remedies at law or in equity which such Person may have.
(h) Governing Law. This Agreement shall be
governed by and construed in accordance with the laws of the
State of New York applicable to a contract executed and
performed in such State, without giving effect to the
conflicts of laws principles thereof.
(i) Counterparts. This Agreement may be executed
in any number of counterparts, each of which will be deemed
an original, but all of which together will constitute one
and the same instrument.
IN WITNESS WHEREOF, this Agreement has been duly
executed and delivered by the duly authorized officer of each
party hereto as of the date first above written.
UNITED STATIONERS SUPPLY CO.
By__________________________
Name:
Title:
UNITED STATIONERS INC.
By
Name:
Title:
[NAME OF INITIAL HOLDERS]
By__________________________ Name:
Title:
EXHIBIT H
[Form of Confidentiality Agreement] CONFIDENTIALITY
AGREEMENT
[Date]
[Insert Name and
Address of Prospective
Participant or Assignee]
Re: Senior Subordinated Credit Agreement
dated as of March 30, 1995 (the "Senior
Subordinated Credit Agreement"), among United
Stationers Supply Co. (as successor by merger
to Associated Stationers, Inc., the
"Company"), United Stationers Inc. (as
successor by merger to Associated Holdings,
Inc.) as parent guarantor, the lenders named
therein and The Roebling Fund, as Agent.
Dear Ladies and Gentlemen:
As a Lender party to the Senior Subordinated Credit
Agreement, we have agreed with the Company pursuant to
Section 13.12 of the Senior Subordinated Credit Agreement to
use reasonable precautions to keep confidential, except as
otherwise provided therein, all non-public information
identified by the Company as being confidential at the time
the same is delivered to us pursuant to the Senior
Subordinated Credit Agreement.
As provided in said Section 13.12, we are
permitted to provide you, as a prospective [holder of a
participation in the Bridge Loans (as defined in the Senior
Subordinated Credit Agreement)] [assignee Lender], with
certain of such non-public information subject to the
execution and delivery by you, prior to receiving such non-
public information, of a Confidentiality Agreement in this
form. Such information will not be made available to you
until your execution and return to us of this Confidentiality
Agreement.
Accordingly, in consideration of the foregoing, you
agree (on behalf of yourself and each of your affiliates,
directors, officers, employees and representatives) that (A)
such information will not be used by you except in connection
with the proposed [participation][assignment] mentioned above
and (B) you shall use reasonable precautions, in accordance
with your customary procedures for handling confidential
information and in accordance with safe and sound practices,
to keep such information confidential, provided that nothing
herein shall limit the disclosure of any such information (i)
to the extent required by statute, rule, regulation or
judicial process, (ii) to your counsel or to counsel for any
of the
Lenders or the Agent, (iii) to regulatory personnel, auditors
or accountants, (iv) to the Agent or any other Lender (or to
Chase Securities, Inc.), (v) in connection with any
litigation relating to the Acquisition or the transactions
contemplated by the Credit Agreement or any other Basic
Document, to which you or any one or more of the Lenders or
the Agent is a party, or (vi) to a subsidiary or affiliate of
yours as provided in Section 13.12(a) of the Senior
Subordinated Credit Agreement; and provided that in no event
shall you be obligated to return any materials furnished to
you pursuant to this Confidentiality Agreement.
Please indicate your agreement to the foregoing by
signing as provided below the enclosed copy of this
Confidentiality Agreement and returning the same to us.
Very truly yours,
[INSERT NAME OF LENDER]
By_________________________
The foregoing is agreed to
as of the date of this letter.
[INSERT NAME OF PROSPECTIVE
PARTICIPANT OR ASSIGNEE]
By_________________________
EXHIBIT I
[Form of Notice of Assignment]
NOTICE OF ASSIGNMENT
[Date]
United Stationers Supply Co.
_________________________ _________________________
Attention: _____________
The Chase Manhattan Bank, N.A.,
as Agent
4 Chase Metrotech Center -- 13th Floor
Brooklyn, New York 11245
Attention: New York Agency
[Name of Issuing Bank]
_________________________
_________________________
Attention: _____________
Re: Senior Subordinated Credit Agreement
dated as of March 30, 1995 (the "Senior
Subordinated Credit Agreement"), among United
Stationers Supply Co. (as successor by merger
to Associated Stationers, Inc., the
"Company"), United Stationers Inc. (as
successor by merger to Associated Holdings,
Inc.) as parent guarantor, the lenders named
therein and The Roebling Fund, as Agent.
Dear Ladies and Gentlemen:
We hereby give notice that, effective as of the date hereof,
[Name of Assignor] (the "Assignor") has assigned its rights
and obligations with respect to % (representing
$_____________) of the Assignor's outstanding [Commitment]
[Bridge Loans] (such interest in such rights and obligations
being hereinafter referred to as the "Assigned Interest")
under the Senior Subordinated Credit Agreement to [Name of
Assignee] (the "Assignee"). The Assignee hereby agrees (i)
to become a "Lender" pursuant to Section 13.06(b) of the
Senior Subordinated Credit Agreement
(if not already a Lender under the Senior Subordinated Credit
Agreement) and (ii) agrees to assume all the obligations of
the Assignor thereunder with respect to the Assigned
Interest.
The address for notices, lending office(s) and
payment instructions for the Assignee are as follows:
Address for Notices:
Attention:
Telephone:
Telecopier:
Lending Office:
Payment Instructions:
Please sign and return the enclosed copy of this
letter to the undersigned to indicate your receipt hereof,
and your consent to or notice of (as applicable) the above-
mentioned assignment and assumption, and your agreement to
the release of the Assignor from its obligations under the
Senior Subordinated Credit Agreement with respect to the
Assigned Interest. As a condition to the effectiveness of
the above-mentioned assignment
and assumption, the Assignee hereby agrees to pay to the
Agent on the date hereof an assignment fee of $3,500.
Very truly yours,
[NAME OF ASSIGNOR]
By
Title:
[NAME OF ASSIGNEE]
By
Title:
ACKNOWLEDGED OR CONSENTED TO
[(AS APPLICABLE)]:
UNITED STATIONERS SUPPLY CO.
By
Title:
THE ROEBLING FUND,
as Agent
By
Title:
_______________________________
1 Bracketed language to be inserted into Registered
Notes.
* Unnecessary if those properties are sold prior to the
Conversion Date.
* Include only for Exchange Securities.
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_
_ _ UNITED STATIONERS INC.
CERTIFICATE OF THE POWERS, DESIGNATIONS,
PREFERENCES, AND RIGHTS OF THE
SERIES A PREFERRED STOCK,
SERIES B PREFERRED STOCK
AND SERIES C PREFERRED
STOCK
Pursuant to Section 151 of the General Corporation
Law of the State of Delaware
The following resolutions were duly adopted by
unanimous written consent of the Board of Directors (the "Board
of Directors") of United Stationers Inc., a Delaware
corporation (the "Corporation"), pursuant to the provisions of
Section 151 of the General Corporation Law of the State of
Delaware (the "DGCL"), on March 30 , 1995.
WHEREAS, the Corporation is a party to an Agreement
and Plan of Merger, dated as of February 13, 1995, between the
Corporation and Associated Holdings, Inc., a Delaware
corporation ("Associated"), pursuant to which the Corporation
will be merged with and into Associated, with Associated
surviving (the "Merger"), and Associated Stationers, Inc., a
Delaware corporation and wholly-owned subsidiary of Associated
("ASI"), will be merged with and into United Stationers Supply
Co., an Illinois corporation and wholly-owned subsidiary of the
Corporation ("Supply Co."), with Supply Co. surviving (the
"Subsidiary Merger"); and
WHEREAS, the Board of Directors is authorized, within
the limitations and restrictions stated in the Corporation's
Certificate of Incorporation, as amended to date (as amended,
the "Certificate of Incorporation"), to fix by resolution or
resolutions the designation of each series of preferred stock
and the powers, preferences, and relative participating,
optional, or other special rights, and qualifications,
limitations, or restrictions thereof, including, without
limiting the generality of the foregoing, such provisions as
may be desired concerning voting, redemption, dividends,
dissolution, or the distribution of assets, conversion, or
exchange, and such other subjects or matters as may be fixed by
resolution or resolutions of the Board of Directors under the
DGCL; and
WHEREAS, it is the desire of the Board of Directors,
pursuant to its authority as aforesaid, to authorize and fix
the
terms of three series of preferred stock and the number of
shares constituting each of such series;
NOW, THEREFORE, BE IT RESOLVED, that the Corporation
hereby fixes the designations and preferences and relative,
participating, optional, and other special rights, and
qualifications, limitations, and restrictions of (i) a series
of preferred stock consisting of 15,000 shares (of which 5,000
shares will be initially issued as of the Effective time of the
Merger (the "Effective Time")) to be designated Series A
Preferred Stock (the "Series A Preferred Stock"), (ii) a series
of preferred stock consisting of 15,000 shares (of which
6,724.4436 shares will be initially issued as of the Effective
Time) to be designated Series B Preferred Stock (the "Series B
Preferred Stock") and (iii) a series of preferred stock
consisting of 15,000 shares (of which 10,086.6657 shares will
be initially issued as of the Effective Time) to be designated
Series C Preferred Stock (the "Series C Preferred Stock");
RESOLVED FURTHER, that the Corporation hereby fixes
the designations and preferences and relative, participating,
optional, and other special rights, and qualifications,
limitations, and restrictions of the Series A Preferred Stock,
Series B Preferred Stock and Series C Preferred Stock; and
RESOLVED FURTHER, that the Series A Preferred Stock,
Series B Preferred Stock and Series C Preferred Stock are
hereby authorized on the terms and with the provisions herein
set forth:
I. Terms Applicable to the Series A Preferred Stock.
1 Dividends. (a) Subject to the provisions of
Sections 1.1(b), 1.2(f), and 1.2(h) the holders of Series A
Preferred Stock shall be entitled to receive, as and when
declared by the Board of Directors of the corporation out of
funds legally available for such purpose, dividends on the
outstanding shares of Series A Preferred Stock at the Series A
Preferred Dividend Rate, payable on each Preferred Dividend
Payment Date to holders of record as they appear on the stock
transfer books of the Corporation on such record dates, not
more than 60 days nor less than 10 days preceding the payment
dates for such dividends, as are fixed by the Board of
Directors (or, to the extent permitted by applicable law, a
duly authorized committee thereof). Such dividends shall be
cumulative and shall accrue with respect to each share of
Series A Preferred Stock, whether or not declared, whether or
not restricted by the terms of the Debt Agreements or otherwise
pursuant to the provisions hereof, and whether or not there are
funds legally available for the payment thereof until paid.
The dividends on the Series A Preferred Stock may be declared
payable in cash or in additional shares of Series A Preferred
Stock valued at $1,000 per share, in the discretion of the
Board of Directors. No other dividends may be declared or paid
to the holders of Series A Preferred Stock. All dividends
declared by the Board of Directors upon shares of Series A
Preferred Stock in accordance with this Section 1.1(a) shall be
declared and paid pro rata with respect to all shares of Series
A Preferred Stock then outstanding.
(a) If at any time the Corporation shall have
failed to pay any accumulated dividends on any shares of Series
A Preferred Stock on any Preferred Dividend Payment Date as
provided above, or if at any time the corporation shall have
failed to redeem shares of Series A Preferred Stock as required
by Section 1.2(a) for any reason, the Corporation shall not
(i) declare or pay any dividend on any Junior
Shares or make any payment on account of, or set apart
money for, a sinking or other analogous fund for the
purchase, redemption, or other retirement of any Junior
Shares or make any distribution with respect thereto,
either directly or indirectly and whether in cash or
property or in obligations or shares (other than in Junior
Shares) of the corporation or any Subsidiary,
(ii) purchase any shares of Series A Preferred
Stock (except for a consideration payable in Junior
Shares) or redeem fewer than all of the shares of Series A
Preferred Stock then outstanding, or
(iii) permit any Subsidiary to purchase any
Junior Shares or permit any Subsidiary to purchase fewer
than all of the shares of Series A Preferred Stock then
outstanding,
unless, at the time of any such dividend, payment,
distribution, purchase, or redemption, all accrued and unpaid
dividends on shares of Series A Preferred Stock are
contemporaneously paid in full in cash or additional shares of
Series A Preferred Stock and all shares of Series A Preferred
Stock which the Corporation shall have so failed to redeem are
contemporaneously redeemed.
2 Redemption.
(a) Scheduled Redemption. Subject to any
limitations contained elsewhere in this Certificate of the
Powers, Designations, Preferences, and Rights of the Series A
Preferred Stock, Series B Preferred Stock and Series C
Preferred Stock (this "Certificate of Designations"), the
Corporation shall, subject to Section 1.2(b), redeem all, but
not less than all, shares of Series A Preferred Stock on July
31, 1999, out of funds legally available for such purpose, at a
price per share equal to the Redemption Price.
(b) Mandatory Redemption. Subject to any
limitations contained elsewhere in this Certificate of
Designations, in the event of the occurrence of a Cash-Out
Event, the Corporation agrees, at the election of any holder of
then outstanding shares of Series A Preferred Stock made as set
forth in Section 1.2(i) below, to redeem all, but not less than
all, of such holder's shares of Series A Preferred Stock then
outstanding, out of funds legally available for such purpose,
at a price per share equal to the Redemption Price therefor.
Notwithstanding any provision contained in this Certificate of
Designations, the Corporation shall not be required to effect a
redemption otherwise required by Section 1.2(a) or (b) prior to
the earlier to occur of (i) the redemption in full of the notes
in the aggregate principal amount of $130,000,000 to be issued
by Supply Co. after the Effective Time (the "Notes") or (ii)
the date ten (10) years after the issuance of the Notes. If
pursuant to such Cash-Out Event the holders of Common Stock of
the Corporation receive cash, Marketable Securities, or a
combination thereof, then, at the option of the Corporation,
the Corporation may, in lieu of the cash redemption
contemplated in the immediately preceding sentence, redeem such
Series A Preferred Stock by converting each such share into
such cash, Marketable Securities, or a combination thereof, in
the same proportions as the holders of Common Stock of the
Corporation so receive, the value of which shall equal the
Redemption Price.
(c) Redemptions at Option of Corporation. At
any time, and from time to time, the Corporation may, at its
election, redeem, out of funds legally available for such
purpose, any portion or all of the Series A Preferred Stock
then
outstanding at a price per share equal to the Redemption Price.
Any redemption of shares pursuant to this Section 1.2(c) will
be made ratably (as nearly as practicable) among the holders of
the Series A Preferred Stock based upon the number of shares
held by each such holder.
(d) Optional Redemption through Note Exchange.
(i) Subject to the provisions of subdivision
(iv) of this Section 1.2(d), at the option of the
Corporation, the Corporation may, at any time out of funds
legally available for such purpose, redeem all, but not
less than all, shares of the Series A Preferred Stock then
outstanding in exchange for, and through the issue by the
Corporation in the manner provided in this subdivision of,
Series A Exchange Notes to be issued under the Series A
Indenture. Such exchange, if any, shall be a redemption of
the Series A Preferred Stock in exchange for the Series A
Exchange Notes. The Series A Exchange Notes issued to each
holder shall be in an aggregate principal amount equal to
the Liquidation Value of the shares of Series A Preferred
Stock redeemed by the Corporation in exchange therefor.
(ii) Not more than 60 nor less than 30 days
prior to the exchange date, the Corporation shall mail
irrevocable written notice, by registered or certified
mail, postage prepaid and return receipt requested, to
each record holder (and, to the extent such holder is a
corporation, to the attention of its Chief Executive
Officer and its Corporate Secretary), specifying the
exchange date and the time and place where certificates
representing shares of Series A Preferred Stock are to be
surrendered for Series A Exchange Notes. Upon mailing
such notice, the Corporation will be obliged to redeem all
shares of Series A Preferred Stock in exchange for the
Series A Exchange Notes on the exchange date specified in
such notice. Upon surrender in accordance with such
notice of the certificates evidencing any shares of Series
A Preferred Stock so exchanged (properly endorsed or
signed for transfer, if the Corporation shall require and
the notice shall so state), the Corporation will cause the
Series A Exchange Notes to be authenticated and issued in
exchange for such shares of Series A Preferred Stock and
to be mailed to the holder of the shares of Series A
Preferred Stock at such holder's address of record or such
other address as the holder shall specify upon such
surrender of such certificates.
(iii) On the exchange date, (A) the shares of
Series A Preferred Stock subject to such exchange and
redemption shall cease to be entitled to any dividends
accruing after the exchange date, (B) all rights of the
respective holders of such shares, as stockholders of the
Corporation by reason of the ownership of such shares,
except the right to receive the Series A Exchange Notes
upon surrender (and endorsement, if required by the
Corporation) of the respective certificates representing
such shares, shall cease, (C) such shares shall cease to
be outstanding, and (D) the person or persons entitled to
receive the Series A Exchange Notes issuable upon such
exchange shall be treated for all purposes as the
registered holder or holders of Series A Exchange Notes;
provided, however, that interest shall not begin to accrue
on any such Series A Exchange Note issuable to a holder of
Series A Preferred Stock until such time as such holder
surrenders the certificate or certificates evidencing such
shares of Series A Preferred Stock.
(iv) The Corporation may redeem shares of Series
A
Preferred Stock in exchange for Series A Exchange Notes
only if, on the Exchange Date, (x) the Corporation has
paid all accrued dividends on all outstanding shares of
Series A Preferred Stock and (y) the Series A Indenture
shall be executed and delivered by the corporation and the
trustee thereunder.
(e) Redemption Price. For each share of Series
A
Preferred Stock which is to be redeemed for cash the
Corporation will be obligated on the Redemption Date to pay to
the holder thereof (upon surrender of the certificate
representing such share to the Corporation's stock transfer
agent, or if none, to the Corporation at its principal office)
an amount in cash equal to the Redemption Price. If the funds
of the Corporation legally available for redemption of shares
of Series A Preferred Stock on any Redemption Date are
insufficient to redeem the total number of shares to be
redeemed on such date, those funds which are legally available
shall be used to redeem the maximum possible number of shares
ratably (as nearly as practicable) among the holders of the
shares to be redeemed based upon the aggregate Redemption Price
of such shares held by each such holder. As and when
additional funds of the Corporation are legally available for
the redemption of shares, such funds shall as soon as
practicable be used to redeem the balance of the shares which
the Corporation has become obligated to redeem on any
Redemption Date.
(f) Dividends after Redemption Date. Subject
to
any limitations contained elsewhere in this Certificate of
Designations, no share of Series A Preferred Stock is entitled
to any dividends accruing after the redemption of such share.
Subject to any limitations contained elsewhere in this
Certificate of Designations, on the date of such redemption
dividends will cease to accrue, all rights of the holder of
such share as such holder will cease, and such shares will be
deemed not to be outstanding.
(g) Redeemed or Otherwise Acquired Shares. Any
shares of Series A Preferred Stock which are redeemed or
otherwise acquired by the Corporation will be retired and
cancelled and may not be reissued.
(h) Restrictions on Dividends and Redemptions.
Notwithstanding anything in this Certificate of Designations to
the contrary, no dividend payment or other distribution or
redemption may be made with respect to Series A Preferred Stock
if such payment or other distribution or redemption will be in
contravention of the restrictions or limitations on such
payments or other distributions or redemptions contained in (i)
this Certificate of Designations, (ii) the Debt Agreements,
(iii) the Subordinated Note, or (iv) any and all applicable
state or federal laws, rules, and regulations or in any and all
orders of any state or federal governmental authority.
(i) Redemption Methods.
(i) In order to effect a redemption under
either
Section 1.2(a) or 1.2(c) above, the Corporation shall
deliver written notice, by registered or certified mail,
postage prepaid and return receipt requested, to the
holders of record (and, to the extent any such holder is a
corporation, to the attention of its Chief Executive
Officer and its Corporate Secretary) of the shares to be
redeemed, addressed to such holders at their last
addresses as shown
on the stock transfer books of the corporation. Each such
notice of redemption shall specify the date fixed for
redemption (to be a date not less than 30 days from the date
of such notice), the Redemption Price, places of payment,
that payment will be made upon presentation and surrender of
the certificates representing shares to be redeemed and that
on and after the date of such redemption (or such earlier
date as permitted hereunder) dividends will cease to
accumulate on such shares. Any notice which is mailed as
herein provided shall be conclusively presumed to have been
duly given when mailed, and failure to give such notice by
mail, or any defect in such notice, to the holders of any
shares designated for redemption shall not affect the
validity of the proceedings for the redemption of any other
shares to be redeemed on or after the date fixed for
redemption as stated in such notice. Each holder of the
shares called for redemption shall surrender its certificate
or certificates evidencing such shares to the Corporation at
the place designated in such notice and shall thereupon be
entitled to receive payment of the Redemption Price in cash,
with respect to any redemption under Sections 1.2(a) or
1.2(c). If less than all shares evidenced by any such
surrendered certificate are redeemed, a new certificate shall
be issued evidencing the unredeemed shares.
(ii) In order to effect a redemption under Section
1.2(b) above, within 30 days after the date of the occurrence
of a Cash-Out Event the Corporation shall deliver notice by
registered or certified mail, postage prepaid and return
receipt requested, to the holders of record (and, to the
extent such holder is a corporation, to the attention of its
Chief Executive Officer and its Corporate Secretary) of the
shares to be redeemed, addressed to such holders at their
last addresses as shown on the stock transfer books of the
Corporation. Each such notice of redemption shall specify
the date fixed for redemption (to be a date not less than 30
days from the date of such notice), the Redemption Price,
places of payment, that payment will be made upon
presentation and surrender of the certificates representing
shares to be redeemed, a description in reasonable detail of
the applicable Cash-Out Event giving rise to the redemption,
and a description in reasonable detail of any Marketable
Securities to be included, and that on or after the date of
such redemption (or such earlier date as permitted hereunder)
dividends will cease to accumulate on such shares. Any
notice which is mailed as herein provided shall be
conclusively presumed to have been duly given when mailed,
and failure to give such notice by mail, or any defect in
such notice, to the holders of any shares designated for
redemption shall not affect the validity of the proceedings
for the redemption of any other shares to be redeemed on or
after the date fixed for redemption as stated in such notice.
Each holder of the shares called for redemption who elects to
exercise the right of redemption under Section 1.2(b) above
must surrender its certificate or certificates evidencing all
such shares to the Corporation on or before the date set for
redemption and at the place designated in the Corporation's
notice and shall thereupon be entitled to receive payment of
the Redemption Price in cash, Marketable Securities, or a
combination thereof, as applicable. Any failure on the part
of any holder notified as provided above to surrender such
certificate or certificates on or before the date set for
redemption at the place designated for redemption as provided
above, shall be conclusively deemed to have not elected to
redeem such holder's shares under and pursuant to Section
1.2(b) above
and shall not be entitled to receive the Redemption Price as
provided above.
(iii) Notwithstanding any other provision of this
Certificate of Designations, if on or after the date on which
any notice of redemption is first sent to the holders of
shares to be redeemed, funds necessary for the redemption
shall be available therefor and shall have been irrevocably
deposited or set aside, then, notwithstanding that the
certificates evidencing any shares so called for redemption
shall not have been surrendered, the dividends with respect
to the shares so called shall cease to accrue after the date
fixed for redemption, the shares shall no longer be deemed
outstanding, holders thereof shall cease to be stockholders,
and all rights whatsoever with respect to the shares so
called for redemption (except the right of the holders to
receive the Redemption Price without interest upon surrender
of their certificates therefor) shall terminate.
3 Voting Rights. Except as set forth below and as
otherwise required by law, holders of shares of Series A Preferred
Stock shall have no voting rights. In connection with any right
to vote, each holder of Series A Preferred Stock will have one
vote for each share held. Any shares of Series A Preferred Stock
held by the Corporation or its Subsidiaries shall not have voting
rights hereunder and shall not be counted in determining the
presence of a quorum. So long as the Series A Preferred Stock is
outstanding, the Corporation shall not, without the affirmative
vote or written consent of the holders of at least 51% of all
outstanding Series A Preferred Stock voting separately as a
series:
(a) amend, alter, modify, or repeal any provision
of the Certificate of Incorporation or the By-Laws of the
Corporation in any manner which affects materially and adversely
the relative rights, preferences, qualifications, powers,
limitations, or restrictions of the Series A Preferred Stock;
(b) increase the authorized number of shares of
Preferred Stock of the Corporation, authorize, issue, or otherwise
create securities convertible into any shares of capital stock of
the Corporation other than Junior Shares.
(c) voluntarily effect any reclassification of
the Series A Preferred Stock.
(ii) the number of members of the Board of
Directors of the Corporation shall be increased by one, effective
as of the time of election of such directors as hereinafter
provided and (ii) the holders of the Series A Preferred Stock
(voting separately as a series) will have the exclusive right to
vote for and elect such one additional director of the Corporation
at any meeting of the stockholders of the Corporation at which
directors are to be elected held during the period such dividends
remain in arrears. The right of the holders of the Series A
Preferred Stock to vote for such one additional director shall
terminate when all accrued and unpaid dividends on the Series A
Preferred Stock have been declared and paid in cash or in
additional shares of Series A Preferred Stock or set apart for
payment. The term of office of any director so elected shall
terminate immediately upon the termination of the right of the
holders of the Series A Preferred Stock to vote for such one
additional director.
The foregoing right of the holders of the Series A
Preferred Stock with respect to the election of one director may
be exercised at any annual meeting of the stockholders of the
Corporation or at any special meeting of the stockholders of the
Corporation held for such purpose. If the right to elect an
additional director shall have accrued to the holders of the
Series A Preferred Stock more than 90 days preceding the date
established for the next annual meeting of stockholders, the
President of the Corporation shall, within 20 days after the
delivery to the Corporation at its principal office of a written
request for a special meeting signed by the holders of at least
10% of the Series A Preferred Stock then outstanding, call a
special meeting of the holders of the Series A Preferred Stock to
be held within 60 days after the delivery of such request for the
purpose of electing such additional directors.
The holders of the Series A Preferred Stock voting as a
series shall have the right to remove without cause at any time
and replace any director such holders shall have elected pursuant
to this Section.
4 Liquidation. (a) In the event of any voluntary
or involuntary liquidation, dissolution, or winding-up of the
Corporation, the holders of shares of Series A Preferred Stock
shall be entitled to receive the Series A Preferred Liquidation
Value of such shares held by them in preference to and in priority
over any distributions upon Junior Shares. Upon payment in full
to the holders of shares of Series A Preferred Stock of the Series
A Preferred Liquidation Value of such shares, the holders of
shares of Series A Preferred Stock shall not be entitled, as such
holders, to any further participation in any distribution of
assets of the Corporation. If the assets of the Corporation are
not sufficient to pay in full the Series A Preferred Liquidation
Value payable to the holders of shares of Series A Preferred
Stock, the holders of all such shares shall share ratably (to the
exclusion of any other holders of capital stock) in such
distribution of assets.
(a) Neither a consolidation or merger of the
Corporation with or into any other corporation, nor a sale or
transfer of all or part of the Corporation's assets for cash,
securities, or other property, nor a merger of any other
corporation with or into the Corporation shall be considered a
liquidation, dissolution, or winding-up of the Corporation within
the meaning of this Section 1.4.
II. Terms Applicable to Series B and Series C Preferred
Stock.
1 Identical Rights. Except as otherwise provided
in this Certificate of Designations, all shares of Series B
Preferred Stock and Series C Preferred Stock shall be identical
and shall entitle the holders thereof to the same rights and
privileges.
2 Dividends. (a) Subject to the provisions of Sections
2.2(b), 2.3(f), and 2.3(h), the holders of Series B and
Series C Preferred Stock shall be entitled to receive, as and when
declared by the Board of Directors of the Corporation out of funds
legally available for such purpose, dividends on the outstanding
shares of Series B and Series C Preferred Stock at the Series B
and Series C Preferred Dividend Rates, payable on each Preferred
Dividend Payment Date to holders of record as they appear on the
stock transfer books of the Corporation on such record dates, not
more than 60 days nor less than 10 days preceding the payment
dates for such dividends, as are fixed by the Board of Directors
(or, to the extent permitted by applicable law, a duly authorized
committee thereof). Such dividends shall
be cumulative and shall accrue with respect to each share of
Series B and Series C Preferred Stock, whether or not declared,
whether or not restricted by the terms of the Debt Agreements or
otherwise pursuant to the provisions hereof, and whether or not
there are funds legally available for the payment thereof until
paid. The dividends on the Series B and Series C Preferred Stock
may be declared payable in cash or in additional shares of the
same series of Preferred Stock, in the discretion of the Board of
Directors; provided that dividends on Series C Preferred Stock may
be payable in additional shares of Series C Preferred Stock only
for Dividend Payment Dates occurring on or prior to January 31,
1999. No other dividends may be declared or paid to the holders
of Series B or Series C Preferred Stock. All dividends declared
by the Board of Directors upon shares of Series B or Series C
Preferred Stock in accordance with this Section 2.2(a) shall be
declared and paid pro rata with respect to all shares of Series B
and Series C Preferred Stock then outstanding.
(a) If at any time the Corporation shall have
failed to pay any accumulated dividends on any shares of Series B
and Series C Preferred Stock on any Preferred Dividend Payment
Date as provided above, or if at any time the Corporation shall
have failed to redeem shares of Series B or Series C Preferred
Stock as required by Section 2.3(a) for any reason, the
Corporation shall not:
(i) declare or pay any dividend on any Junior
Shares or make any payment on account of, or set apart money
for, a sinking or other analogous fund for the purchase,
redemption or other retirement of any Junior Shares or make
any distribution with respect thereto, either directly or
indirectly and whether in
cash or property or in obligations or shares (other than in
Junior Shares) of the Corporation or any Subsidiary;
(ii) purchase any shares of Series B or Series C
Preferred Stock (except for a consideration payable in Junior
Shares) or redeem fewer than all of the shares of Series B
and Series C Preferred Stock then outstanding (except in a
manner consistent with the last sentence of Section 2.3(c));
or
(iii) permit any Subsidiary to purchase any Junior
Shares or permit any Subsidiary to purchase fewer than all of
the shares of Series B and Series C Preferred Stock then
outstanding;
unless, at the time of any such dividend payment, distribution,
purchase or redemption, all accrued and unpaid dividends on shares
of Series B and Series C Preferred Stock are contemporaneously
paid in full in cash or additional shares of Series B or Series C
Preferred Stock, as applicable, and all shares of Series B or
Series C Preferred Stock which the Corporation shall have so
failed to redeem are contemporaneously redeemed.
(b) Notwithstanding any other provision in this
Certificate of Designations, the Corporation shall not, and shall
not permit any of its Subsidiaries to, take any of the actions
specified in subsections 2.2(b)(i), (ii), or (iii) above in excess
of $1 million in the aggregate for all such actions, unless at the
time such action is taken:
(i) the Corporation has redeemed for cash all
shares of Series B and Series C Preferred Stock, if any,
which have been issued to the holders of Series B and Series
C Preferred Stock, respectively, as in-kind dividends on the
Series B or Series C Preferred Stock, respectively, pursuant
to Section 2.2(a) above;
(ii) the Corporation and its wholly-owned
Subsidiaries, on a consolidated basis, have common equity
computed in accordance with generally accepted accounting
principles, after giving effect to any purchases,
redemptions, payments, distributions or disbursements under
subsections 2.2(b)(i), (ii), or (iii) above, of at least $26
million;
(iii) if any such purchases, redemptions, payments,
distributions, or disbursements specified in subsections
2.2(b)(i), (ii), or (iii) above are to be made on or after
July 31, 1999, then all shares of Series B Preferred Stock
shall have been redeemed or otherwise retired; and
(iv) if any such purchases, redemptions, payments,
distributions, or disbursements specified in subsections
2.2(b)(i), (ii), or (iii) above are to be made on or after
the dates required for redemptions of shares of Series C
Preferred Stock pursuant to Section 2.3(c) below, then that
portion of such Series C Preferred Stock so required to be
redeemed as of such dates shall have been redeemed or
otherwise retired;
provided, however, nothing in this Section 2.2(c) shall limit or
impair the Corporation's obligation to make payments or
disbursements for any amount it is obligated to pay under or
pursuant to the Warrant Agreement dated as of January 31, 1992
between the Corporation (as successor-in-interest to Associated
Holdings, Inc., a Delaware corporation to be merged into the
Corporation) and Chase Manhattan Investment Holdings, Inc., as
amended, and further provided, nothing in this Section 2.2(c)
shall limit the Corporation or its Subsidiaries from re-purchasing
Common Stock or options to purchase Common Stock of the
Corporation held by any employee of the Corporation or its
Subsidiaries in connection with the termination of such employee's
employment.
3 Redemption.
(a) Scheduled Redemption. Subject to any
limitations contained elsewhere in this Certificate of
Designations, the Corporation shall redeem all shares of Series B
Preferred Stock on July 31, 1999. The Corporation shall redeem
all shares of Series C Preferred Stock by January 31, 2002, such
redemption to be made in four equal (as nearly as practicable)
quarterly installments of principal on April 30, 2001, July 31,
2001, October 31, 2001, and January 31, 2002. Scheduled
redemptions shall be made out of funds legally available for such
purpose, at a price per share equal to the Redemption Price.
(b) Mandatory Redemption. Subject to any
limitations contained elsewhere in this Certificate of
Designations, in the event of the occurrence of a Cash-Out Event,
the Corporation agrees, at the election of any holder of then
outstanding shares of Series B or Series C Preferred stock, as
applicable, made as set forth in Section 2.3(i) below, to redeem
all, but not less than all, of such holder's shares of Series B or
Series C Preferred Stock, as applicable, then outstanding, out of
funds legally available for such purpose, at a price per share
equal to the Redemption Price therefor. If pursuant to such Cash-
Out Event the holders of Common Stock of the Corporation received
cash, Marketable Securities, or a combination thereof,
then, at the option of the Corporation, the Corporation may, in
lieu of the cash redemption contemplated in the immediately
preceding sentence, redeem such Series B or Series C Preferred
Stock, as applicable, by converting each such share into such
cash, Marketable Securities or a combination thereof, in the same
proportions received by the holders of Common Stock of the
Corporation, the value of which shall equal the Redemption Price.
(c) Redemptions at Option of Corporation. At any
time, and from time to time, the Corporation may, at its election,
redeem, out of funds legally available for such purpose, any
portion or all of the Series B and Series C Preferred Stock then
outstanding at a price per share equal to the Redemption Price.
Any redemption of shares pursuant to this Section 2.3(c) will be
made ratably (as nearly as practicable) among the holders of the
Series B and Series C Preferred Stock based upon the number of
shares held by each such holder without distinction between
series.
(d) Optional Redemption through Note Exchange.
(i) Subject to the provisions of subdivision (iv)
of this Section 2.3(d), at the option of the Corporation, the
Corporation may, at any time out of funds legally available
for such purpose, redeem all, but not less than all shares of
the Series B and Series C Preferred Stock then outstanding in
exchange for, and through the issue by the Corporation in the
manner provided in this subdivision of, Series B Exchange
Notes (with respect to exchanges of Series B Preferred Stock)
and Series C Exchange Notes (with respect to exchanges of
Series C Preferred Stock). The Series B Exchange Notes shall
be issued under the Series B Indenture and the Series C
Exchange Notes shall be issued under the Series C Indenture.
The Series B Exchange Notes or Series C Exchange Notes issued
to each holder shall be in an aggregate principal amount
equal to the Liquidation Value of the shares of Series B and
Series C Preferred Stock redeemed by the Corporation in
exchange thereof.
(ii) Not more than 60 nor less than 30 days prior
to the exchange date, the Corporation shall mail irrevocable
written notice, by registered or certified mail, postage
prepaid and return receipt requested, to each record holder
(and, to the extent such holder is a corporation, to the
attention of its Chief Executive Officer and its Corporate
Secretary), specifying the exchange date and the time and
place where certificates representing shares of Series B and
Series C Preferred Stock are to be surrendered for Series B
and Series C Exchange Notes. Upon mailing such notice, the
Corporation will be obliged to redeem all shares of Series B
and Series C Preferred Stock in exchange for the Exchange
Notes on the exchange date specified in such notice. Upon
surrender in accordance with such notice of the certificates
evidencing the shares of Series B or Series C Preferred Stock
so exchanged (properly endorsed or signed for transfer, if
the Corporation shall require and the notice shall so state),
the Corporation will cause the Series B or Series C Exchange
Notes, as applicable, to be authenticated and issued in
exchange for such shares of Series B or Series C Preferred
Stock and to be mailed to the holders of the shares of Series
B or Series C Preferred Stock at such holder's address of
record or such other address as the holder shall specify on
such surrender of such certificates.
(iii) On the exchange date, (A) the shares of Series
B and Series C Preferred Stock subject to such
exchange and redemption shall cease to be entitled to any
dividends accruing after that date, (B) all rights of the
respective holders of such shares, as stockholders of the
Corporation by reason of the ownership of such shares, except
the right to receive the Series B and Series C Exchange Notes
upon surrender (and endorsement, if required by the
Corporation) of the respective certificates representing such
shares, shall cease, (C) such shares shall cease to be
outstanding, and (D) the person or persons entitled to
receive the Series B or Series C Exchange Notes, as
applicable, issuable upon such exchange shall be treated for
all purposes as the registered holder or holders of Series B
or Series C Exchange Notes, as applicable; provided, however,
that interest shall not begin to accrue on any such Series B
or Series C Exchange Notes issuable to a holder of Series B
or Series C Preferred Stock, as applicable, until such time
as such holder surrenders the certificate or certificates
evidencing such shares of Series B or Series C Preferred
Stock, as applicable.
(iv) The Corporation may redeem shares of Series B
and Series C Preferred Stock in exchange for Series B and
Series C Exchange Notes only if, on the Exchange Date,
(x) the Corporation has redeemed any outstanding shares of
Series A Preferred Stock and, if such redemption of Series A
Preferred Stock is effected by the issuance of a Series A
Exchange Note, such Series A Exchange Notes shall be senior
to any Series B or Series C Exchange Note issued in exchange
for Series B or Series C Preferred Stock, (y) the Corporation
has paid all accrued dividends on all outstanding shares of
Series B or Series C Preferred stock, as applicable, and (z)
the Series B Indenture or the Series C Indenture, as
applicable, shall be executed and delivered by the
Corporation and the applicable trustee thereunder.
(e) Redemption Price. For each share of Series B
and Series C Preferred Stock which is to be redeemed for cash, the
Corporation will be obligated on the Redemption Date to pay to the
holder thereof (upon surrender of the certificate representing
such share to the Corporation's stock transfer agent, or if none,
to the Corporation at its principal office) an amount in cash
equal to the Redemption Price. If the funds of the Corporation
legally available for redemption of shares of Series B and Series
C Preferred Stock on any Redemption Date are insufficient to
redeem the total number of shares to be redeemed on such date,
those funds which are legally available shall be used to redeem
the maximum possible number of shares ratably (as nearly as
practicable) among the holders of the shares to be redeemed based
upon the aggregate Redemption Price of such shares held by each
such holder. As and when additional funds of the Corporation are
legally available for the redemption of shares, such funds shall
as soon as practicable be used to redeem the balance of the shares
which the Corporation has become obligated to redeem on any
Redemption Date.
(f) Dividends after Redemption Date. Subject to
any limitations contained elsewhere in this Certificate of
Designations, no share of Series B or Series C Preferred Stock is
entitled to any dividends accruing after the redemption of such
share. On the date of such redemption dividends will cease to
accrue, all rights of the holder of such share as such holder will
cease, and such shares will not be deemed to be outstanding.
(g) Redeemed or Otherwise Acquired Shares. Any
shares of Series B or Series C Preferred Stock which are redeemed
or otherwise acquired by the Corporation will be retired and
cancelled and may not be reissued.
(h) Restrictions on Dividends and Redemptions.
Notwithstanding anything in this Certificate of Designations to
the contrary, no dividend payment or other distribution or
redemption may be made with respect to Series B or Series C
Preferred Stock if such payment or other distribution or
redemption will be in contravention of the restrictions or
limitations on such payments or other distributions or redemption
contained in (i) this Certificate of Designations, (ii) the Debt
Agreements, (iii) the Subordinated Note or (iv) any and all
applicable state or federal laws, rules, and regulations or in any
and all orders of any state or federal governmental authority.
(i) Redemption Methods. Any redemption of shares of Series
B or Series C Preferred Stock under and pursuant to Sections
2.3(a), 2.3(b), or 2.3(c) shall be conducted in the same
applicable manner as described with respect to the Series A
Preferred Stock in Section 1.2(i) above. Notwithstanding any
other provision of this Certificate of Designations, if on or
after the date on which any notice of redemption is first sent to
the holders of shares to be redeemed, funds necessary for the
redemption shall be available therefor and shall have been
irrevocably deposited or set aside, then, notwithstanding that the
certificates evidencing the shares so called for redemption shall
not have been surrendered, the dividends with respect to the
shares so called shall cease to accrue after the date fixed for
redemption, shares shall no longer be deemed outstanding, owners
thereof shall cease to be stockholders, and all rights whatsoever
with respect to the shares so called for redemption (except the
right of the holders to receive the Redemption Price without
interest thereon upon surrender of their certificates therefor)
shall terminate.
4 Voting Rights. Except as otherwise set forth
below and as otherwise required by law, holders of shares of
Series B or Series C Preferred Stock shall have no voting rights.
In connection with the right to vote, each holder of Series B
Preferred Stock will have one vote for each share held and each
holder of Series C Preferred Stock shall have one vote for each
share held. Any shares of Series B or Series C Preferred Stock
held by the Corporation or its Subsidiary shall not have voting
rights hereunder and shall not be counted in determining the
presence of a quorum. So long as the Series B Preferred Stock or
Series C Preferred Stock is outstanding, the Corporation shall not
without the affirmative vote or written consent of the holders of
all outstanding Series B and Series C Preferred Stock, each voting
as a separate series:
(a) amend, alter, modify, or repeal any provision
of the Certificate of Incorporation or the By-Laws of the
Corporation in any manner which affects adversely the relative
rights, preferences, qualifications, powers, limitations, or
restrictions of that series of Preferred Stock;
(b) increase the authorized number of shares of
capital stock of the Corporation, or authorize, issue, or
otherwise create securities convertible into any shares of capital
stock of the Corporation other than shares of Series A (only for
purposes of paying dividends in-kind on Series A Preferred Stock),
Series B or Series C Preferred Stock, Common Stock and/or Junior
Shares; or
(c) voluntarily effect any reclassification of the
Series B or Series C Preferred Stock.
(ii) the number of members of the Board of
Directors of the Corporation shall be increased by one, effective
as of the time of the election of such directors as hereinafter
provided and (ii) the holders of Series B Preferred Stock (voting
separately as a series) will have the exclusive right to vote for
and elect one additional director of the Corporation at any
meeting of the stockholders of the Corporation at which directors
are to be elected held during the period such dividends remain in
arrears. The right of the holders of Series B Preferred Stock to
vote for such one additional director shall terminate when all
accrued and unpaid dividends on the Series B Preferred Stock have
been declared and paid in cash or in-kind or set apart for
payment. The term of office of any director so elected shall
terminate immediately upon the termination of the right of the
holders of the Series B Preferred Stock to vote for such one
additional director.
(iv) the number of members of the Board of
Directors of the Corporation shall be increased by one, effective
as of the time of the election of such directors as hereinafter
provided and (iv) the holders of Series C Preferred Stock (voting
separately as a series) will have the exclusive right to vote for
and elect one additional director of the Corporation at any
meeting of the stockholders of the Corporation at which directors
are to be elected held during the period such dividends remain in
arrears. The right of the holders of Series C Preferred Stock to
vote for such one additional director shall terminate when all
accrued and unpaid dividends on the Series C Preferred Stock have
been declared and paid in cash or in-kind or set apart for
payment. The term of office of any director so elected shall
terminate immediately upon the termination of the right of the
holders of the Series C Preferred Stock to vote for such one
additional director.
The foregoing right of the holders of Series B and
Series C Preferred Stock with respect to the election of one
director per series may be exercised at any annual meeting of the
stockholders of the Corporation or at any special meeting of the
stockholders of the Corporation held for such purpose. If the
right to elect an additional director shall have accrued to the
holders of Series B Preferred Stock or Series C Preferred Stock
more than 90 days preceding the date established for the next
annual meeting of stockholders, the President of the Corporation
shall, within 20 days after the delivery to the Corporation at its
principal office of a written request for a special meeting signed
by the holders of at least 10% of the Series B Preferred Stock or
Series C Preferred Stock, as applicable, then outstanding, call a
special meeting of the holders of the Series B or Series C
Preferred Stock, as applicable, to be held within 60 days after
the delivery of such request for the purpose of electing such
additional directors. The holders of the Series B Preferred Stock
voting as a series shall have the right to remove without cause at
any time and replace any director such holder shall have elected
pursuant to this Section. The holders of the Series C Preferred
Stock voting as a series shall have the right to remove without
cause at any time and replace any director such holder shall have
elected pursuant to this Section.
5 Liquidation. (a) In the event of any voluntary
or involuntary liquidation, dissolution or winding-up of the
corporation, the holders of shares of Series B and Series C
Preferred Stock shall be entitled to receive the Series B or
Series C Preferred Liquidation Value of such shares held by them
in preference to and in priority over any distributions upon
Junior Shares. Upon payment in full to the holders of shares of
Series B and Series C Preferred Stock of the Series B and Series C
Preferred Liquidation Values of such shares, the holders of shares
of Series B or Series C Preferred Stock shall not be entitled, as
such holders, to any further participation in any distribution of
assets of the Corporation. If the assets of the Corporation are
not sufficient to pay in full the Series B and Series C Preferred
Liquidation Value payable to the holders of shares of Series B or
Series C Preferred Stock, the holders of all such shares shall
share ratably (to the exclusion of any other holders of capital
stock) in such distribution of assets.
(a) Neither a consolidation or merger of the
Corporation with or into any other corporation, nor a sale or
transfer of all or part of the Corporation's assets for cash,
securities or other property, nor a merger of any other
corporation with or into the Corporation, shall be considered a
liquidation, dissolution, or winding-up of the Corporation within
the meaning of this Section 2.5.
III. Definitions.
As used in this Certificate of Designations, the terms
indicated below shall have the following respective meanings:
"Affiliate", with respect to any Person, means any other
Person directly or indirectly controlling, controlled by, or under
direct or indirect common control with, such Person. A Person
shall be deemed to control a corporation if such Person possesses,
directly or indirectly, the power to direct or cause the direction
of the management and policies of such corporation, by contract or
otherwise. Additionally, with respect to Wingate Partners, L.P.,
the term "Affiliate" for purposes of the definition of Change of
Control shall be deemed to include James T. Callier, Jr.,
Frederick B. Hegi, Jr., Thomas W. Sturgess, James A. Johnson,
Dennis J. Johnson, Sue Goddard, Wallace R. Hawley, Lee Walton, Bud
Applebaum, Estate of Howard Beasley, Callier Buy-Out Partners, as
defined in the Agreement of Limited Partnership of Wingate
Partners, L.P., Peter J. Wodtke, and pension plans for the benefit
of such individuals or entities.
"Bank Holding Company Affiliate" shall mean, with
respect to any Person subject to the provisions of Regulation Y,
(i) if such Person is a bank holding company, any company directly
or indirectly controlled by such bank holding company, and (ii)
otherwise, the bank holding company that controls such Person and
any company (other than such Person) directly or indirectly
controlled by such bank holding company.
"Business Sale" means a transaction or a series of
transactions, whether effected by sale or exchange of securities
or assets, merger or consolidation, or otherwise, that results in
the sale of the Corporation or its business to an Independent
Third Party or group of Independent Third Parties, pursuant to
which such Independent Third Party or group of Independent Third
Parties would acquire (a) capital stock of the Corporation
possessing the voting power under normal circumstances to elect a
majority of the Board or (b) all or substantially all of the
Corporation's assets determined on a consolidated basis.
"Cash-Out Event" means the occurrence of a Business
Sale, a Change in Control, a Qualified Public Offering, or a
Recapitalization. In the case of the Series C Preferred Stock,
"Cash-Out Event" shall also include the expiration of the
Agreement for Data Processing Services, dated January 31, 1995,
between ASI and Affiliated Computer Services, Inc. (together with
all amendments thereto and extensions, modifications, and waivers
thereof, the "Supply Agreement") providing for the furnishing of
information systems services to Supply Co., or the early
termination of the Supply Agreement for any reason other than
termination of such agreement by Affiliated Computer Services,
Inc.
"Change in Control" means an occurrence by which Wingate
Partners and its Affiliates and Cumberland Capital Corporation and
its Affiliates shall have collectively sold or otherwise disposed
of and received the pecuniary benefit of 33-1/3% of the Common
Stock legally or beneficially owned by them collectively as of
________ __, 1995 [day after closing of Merger], subject to
appropriate adjustment in the event of a stock split, reverse
stock split or similar transaction and excluding any sales or
other dispositions made by any of them to employees of the
Corporation or of any of its Subsidiaries of up to 10% of such
holdings.
"Control" (including, with its correlative meanings,
"controlled by" and "under common control with") shall mean, with
respect to any Person, the possession, direct or indirect, of the
power to direct or cause the direction of the management and
policies of such Person, whether through the ownership of voting
securities, by contract, or otherwise.
"Debt Agreements" means the Credit Agreement, dated as
of March __, 1995, among ASI, AHI, The Chase Manhattan Bank
(National Association) and the other lenders named therein, and
the notes and other documents and instruments executed and
delivered in connection therewith, as said agreement and notes and
other documents and instruments may from time to time be amended
or supplemented, and any agreements evidencing any renewal,
extension, refinancing, refunding or replacement thereof.
"Dividend Base" of any share of Series A, Series B, or
Series C Preferred Stock means $1,000, subject to appropriate
adjustment in the event of a stock split, reverse stock split or
similar transaction.
"Independent Third Party" means any person who,
immediately prior to the contemplated transaction, does not own in
excess of 5% of the Common Stock on a fully diluted and converted
basis (a "5% Owner"), who is not controlling, controlled by, or
under common control with the Corporation or any such 5% Owner,
and who is not the spouse or descendant (by birth or adoption) of
any such 5% Owner or a trust for the benefit of such 5% Owner
and/or such other persons.
"Junior Shares" means with respect to the priority of
any class or series of Preferred Stock, shares of Common Stock, or
shares of any other series or class of Preferred Stock of the
Corporation which are designated as junior to such series in the
Certificate of Incorporation or any amendment thereto, or in the
resolution designating the class or series of such Preferred Stock
and any warrants, options, or other rights to acquire or purchase
such securities. The shares of Series B and Series C Preferred
Stock are Junior Shares in relation to the Series A Preferred
Stock. Any shares of Additional Preferred Stock, regardless of
designation, shall be deemed Junior Shares in relation to the
Series A, Series B, and Series C Preferred Stock.
"Liquidation Date" means as to any series of Preferred
Stock, the first date on which the assets of the Corporation are
distributed to the holders of such series of Preferred Stock in
the event of any voluntary or involuntary liquidation, dissolution
or winding-up of the Corporation.
"Marketable Securities" shall mean Common Stock or
common stock or other securities of any corporation that is the
successor to substantially all of the business or assets of the
Corporation or the ultimate parent of such successor which is (or
will, upon distribution thereof, be) listed on the New York Stock
Exchange, the American Stock Exchange, or approved for quotation
on the Nasdaq National Market System.
"Person" means an individual, partnership, association,
joint venture, corporation, business, trust, estate,
unincorporated organization, or government or any department,
agency or subdivision thereof.
"Preferred Dividend Payment Date" shall mean each April
30, July 31, October 31, and January 31, or the next business day
following each such date of any year commencing with the initial
payment April 30, 1992.
"Qualified Public Offering" means a sale in a public
offering or series of public offerings, registered under the
Securities Act, of Common Stock; provided, however, that such
offering or series of offerings shall not be deemed to be a
Qualified Public Offering unless such offering or offerings shall
have resulted in (A)(i) public ownership of not less than 20% of
the Common Stock of the Corporation on a fully-diluted basis
(which such shares of Common Stock are listed upon the New York
Stock Exchange, the American Stock Exchange, or are approved for
quotation on the Nasdaq National Market System), and (ii) such
offering or offerings shall have resulted in receipt by the
Corporation of aggregate cash proceeds (after deduction of
underwriter discounts and the costs associated with such offering
or offerings) of at least $37.5 million, or (B) the holders of
Common Stock of the Corporation receive, as a result of such
offering or offerings, cash, Marketable Securities, or a
combination thereof valued at not less than $1 million.
"Recapitalization" means a recapitalization of the
Corporation pursuant to which the holders of Common Stock of the
Corporation receive cash, securities (other than shares junior to
the Series B or Series C Preferred Stock), property, or other
assets and such consideration is valued at not less than
$1 million.
"Redemption Date" as to any share of Series A, Series B,
or Series C Preferred Stock means the date specified in the notice
of any redemption at the Corporation's option or the applicable
date specified herein in the case of any other redemption;
provided that no such date will be a Redemption Date unless the
applicable Redemption Price is actually paid or has been set aside
for payment to such stockholder in full as of such date, and if
not so paid or set aside for payment to such stockholder in full,
the Redemption Date will be the date on which such Redemption
Price is fully paid.
"Redemption Price" of any share of Series A, Series B,
or Series C Preferred Stock means as of the Redemption Date an
amount equal to the sum of $1,000 plus the aggregate of accrued
and unpaid dividends on such share to such date, subject to
appropriate adjustment in the event of a stock split, reverse
stock split, or similar transaction.
"Regulation Y" shall mean Regulation Y promulgated by
the Board of Governors of the Federal Reserve System (12 C.F.R.
225) or any successor regulation.
"Securities Act" means the Securities Act of 1933, as
amended, and the rules and regulations promulgated thereunder.
"Series A Exchange Notes" means the Series A
Subordinated Exchange Notes which may be issued by the Corporation
to the holders of the Series A Preferred Stock upon a redemption
pursuant to Section 1.2(d). Such Series A Exchange Notes shall
have a maturity date of July 31, 1999 and shall bear interest at
the rate of 10% for interest paid in cash and 13% for interest
paid in-kind in additional Series A Exchange Notes. Such interest
shall be payable quarterly in arrears, either in cash or in-kind,
on the Preferred Dividend Payment Dates. Such Series A Exchange
Notes will permit a required prepayment to the same amounts on the
same dates as would have applied to an optional or mandatory
redemption of the Series A Preferred Stock (assuming that the
exchange pursuant to Section 1.2(d) had not occurred), shall not
contain any financial covenants by, or other restrictive covenants
(other than limitations imposed by senior debt and applicable law)
on, the Corporation, and shall provide for an event of default
only upon the Corporation's failure to make payments in accordance
with its terms or upon a bankruptcy filing by or against the
Corporation which filing is not dismissed within 60 days after
filing. The payment of principal, interest, and premium (if any)
will be subordinated to senior debt (to be defined as any
obligation of the Corporation or its subsidiaries for borrowed
money including the obligations under the Subordinated Note).
"Series A Indenture" means an indenture for the Series A
Exchange Notes that qualifies under and is in compliance with the
Trust Indenture Act to be entered into between the Corporation and
a trustee acceptable to the Corporation and a majority of the
holders of Series A Exchange Notes and containing such terms and
provisions as are approved by the Board of Directors of the
Corporation.
"Series A Preferred Dividend Rate" means a rate of 10%
per annum, computed on the basis of a 360-day year and twelve 30-
day months, to be applied to the Dividend Base for the Series A
Preferred Stock as from time to time adjusted; provided that in
the event of and during continuance of a failure by the
Corporation to pay in cash a dividend on the Series A Preferred
Stock on any Preferred Dividend Payment Date or to make any
redemption payment when due, the dividend rate shall be increased
to 13% per annum, and shall remain at said rate until such failure
is cured, such increase to be effective retroactive to the first
day of the accrual period for which the dividend was not paid.
"Series A, Series B, and Series C Preferred Liquidation
Value" of any share of Series A, Series B, or Series C Preferred
Stock means as of any particular date an amount equal to the sum
of $1,000 plus the aggregate of accrued and unpaid dividends on
such share to such date, subject to appropriate adjustment in the
event of a stock split, reverse stock split, or similar
transaction.
"Series B and Series C Exchange Notes" means the Series
B Subordinated Exchange Notes and the Series C Subordinated
Exchange Notes which may be issued by the Corporation to the
holders of the Series B or Series C Preferred stock, as
applicable, upon a redemption pursuant to Section 2.3(d). Series
B Exchange Notes shall have a maturity date of July 31, 1999.
The Series C Exchange Notes shall have a maturity date of January
31, 2002, with payments to be made thereon in four equal
(as nearly as practicable) installments of principal on April 30,
2001, July 31, 2001, October 31, 2001, and January 31, 2002. Both
Series B and Series C Exchange Notes shall bear interest at the
rate of 11% for interest paid in cash and 12% for interest paid in-
kind in additional Series B or Series C Exchange Notes, as
applicable. Such interest shall be payable quarterly in arrears,
either in cash or in-kind as would have applied to the Series B
and Series C Preferred Stock Dividend on the Preferred Dividend
Payment Dates. Such Notes will permit or require prepayments in
the same amounts and at the same dates as would have applied to an
optional or mandatory redemption of the Series B and Series C
Preferred Stock (assuming that the exchange pursuant to Section
2.3(d) had not occurred), shall not contain any financial
covenants by, or other restrictive covenants (other than
limitations imposed by senior debt and applicable law) on, the
Corporation, and shall provide for an event of default only upon
the Corporation's failure to make payments in accordance with its
terms or upon a bankruptcy filing by or against the Corporation,
which filing is not dismissed within 60 days after filing. The
payment of principal, interest, and premium (if any) will be
subordinated to senior debt (to be defined as any obligation of
the Corporation for borrowed money including the obligations under
the Subordinated Note) and payments in respect of Series A
Exchange Notes.
"Series B Indenture" means an indenture for the Series B
Exchange Notes that qualifies under and is in compliance with the
Trust Indenture Act to be entered into between the Corporation and
a trustee acceptable to the Corporation and a majority of the
holders of Series B Exchange Notes and containing such terms and
provisions as are approved by the Board of Directors of the
Corporation.
"Series B or Series C Preferred Dividend Rate" means a
rate of 9% per annum computed on the basis of a 360-day year and
twelve 30-day months, to be applied to the Dividend Base for the
Series B or Series C Preferred Stock as from time to time
adjusted; provided that in the event of and during continuance of
a failure by the Corporation to pay in cash a dividend on the
Series B or Series C Preferred Stock on any Preferred Dividend
Payment Date or to make any redemption payment when due, the
dividend rate shall be increased to 10% per annum, and shall
remain at said rate until such failure is cured, such increase to
be effective retroactive to the first day of the accrual period
for which the dividend was not paid.
"Series C Indenture" means an indenture for the Series C
Exchange Notes that qualifies under and is in compliance with the
Trust Indenture Act to be entered into between the Corporation and
a trustee acceptable to the Corporation and a majority of the
holders of Series C Exchange Notes and containing such terms and
provisions as are approved by the Board of Directors of the
Corporation.
"Subordinated Note" means the Senior Subordinated Credit
Agreement, dated as of March __, 1995, among ASI, AHI, The
Roebling Fund, a Delaware statutory business trust, and the other
lenders named therein, and the notes and other documents and
instruments executed and delivered in connection therewith, as
said agreement and notes and other documents and instruments may
from time to time be amended or supplemented, and any agreements
evidencing any renewal, extension, refinancing, refunding or
replacement thereof.
"Subsidiary" means any corporation, a majority (by
number of votes) of the voting securities of which shall, at the
time as of which any determination is being made, be owned by the
Corporation, directly or indirectly through one or more
Subsidiaries.
"Supply Co." means United Stationers Supply Co., an
Illinois corporation and wholly-owned subsidiary of the
Corporation.
"Trust Indenture Act" means the Trust Indenture Act of
1939, as amended, the rules and regulations promulgated
thereunder, and any successor legislation thereto.
IN WITNESS WHEREOF, United Stationers Inc. has
caused this certificate to be signed on its behalf by its
President and attested by its Secretary, this 30th day of
March, 1995.
UNITED STATIONERS INC.
By: /s/ THOMAS W. STURGESS
Thomas W. Sturgess
Chairman of the Board
ATTEST:
/s/ GARY G. MILLER
Gary G. Miller
Secretary
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_ _ _ Text should begin immediately below this line. _
_ _ CERTIFICATE OF OWNERSHIP AND MERGER
MERGING
ASSOCIATED HOLDINGS, INC.
INTO
UNITED STATIONERS INC.
(PURSUANT TO SECTION 253 OF THE GENERAL
CORPORATION LAW OF THE STATE OF DELAWARE)
Associated Holdings, Inc., a corporation incorporated on the
30th day of January, 1992, pursuant to the provisions of the
General Corporation Law of the State of Delaware (the
"Corporation"), does hereby certify that the Corporation owns at
least ninety percent (90%) of the outstanding Common Stock, $0.10
par value, of United Stationers Inc., a corporation incorporated
on the 18th day of August, 1981, pursuant to the General
Corporation Law of the State of Delaware ("USI"), having no other
class of stock outstanding other than said Common Stock, and that
the Corporation by the following resolutions of its Board of
Directors, duly adopted by unanimous written consent of the
members thereof to be effective as of March 30, 1995, determined
to merge itself into said USI:
WHEREAS, the Corporation is the legal and beneficial owner
of at least ninety percent (90%) of the outstanding shares of
Common Stock, $0.10 par value per share ("Common Stock"), of USI;
and
WHEREAS, said Common Stock is the only issued and
outstanding class of stock of USI; and
WHEREAS, this Corporation desires to merge itself into USI
pursuant to the provisions of Section 253 of the General
Corporation Law of the State of Delaware (the "DGCL");
NOW, THEREFORE, BE IT RESOLVED, that effective upon the
filing of an appropriate Certificate of Ownership and Merger
embodying these resolutions with the Secretary of State of
Delaware, the Corporation merge and it hereby does merge itself
into USI, which will assume all of the liabilities and
obligations of the Corporation;
FURTHER RESOLVED, that the terms and conditions of the
merger are as follows: Upon the proposed merger becoming
effective (the "Effective Time"), each share of Common Stock
(other than shares of Common Stock held by the Corporation or any
of its subsidiaries or affiliates immediately prior to the
Effective Time ("Corporation-owned Shares") and shares of Common
Stock then held in the treasury of USI or any of its subsidiaries
("Treasury Shares")) shall remain outstanding and be unaffected
by the Merger. Each Corporation-owned Share and each Treasury
Share shall be cancelled and retired and cease to exist without
any payment therefor. Each share of Class A Common Stock, $0.01
par value, of the Corporation outstanding immediately prior to
the Effective Time shall be converted into 3.446286301 shares of
Common Stock, certificates for which shall be issued to the
stockholders of the Corporation upon surrender to USI of such
stockholder's certificates formerly representing such shares of
Class A Common Stock of the Corporation. Each share (and
fraction thereof) of Class A Preferred Stock, $0.01 par value, of
the Corporation (the "Class A Preferred Stock") shall be
converted into one share (and corresponding fraction thereof) of
Series A Preferred Stock, $0.01 par value, of USI (the "USI
Series A Preferred Stock"); each share (and fraction thereof) of
Class B Preferred Stock, $0.01 par value, of the Corporation (the
"Class B Preferred Stock") shall be converted into one share (and
corresponding fraction thereof) of Series B Preferred Stock,
$0.01 par value, of USI (the "USI Series B Preferred Stock"); and
each share (and fraction thereof) of Class C Preferred Stock, $
0.01 par value, of the Corporation (the "Class C Preferred Stock"
and, together with the Class A Preferred Stock and the Class B
Preferred Stock, the "Preferred Stock") shall be converted into
one share (and corresponding fraction thereof) of Series C
Preferred Stock, $0.01 par value, of USI (the "USI Series C
Preferred Stock"). At the Effective Time, all shares of
Preferred Stock shall no longer be outstanding and shall
automatically be cancelled and retired and shall cease to exist,
and each certificate previously representing any such shares of
Preferred Stock shall thereafter represent the right to receive
the shares of USI Series A Preferred Stock, USI Series B
Preferred Stock or USI Series C Preferred Stock, as the case may
be, into which such Preferred Stock has been converted;
FURTHER RESOLVED, that the proposed merger be submitted to
the stockholders of the Corporation and that upon receiving the
required consent of such stockholders, the proposed merger shall
be approved;
FURTHER RESOLVED, that USI, as the surviving corporation in
the merger, shall notify each stockholder of record of said USI
within ten days after the effective date of the merger that the
merger has become effective;
FURTHER RESOLVED, that pursuant to Section 1.1 of that
certain Agreement and Plan of Merger, dated as of February 13,
1995, between the Corporation and USI, and in accordance with
Section 153(c) of the DGCL, the Restated Certificate of
Incorporation (the "Certificate of Incorporation") of USI is
automatically amended, to be effective as of the Effective Time,
as follows:
Article FOURTH of the Certificate of Incorporation is
hereby amended and restated in its entirety to read as set
forth in Exhibit A hereto;
Article EIGHTH of the Certificate of Incorporation is
hereby amended and restated in its entirety to read as set
forth in Exhibit B hereto; and
Article NINTH of the Certificate of Incorporation is
hereby amended and restated in its entirety to read as set
forth in Exhibit C hereto;
FURTHER RESOLVED, that the Chairman of the Board, the
President or any Vice President of the Corporation be, and each
hereby is, authorized to make and execute, and the Secretary or
any Assistant Secretary be, and each hereby is, authorized to
attest, a Certificate of Ownership and Merger setting forth a
copy of these resolutions providing for the merger of the
Corporation into USI, and the date of adoption hereof, and to
cause the same to be filed with the Secretary of State and a
certified copy recorded in the office of Recorder of Deeds of New
Castle County, Delaware, and to do all acts and things,
whatsoever, whether within or without the State of Delaware,
which may be in any way necessary or appropriate to effect said
merger; and
FURTHER RESOLVED, that the merger has been approved by the
holder of all of the outstanding stock of the Corporation
entitled to vote thereon by unanimous written consent without a
meeting in accordance with Section 228 of the DGCL.
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IN WITNESS WHEREOF, said Corporation has caused this
Certificate to be signed by its Chairman and attested by its
Assistant Secretary, this 30th day of March, 1995.
ASSOCIATED HOLDINGS, INC.
By: /s/ THOMAS W. STURGESS
Thomas W. Sturgess
Chairman of the Board and
Chief Executive Officer
ATTEST:
By: /s/ GARY G. MILLER
Gary G. Miller
Secretary
EXHIBIT A
FOURTH: The total number of shares of all classes of
capital stock which the Corporation shall have authority to issue
is 46,500,000 shares, consisting of (a) 1,500,000 shares of a
class designated as Preferred Stock, par value $.01 per share
(the "Preferred Stock"), (b) 40,000,000 shares of a class
designated as Common Stock, par value $.10 per share (the "Common
Stock"), and (c) 5,000,000 shares of a class designated as
Nonvoting Common Stock, par value $.01 per share (the "Nonvoting
Common Stock").
The designations and the powers, preferences, rights,
qualifications, limitations, and restrictions of the Preferred
Stock, Common Stock and Nonvoting Common Stock are as follows:
1. Provisions Relating to the Preferred Stock.
(a) The Preferred Stock may be issued from time to time in
one or more classes or series, the shares of each class or series
to have such designations and powers, preferences, and rights,
and qualifications, limitations, and restrictions thereof, as are
stated and expressed herein and in the resolution or resolutions
providing for the issue of such class or series adopted by the
board of directors of the Corporation as hereafter prescribed.
(b) Authority is hereby expressly granted to and vested in
the board of directors of the Corporation to authorize the
issuance of the Preferred Stock from time to time in one or more
classes or series, and with respect to each class or series of
the Preferred Stock, to fix and state by the resolution or
resolutions from time to time adopted providing for the issuance
thereof the following:
(i) whether or not the class or series is to have voting
rights, full, special, or limited, or is to be without voting
rights, and whether or not such class or series is to be entitled
to vote as a separate class either alone or together with the
holders of one or more other classes or series of stock;
(iii) the number of shares to constitute
the class or series and the designations thereof;
(v) the preferences, and relative,
participating, optional, or other special rights, if any, and the
qualifications, limitations, or restrictions thereof, if any,
with respect to any class or series;
(vii) whether or not the shares of any
class or series shall be redeemable at the option of the
Corporation or the holders thereof or upon the happening of any
specified event, and, if redeemable, the redemption price or
prices (which may be payable in the form of cash, notes,
securities, or other property), and the time or times at which,
and the terms and conditions upon which, such shares shall be
redeemable and the manner of redemption;
(viii) whether or not the shares of a class or
series shall be subject to the operation of retirement or sinking
funds to be applied to the purchase or redemption of such shares
for retirement, and, if such retirement or sinking fund or funds
are to be established, the annual amount thereof, and the terms
and provisions relative to the operation thereof;
(x) the dividend rate, whether dividends are
payable in cash, stock of the Corporation, or other property, the
conditions upon which and the times when such dividends are
payable, the preference to or the relation to the payment of
dividends payable on any other class or classes or series of
stock, whether or not such dividends shall be cumulative or
noncumulative, and if cumulative, the date or dates from which
such dividends shall accumulate;
(xii) the preferences, if any, and the
amounts thereof which the holders of any class or series thereof
shall be entitled to receive upon the voluntary or involuntary
dissolution of, or upon any distribution of the assets of, the
Corporation;
(xiv) whether or not the shares of any
class or series, at the option of the Corporation or the holder
thereof or upon the happening of any specified event, shall be
convertible into or exchangeable for, the shares of any other
class or classes or of any other series of the same or any other
class or classes of stock, securities, or other property of the
Corporation and the conversion price or prices or ratio or ratios
or the rate or rates at which such exchange may be made, with
such adjustments, if any, as shall be stated and expressed or
provided for in such resolution or resolutions; and
(xvi) such other special rights and
protective provisions with respect to any class or series as may
to the board of directors of the Corporation seem advisable.
(c) The shares of each class or series of the Preferred
Stock may vary from the shares of any other class or series
thereof in any or all of the foregoing respects. The board of
directors of the Corporation may increase the number of shares of
the Preferred Stock designated for any existing class or series
by a resolution adding to such class or series authorized and
unissued shares of the Preferred Stock not designated for any
other class or series. The board of directors of the Corporation
may decrease the number of shares of the Preferred Stock
designated for any existing class or series by a resolution
subtracting from such class or series authorized and unissued
shares of the Preferred Stock designated for such existing class
or series, and the shares so subtracted shall become authorized,
unissued, and undesignated shares of the Preferred Stock.
2. Provisions Relating to the Common Stock and Nonvoting
Common Stock.
(a) Identical Rights. Except as otherwise provided in this
ARTICLE FOURTH, all shares of Common Stock and Nonvoting Common
Stock shall be identical and shall entitle the holder thereof to
the same rights and privileges.
(b) Dividends. From and after the date of issuance, the
holders of outstanding shares of Common Stock and Nonvoting
Common Stock shall be entitled to receive dividends on the shares
of Common Stock and Nonvoting Common Stock when, as, and if
declared by the Board of Directors, out of funds legally
available for such purpose. All holders of shares of Common
Stock and Nonvoting Common Stock shall share ratably, in
accordance with the numbers of shares held by each such holder,
in all dividends or distributions on shares of Common Stock
payable in cash, in property or in securities of the Corporation
(other than shares of Common stock). All dividends or
distributions declared on shares of Common Stock and Nonvoting
Common Stock which are payable in shares of Common Stock or
Nonvoting Common Stock shall be declared on both classes of
shares at the same rate, provided that any such dividend or
distribution shall be payable in shares of the class of Common
Stock or Nonvoting Common Stock held by the stockholder to whom
the dividend or distribution is payable.
(c) Stock Splits, Etc. The Corporation shall not in any
manner subdivide (by stock split, stock dividend, or otherwise),
or combine (by reverse stock split, or otherwise) the outstanding
shares of Common Stock or Nonvoting Common Stock unless the
outstanding shares of the other class shall be proportionately
subdivided or combined. No reclassification or any other
adjustment or modification of the rights or preferences shall be
effected (including without limitation pursuant to a merger,
consolidation or liquidation involving the Corporation) with
respect to either the Common Stock or the Nonvoting Common Stock
unless both the Common Stock and Nonvoting Common Stock are
reclassified or the rights or preferences are adjusted or
modified in exactly the same manner and at the same time. In
this regard, and without limiting the generality of the
foregoing, in the case of any consolidation or merger of the
Corporation with or into any other entity (other than a merger
which does not result in any reclassification, conversion,
exchange or cancellation of the Common Stock), or in case of any
sale or transfer of all or substantially all the assets of the
Corporation, or the reclassification of the Common Stock into any
other form of capital stock of the Corporation, whether in whole
or in part, each share of Nonvoting Common Stock shall, after
such consolidation, merger, sale, or transfer or
reclassification, be converted into the kind and amount of shares
of stock and other securities and property which such holder
would have been entitled to receive upon such consolidation,
merger, sale, or transfer or reclassification if such holder had
held such Common Stock issuable upon the conversion of such share
of Nonvoting Common Stock immediately prior to such
consolidation, merger, sale, or transfer or reclassification;
provided, however, that no such shares of stock or other
securities into which shares of Nonvoting Common Stock are so
converted shall have any voting rights whatsoever.
(d) Liquidation. In the event of any voluntary or involuntary
liquidation, dissolution, or winding up of the affairs of the
Corporation, the holders of shares of Common Stock and Nonvoting
Common Stock shall be entitled to share ratably, in accordance
with the number of shares held by each such holder, in all of the
assets of the Corporation available for distribution to the
holders of shares of Common Stock.
(e) Voting Rights. Except as otherwise provided herein or by
law, the entire voting power of the Corporation shall be vested
in the holders of shares of Common Stock and each holder of
shares of Common Stock shall be entitled to one vote for each
share of Common Stock held of record by such holder; provided
that, without the consent of the holders of record of at least
51% of Nonvoting Common Stock at the time outstanding (assuming,
for the purposes of this provision, that the holders of rights to
acquire shares of Nonvoting Common Stock shall be deemed to be
the holders of the shares of Nonvoting Common Stock which are at
the time issuable upon the full exercise thereof whether or not
such holders are then entitled to exercise such rights pursuant
to the terms thereof), given in writing or by the vote at any
regular or special meeting of stockholders of the Corporation,
the Corporation shall not:
(i) amend, alter, modify, or repeal any provision of
this Certificate of Incorporation or the By-Laws of the
Corporation in any manner which adversely affects the relative
rights, preferences, qualifications, powers, limitations or
restrictions of the Nonvoting Common Stock, or amend, alter,
modify, or repeal this Section 2(e);
(ii) increase or decrease the authorized number of shares of
any class of capital stock of the Corporation or authorize,
issue, or otherwise create securities convertible into or
exercisable for any shares of capital stock of the Corporation
other than the shares of Common Stock and Nonvoting Common Stock
authorized hereunder and the shares of Series A, Series B, and
Series C Preferred Stock designated in that certain Certificate
of the Powers, Designations, Preferences, and Rights of the
Series A Preferred Stock, Series B Preferred Stock and Series C
Preferred Stock dated _________ __, 1995;
(iii) voluntarily effect an exchange or reclassification
of shares of Nonvoting Common Stock into shares of another class
of capital stock of the Corporation; or
(iv) effect a merger or consolidation of the Corporation
with another corporation, unless the certificate or articles of
incorporation of the surviving corporation shall provide that the
shares of the capital stock of such surviving corporation into
which the shares of Nonvoting Stock hereunder shall be converted
shall have the identical rights and privileges as the shares of
capital stock of such surviving corporation into which the shares
of Common Stock hereunder shall be converted, other than the
voting rights in this Section 2(e) and the conversion and other
rights in Section 3 below which shall not be adversely affected
by such merger or consolidation.
3. Conversion.
(a) Right to Conversion. Subject to and upon compliance
with the provisions of this Section 3, any holder of shares of
Nonvoting Common Stock shall be entitled at any time and from
time to time to convert each share of Nonvoting Common Stock held
by such holder into a share of Common Stock at the conversion
rate of one share of Common Stock for one share of Nonvoting
Common Stock.
(b) Procedure. The conversion of any shares of Nonvoting
Common Stock into shares of Common Stock shall be effected by the
holder of the shares of Nonvoting Common Stock to be converted
surrendering the certificate therefor, duly endorsed, at the
office of the Corporation or of any transfer agent for the shares
of Common Stock or at such other place as the Corporation is
willing to accept such surrender accompanied by written notice to
the Corporation at such office or other place that it elects to
so convert and stating the number of shares of Nonvoting Common
Stock being converted. Thereupon the Corporation shall promptly
issue and deliver at such office or other place to such holder a
certificate or certificates for the number of shares of Common
Stock to which such holder is entitled, registered in the name of
such holder or a designee of such holder as specified in such
notice. Such conversion shall be deemed to have been made at the
close of business on the date of such surrender of the shares to
be converted in accordance with the procedure set forth in the
first sentence of this Section 3(b), and the Person entitled to
receive the shares issuable upon such conversion shall be treated
for all purposes as having become the record holder of such
shares at such time. In the event of the conversion of less than
all of the shares of Nonvoting Common Stock into shares of Common
Stock evidenced by the certificate so surrendered, the
Corporation shall execute and deliver to or upon the written
order of such holder, without charge to such holder, a new
certificate evidencing the shares of Nonvoting Common Stock not
converted.
(c) Reservation. The corporation shall at all times
reserve and keep available out of its authorized but unissued
shares of Common Stock, or any shares of Common Stock held in its
treasury, solely for the purpose of issue upon conversion of the
shares of Nonvoting Common Stock as provided herein, such number
of shares of Common Stock as shall then be issuable upon the
conversion of all outstanding shares of Nonvoting Common Stock.
The shares of Common Stock so issuable shall when so issued be
duly and validly issued, fully paid, and nonassessable.
(d) Certain Legal Requirements. No person subject to the
provisions of Regulation Y shall, and no such Person shall permit
any of its Bank Holding Company Affiliates to, convert any shares
of Nonvoting Common Stock held by it into shares of Common Stock,
if after giving effect to such conversion, (i) such Person and
its Bank Holding Company Affiliates would own more than 5% of the
total issued and outstanding shares of Common Stock or (ii) such
Person would Control the Corporation (and, for purposes of this
clause (ii), a reasoned opinion of counsel to such Person (which
is based on facts and circumstances deemed appropriate by such
counsel) to the effect that such Person does not control the
Corporation shall be conclusive).
4. Definitions.
As used in this ARTICLE FOURTH, the terms indicated
below shall have the following respective meanings:
"Bank Holding Company Affiliate" shall mean, with
respect to any Person subject to the provisions of Regulation Y,
(i) if such Person is a bank holding company, any company
directly or indirectly controlled by such bank holding company,
and (ii) otherwise, the bank holding company that controls such
Person and any company (other than such Person) directly or
indirectly controlled by such bank holding company.
"Control" (including, with its correlative meanings,
"controlled by" and "under common control with") shall mean, with
respect to any Person, the possession, direct or indirect, of the
power to direct or cause the direction of the management and
policies of such Person, whether through the ownership of voting
securities, by contract, or otherwise.
"Person" means an individual, partnership, association,
joint venture, corporation, business, trust, estate,
unincorporated organization, or government or any department,
agency or subdivision thereof.
"Regulation Y" shall mean Regulation Y promulgated by
the Board of Governors of the Federal Reserve System (12 C.F.R.
225) or any successor regulation.
EXHIBIT B
EIGHTH: The Corporation shall indemnify any person who was,
is, or is threatened to be made a party to a proceeding (as here
inafter defined) by reason of the fact that he or she (i) is or
was a director or officer of the Corporation or (ii) while a
director or officer of the Corporation, is or was serving at the
request of the Corporation as a director, officer, partner, ventu
rer, proprietor, trustee, employee, agent, or similar functionary
of another foreign or domestic corporation, partnership, joint
venture, sole proprietorship, trust, employee benefit plan, or
other enterprise, to the fullest extent permitted under the
Delaware General Corporation Law, as the same exists or may here
after be amended. Such right shall be a contract right and as
such shall run to the benefit of any director or officer who is
elected and accepts the position of director or officer of the
Corporation or elects to continue to serve as a director or
officer of the Corporation while this Article EIGHTH is in
effect. Any repeal or amendment of this Article EIGHTH shall be
prospective only and shall not limit the rights of any such
director or officer or the obligations of the Corporation with
respect to any claim arising from or related to the services of
such director or officer in any of the foregoing capacities prior
to any such repeal or amendment to this Article EIGHTH. Such
right shall include the right to be paid by the Corporation
expenses incurred in investigating or defending any such
proceeding in advance of its final disposition to the maximum
extent permitted under the Delaware General Corporation Law, as
the same exists or may hereafter be amended. If a claim for
indemnification or advancement of expenses hereunder is not paid
in full by the Corporation within sixty (60) days after a written
claim has been received by the Corporation, the claimant may at
any time thereafter bring suit against the Corporation to recover
the unpaid amount of the claim, and if successful in whole or in
part, the claimant shall also be entitled to be paid the expenses
of prosecuting such claim. It shall be a defense to any such
action that such indemnification or advancement of costs of
defense is not permitted under the Delaware General Corporation
Law, but the burden of proving such defense shall be on the
Corporation. Neither the failure of the Corporation (including
its board of directors or any committee thereof, independent
legal counsel, or stockholders) to have made its determination
prior to the commencement of such action that indemnification of,
or advancement of costs of defense to, the claimant is permis
sible in the circumstances nor an actual determination by the
Corporation (including its board of directors or any committee
thereof, independent legal counsel, or stockholders) that such
indemnification or advancement is not permissible shall be a
defense to the action or create a presumption that such indemnifi
cation or advancement is not permissible. In the event of the
death of any person having a right of indemnification under the
foregoing provisions, such right shall inure to the benefit of
his or her heirs, executors, administrators, and personal repre
sentatives. The rights conferred above shall not be exclusive of
any other right which any person may have or hereafter acquire
under any statute, by-law, resolution of stockholders or direc
tors, agreement, or otherwise.
The Corporation may additionally indemnify any employee or
agent of the Corporation to the fullest extent permitted by law.
Without limiting the generality of the foregoing, to the
extent permitted by then applicable law, the grant of mandatory
indemnification pursuant to this Article EIGHTH shall extend to
proceedings involving the negligence of such person.
As used herein, the term "proceeding" means any threatened,
pending, or completed action, suit, or proceeding, whether civil,
criminal, administrative, arbitrative, or investigative, any
appeal in such an action, suit, or proceeding, and any inquiry or
investigation that could lead to such an action, suit, or proceed
ing.
EXHIBIT C
NINTH: A director of the Corporation shall not be
personally liable to the Corporation or its stockholders for mone
tary damages for breach of fiduciary duty as a director, except
for liability (i) for any breach of the director's duty of loyal
ty to the Corporation or its stockholders, (ii) for acts or omis
sions not in good faith or which involve intentional misconduct
or knowing violation of law, (iii) under Section 174 of the Dela
ware General Corporation Law, or (iv) for any transaction from
which the director derived an improper personal benefit. Any
repeal or amendment of this Article NINTH by the stockholders of
the Corporation shall be prospective only, and shall not
adversely affect any limitation on the personal liability of a
director of the Corporation arising from an act or omission
occurring prior to the time of such repeal or amendment. In
addition to the circumstances in which a director of the
Corporation is not personally liable as set forth in the
foregoing provisions of this Article NINTH, a director shall not
be liable to the Corporation or its stockholders to such further
extent as permitted by any law hereafter enacted, including
without limitation any subsequent amendment to the Delaware
General Corporation Law.
Exhibit 15
INDEPENDENT ACCOUNTANT'S REVIEW REPORT
The Board of Directors
United Stationers Inc.
We have reviewed the accompanying condensed consolidated balance sheet and
the related condensed consolidated statements of operations and cash flows
of United Stationers Inc. (previously doing business as Associated
Holdings, Inc.) and subsidiaries as of March 31, 1995, and for the three-
month period then ended. These financial statements are the responsibility
of the Company's management. We did not perform a similar review of the
condensed consolidated statements of operations and cash flows of United
Stationers Inc. for the three-month period ended March 31, 1994.
We conducted our review in accordance with standards established by the
American Institute of Certified Public Accountants. A review of interim
financial information consists principally of applying analytical
procedures to financial data, and making inquiries of persons responsible
for financial and accounting matters. It is substantially less in scope
than an audit conducted in accordance with generally accepted auditing
standards, which will be performed for the full year with the objective of
expressing an opinion regarding the financial statements taken as a whole.
Accordingly, we do not express such an opinion.
Based on our review, we are not aware of any material modifications that
should be made to the accompanying condensed consolidated financial
statements as of March 31, 1995, and for the three-month period then ended
for them to be in conformity with generally accepted accounting principles.
The consolidated balance sheet of United Stationers Inc. as of December 31,
1994, and the related consolidated statements of income, stockholders'
equity and cash flows for the year then ended (not presented herein), were
previously audited, in accordance with generally accepted auditing
standards, by other auditors who expressed an unqualified opinion dated
January 23, 1995 (except with respect to the matters discussed in Note 14
as to which the date is February 13, 1995) on those financial statements.
In our opinion, the information set forth in the accompanying condensed
consolidated balance sheet as of December 31, 1994, is fairly stated, in
all material respects, in relation to the consolidated balance sheet from
which it has been derived.
/s/ERNST & YOUNG LLP
Chicago, Illinois
May 15, 1995
WARNING: THE EDGAR SYSTEM ENCOUNTERED ERROR(S) WHILE PROCESSING THIS SCHEDULE.
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