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UNITED STATES SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 8-K
CURRENT REPORT
PURSUANT TO SECTION 13 OR 15(D) OF THE
SECURITIES EXCHANGE ACT OF 1934
DATE OF REPORT (DATE OF EARLIEST EVENT REPORTED): APRIL 21, 1998
STEWART ENTERPRISES, INC.
(Exact name of registrant as specified in its charter)
LOUISIANA 0-19508 72-0693290
(State or other jurisdiction (Commission (I.R.S. Employer
of incorporation) File Number) Identification No.)
110 VETERANS MEMORIAL BOULEVARD
METAIRIE, LOUISIANA 70005
(Address of principal executive offices) (Zip Code)
(504) 837-5880
(Registrant's telephone number, including area code)
NOT APPLICABLE
(Former name or former address, if changed since last report)
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<PAGE>
ITEM 5. OTHER EVENTS
This Current Report on Form 8-K is being filed in order to file as
exhibits hereto (i) the Underwriting Agreement, dated April 21, 1998,
between Stewart Enterprises, Inc. (the "Company") and the underwriters
named therein, relating to the Company's 6.40% Remarketable Or Redeemable
Securities (ROARS) Due May 1, 2013 (Remarketing Date May 1, 2003) (the
"ROARS"); (ii) the Remarketing Agreement, dated April 24, 1998, between the
Company and NationsBanc Montgomery Securities LLC, relating to the ROARS;
(iii) the First Supplemental Indenture, dated April 24, 1998, between the
Company and Citibank, N.A., as Trustee, relating to the ROARS; and (iv) the
form of ROARS.
On April 24, 1998, the Company issued the following press release.
"CONTACT:
Ronald H. Patron
Stewart Enterprises, Inc.
110 Veterans Memorial Boulevard
Metairie, Louisiana 70005
(504) 837-5880
FOR IMMEDIATE RELEASE
STEWART ENTERPRISES ANNOUNCES COMPLETION OF $200 MILLION OFFERING OF
REMARKETABLE OR REDEEMABLE SECURITIES
Metairie, Louisiana, April 24, 1998. . . Stewart Enterprises, Inc. (NASDAQ
NMS: STEI) announced today that it has completed its public offering of
$200 million of 6.40% Remarketable Or Redeemable Securities (ROARS) due May
1, 2013 (remarketing date May 1, 2003). The ROARS were priced to the public
at 99.677% to yield 6.476%. The offering was underwritten by NationsBanc
Montgomery Securities LLC, Bear, Stearns & Co. Inc and Citicorp Securities,
Inc.
On the remarketing date, May 1, 2003, the ROARS will either be redeemed at
par by the Company or purchased at par by NationsBanc Montgomery Securities
LLC for remarketing. If the ROARS are remarketed, they will have a new
coupon for the remaining 10-year term equal to 5.44% plus a spread
representing the then-current market spread for the remaining scheduled
term of the ROARS. As part of the transaction, the Company has received
from NationsBanc Montgomery Securities LLC a payment for the right to
remarket the securities on the remarketing date.
In addition, the Company entered into a forward Treasury lock agreement in
early April, which was settled at a gain at the time the offering was
priced. The net effective rate to the Company, including the remarketing
payment and gain from the Treasury lock, assuming the securities are
redeemed by the Company after five years, is 5.77%. If the securities are
remarketed after five years, the net effective rate is expected to be
approximately 6.14% over 15 years.
The offering generated net proceeds to the Company of approximately $203.6
million, including the remarketing payment, which will be used to reduce
the balances outstanding on its existing credit facilities, which amounts
will then become available to the Company to fund its continuing business
expansion program and for general corporate purposes.
Founded in 1910, Stewart Enterprises, Inc. is the third largest provider of
products and services in the death care industry in North America,
currently owning and operating 452 funeral homes and 132 cemeteries in
North America, Europe, the Pacific Rim and South America."
Additionally, on April 21, 1998, the Company issued the following press
release.
"CONTACT:
William E. Rowe
Stewart Enterprises, Inc.
110 Veterans Boulevard
Metairie, Louisiana 70005
504/837-5880
FOR IMMEDIATE RELEASE
STEWART ENTERPRISES ENTERS SOUTH AMERICA WITH ACQUISITION IN
ARGENTINA
New Orleans, Louisiana, April 21, 1998 ... Stewart Enterprises, Inc.
(NASDAQ NMS:STEI) today announced its initial entry into South America with
the acquisition of 18 funeral homes in Buenos Aires, Argentina.
The firms, collectively known as Cocheria Parana, S.A., are located in the
greater Buenos Aires market. Buenos Aires is the capital of Argentina
with a population of approximately 12 million, or about one third of the
total Argentine population of 35 million. Founded in 1961, these firms
perform in excess of 6,400 services annually. Cocheria Parana, S.A. is the
largest funeral company in Argentina.
"The acquisition of this fine funeral business is an exciting opportunity
for our company, as we enter South America," said Joseph P. Henican, III,
chief executive officer of Stewart Enterprises, Inc., adding, "The
Company's experience in the Latin markets in North America has been very
successful, and we expect this acquisition in Buenos Aires to serve as the
foundation of future growth in South America. Stewart's expansion now
extends to ten countries in locations across the globe, including North
America, Europe, the Pacific Rim and South America."
"Our affiliation with the Cocheria Parana funeral business in South America
marks a very positive step in our company's strategic acquisition program.
Argentina is a very promising marketplace, and we look forward to providing
the families of that country with the highest possible quality, service
and value," said William E. Rowe, president and chief operating officer of
Stewart Enterprises, Inc. adding, "We are pleased that Cocheria Parana's
president, Alfredo Peculo, will continue to manage the day-to-day
operations of these fine businesses. Peculo brings over 37 years of
experience in the death care industry to the Company."
Founded in 1910, Stewart Enterprises, Inc. is the third largest provider of
products and services in the death care industry in North America,
currently owning and operating 452 funeral homes and 132 cemeteries in
North America, Europe, the Pacific Rim and South."
ITEM 7. FINANCIAL STATEMENTS AND EXHIBITS
(c) Exhibits
1.1 Underwriting Agreement dated April 21, 1998 between the Company and
each of the underwriters named therein.
1.2 Remarketing Agreement dated April 24, 1998 between the Company and
NationsBanc Montgomery Securities LLC.
4.1 First Supplemental Indenture dated April 24, 1998 between the Company
and Citibank, N.A., as Trustee.
4.2 Form of ROARS.
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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.
STEWART ENTERPRISES, INC.
April 22, 1998 /s/ Kenneth C. Budde
-------------------------------
Kenneth C. Budde
Senior Vice President - Finance
Secretary and Treasurer
(Principal Accounting Officer)
<PAGE>
EXHIBIT INDEX
1.1 Underwriting Agreement dated April 21, 1998 between the Company and
each of the underwriters named therein.
1.2 Remarketing Agreement dated April 24, 1998 between the Company and
NationsBanc Montgomery Securities LLC.
4.1 First Supplemental Indenture dated April 24, 1998 between the Company
and Citibank, N.A., as Trustee.
4.2 Form of ROARS.
<PAGE>
$200,000,000
STEWART ENTERPRISES, INC.
6.40% REMARKETABLE OR REDEEMABLE SECURITIES{SM} ("ROARS"{SM})
DUE MAY 1, 2013
UNDERWRITING AGREEMENT
April 21, 1998
NationsBanc Montgomery Securities LLC
Bear, Stearns & Co. Inc.
Citicorp Securities, Inc.
c/o NationsBanc Montgomery Securities LLC
NationsBank Corporate Center
100 North Tryon Street
Charlotte, North Carolina 28255
Dear Sirs:
SECTION 1. INTRODUCTORY. Stewart Enterprises, Inc., a Louisiana
corporation (the "Company"), proposes to issue and sell to the several
Underwriters named in SCHEDULE I hereto (the "Underwriters"), $200,000,000
principal amount of its 6.40% Remarketable or Redeemable Securities (ROARS)
due May 1, 2013 (Remarketing Date May 1, 2003) (the "Notes"). The Notes
are to be issued pursuant to the provisions of an indenture dated as of
December 1, 1996 between the Company and Citibank, N.A., as Trustee (the
"Trustee"), as supplemented by the First Supplemental Indenture (the
"Supplemental Indenture") to be dated as of April 24, 1998 between the
Company and the Trustee (as supplemented, the "Indenture"). The Company
hereby agrees with the Underwriters as follows:
SECTION 2. REPRESENTATIONS, WARRANTIES AND AGREEMENTS OF THE
COMPANY. The Company represents and warrants to, and agrees with, the
several Underwriters that:
(a) A registration statement on Form S-3 (File No. 333-14467)
with respect to an aggregate of $300,000,000 initial public offering
price of debt securities (including the Notes) (i) has been prepared
by the Company in conformity with the requirements of the Securities
Act of 1933, as amended (the "Act"), and the rules and regulations
(the "Rules and Regulations") of the Securities and Exchange
Commission (the "Commission") thereunder, (ii) has been filed with the
Commission under the Act and (iii) has become effective under the Act
and either is not proposed to be amended or is proposed to be amended
by amendment or post-effective amendment. If any post-effective
amendment to such registration statement has been filed with the
Commission prior to the execution and delivery of this Agreement, the
most recent such amendment has been declared effective by the
Commission. Copies of such registration statement as amended to date
have been delivered by the Company to you. For purposes of this
Agreement, "Effective Time" means the date and the time as of which
such registration statement, or the most recent post-effective
amendment thereto, if any, was declared effective by the Commission;
"Effective Date" means the date of the Effective Time; "Preliminary
Prospectus" means each prospectus included in such registration
statement, or amendments thereof, before it became effective under the
Act and any prospectus filed with the Commission by the Company with
the consent of the Underwriters pursuant to Rule 424(a) of the Rules
and Regulations prior to the filing of the Prospectus; "Registration
Statement" means such registration statement, as amended at the
Effective Time, including any documents incorporated by reference
therein but excluding that part of the registration statement that
constitutes the Statement of Eligibility and Qualification ("Form T-
1") under the Trust Indenture Act of 1939, as amended (the "1939
Act"), of the Trustee; "Prospectus" means the prospectus relating to
the Notes, in the form in which it has most recently been filed, or
transmitted for filing, with the Commission on or prior to the date of
this Agreement; any reference herein to any Preliminary Prospectus or
the Prospectus shall be deemed to refer to and include the documents
incorporated by reference therein as of the date of such Preliminary
Prospectus or Prospectus, as the case may be; any reference to any
amendment or supplement to any Preliminary Prospectus or the
Prospectus shall be deemed to refer to and include any documents filed
after the date of such Preliminary Prospectus or Prospectus, as the
case may be, under the Securities Exchange Act of 1934, as amended
(the "Exchange Act"), and incorporated by reference in such
Preliminary Prospectus or Prospectus, as the case may be; any
reference to any amendment to the Registration Statement shall be
deemed to refer to and include any annual report of the Company filed
pursuant to Section 13(a) or 15(d) of the Exchange Act after the
effective date of the Registration Statement that is incorporated by
reference in the Registration Statement; and any reference to the
Prospectus as amended or supplemented shall be deemed to refer to the
Prospectus as amended or supplemented in relation to the Notes in the
form in which it is filed with the Commission pursuant to Rule 424(b)
under the Act in accordance with Section 5(a) hereof, including any
documents incorporated by reference therein as of the date of such
filing. The Commission has not issued any order preventing or
suspending the use of any Preliminary Prospectus or the Prospectus.
(b) The Registration Statement and the Prospectus conform, and
any amendments or supplements thereto will conform, in all material
respects with the requirements of the Act and the Rules and
Regulations, and at the Effective Time, the Registration Statement did
not include any untrue statement of a material fact or omit to state
any material fact required to be stated therein or necessary to make
the statements therein not misleading, and the Prospectus, as amended
or supplemented at the date hereof and the Closing Date, if
applicable, does not and will not contain any untrue statement of a
material fact or omit to state a material fact required to be stated
therein or necessary to make the statements contained therein, in the
light of the circumstances under which they were made, not misleading;
except that the foregoing does not apply to statements in or omissions
from the Registration Statement or the Prospectus, as amended or
supplemented if applicable, based upon written information furnished
to the Company by any Underwriter through you specifically for use
therein.
(c) The consolidated financial statements included in the
Registration Statement and Prospectus present fairly the consolidated
financial position of the Company and its consolidated subsidiaries as
at the dates indicated and the results of their operations and the
changes in their cash flow for the periods specified; said financial
statements have been prepared in conformity with generally accepted
accounting principles applied on a consistent basis during the periods
involved, except as indicated therein; and the supporting schedule
included in the Registration Statement presents fairly the information
required to be stated therein.
(d) Since the respective dates as of which information is given
in the Registration Statement and the Prospectus, except as otherwise
stated therein, (i) there has been no material adverse change in the
condition, financial or otherwise, earnings, affairs or business of
the Company and its subsidiaries considered as a whole, whether or not
arising in the ordinary course of business and (ii) there have been no
material transactions entered into by the Company or any of its
subsidiaries other than those, including acquisitions, in the ordinary
course of business.
(e) The Company has been duly incorporated and is validly
existing as a corporation in good standing under the laws of the State
of Louisiana with corporate power and authority to own, lease and
operate its properties and conduct its business as described in the
Registration Statement; and the Company is duly qualified as a foreign
corporation to transact business and is in good standing in each
jurisdiction in which it owns or leases properties or in which the
conduct of its business requires such qualification, except to the
extent that the failure to be so qualified or be in good standing
would not have a material adverse effect on the Company and its
subsidiaries considered as a whole.
(f) Each of the subsidiaries of the Company has been duly
incorporated or formed and is validly existing in good standing under
the laws of the jurisdiction of its incorporation or formation, with
full power and authority to own, lease and operate its properties and
conduct its business as described in the Registration Statement and is
duly qualified to transact business and is in good standing in each
jurisdiction in which it owns or leases properties or in which the
conduct of its business requires such qualification, except to the
extent that the failure to be so qualified or be in good standing
would not have a material adverse effect on the Company and its
subsidiaries considered as a whole; all of the issued and outstanding
capital stock of each corporate subsidiary has been duly authorized
and validly issued and is fully paid and nonassessable and, except as
set forth in SCHEDULE II hereto, all of the outstanding capital stock
or partnership interests of each subsidiary are owned by the Company,
directly or through subsidiaries, free and clear of any mortgage,
pledge, lien, encumbrance or claim.
(g) Neither the Company nor any of its subsidiaries is (i) in
violation of its or any of their charters, by-laws, partnership
agreements or other governing documents or (ii) in default in the
performance or observance of any obligation, agreement, covenant or
condition contained in any material contract, indenture, mortgage,
loan agreement, note, lease or other instrument to which it or any of
them is a party or by which it or any of them or their properties may
be bound (except in the case of violations or defaults that,
individually or in the aggregate, would not have a material adverse
effect on the condition, financial or otherwise, earnings, affairs or
business of the Company and its subsidiaries considered as a whole);
no consent, approval, authorization or order of any court or
governmental authority or agency is required for the consummation by
the Company of the transactions contemplated by this Agreement, except
such as may be required under the Act, the 1939 Act, the Rules and
Regulations or state securities or blue sky laws; and the execution
and delivery of this Agreement, the Indenture and the Notes and the
consummation of the transactions contemplated herein and therein will
not conflict with or constitute a breach of, or default under, or
result in the creation or imposition of any lien, charge or
encumbrance upon any property or assets of the Company or any of its
subsidiaries pursuant to, any material contract, indenture, mortgage,
loan agreement, note, lease or other instrument to which the Company
or any of its subsidiaries is a party or by which it or any of them
may be bound or to which any of the property or assets of the Company
or any of its subsidiaries is subject, nor will such action result in
any violation of or conflict with the provisions of the charter or
by-laws of the Company or any law, administrative regulation or
administrative or court decree.
(h) The Company and its subsidiaries possess adequate
certificates, authorities, licenses or permits issued by the
appropriate state, federal or foreign regulatory agencies or bodies
necessary to conduct the business now operated by them, and neither
the Company nor any of its subsidiaries has received any notice of
proceedings relating to the revocation or modification of any such
certificate, authority, license or permit that, singly or in the
aggregate, if the subject of an unfavorable decision, ruling or
finding, would materially adversely affect the condition, financial or
otherwise, earnings, affairs or business of the Company and its
subsidiaries considered as a whole.
(i) Except as set forth in the Prospectus, there is no action,
suit or proceeding before or by any court or governmental agency or
body, domestic or foreign, now pending or, to the knowledge of the
Company, threatened against or affecting the Company or any of its
subsidiaries, that might reasonably be expected to result in any
material adverse change in the condition, financial or otherwise,
earnings, affairs or business of the Company and its subsidiaries
considered as a whole, or might materially and adversely affect the
offering of the Notes; and there are no material contracts or other
documents that are required to be filed as exhibits to the
Registration Statement by the Act or by the Rules and Regulations that
have not been so filed.
(j) The Company and each of its subsidiaries has good and
marketable title in fee simple to all real property and good and
marketable title to all personal property owned by it and necessary in
the conduct of the business of the Company or such subsidiary in each
case free and clear of all liens, encumbrances and defects except
(i) such as are referred to in the Prospectus or (ii) such as do not
individually or in the aggregate have a material adverse effect on the
Company and its subsidiaries taken as a whole.
(k) This Agreement has been duly authorized, executed and
delivered by the Company and is a valid and binding agreement of the
Company, except as rights to indemnity hereunder may be limited by
applicable law and except as enforcement thereof may be limited by
bankruptcy, insolvency, reorganization, moratorium or other laws
relating to or affecting enforcement of creditors' rights generally or
by general equity principles.
(l) The Indenture has been duly qualified under the 1939 Act, has
been duly authorized and is a valid and binding agreement of the
Company enforceable against the Company in accordance with its terms,
except as enforcement thereof may be limited by bankruptcy,
insolvency, reorganization, moratorium or other laws relating to or
affecting enforcement of creditors' rights generally or by general
equity principles. The Supplemental Indenture to be executed on the
Closing Date will have been duly authorized and will be a valid and
binding agreement of the Company enforceable against the Company in
accordance with its terms, except as enforcement thereof may be
limited by bankruptcy, insolvency, reorganization, moratorium or other
laws relating to or affecting enforcement of creditors' rights
generally or by general equitable principles.
(m) The Notes have been duly and validly authorized by the
Company for issuance and sale to the Underwriters pursuant to this
Agreement and, when executed by the Company and authenticated by the
Trustee in accordance with the Indenture and delivered to the
Underwriters against payment therefor in accordance with the terms
hereof, will have been validly issued and delivered, free of any
preemptive or similar rights, and will constitute valid and binding
obligations of the Company, will be entitled to the benefits of the
Indenture and enforceable against the Company in accordance with their
terms, except as enforcement thereof may be limited by bankruptcy,
insolvency, reorganization or other similar laws relating to or
affecting the enforcement of creditors' rights generally or by general
equity principles. The Notes conform, or will conform, to the
description thereof in the Registration Statement and the Prospectus.
Neither the filing of the Registration Statement nor the offering or
sale of the Notes as contemplated by this Agreement gives rise to any
rights, other than those that have been duly waived or satisfied, for
or relating to the registration of any securities of the Company. The
capitalization of the Company as of the date of the most recent
balance sheet included in the Prospectus is as set forth in the
Prospectus. The Company has all requisite corporate power and
authority to issue, sell and deliver the Notes in accordance with and
upon the terms and conditions set forth in this Agreement and in the
Registration Statement and Prospectus. All corporate action required
to be taken by the Company for the authorization, issuance, sale and
delivery of the Notes to be sold by the Company hereunder has been
validly and sufficiently taken.
SECTION 3. PURCHASE, SALE AND DELIVERY OF NOTES. On the basis
of the representations, warranties and agreements herein contained, but
subject to the terms and conditions herein set forth, the Company agrees to
issue and sell to the Underwriters, and each Underwriter agrees, severally
and not jointly, to purchase from the Company at a purchase price of
99.077% of the principal amount per Note (the "purchase price per Note")
plus accrued interest, if any, from April 24, 1998 to the date of payment
and delivery, the respective principal amount of Notes set forth opposite
such Underwriter's name in SCHEDULE I hereto. The Company's obligation to
sell the Notes to the Underwriters on the Closing Date is conditioned upon
the execution and delivery on or prior to the Closing Date by the Company
and NationsBanc Montgomery Securities LLC ("NationsBanc") of the
Remarketing Agreement described in the preliminary prospectus supplement
relating to the Notes and upon the receipt by the Company of $5.8 million
from NationsBanc in connection therewith.
The Notes to be purchased by each Underwriter hereunder will be
represented by one or more definitive Global Certificates in book-entry
form which will be deposited by or on behalf of the Company with The
Depository Trust Company ("DTC") or its designated custodian. The Company
will deliver the Notes to NationsBanc for the account of each Underwriter,
against payment by or on behalf of such underwriter of the purchase price
therefor by wire transfer of immediately available funds to the account
specified by the Company, by causing DTC to credit the Notes to the account
of NationsBanc at DTC. The Company will cause the certificates
representing the Notes to be made available to NationsBanc for checking at
least twenty-four hours prior to the Closing Date at the office of DTC or
its designated custodian. The Closing Date and time shall be 9:00 a.m.,
New Orleans time, on April 24, 1998, or at such other date and time not
later than seven full business days thereafter as you and the Company
determine. The documents (other than the certificate(s) representing the
Notes) to be delivered on the Closing Date will be delivered at the offices
of Jones, Walker, Waechter, Poitevent, Carrere & Denegre L.L.P., and
the Notes will be delivered at the office of DTC or its designated
custodian.
SECTION 4. OFFERING BY UNDERWRITERS. The several Underwriters
will offer the Notes for sale to the public on the terms as set forth in
the Prospectus as amended or supplemented.
SECTION 5. COVENANTS OF THE COMPANY. The Company covenants and
agrees with the several Underwriters that:
(a) The Company will prepare a final prospectus supplement with
respect to the Notes in a form approved by you and will file such
prospectus supplement pursuant to Rule 424(b) under the Act by the
time required pursuant to Rule 424(b) under the Act. The Company will
advise you promptly of the filing or effectiveness of any amendment or
supplement to the Registration Statement or the Prospectus, the
receipt of any comments from the Commission with respect to the
Registration Statement or the Prospectus or any amendment or
supplement thereto, and of receipt of notification of the institution
by the Commission or any State of any stop order proceedings in
respect of the Registration Statement or the initiation or threatening
of any proceeding for such purpose, and will use every reasonable
effort to prevent the issuance of any such stop order and to obtain as
soon as possible its lifting, if issued. The Company will also notify
you promptly of any request by the Commission for any amendment of or
supplement to the Registration Statement or the Prospectus or for
additional information; the Company will prepare and file with the
Commission, promptly upon your request, any amendments or supplements
to the Registration Statement or the Prospectus which, in your
opinion, may be necessary or advisable in connection with the
distribution of the Notes; and the Company will not file any amendment
or supplement to the Registration Statement or the Prospectus or file
any document under the Exchange Act before the termination of the
offering of the Notes by the Underwriters if such document would be
deemed to be incorporated by reference into the Prospectus, which
filing is not consented to by you after reasonable notice thereof,
such consent not to be unreasonably withheld or delayed.
(b) If, during such period of time after the first date of the
public offering of the Notes as in the opinion of counsel for the
Underwriters a prospectus relating to the Notes is required by law to
be delivered in connection with sales by an Underwriter or dealer, any
event occurs as a result of which the Prospectus as then amended or
supplemented would, in the judgment of the Underwriters and their
counsel, include an untrue statement of a material fact, or omit to
state a material fact necessary to make the statements therein, in
light of the circumstances under which they were made, not misleading,
or if it is necessary at any time to amend the Prospectus to comply
with the Act or any other law, the Company promptly will prepare and
file with the Commission an amendment or supplement that will correct
such statement or omission or an amendment that will effect such
compliance and will notify you and, upon your request, prepare and
furnish without charge to each Underwriter and to any dealer in the
Notes as many copies as you may from time to time reasonably request
of an amended Prospectus or a supplement to the Prospectus that will
correct such statement or omission or effect such compliance.
(c) The Company will make generally available to the Company's
security holders (and shall deliver to you), in the manner
contemplated by Rule 158(b) under the Act or otherwise, as soon as
practicable but in any event not later than 45 days after the end of
its fiscal quarter in which the first anniversary date of the date the
Notes are released for sale occurs (or not later than 90 days after
the end of such fiscal quarter if such fiscal quarter is the last
fiscal quarter of the fiscal year), an earnings statement satisfying
the requirements of Section 11(a) of the Act and the Rules and
Regulations and covering a period of at least 12 consecutive months
beginning after the date the Notes are released for sale.
(d) The Company will deliver to each of you as many conformed
copies of the Registration Statement (as originally filed) and of each
amendment thereto (including exhibits filed therewith or incorporated
by reference therein) and of the Prospectus as you may reasonably
request, including a conformed copy of the Registration Statement and
each amendment thereto for each of the Underwriters.
(e) The Company will endeavor, in cooperation with you, to
qualify the Notes for offering and sale under the applicable
securities laws of such states and other jurisdictions of the United
States as you may designate, and will maintain such qualifications in
effect for as long as may be required for the distribution of the
Notes.
(f) During the period of three years hereafter, the Company will
furnish to you, and upon request to each of the other Underwriters, as
soon as practicable after the end of each fiscal year, a copy of its
annual report to stockholders for such year, and the Company will
furnish to you as soon as available, a copy of each report or
definitive proxy statement of the Company filed with the Commission
under the Exchange Act or mailed to stockholders.
(g) Until the termination of the offering of the Notes, the
Company shall timely file all documents and amendments to previously
filed documents required to be filed by it pursuant to Section 12, 13,
14 or 15(d) of the Exchange Act.
(h) The Company shall apply the net proceeds from the sale of the
Notes as set forth in the Prospectus.
SECTION 6. CONDITIONS OF THE OBLIGATIONS OF THE UNDERWRITERS.
The obligations of the several Underwriters to purchase and pay for the
Notes on the Closing Date will be subject to the accuracy of the
representations and warranties on the part of the Company herein as of the
date hereof and as of the Closing Date with the same force and effect as if
made as of that date, to the performance by the Company of its obligations
hereunder and to the following additional conditions precedent:
(a) The Registration Statement shall have become effective (or if
a post-effective amendment is required to be filed under the Act, such
post-effective amendment shall have become effective) not later than
5:00 p.m., New York time, on the date of this Agreement, or such later
time or date as shall have been consented to by you; and prior to the
Closing Date, no stop order suspending the effectiveness of the
Registration Statement shall have been issued and no proceedings for
that purpose shall have been instituted, or to the knowledge of the
Company or you, shall be contemplated by the Commission.
(b) You shall not have advised the Company that the Registration
Statement or Prospectus, or any amendment or supplement thereto,
contains an untrue statement of fact or omits to state a fact which,
you have concluded, is material and in the case of an omission is
required to be stated therein or is necessary to make the statements
therein not misleading.
(c) You shall have received a favorable opinion of Jones, Walker,
Waechter, Poitevent, Carrere & Denegre, L.L.P., counsel for the
Company ("Jones, Walker"), dated the Closing Date, to the effect that:
(i) The Company has been duly incorporated and is validly
existing as a corporation in good standing under the laws of
Louisiana with corporate power and authority to own, lease and
operate its properties and conduct its business as described in
the Registration Statement; and, to such counsel's knowledge
after due inquiry, the Company is duly qualified as a foreign
corporation to transact business and is in good standing in each
jurisdiction in which it owns or leases property or in which the
conduct of its business requires such qualification, except to
the extent that the failure to be so qualified or be in good
standing would not have a material adverse effect on the Company
and its subsidiaries considered as a whole.
(ii) Each of the subsidiaries of the Company listed on
SCHEDULE III hereto (the "Significant Subsidiaries") has been
duly incorporated and is validly existing as a corporation in
good standing under the laws of the jurisdiction of its
incorporation, has corporate power and authority to own, lease
and operate its properties and conduct its business as described
in the Registration Statement and, to such counsel's knowledge,
is duly qualified as a foreign corporation to transact business
and is in good standing in each jurisdiction in which it owns or
leases properties or in which the conduct of its business
requires such qualification, except to the extent that the
failure to be so qualified or be in good standing would not have
a material adverse effect on the condition, financial or
otherwise, or the earnings, business affairs or business of the
Company and its subsidiaries considered as a whole; all of the
issued and outstanding capital stock of each Significant
Subsidiary is held of record by the Company or a wholly owned
subsidiary of the Company and has been duly authorized and
validly issued and is fully paid and non-assessable, and all of
such capital stock, to their knowledge after due inquiry, is
owned by the Company or a wholly owned subsidiary of the Company
free and clear of any mortgage, pledge, lien, encumbrance, claim
or equity (other than those mortgages, pledges, liens,
encumbrances, claims or equities specifically noted in such
opinion).
(iii) All of the outstanding shares of capital stock of the
Company have been duly authorized and are validly issued, fully
paid and nonassessable. To such counsel's knowledge after due
inquiry, neither the filing of the Registration Statement nor the
offering or sale of the Notes as contemplated by this Agreement
gives rise to any rights, other than those which have been waived
or satisfied, for or relating to the registration of any
securities of the Company or any of its subsidiaries and, to
their knowledge, no person or entity (other than the
Underwriters) has the right, contractual or otherwise, to cause
the Company to sell or otherwise issue to such person or entity,
or permit such person or entity to underwrite the sale of, any of
the Notes. The authorized capital stock of the Company is as set
forth in the Prospectus, and the Notes conform as to legal
matters to the description thereof contained in the Prospectus.
The Company has all requisite corporate power and authority to
issue, sell and deliver the Notes in accordance with and upon the
terms and conditions set forth in this Agreement and in the
Registration Statement and Prospectus.
(iv) This Agreement has been duly authorized, executed and
delivered by the Company. The courts of Louisiana will give
effect to the choice of law provisions of this Agreement.
(v) The Indenture and the Supplemental Indenture have been
duly authorized, executed and delivered by the Company and has
been duly qualified under the 1939 Act. The courts of Louisiana
will give effect to the choice of law provisions of the Indenture
applicable to the Indenture and the Notes.
(vi) The Notes have been duly authorized and executed by the
Company for issuance and sale to the Underwriters.
(vii) The Registration Statement is effective under the Act
and, to such counsel's knowledge after due inquiry, no stop order
suspending the effectiveness of the Registration Statement has
been issued under the Act or proceedings therefor initiated or
threatened by the Commission. All required filings by the
Company under Rule 424(b) of the Rules and Regulations with
respect to the Notes have been timely made.
(viii) Statements set forth in the Prospectus under the
headings "Description of the ROARS" and "Description of Debt
Securities," in the Registration Statement in Item 15, under the
headings "Legal Proceedings" and "Regulation" in the Company's
Annual Report on Form 10-K for the fiscal year ended October 31,
1997, and under the heading "Legal Proceedings" in each of the
Company's Quarterly Reports on Form 10-Q filed with the
Commission since that time, which are incorporated by reference
into the Prospectus, insofar as such statements constitute a
summary of the legal matters, documents or proceedings referred
to therein, fairly present the information called for with
respect to such legal matters, documents and proceedings.
(ix) To such counsel's knowledge after due inquiry, no
consent, approval, authorization or order of any court or
governmental authority or agency is required in connection with
the transactions contemplated by this Agreement, except such as
may be required under the Act, the 1939 Act, the Rules and
Regulations or state securities or Blue Sky laws; and, to their
knowledge after due inquiry, the execution and delivery of this
Agreement, the Notes, the Indenture and the Supplemental
Indenture and the consummation of the transactions contemplated
herein will not conflict with or constitute a breach of, or
default under, or result in the creation or imposition of any
lien, charge or encumbrance upon any property or assets of the
Company or any of its subsidiaries pursuant to, any material
contract, indenture, mortgage, loan agreement, note, lease or
other instrument known to such counsel to which the Company or
any of its subsidiaries is a party or by which it or any of them
may be bound or to which any of the property or assets of the
Company or any of its subsidiaries is subject; nor will such
action result in any violation of the provisions of the charter
or by-laws of the Company, or any law, administrative regulation
or administrative or court decree known by such counsel to be
applicable to the Company.
(x) To such counsel's knowledge after due inquiry, there are
no legal or governmental proceedings pending or threatened to
which the Company or any of its subsidiaries is a party or to
which any of the properties of the Company is subject that are
required to be described in the Registration Statement or the
Prospectus and are not so described or any material contracts or
other documents that are required to be described in the
Registration Statement or the Prospectus or to be filed as an
exhibit to the Registration Statement that are not so described
or filed as required; and
(xi) The Registration Statement and any further amendments
thereto made by the Company at the time the Registration
Statement and each amendment thereto became effective and the
prospectus and any amendment or supplement thereto, on the date
of filing thereof with the Commission (except that in each case
no opinion need be expressed as to the financial statements,
financial statement schedule or notes to such financial
statements and other financial and statistical data contained
therein) and the Form T-1 complied as to form in all material
respects with the applicable requirements of the Act and the
Rules and Regulations and the 1939 Act and the rules and
regulations thereunder. Each document incorporated by reference
in the Registration Statement as filed under the Exchange Act
complied when so filed as to form in all material respects with
the applicable requirements of the Exchange Act and the rules and
regulations of the Commission thereunder (except that no opinion
need be expressed as to the financial statements or notes thereto
and other financial or statistical data contained therein). The
Company has satisfied the conditions for the use of Form S-3 set
forth in the general instructions thereto.
Such counsel shall also state that they have no reason to believe
that (i) the Registration Statement, as of the Effective Time, or any
amendment thereto, at the time it became effective, including in each
case any document filed under the Exchange Act and incorporated by
reference therein, contained any untrue statement of a material fact
or omitted to state any material fact required to be stated therein or
necessary in order to make the statements therein not misleading, or
(ii) the Prospectus or any supplement or amendment thereto, including
in each case any document filed under the Exchange Act and
incorporated by reference therein, on such Closing Date or at the time
such Prospectus or supplement or amendment thereto was issued contains
or contained any untrue statement of a material fact or omits or
omitted to state any material fact required to be stated therein or
necessary in order to make the statements therein, in light of the
circumstances under which they were made, not misleading.
Jones, Walker shall be entitled to rely on the opinion of Ogilvy
Renault S.E.N.C. in rendering the opinions expressed in (ii) with respect
to Le Groupe Stewart Inc.-Stewart Group Inc. and on the opinion of Henican
James & Cleveland L.L.P. in rendering the opinions expressed in (vii) with
respect to litigation, in the second clause of (ix) with respect to the
Company's revolving credit agreements described in the Prospectus and the
Company's agreements with the holders of its 6.04% Senior Notes and its
Senior Notes, Series A, B and C. Any opinions of Jones, Walker or Henican
James & Cleveland, L.L.P. with respect to litigation involving the Company,
when such litigation is not being handled by the firm rendering the
opinion, may be based solely upon discussions with the law firm that has
been retained by the Company to handle the litigation.
(d) You shall have received from Baker & Botts, L.L.P., counsel
for the Underwriters, an opinion, dated such Closing Date, with
respect to the matters set forth in (iv) (excluding the last
sentence), (v) (excluding the last sentence), (vi) and (viii) (but
only as to the statements in the Prospectus under "Description of the
ROARS"), with respect to the enforceability of this Agreement, the
Indenture and the Notes (containing such exceptions as you shall
approve), and with respect to the matters set forth in (xi) (excluding
the last sentence) and to the effect of the first unnumbered paragraph
following numbered paragraph (xi) of subsection (c) of this Section.
With respect to the penultimate unnumbered paragraph of
subsection (c) above and the similar provision of subsection (d)
above, Jones, Walker, Waechter, Poitevent, Carrere & Denegre,
L.L.P. and Baker & Botts, L.L.P. may state that their opinions and
beliefs are based upon their participation in the preparation of the
Registration Statement and Prospectus and any amendments or
supplements thereto and review and discussion of the contents thereof,
but is without independent check or verification except as specified.
(e) At the Closing Date, there shall not have been, since the
date of this Agreement or since the respective dates as of which
information is given in the Prospectus, any material adverse change in
the condition, financial or otherwise, earnings, business affairs or
business of the Company and its subsidiaries considered as a whole,
whether or not arising in the ordinary course of business, and you
shall have received a certificate of an executive officer of the
Company, dated as of the Closing Date, to the effect that (i) the
representations and warranties of the Company contained in Section 2
are true and correct with the same force and effect as though
expressly made on and as of the Closing Date, (ii) the Company has
performed or complied with all agreements and satisfied all conditions
on its part to be performed or satisfied at or prior to the Closing
Date and (iii) no stop order suspending the effectiveness of the
Registration Statement has been issued and no proceedings for that
purpose have been initiated or threatened by the Commission or any
State.
(f) You shall have received from Coopers & Lybrand L.L.P.,
independent public accountants, two letters, the first delivered the
day of but prior to the execution of, and dated the date of, this
Agreement and the other dated the Closing Date, addressed to the
Underwriters (with conformed copies for each of the Underwriters), in
form and substance satisfactory to you, to the effect that:
(i) They are independent public accountants with respect to
the Company and its subsidiaries within the meaning of the Act
and the Rules and Regulations.
(ii) In their opinion, the consolidated financial statements
and supporting schedule of the Company and its subsidiaries
examined by them and included or incorporated by reference in the
Registration Statement comply as to form in all material respects
with the applicable accounting requirements of the Act and the
Rules and Regulations with respect to registration statements on
Form S-3 and the Exchange Act and the rules and regulations
promulgated thereunder (the "Exchange Act Regulations").
(iii) They have performed specified procedures, not
constituting an audit, including a reading of the latest
available interim financial statements of the Company and its
indicated subsidiaries, a reading of the minute books of the
Company and such subsidiaries since the end of the most recent
fiscal year with respect to which an audit report has been
issued, inquiries of and discussions with certain officials of
the Company and such subsidiaries responsible for financial and
accounting matters with respect to the unaudited consolidated
financial statements included or incorporated by reference in the
Registration Statement and Prospectus and the latest available
interim unaudited financial statements of the Company and its
subsidiaries in accordance with Statement of Auditing Standards
No. 71, and such other inquiries and procedures as may be
specified in such letters, and on the basis of such inquiries and
procedures nothing came to their attention that caused them to
believe that: (A) the unaudited consolidated financial
statements of the Company and its subsidiaries included or
incorporated by reference in the Registration Statement and
Prospectus do not comply as to form in all material respects with
the applicable accounting requirements of the Exchange Act and
the Exchange Act Regulations or were not fairly presented in
conformity with generally accepted accounting principles in the
United States applied on a basis substantially consistent with
that of the audited financial statements included or incorporated
by reference therein, or (B) at a specified date not more than
five days prior to the date of such letters, there was any change
in the consolidated capital stock or any increase in consolidated
long-term debt of the Company and its subsidiaries or any
decrease in the consolidated net current assets or net assets of
the Company and its subsidiaries or any increases or decreases in
any other items specified by the Underwriters, in each case as
compared with the amounts shown on the most recent balance sheet
of the Company and its subsidiaries included or incorporated by
reference in the Registration Statement and Prospectus or, during
the period from the date of such balance sheet to a specified
date not more than five days prior to the date of such letters,
there were any decreases, as compared with the corresponding
period in the preceding year, in consolidated net revenues or the
total or per share amounts of consolidated net income of the
Company and its subsidiaries or any increases or decreases in any
other items specified by the Underwriters, except in each such
case as set forth in or contemplated by the Registration
Statement and Prospectus or except for such exceptions enumerated
in such letters as shall have been agreed to by the Underwriters
and the Company.
(iv) In addition to the examination referred to in their
report included or incorporated by reference in the Registration
Statement and the Prospectus, and the limited procedures referred
to in clause (iii) above, they have carried out certain other
specified procedures, not constituting an audit, with respect to
certain amounts, percentages and financial information which are
included or incorporated by reference in the Registration
Statement and Prospectus and which are specified by the
Underwriters, and have found such amounts, percentages and
financial information to be in agreement with the relevant
accounting, financial and other records of the Company and its
subsidiaries identified in such letters.
(g) At the Closing Date, counsel for the Underwriters shall have
been furnished with such other documents and opinions as they may
reasonably require.
(h) At the time of the Closing, the Notes shall have a rating of
at least Baa3 by Moody's Investors Service, Inc. and BBB by Standard &
Poor's Ratings Services, and the Company shall have delivered to the
Underwriters a letter, dated the Closing Date, from each such rating
agency or other evidence satisfactory to the Underwriters, confirming
such ratings. Since the Effective Date, there shall not have occurred
any downgrading with respect to any debt securities of the Company or
any of its subsidiaries by any "nationally recognized statistical
rating organization" as that term is defined by the Commission for
purposes of Rule 436(g)(2) under the Act or any public announcement
that any such organization has under surveillance or review its rating
of any such debt securities (other than an announcement with no
implication of a possible downgrading of such rating).
All such opinions, certificates, letters and documents shall be
in compliance with the provisions hereof only if they are satisfactory
in form and substance to you and to counsel for the Underwriters in
your and such counsel's reasonable discretion. The Company shall
furnish to you conformed copies of such opinions, certificates,
letters and other documents in such number as you shall reasonably
request. If any of the conditions specified in this Section 6 shall
not have been fulfilled when and as required by this Agreement, this
Agreement and all obligations of the Underwriters hereunder may be
canceled at, or at any time prior to, the Closing Date, by you. Any
such cancellation shall be without liability of the Underwriters to
the Company. Notice of such cancellation shall be given to the
Company in writing, or by telegraph or telephone and confirmed in
writing.
SECTION 7. PAYMENT OF EXPENSES. The Company will pay all costs,
expenses, fees and taxes incident to (i) the preparation by the Company,
printing, filing and distribution under the Act of the Registration
Statement (including financial statements and exhibits), the Prospectus,
each preliminary prospectus and all amendments and supplements to any of
them prior to or during the period specified in Section 5(b), (ii) the
preparation, printing and delivery of this Agreement, the Supplemental
Indenture, Preliminary and Supplemental Blue Sky Memoranda, the Notes and
all other agreements, memoranda, correspondence and other documents printed
and delivered in connection with the offering of the Notes, (iii) the
registration with the Commission, and the issuance by the Company of the
Notes (iv) the registration or qualification of the Notes for offer and
sale under the securities or Blue Sky laws of the several states as
described in Section 5(e) (including the reasonable fees and disbursements
of your counsel relating to such registration or qualification), (v) any
fees or expenses relating to the use of book-entry notes, (vi) the fees,
costs and charges of the Trustee, including the fees and disbursements of
counsel for the Trustee, (vii) the fees and expenses of rating agencies,
and (viii) all other costs and expenses incident to the performance by the
Company of its other obligations under this Agreement.
If this Agreement is terminated by you in accordance with the
provisions of Section 6 or Section 10(i), the Company shall reimburse you
for all of your out-of-pocket expenses, including the reasonable fees and
disbursements of counsel for the Underwriters.
SECTION 8. INDEMNIFICATION AND CONTRIBUTION. (a) The Company
agrees to indemnify and hold harmless each Underwriter and each person, if
any, who controls any Underwriter within the meaning of Section 15 of the
Act or Section 20 of the Exchange Act, from and against any and all losses,
claims, damages, liabilities and judgments (including, without limiting the
foregoing, the reasonable legal and other expenses incurred in connection
with any action, suit or proceeding or any claim asserted) arising out of
or caused by any untrue statement or alleged untrue statement in Section 2
hereof or any untrue statement or alleged untrue statement of a material
fact contained in the Registration Statement or the Prospectus 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 expenses are caused by any such untrue
statement or omission or alleged untrue statement or omission based upon
information furnished in writing to the Company by any Underwriter through
you expressly for use therein. This indemnity agreement will be in addition
to any liability which the Company may otherwise have to the persons
referred to above in this Section 8(a).
(b) Each Underwriter agrees, severally and not jointly, to
indemnify and hold harmless the Company, the directors of the Company, the
officers of the Company who sign the Registration Statement and each
person, if any, who controls the Company within the meaning of either
Section 15 of the Act or Section 20 of the Exchange Act from and against
any and all losses, claims, damages, liabilities and judgments (including,
without limiting the foregoing, the reasonable legal and other expenses
incurred in connection with any action, suit or proceeding or any claim
asserted) arising out of or caused by any untrue statement or alleged
untrue statement of a material fact contained in the Registration Statement
or the Prospectus (as amended or supplemented if the Company 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, but only with reference to and only to
the extent of information furnished to the Company in writing by such
Underwriter through you expressly for use in the Registration Statement,
the Prospectus, any amendment or supplement thereto, or any Preliminary
Prospectus.
(c) In case any action or proceeding (including any governmental
or regulatory investigation or proceeding) shall be instituted involving
any person in respect of which indemnity may be sought pursuant to either
of the two preceding paragraphs, such person (hereinafter called the
indemnified party) shall promptly notify the person against whom such
indemnity may be sought (hereinafter called the indemnifying party) in
writing and the indemnifying party shall be entitled to assume the defense
thereof and, upon request of the indemnified party, shall assume the
defense thereof, including the employment of counsel reasonably
satisfactory to the indemnified party to represent the indemnified party
and any others the indemnifying party may designate and shall pay the fees
and disbursements of such counsel related to such proceeding. In any such
action or proceeding, any indemnified party shall have the right to retain
its own counsel, but the fees and expenses of such counsel shall be at the
expense of such indemnified party unless (i) the indemnifying party and the
indemnified party shall have mutually agreed to the retention of such
counsel or (ii) the named parties to any such proceeding (including any
impleaded parties) include both the indemnifying party and the indemnified
party and representation of both parties by the same counsel would be
inappropriate due to actual or potential differing interests between them.
It is understood that the indemnifying party shall not, in connection with
any proceeding or related proceedings in the same jurisdiction, be liable
for (a) the reasonable fees and expenses of more than one separate firm (in
addition to one local counsel for each jurisdiction involved) for all
Underwriters and all persons, if any, who control Underwriters within the
meaning of either Section 15 of the Act or Section 20 of the Exchange Act
and (b) the reasonable fees and expenses of more than one separate firm (in
addition to one local counsel for each jurisdiction involved) for the
Company, its directors, its officers who sign the Registration Statement
and each person, if any, who controls the Company within the meaning of
either such Section and that all such fees and expenses shall be reimbursed
as they are incurred. In the case of any such separate firm for the
Underwriters and such control persons of Underwriters, such firm shall be
designated in writing by NationsBanc Montgomery Securities LLC In the case
of any such separate firm for the Company, and such directors, officers and
control persons of the Company, such firm shall be designated in writing by
the Company. The indemnifying party shall not be liable for any settlement
of any proceeding effected without its written consent, but if settled with
such consent or if there be a final judgment for the plaintiff, the
indemnifying party agrees to indemnify the indemnified party from and
against any loss or liability by reason of such settlement or judgment. No
indemnifying party shall, without the prior written consent of the
indemnified party, effect any settlement of any pending or threatened
proceeding in respect of which any indemnified party is or could have been
a party and indemnity could have been sought hereunder by such indemnified
party, unless such settlement includes an unconditional release of such
indemnified party from all liability on claims that are the subject matter
of such proceeding.
(d) If the indemnification provided for in this Section 8 is
unavailable to an indemnified party in respect of any losses, claims,
damages, liabilities or judgments referred to therein, then each
indemnifying party, in lieu of indemnifying such indemnified party, shall
contribute to the amount paid or payable by such indemnified party as a
result of such losses, claims, damages, liabilities and expenses (i) in
such proportion as is appropriate to reflect the relative benefits received
by the Company on the one hand and the Underwriter on the other from the
offering of the Notes or (ii) if the allocation provided by clause
(i) above is not permitted by applicable law, in such proportion as is
appropriate to reflect not only the relative benefits referred to in clause
(i) above but also the relative fault of the Company on the one hand and
the Underwriter on the other in connection with the statements or omissions
which resulted in such losses, claims, damages, liabilities or expenses, as
well as any other relevant equitable considerations. The relative benefits
received by the Company on the one hand and the Underwriter on the other
shall be deemed to be in the same proportions as the total net proceeds
from the offering (before deducting expenses) received by the Company bear
to the total underwriting discounts and commissions received by the
Underwriter, in each case as set forth in the table on the cover page of
the Prospectus. The relative fault of the Company on the one hand and the
Underwriter on the other shall be determined by reference to, among other
things, whether the untrue or alleged untrue statement of a material fact
or the omission to state a material fact relates to information supplied by
the Company or by the Underwriter and the parties' relative intent,
knowledge, access to information and opportunity to correct or prevent such
statement or omission.
(e) The Company and the Underwriters agree that it would not be
just and equitable if contribution pursuant to Section 8(d) were determined
by pro rata allocation or by any other method of allocation which does not
take account of the equitable considerations referred to in the immediately
preceding paragraph. The amount paid or payable by an indemnified party as
a result of the losses, claims, damages, liabilities or judgments referred
to in the immediately preceding paragraph shall be deemed to include,
subject to the limitations set forth above, any legal or other expenses
reasonably incurred by such indemnified party in connection with
investigating or defending any such action or claim. Notwithstanding the
provisions of Section 8(d), in no event shall any Underwriter be required
to contribute any amount in excess of the amount by which the total price
at which the Notes underwritten by it and distributed to the public were
offered to the public exceeds the amount of any damages which each
Underwriter has otherwise been required to pay by reason of such untrue or
alleged untrue statement or omission or alleged omission. No person guilty
of fraudulent misrepresentation (within the meaning of Section 11(f) of the
Act) shall be entitled to contribution from any person who was not guilty
of such fraudulent misrepresentation. The Underwriters' obligations to
contribute pursuant to Section 8(d) are several in proportion to the
respective number of Notes set forth opposite their names in SCHEDULE I
hereto.
SECTION 9. REPRESENTATIONS, WARRANTIES AND AGREEMENTS TO SURVIVE
DELIVERY. All representations, warranties and agreements contained in this
Agreement, or contained in certificates of officers of the Company
submitted hereto, including indemnity and contribution agreements, shall
remain operative and in full force and effect, regardless of any
termination of this Agreement, or any investigation made by or on behalf of
any Underwriter or any person controlling any Underwriter by or on behalf
of the Company, its officers or directors, and shall survive acceptance and
payment for the Notes hereunder.
SECTION 10. EFFECTIVENESS OF AGREEMENT AND TERMINATION. This
Agreement shall become effective upon execution and delivery hereof by the
parties hereto.
This Agreement may be terminated at any time prior to the Closing
Date by NationsBanc Montgomery Securities LLC upon the giving of written
notice of such termination to the Company, if at or prior to the Closing
Date (i) the Company shall have failed, refused or been unable to perform
any agreement on its part to be performed hereunder, (ii) any other
condition of the Underwriters' obligation hereunder is not fulfilled,
(iii) there has been, since the respective dates as of which information is
given in the Prospectus, any material adverse change in the condition,
financial or otherwise, earnings, business affairs or business prospects of
the Company and its subsidiaries considered as a whole, whether or not
arising in the ordinary course of business, (iv) there has occurred any
outbreak or escalation of hostilities involving the United States or the
declaration by the United States of a national emergency or war, or other
calamity or crisis or material change in existing financial, political,
economic or securities market conditions, the effect of which is such as to
make it, in the judgment of NationsBanc Montgomery Securities LLC,
impracticable or inadvisable to market the Notes in the manner contemplated
in the Prospectus or enforce contracts for the sale of the Notes, (v)
reporting of bid and asked prices of the Common Stock of the Company has
been suspended by the Commission or by the National Association of
Securities Dealers, Inc. or trading generally on either the American Stock
Exchange or the New York Stock Exchange has been suspended, or minimum or
maximum prices for trading have been fixed, or maximum ranges for prices
for securities have been required, by either of said exchanges or by order
of the Commission or any other governmental authority, or if a banking
moratorium has been declared by Federal, New York or Louisiana authorities
or (vi) if there shall have come to the attention of the Underwriters any
facts that would cause the Underwriters to believe that the Prospectus (as
amended or supplemented), at the time it was required to be delivered to a
purchaser of Notes, included an untrue statement of a material fact or
omitted to state a material fact necessary in order to make the statements
therein, in light of the circumstances existing at the time of such
delivery, not misleading. In the event of any such termination, the
provisions of Section 7, the indemnity agreement and contribution
provisions set forth in Section 8, and the provisions of Sections 9 and 14
shall remain in effect.
SECTION 11. DEFAULT. If, on the Closing Date, any one or more of
the Underwriters shall fail or refuse to purchase Notes that it or they
have agreed to purchase hereunder on such date, and the aggregate principal
amount of Notes which such defaulting Underwriter or Underwriters agreed
but failed or refused to purchase is not more than one-tenth of the
aggregate principal amount of the Notes to be purchased on such date, the
other Underwriters shall be obligated severally in the proportions that the
principal amount of Notes set forth opposite their respective names in
Schedule I bears to the aggregate principal amount of Notes set forth
opposite the names of all such non-defaulting Underwriters, or in such
other proportions as you may specify, to purchase the Notes which such
defaulting Underwriter or Underwriters agreed but failed or refused to
purchase on such date; provided that in no event shall the principal amount
of Notes that any Underwriter has agreed to purchase pursuant to Section 3
be increased pursuant to this Section 11 by an amount in excess of one-
ninth of such principal amount of Notes without the written consent of such
Underwriter. If, on the Closing Date any Underwriter or Underwriters shall
fail or refuse to purchase Notes and the aggregate principal amount of
Notes with respect to which such default occurs is more than one-tenth of
the aggregate principal amount of Notes to be purchased on such date, and
arrangements satisfactory to you and the Company for the purchase of such
Notes are not made within 36 hours after such default, this Agreement shall
terminate without liability on the part of any non-defaulting Underwriter
or the Company. In any such case either you or the Company shall have the
right to postpone the Closing Date, but in no event for longer than seven
days, in order that the required changes, if any, in the Registration
Statement and in the Prospectus or in any other documents or arrangements
may be effected. Any action taken under this paragraph shall not relieve
any defaulting Underwriter from liability in respect of any default of such
Underwriter under this Agreement.
SECTION 12. NOTICES. All notices and other communications
hereunder shall be in writing and shall be deemed to have been duly given
when received via mail or any standard form of telecommunication. Notices
to the Underwriters shall be directed to you c/o NationsBanc Montgomery
Securities LLC, 100 North Tryon Street, Charlotte, North Carolina 28255;
Attention: Syndicate; notices to the Company shall be directed to it at
Stewart Enterprises, Inc., 110 Veterans Boulevard, Metairie, Louisiana
70005, to the attention of the Chief Executive Officer with a copy to the
Edward N. George, Henican, James & Cleveland L.L.P., 111 Veterans
Boulevard, Suite 1200, Metairie, Louisiana 70005.
SECTION 13. PARTIES. This Agreement shall inure to the benefit
of and be binding upon the Company, the Underwriters, any controlling
persons referred to herein and their respective successors and assigns.
Nothing expressed or mentioned in this Agreement is intended or shall be
construed to give any other person, firm or corporation any legal or
equitable right, remedy or claim under or in respect of this Agreement or
any provision herein contained. This Agreement and all conditions and
provisions hereof are intended to be for the sole and exclusive benefit of
the parties hereto and respective successors and said controlling persons
and officers and directors and their heirs and legal representatives, and
for the benefit of no other person, firm or corporation. No purchaser of
Notes from any Underwriter shall be deemed to be a successor by reason
merely of such purchase.
SECTION 14. GOVERNING LAW. This Agreement and all the rights and
obligations of the parties shall be governed by and construed in accordance
with the laws of the State of New York applicable to agreements made and to
be performed in such State.
This Agreement may be signed in two or more counterparts each of which
shall be an original, with the same effect as if the signatures thereto and
hereto were upon the same instrument.
<PAGE>
If the foregoing is in accordance with your understanding of our
agreement, please sign this Agreement and return a counterpart hereof to
us, whereupon this instrument, along with all counterparts, will become a
binding agreement between the Underwriters and the Company in accordance
with its terms.
Very truly yours,
STEWART ENTERPRISES, INC.
By: /S/ Joseph P. Henican, III
--------------------------------
Name: Joseph P. Henican, III
Title: Chief Executive Officer and
Vice Chairman of the Board
Confirmed and Accepted, as of the date first above written:
NATIONSBANC MONTGOMERY SECURITIES LLC
BEAR, STEARNS & CO. INC.
CITICORP SECURITIES, INC.
Acting severally on behalf of
themselves and the several
Underwriters named herein.
By: NATIONSBANC MONTGOMERY SECURITIES LLC
By: /s/ Charles P. Drakos
----------------------------
Name: Charles P. Drakos
Title: Managing Director
REMARKETING AGREEMENT, dated as of April 24, 1998 (the
"Remarketing Agreement"), between:
STEWART ENTERPRISES, INC., a Louisiana corporation (the
"Company"); and
NATIONSBANC MONTGOMERY SECURITIES LLC ("NMS" and, in
its capacity as the remarketing dealer hereunder, the
"Remarketing Dealer").
WHEREAS, the Company has issued $200,000,000 aggregate
principal amount of its 6.40% Remarketable Or Redeemable
Securities Due May 1, 2013 (Remarketing Date May 1, 2003) (the
"ROARS")1 pursuant to an Indenture, dated as of December 1, 1996
(the "Indenture"), between the Company and Citibank, N.A., as
trustee (in such capacity, the "Trustee"), as supplemented by the
First Supplemental Indenture (the "Supplemental Indenture") dated
as of April 24, 1998 between the Company and the Trustee (as
supplemented, the "Indenture"); and
WHEREAS, the ROARS are being sold initially pursuant to
an underwriting agreement, dated April 21, 1998 (the
"Underwriting Agreement"), between the Company and the
underwriters named therein, including NMS; and
WHEREAS, the Company has filed with the Securities and
Exchange Commission (the "Commission") a registration statement
(No. 333-14467) under the Securities Act of 1933, as amended (the
"1933 Act"), in connection with the offering of Debt Securities,
including the ROARS, which registration statement was declared
effective by order of the Commission, and has filed such
amendments thereto and such amended prospectuses as may have been
required to the date hereof (such registration statement (No. 333-
14467), including any amendments and supplements thereto, and
including any preliminary or final prospectus relating to the
offering of Debt Securities by the Company constituting a part
thereof and all documents incorporated therein by reference, as
from time to time amended or supplemented pursuant to the
Securities Exchange Act of 1934, as amended (the "1934 Act"), the
1933 Act, or otherwise, are referred to herein as the
"Registration Statement" and the "Prospectus", respectively,
except that (i) if any new registration statement is filed by the
Company and declared effective by order of the Commission in
connection with the remarketing of the ROARS, the term
"Registration Statement" shall refer to such new registration
statement, from and after the time it becomes effective,
including all documents incorporated therein by reference, as
from time to time amended or supplemented, and (ii) if any
revised or supplemented prospectus shall be provided to the
Remarketing Dealer by the Company for use in connection with the
remarketing of the ROARS which differs from the Prospectus on
file at the Commission at the time the Registration Statement
became effective (whether or not such revised or supplemented
prospectus is required to be filed by the Company pursuant to
Rule 424(b) of the rules and regulations under the 1933 Act (the
"1933 Act Regulations")), the term "Prospectus" shall refer to
such revised or supplemented prospectus from and after the time
it is first provided to the Remarketing Dealer for such use, and
includes all documents incorporated therein by reference, as from
time to time amended or supplemented); and
WHEREAS, NMS is prepared to act as the Remarketing
Dealer with respect to the remarketing of the ROARS on May 1,
2003 (the "Remarketing Date") pursuant to the terms of, but
subject to the conditions set forth in, this Agreement;
NOW, THEREFORE, for and in consideration of the
covenants herein made, and subject to the conditions herein set
forth, the parties hereto agree as follows:
Section 1. Definitions. Capitalized terms used and
not defined in this Agreement shall have the meanings assigned to
them in the Indenture (including in the form of the ROARS issued
thereunder).
Section 2. Representations and Warranties.
(a) The Company represents and warrants to the
Remarketing Dealer as of the date hereof, the Notification Date
(as defined below), the Determination Date (as defined below),
the Remarketing Date and each date thereafter, if any, of an
amended prospectus supplement pursuant to Section 3(e) relating
to the ROARS (each of the foregoing dates being hereinafter
referred to as a "Representation Date"), that (i) it has made all
the filings with the Commission that it is required to make under
the 1934 Act and the rules and regulations thereunder (the "1934
Act Regulations") (collectively, and together with any voluntary
filings made by the Company under the 1934 Act, the "1934 Act
Documents"), (ii) each 1934 Act Document complies in all material
respects with the requirements of the 1934 Act and 1934 Act
Regulations, and each 1934 Act Document did not at the time of
filing with the Commission include an untrue statement of a
material fact or omit to state a material fact required to be
stated therein or necessary in order to make the statements
therein, in the light of the circumstances under which they were
made, not misleading, and (iii) the Prospectus will not, as of
the Remarketing Date and each date thereafter, if any, of an
amended prospectus supplement pursuant to Section 3(e) relating
to the ROARS, include an untrue statement of a material fact or
omit to state a material fact required to be stated therein or
necessary in order to make the statements therein, in the light
of the circumstances under which they were made, not misleading.
(b) The Company further represents and warrants to the
Remarketing Dealer as of each Representation Date as follows:
(i) The accountants who certified the financial
statements and supporting schedules included or incorporated
by reference in the 1934 Act Documents are independent
public accountants as required by the 1933 Act and the 1933
Act Regulations.
(ii) The consolidated financial statements included or
incorporated by reference in the Registration Statement and
Prospectus, together with any related schedules and notes,
present fairly the consolidated financial condition and
results of operations of the Company and its consolidated
subsidiaries at the dates indicated and the results of their
operations and the changes in their cash flow for the
periods specified and comply with the applicable accounting
requirements of the 1933 Act; said financial statements have
been prepared in conformity with generally accepted
accounting principles ("GAAP") applied on a consistent basis
throughout the periods involved, except as expressly
described therein. Any supporting schedules included or
incorporated by reference in the 1934 Act Documents present
fairly in accordance with GAAP the information required to
be stated therein. Any pro forma financial statements and
the related notes thereto included or incorporated by
reference in the 1934 Act Documents present fairly the
information shown therein, have been prepared in accordance
with the Commission's rules and guidelines with respect to
pro forma financial statements and have been properly
compiled on the bases described therein, and the assumptions
used in the preparation thereof are reasonable and the
adjustments used therein are appropriate to give effect to
the transactions and circumstances referred to therein.
(iii) Since the respective dates as of which
information is given in the Registration Statement and the
Prospectus (including documents incorporated therein by
reference), except as otherwise stated therein, (x) there
has been no material adverse change in the condition,
financial or otherwise, earnings, affairs or business of the
Company and its subsidiaries considered as a whole, whether
or not arising in the ordinary course of business, and (y)
there have been no material transactions entered into by the
Company or any of its subsidiaries other than those,
including acquisitions, in the ordinary course of business.
(iv) The Company has been duly incorporated and is
validly existing and in good standing under the laws of the
State of Louisiana with corporate power and authority to
own, lease and operate its properties and conduct its
business as described in the Registration Statement; and the
Company is duly qualified as a foreign corporation to
transact business and is in good standing in each
jurisdiction in which it owns or leases property or in which
the conduct of its business requires such qualification,
except to the extent that the failure to be so qualified or
be in good standing would not have a material adverse effect
on the condition, financial or otherwise, earnings, affairs
or business of the Company and its subsidiaries considered
as a whole (a "Material Adverse Effect"), whether or not
arising in the ordinary course of business.
(v) Each of the subsidiaries of the Company has been
duly incorporated or formed and, is validly existing and in
good standing under the laws of the jurisdiction of its
incorporation or formation, is duly qualified to do business
and in good standing as a foreign corporation in each
jurisdiction in which its ownership of property or conduct
of its business requires such qualification (except where
the failure to so qualify or be in good standing would not
have a Material Adverse Effect), and has power and authority
necessary to own, lease or operate its properties, to
conduct the business in which it is engaged; except as
otherwise disclosed in the 1934 Act Documents, all of the
issued and outstanding capital stock of each corporate
subsidiary that is held of record by the Company or a
subsidiary of the Company has been duly authorized and
validly issued, is fully paid and nonassessable, except to
the extent failure to be would not have a Material Adverse
Effect, and such capital stock or equity interests in each
subsidiary that are owned by the Company, directly or
through subsidiaries, are held free and clear of any
mortgage, pledge, lien, encumbrance or claim not permitted
by the Indenture.
(vi) This Agreement has been duly authorized, executed
and delivered by the Company.
(vii) The Indenture has been validly authorized,
executed and delivered by the Company and duly qualified
under the Trust Indenture Act of 1939, as amended (the "1939
Act"), and, assuming it has been duly executed and delivered
by the Trustee, constitutes the legally binding obligation
of the Company.
(viii) The ROARS have been validly authorized and
executed by the Company and authenticated, issued and
delivered in the manner provided for in the Indenture and
delivered against payment of the purchase price therefor as
provided in the Underwriting Agreement, and constitute
legally binding obligations of the Company entitled to the
benefits of the Indenture.
(ix) Neither the Company nor any of its subsidiaries
is in violation of its corporate charter or by-laws or in
default under any agreement, indenture or instrument, except
for such violations or defaults that would not result in a
Material Adverse Effect; and the execution, delivery and
performance of this Agreement, the Indenture and the ROARS
and the consummation of the transactions contemplated herein
and in the Prospectus (including the issuance and sale of
the ROARS and the use of the proceeds from the sale thereof
as described in the Prospectus under the caption "Use of
Proceeds") have been duly authorized by all necessary
corporate action and do not and will not conflict with or
constitute a breach of, or default under, or result in the
creation or imposition of any lien, charge or encumbrance
upon any property or assets of the Company or any such
subsidiary pursuant to, any material agreement, indenture or
instrument to which the Company or any such subsidiary is a
party or by which it is bound or to which any of its
property or assets is subject, nor will such action result
in a material violation of the charter or by-laws of the
Company or any such subsidiary or any order, rule or
regulation of any court or governmental agency having
jurisdiction over the Company or any such subsidiary or its
property.
(x) Except as set forth in the Prospectus (including
documents incorporated therein by reference), there is no
action, suit or proceeding before any court or governmental
agency or body, domestic or foreign, now pending, or, to the
knowledge of the Company, threatened, against or affecting
the Company or any subsidiary, that might reasonably be
expected to result in any material adverse change in the
condition, financial or otherwise, earnings, affairs or
business of the Company and its subsidiaries considered as a
whole, or which might reasonably be expected to materially
and adversely affect the consummation of the transactions
contemplated in this Agreement or the performance by the
Company of its obligations hereunder.
(xi) No consent, approval, authorization, order or
decree of, or filing or registration with, any court or
governmental agency or body is required for the execution,
delivery and performance by the Company of this Agreement
and the Indenture or the consummation of the transactions
contemplated hereby and thereby or in connection with the
remarketing of the ROARS pursuant hereto, except such as
have been already obtained or will be obtained as of the
time required.
(xii) The Company and its subsidiaries possess
adequate certificates, authorities, licenses or permits
issued by the appropriate state, federal or foreign
regulatory agencies or bodies necessary to conduct the
business now operated by them, and neither the Company nor
any of its subsidiaries has received any notice of
proceedings relating to the revocation or modification of
any such certificate, authority, license or permit that,
singly or in the aggregate, if the subject of an unfavorable
decision, ruling or finding, would have a Material Adverse
Effect.
(xiii) The Company and each of its subsidiaries has
good and marketable title in fee simple to all real property
and good and marketable title to all personal property owned
by it and necessary in the conduct of the business of the
Company or such subsidiary in each case free and clear of
all liens, encumbrances and defects except (x) such as are
referred to in the Prospectus (including documents
incorporated therein by reference) or (y) such as do not
individually or in the aggregate have a Material Adverse
Effect.
(xiv) Neither the Company nor any of its subsidiaries
is an "investment company" or an entity "controlled" by an
"investment company" as such terms are defined in the
Investment Company Act of 1940, as amended.
(xv) The ROARS are rated at least "Baa3" by Moody's
Investors Service, Inc., at least "BBB" by Standard &
Poor's, a division of The McGraw-Hill Companies, Inc., or,
in each case, such other rating as to which the Company
shall have most recently notified the Remarketing Dealer
pursuant to Section 3(a) hereof.
(c) Any certificate signed by any director or officer
of the Company and delivered to the Remarketing Dealer or to
counsel for the Remarketing Dealer in connection with the
remarketing of the ROARS shall be deemed a representation and
warranty by the Company to the Remarketing Dealer as to the
matters covered thereby.
Section 3. Covenants of the Company. The Company
covenants with the Remarketing Dealer as follows:
(a) The Company will provide prompt notice by
telephone, confirmed in writing (which may include facsimile or
other electronic transmission), to the Remarketing Dealer of the
occurrence at any time of any event set forth in clause (i), (ii)
or (v) or the first subclause of clause (iii) of Section 8(d) of
this Agreement.
(b) The Company will furnish to the Remarketing Dealer
promptly upon its request:
(i) the Registration Statement, the Prospectus and any
prospectus supplement relating to the ROARS (including in
each case any amendment or supplement thereto, each exhibit
thereto and each document incorporated therein by
reference);
(ii) copies of each report or other document,
including each 1934 Act Document, mailed to or filed by the
Company with the Commission after the date hereof (including
in each case any exhibit attached thereto and document
incorporated therein by reference); and
(iii) in connection with the Remarketing Dealer's due
diligence described below relating to the remarketing of
the ROARS, such other information as the Remarketing Dealer
may reasonably request from time to time, in such form as
the Remarketing Dealer may reasonably request, including,
but not limited to, the financial condition of the Company
or any subsidiary thereof.
The Company agrees to provide the Remarketing Dealer with as many
copies of the foregoing written materials and other Company-
approved information as the Remarketing Dealer may reasonably
request for use in connection with the remarketing of ROARS and
consents to the use thereof in compliance with any applicable
laws for such purpose and agrees to provide the Remarketing
Dealer with the opportunity to perform customary due diligence
with respect to the Company and its subsidiaries from time to
time in advance of the Remarketing Date as the Remarketing Dealer
may reasonably request.
(c) If, at any time from the Notification Date through
the end of the 45 Business Day period described in (e) below, any
event or condition known to the Company relating to or affecting
the Company, any subsidiary thereof or the ROARS shall occur
which would reasonably be expected to cause the Prospectus to
contain an untrue statement of a material fact or omit to state a
material fact, the Company shall promptly notify the Remarketing
Dealer in writing of the circumstances and details of such event
or condition.
(d) So long as the ROARS are outstanding, the Company
will file all documents required to be filed with the Commission
pursuant to the 1934 Act within the time periods required by the
1934 Act and the 1934 Act Regulations.
(e) The Company will comply with the 1933 Act and the
1933 Act Regulations, the 1934 Act and the 1934 Act Regulations
and the 1939 Act and the rules and regulations of the Commission
thereunder so as to permit the completion of the remarketing of
the ROARS as contemplated in this Agreement and in each
Prospectus. Except as provided below, if at any time when a
prospectus is required by the 1933 Act to be delivered in
connection with sales of the ROARS on or after the Remarketing
Date, any event shall occur or condition shall exist as a result
of which it is necessary, in the reasonable opinion of counsel
for the Remarketing Dealer or for the Company, to amend the
Registration Statement or amend or supplement any Prospectus in
order that such Prospectus will not include any untrue statements
of a material fact or omit to state a material fact necessary in
order to make the statements therein not misleading in the light
of the circumstances existing at the time it is delivered to a
purchaser, or if it shall be necessary, in the opinion of such
counsel, at any such time to amend the Registration Statement or
file a new registration statement or amend or supplement any
Prospectus or issue a new prospectus in order to comply with the
requirements of the 1933 Act or the 1933 Act Regulations and the
Commission's interpretations of the 1933 Act and the 1933 Act
Regulations, the Company, at its expense, will promptly (i)
prepare and file with the Commission such amendment or supplement
as may be necessary to correct such statement or omission or to
make the Registration Statement or any such Prospectus comply
with such requirements, or prepare and file any such new
registration statement and prospectus as may be necessary for
such purpose and (ii) furnish to the Remarketing Dealer such
number of copies of such amendment, supplement or other document
as the Remarketing Dealer may reasonably request; provided that
(a) the Company shall be obligated to perform the agreements set
forth in (i) and (ii) above during the period ending on the 45th
Business Day after the Remarketing Date, and (b) subsequent to
the 45th Business Day after the Remarketing Date, the Company may
suspend its obligation to comply with the agreements set forth in
(i) and (ii) above and the Remarketing Dealer shall suspend the
use of the Prospectus or any sales of the ROARS that would
require the delivery of a prospectus under the 1933 Act if (x) in
the reasonable opinion of counsel to the Company, the Company
would be required to amend the Registration Statement or amend or
supplement any Prospectus to disclose (A) information relating to
corporate developments or business transactions involving the
Company or its subsidiaries that is not otherwise then required
by law to be publicly disclosed, or (B) financial or other
information relating to parties to such business transactions
that is not readily available to the Company, and (y) in the good
faith judgment of the Chief Executive Officer or Chief Financial
Officer of the Company, such disclosure at such time could
materially and adversely affect the Company or any such corporate
development or business transaction contemplated by the Company
or its subsidiaries, or such disclosure would be unduly
burdensome or impracticable for the Company to provide. If the
Remarketing Dealer has elected to remarket the ROARS and the
Company has not elected to redeem the ROARS, and if as of the
Remarketing Date the Company is obligated, pursuant to the
preceding provisions of this paragraph, to file and have declared
effective a new registration statement or to provide the
Remarketing Dealer with a Prospectus, then the Company shall, at
its expense, on the Remarketing Date furnish to the Remarketing
Dealer an officers' certificate, an opinion, including a
statement relating to the absence of material misstatements in or
omissions from the Registration Statement and the Prospectus, of
counsel for the Company reasonably satisfactory to the
Remarketing Dealer and a "comfort letter" from the Company's
independent accountants, in each case in form and substance
reasonably satisfactory to the Remarketing Dealer, of the same
tenor as the officers' certificate, opinion and comfort letter,
respectively, delivered pursuant to the Underwriting Agreement,
but modified to relate to the Registration Statement and each
Prospectus as amended or supplemented to the date thereof or such
new registration statement and Prospectus.
(f) The Company agrees that neither it, nor any of its
subsidiaries or affiliates whose ownership would cause the ROARS
to be deemed to be no longer outstanding, shall defease, purchase
or otherwise acquire, or enter into any agreement to defease,
purchase or otherwise acquire, any of the ROARS prior to the
remarketing thereof by the Remarketing Dealer, other than
pursuant to Section 4(g) or 4(h) of this Agreement.
(g) The Company will comply with each of the covenants
set forth in the Underwriting Agreement.
Section 4. Appointment and Obligations of the
Remarketing Dealer.
(a) Unless this Agreement is otherwise terminated in
accordance with Section 11 hereof, in accordance with the terms,
but subject to the conditions, of this Agreement, the Company
hereby appoints NMS, and NMS hereby accepts such appointment, as
the exclusive Remarketing Dealer with respect to $200,000,000
aggregate principal amount of ROARS, subject further to
redemption of the ROARS in accordance with clause (g) or (h) of
this Section 4.
(b) The obligations of the Remarketing Dealer
hereunder with respect to the ROARS to be remarketed on the
Remarketing Date are conditioned on (i) the issuance and delivery
of such ROARS pursuant to the terms and conditions of the
Underwriting Agreement and (ii) the Remarketing Dealer's election
on the Notification Date to purchase the ROARS for remarketing on
the Remarketing Date. If the Remarketing Dealer has elected to
remarket the ROARS pursuant to clause (c) below, the Remarketing
Dealer shall not be obligated to set the Interest Rate to
Maturity (as defined below) on any ROARS, to remarket any ROARS
or to perform any of the other duties set forth herein at any
time after the Notification Date in the event that (i) any of the
conditions set forth in clause (a), (b) or (c) of Section 8
hereof shall not have been fully and completely met to the
reasonable satisfaction of the Remarketing Dealer, or (ii) any of
the events set forth in clause (d) of Section 8 hereof shall have
occurred after the Remarketing Dealer makes such election.
(c) If the Remarketing Dealer notifies the Company
and the Trustee on the fifth Business Day prior to the
Remarketing Date (the "Notification Date"), no later than 4:00
p.m. New York City time, of its intention to purchase all but not
less than all the ROARS on the Remarketing Date, all of the ROARS
shall be subject to mandatory tender to the Remarketing Dealer
for purchase and remarketing on the Remarketing Date, and the
Remarketing Dealer shall purchase the ROARS on the Remarketing
Date, upon the terms and subject to the conditions described
herein. The purchase price of the ROARS shall be equal to 100%
of the aggregate principal amount thereof, and the Company shall
pay interest on the ROARS as described in Section 4(f) herein.
(d) If the Remarketing Dealer elects to remarket the
ROARS as provided in clause (c) above, by 3:30 p.m., New York
City time, on the third Business Day immediately preceding the
Remarketing Date (the "Determination Date"), the Remarketing
Dealer shall determine the Interest Rate to Maturity to the
nearest thousandth (0.001) of one percent per annum. The
"Interest Rate to Maturity" shall be equal to the sum of 5.44%
(the "Base Rate") and the Applicable Spread (as defined below),
which will be based on the Dollar Price (as defined below) of the
ROARS.
The "Applicable Spread" shall be the lowest bid
indication, expressed as a spread (in the form of a
percentage or in basis points) above the Base Rate, obtained
by the Remarketing Dealer on the Determination Date from the
bids quoted by five Reference Corporate Dealers (as defined
below) for the full aggregate principal amount of the ROARS
at the Dollar Price, but assuming (i) an issue date that is
the Remarketing Date, with settlement on such date without
accrued interest, (ii) a maturity date that is the Stated
Maturity Date and (iii) a stated annual interest rate equal
to the Base Rate plus the spread bid by the applicable
Reference Corporate Dealer. If fewer than five Reference
Corporate Dealers bid as described above, then the
Applicable Spread shall be the lowest of such bid
indications obtained as described above. The Interest Rate
to Maturity announced by the Remarketing Dealer, absent
manifest error, shall be binding and conclusive upon the
actual purchasers of the ROARS ("Beneficial Owners") and
Holders of the ROARS, the Company and the Trustee.
"Comparable Treasury Issues" means the United States
Treasury security or securities selected by the Remarketing
Dealer as having an actual or interpolated maturity or
maturities comparable to the remaining term of the ROARS
being purchased by the Remarketing Dealer.
"Comparable Treasury Price" means, with respect to the
Remarketing Date, (a) the offer prices for the Comparable
Treasury Issues (expressed in each case as a percentage of
its principal amount) on the Determination Date, as set
forth on "Telerate Page 500" (or such other page as may
replace Telerate Page 500), or (b) if such page (or any
successor page) is not displayed or does not contain such
offer prices on the Determination Date, (i) the average of
the Reference Treasury Dealer Quotations (as defined below)
for the Remarketing Date, after excluding the highest and
lowest such Reference Treasury Dealer Quotations, or (ii) if
the Remarketing Dealer obtains fewer than four such
Reference Treasury Dealer Quotations, the average of all
such Reference Treasury Dealer Quotations. "Telerate Page
500" means the display designated as "Telerate Page 500" on
Dow Jones Markets (or such other page as may replace
Telerate Page 500 on such service) or such other service
displaying the offer prices specified in (a) above as may
replace Dow Jones Markets.
"Dollar Price" means, with respect to the ROARS, the
present value, as of the Remarketing Date, of the Remaining
Scheduled Payments (as defined below) discounted to the
Remarketing Date on a semi-annual basis (assuming a 360-day
year consisting of twelve 30-day months) at the Treasury
Rate (as defined below).
"Reference Corporate Dealer" means each of NationsBanc
Montgomery Securities LLC, Bear, Stearns & Co. Inc.,
Citicorp Securities, Inc. and two others to be selected by
the Company at a later date and their respective successors;
provided that if any of the foregoing or their affiliates
shall cease to be a leading dealer of publicly traded debt
securities of the Company (a "Primary Corporate Dealer"),
the Remarketing Dealer shall substitute therefor another
Primary Corporate Dealer.
"Reference Treasury Dealer" means each of NationsBanc
Montgomery Securities LLC, Bear, Stearns & Co. Inc.,
Citicorp Securities, Inc. and two others to be selected by
the Company at a later date and their respective successors;
provided that if any of the foregoing or their affiliates
shall cease to be a primary U.S. Government securities
dealer (a "Primary Treasury Dealer"), the Remarketing Dealer
shall substitute therefor another Primary Treasury Dealer.
"Reference Treasury Dealer Quotations" means, with
respect to each Reference Treasury Dealer and the
Remarketing Date, the offer prices for the Comparable
Treasury Issues (expressed in each case as a percentage of
its principal amount) quoted in writing to the Remarketing
Dealer by such Reference Treasury Dealer by 3:30 p.m., on
the Determination Date.
"Remaining Scheduled Payments" means, with respect to
the ROARS, the remaining scheduled payments of the principal
thereof and interest thereon, calculated at the Base Rate
only, that would be due after the Remarketing Date to and
including the Stated Maturity Date; provided that if the
Remarketing Date is not an Interest Payment Date with
respect to the ROARS, the amount of the next succeeding
scheduled interest payment thereon, calculated at the Base
Rate only, will be reduced by the amount of interest accrued
thereon, calculated at the Base Rate only, to the
Remarketing Date.
"Treasury Rate" means, with respect to the Remarketing
Date, the rate per annum equal to the semi-annual equivalent
yield to maturity or interpolated (on a day count basis)
yield to maturity of the Comparable Treasury Issues,
assuming a price for the Comparable Treasury Issues
(expressed as a percentage of its principal amount), equal
to the Comparable Treasury Price for the Remarketing Date.
(e) If the Remarketing Dealer elects to remarket the
ROARS as provided in clause (c) above, the Remarketing Dealer
shall notify the Company, the Trustee and The Depository Trust
Company ("DTC") by telephone, confirmed in writing (which may
include facsimile or other electronic transmission), by 4:00
p.m., New York City time, on the Determination Date of the
Interest Rate to Maturity applicable to the ROARS effective from
and including the Remarketing Date.
(f) If the Remarketing Dealer elects to remarket the
ROARS as provided in clause (c) above, then, subject to the
conditions in Section 8 and the Company's rights in Section 4(h),
the Remarketing Dealer shall deliver the purchase price for the
ROARS to the Trustee by 3:00 p.m. New York City time on the
Business Day immediately preceding the Remarketing Date for
payment to the DTC participant of each Beneficial Owner of ROARS,
through DTC in accordance with the procedures of DTC against
delivery or deemed delivery through DTC of such Beneficial
Owner's ROARS. The purchase price of the ROARS shall be equal to
100% of the aggregate principal amount thereof. The Company
shall make, or cause the Trustee to make, payment of interest due
on the Remarketing Date to each Beneficial Owner of ROARS by book
entry through DTC by the close of business on the Remarketing
Date.
(g) Subject to Section 11(c) of this Agreement, in the
event that (i) the Remarketing Dealer for any reason does not
notify the Company of the Interest Rate to Maturity by 4:00 p.m.,
New York City time, on the Determination Date, (ii) prior to the
Remarketing Date, the Remarketing Dealer resigns and no successor
has been appointed on or before the Determination Date, (iii) at
any time after the Remarketing Dealer elects on the Notification
Date to remarket the ROARS, the Remarketing Dealer shall have
elected to terminate this Agreement as provided in Section 11(b),
(iv) the Remarketing Dealer for any reason does not elect, by
notice to the Company and the Trustee not later than 4:00 p.m.
New York City time on the Notification Date, to purchase the
ROARS for remarketing on the Remarketing Date, (v) the
Remarketing Dealer for any reason does not deliver the purchase
price of the ROARS to the Trustee by 3:00 p.m. New York City time
on the Business Day immediately preceding the Remarketing Date,
or (vi) the Company for any reason fails to pay for and redeem
the ROARS following the Company's election to effect such
redemption as specified in Section 4(h) of this Agreement, the
Company shall redeem the ROARS from the holders as a whole on the
Remarketing Date at a price equal to 100% of the aggregate
principal amount of the ROARS plus all accrued and unpaid
interest, if any, on the ROARS to the Remarketing Date. In any
such case, payment will be made by the Company through the
Trustee to the DTC participant of each Beneficial Owner of ROARS,
by book-entry through DTC by the close of business on the
Remarketing Date against delivery through DTC of such Beneficial
Owner's ROARS.
(h) If the Remarketing Dealer elects to remarket the
ROARS as provided in clause (c) above, then not later than 4:00
p.m. New York City time on the Business Day immediately preceding
the Determination Date, the Company shall notify the Remarketing
Dealer and the Trustee if the Company irrevocably elects to
exercise its right to redeem the ROARS, in whole but not in part,
on the Remarketing Date. If the Company gives such notice to the
Remarketing Dealer and the Trustee, then (i) the Remarketing
Dealer will be deemed to have elected not to remarket the ROARS,
(ii) the Company shall redeem the ROARS from the holders as a
whole on the Remarketing Date at a price equal to 100% of the
aggregate principal amount of the ROARS plus all accrued and
unpaid interest, if any, on the ROARS to the Remarketing Date
(such payment to be made by the Company through the Trustee to
the DTC participant of each Beneficial Owner of ROARS, by book-
entry through DTC by the close of business on the Remarketing
Date against delivery through DTC of such Beneficial Owner's
ROARS) and (iii) the Company will pay the Calculation Amount to
the Remarketing Dealer as provided in Section 11(e) of this
Agreement.
(i) The tender and settlement procedures set forth in
this Section 4, including provisions for payment by purchasers of
ROARS in the remarketing or for payment to the selling Beneficial
Owners of ROARS, shall be subject to modification to the extent
required by DTC or, if the book-entry system is no longer
available for the ROARS at the time of the remarketing, to the
extent required to facilitate the tendering and remarketing of
ROARS in certificated form. In addition, the Remarketing Dealer
may modify (with the consent of the Trustee to the extent
required by the Indenture) the settlement procedures set forth in
the Indenture and/or the ROARS in order to facilitate the
settlement process in any manner not contrary to the Indenture or
adverse to the interests of the Holders of the ROARS; provided,
that such procedures must, in the reasonable opinion of the
Company, allow the Company sufficient time to fund the redemption
of the ROARS on the Remarketing Date.
(j) The Company will (i) use its best efforts to
maintain the ROARS in book-entry form with DTC or any successor
thereto and to appoint a successor depository to the extent
necessary to maintain the ROARS in book-entry form and (ii) waive
any discretionary right it otherwise may have under the Indenture
to cause the ROARS to be issued in certificated form.
Section 5. Fees and Expenses. Subject to Section 11
of this Agreement, for its services in performing its duties set
forth herein, the Remarketing Dealer will not receive any fees or
reimbursement of expenses from the Company.
Section 6. Resignation of the Remarketing Dealer. The
Remarketing Dealer may resign and be discharged from its duties
and obligations hereunder at any time, such resignation to be
effective 10 Business Days after delivery of a written notice to
the Company and the Trustee of such resignation. The Remarketing
Dealer also may resign and be discharged from its duties and
obligations hereunder at any time, such resignation to be
effective immediately, upon termination of this Agreement in
accordance with Section 11(b) hereof. It shall be the sole
obligation of the Company to appoint a successor Remarketing
Dealer.
Section 7. Dealing in the ROARS; Purchase of ROARS by
the Company.
(a) NMS, when acting as the Remarketing Dealer or in
its individual or any other capacity, may, to the extent
permitted by law, buy, sell, hold and deal in any of the ROARS.
NMS, as Holder or Beneficial Owner of the ROARS, may exercise any
vote or join as a Holder or Beneficial Owner, as the case may be,
in any action which any Holder or Beneficial Owner of ROARS may
be entitled to exercise or take pursuant to the Indenture with
like effect as if it did not act in any capacity hereunder. The
Remarketing Dealer, in its capacity either as principal or agent,
may also engage in or have an interest in any financial or other
transaction with the Company as freely as if it did not act in
any capacity hereunder.
(b) Neither the Company nor any of its affiliates may
agree to purchase ROARS from any Reference Corporate Dealer
during the period of time they are submitting a bid in connection
with the remarketing contemplated by this Agreement unless the
Remarketing Dealer is able to confirm that the Applicable Spread
established in such remarketing would not be different than the
Applicable Spread that would have been established had neither
the Company nor any of its affiliates agreed to purchase ROARS
from any such Reference Corporate Dealer in such remarketing.
Section 8. Conditions to Remarketing Dealer's
Obligations. The obligations of the Remarketing Dealer under
this Agreement have been undertaken in reliance on, and shall be
subject to, (a) the due performance in all material respects by
the Company of its obligations and agreements as set forth in
this Agreement and the accuracy on each Representation Date of
the representations and warranties in this Agreement and any
certificate delivered pursuant hereto, (b) the due performance in
all material respects by the Company of its obligations and
agreements set forth in, and the accuracy in all material
respects as of the dates specified therein of the representations
and warranties contained in, the Underwriting Agreement, (c) the
submission of a bid by at least one Reference Corporate Dealer on
the Determination Date to purchase the full aggregate principal
amount of the ROARS at the Dollar Price, and (d) the further
condition that none of the following events shall have occurred
after the Remarketing Dealer elects on the Notification Date to
remarket the ROARS:
(i) the rating of any securities of the Company shall
have been down graded or put under surveillance or review
with negative implications, including being put on what is
commonly termed a "watch list," or withdrawn by a nationally
recognized statistical rating agency;
(ii) without the prior written consent of the
Remarketing Dealer, the Indenture (including the ROARS)
shall have been amended in any manner, or otherwise contain
any provision not contained therein as of the date hereof,
that in either case in the reasonable judgment of the
Remarketing Dealer materially changes the nature of the
ROARS or the remarketing procedures (it being understood
that, notwithstanding the provisions of this clause (ii),
the Company shall not be prohibited from amending the
Indenture);
(iii) trading in any securities of the Company shall
have been suspended or materially limited by the Commission,
or if trading generally on the American Stock Exchange or
the New York Stock Exchange or in the Nasdaq National Market
shall have been suspended or materially limited, or minimum
or maximum prices for trading shall have been fixed, or
maximum ranges for prices shall have been required, by any
of said exchanges or by such system or by order of the
Commission, the National Association of Securities Dealers,
Inc. or any other governmental authority, or if a banking
moratorium shall have been declared by either Federal or New
York authorities;
(iv) there shall have occurred any material adverse
change in the financial markets in the United States, any
outbreak of hostilities involving the United States or
escalation thereof or other calamity or crisis or any
material change in existing national or international
political, financial or economic conditions, in each case
the effect of which is such as to make it, in the reasonable
judgment of the Remarketing Dealer, impracticable to
remarket the ROARS or to enforce contracts for the sale of
the ROARS;
(v) an Event of Default, or any event which, with the
giving of notice or passage of time, or both, would
constitute an Event of Default, with respect to the ROARS
shall have occurred and be continuing;
(vi) a material adverse change in the condition,
financial or otherwise, earnings, affairs or business of the
Company and its subsidiaries considered as a whole, whether
or not arising in the ordinary course of business, the
effect of which is such as to make it, in the reasonable
judgment of the Remarketing Dealer, impracticable to
remarket the ROARS or to enforce contracts for the sale of
the ROARS, shall have occurred since the Notification Date
or since the respective dates as of which information is
given in the 1934 Act Documents;
(vii) if required pursuant to Section 3(e) of this
Agreement, the Company shall fail to furnish to the
Remarketing Dealer on the Remarketing Date the officers'
certificate, opinion and comfort letter referred to in
Section 3(e) of this Agreement and such other documents and
opinions as counsel for the Remarketing Dealer may
reasonably require for the purpose of enabling such counsel
to pass upon the sale of ROARS in the remarketing as herein
contemplated and related proceedings, or in order to
evidence the accuracy and completeness of any of the
representations and warranties, or the fulfillment of any of
the conditions, herein contained; and the Remarketing Dealer
shall have failed to receive on the Remarketing Date a
certificate of the Chairman of the Board, the Chief
Executive Officer, the President, the Chief Financial
Officer or a Vice President of the Company, and the
Treasurer or an Assistant Treasurer of the Company, dated as
of the Remarketing Date, to the effect that (i) the
representations and warranties in this Agreement are true
and correct with the same force and effect as though
expressly made at and as of the Remarketing Date, (ii) the
Company has complied with all agreements and satisfied all
conditions on its part to be performed or satisfied under
this Agreement at or prior to the Remarketing Date and (iii)
none of the events specified in the preceding clause (d) has
occurred; or
(viii) the ROARS are not maintained in book-entry form
with DTC or any successor thereto; provided, that the
Remarketing Dealer, in its sole discretion and subject to
receipt of an opinion of counsel for the Company reasonably
satisfactory to the Remarketing Dealer, may waive the
foregoing condition if in the Remarketing Dealer's judgment
the Indenture and the ROARS can be amended, and they are
amended, so as to permit the remarketing of the ROARS in
certificated form and otherwise as contemplated herein.
(e) In furtherance of the foregoing, the effectiveness
of the Remarketing Dealer's election on the Notification Date to
remarket the ROARS shall be subject to the condition that the
Remarketing Dealer shall have received a certificate of the
Chairman of the Board, the Chief Executive Officer, the
President, the Chief Financial Officer, or a Vice President of
the Company, and the Treasurer or an Assistant Treasurer of the
Company, dated as of the Notification Date, to the effect that
(i) the Company has, prior to the Remarketing Dealer's election
on the Notification Date to remarket the ROARS, provided the
Remarketing Dealer with notice of all events as required under
Section 3(a) of this Agreement, (ii) the representations and
warranties in this Agreement are true and correct at and as of
the Notification Date and (iii) the Company has complied with all
agreements and satisfied all conditions on its part to be
performed or satisfied under this Agreement at or prior to the
Notification Date. Such certificate shall be delivered by the
Company to the Remarketing Dealer as soon as practicable
following notification by the Remarketing Dealer to the Company
on the Notification Date of its election to remarket the ROARS
and in any event prior to the Determination Date.
In the event of the failure of any of the foregoing
conditions in this Section 8, the Remarketing Dealer may
terminate its obligations under this Agreement or redetermine the
Interest Rate to Maturity as provided in Section 11.
Section 9. Indemnification.
(a) The Company agrees to indemnify and hold harmless
the Remarketing Dealer and its officers, directors and employees
and each person, if any, who controls the Remarketing Dealer
within the meaning of Section 20 of the 1934 Act (the
"Remarketing Dealer Indemnitees") against any loss, liability,
claim, damage and expense whatsoever, as incurred, arising out of
(i) any untrue statement or alleged untrue statement of a
material fact contained in the Registration Statement or the
Prospectus (including any incorporated documents), or (ii) the
omission or alleged omission therefrom of a material fact
necessary to make the statements therein, in the light of the
circumstances in which they were made, not misleading, or (iii)
the acts or omissions of the Remarketing Dealer in connection
with its duties and obligations to determine the Interest Rate to
Maturity hereunder except to the extent finally judicially
determined to be due to its gross negligence or willful
misconduct, and will reimburse the Remarketing Dealer Indemnitees
for expenses reasonably incurred in investigating or defending
against any such loss, liability, claim or damage, as incurred,
including the reasonable fees and disbursements of counsel;
provided that the foregoing indemnity shall not apply to any
losses, liabilities, claims, damages and expenses to the extent
arising out of any untrue statement or omission or alleged untrue
statement or omission made in reliance upon and in conformity
with written information furnished to the Company by the
Remarketing Dealer expressly for use in the Registration
Statement or the Prospectus.
(b) The Remarketing Dealer agrees to indemnify and
hold harmless the Company, its directors and each of its officers
who signed the Registration Statement (the "Company Indemnitees")
from and against any loss, liability, claim, damage and expense,
as incurred, and will reimburse the Company Indemnitees for
expenses reasonably incurred in investigating or defending
against any such loss, liability, claim or damage, as incurred,
including the reasonable fees and disbursements of counsel, but
only with respect to untrue statements or omissions or alleged
untrue statements or omissions made in the Registration Statement
or the Prospectus in reliance upon and in conformity with
information furnished to the Company in writing by the
Remarketing Dealer expressly for use in such Registration
Statement or the Prospectus. The indemnity agreement in this
clause (b) shall extend upon the same terms and conditions to
each person, if any, who controls the Company within the meaning
of Section 20 of the 1934 Act.
(c) In case any action or proceeding (including any
governmental or regulatory investigation or proceeding) shall be
instituted involving any person in respect of which indemnity may
be sought pursuant to this Section 9, such person (hereinafter
called the indemnified party) shall promptly notify the person
against whom such indemnity may be sought (hereinafter called the
indemnifying party) in writing and the indemnifying party shall
be entitled to assume the defense thereof and, upon request of
the indemnified party, shall assume the defense thereof,
including the employment of counsel reasonably satisfactory to
the indemnified party to represent the indemnified party and any
others the indemnifying party may designate and shall pay the
fees and disbursements of such counsel related to such
proceeding. In any such action or proceeding, any indemnified
party shall have the right to retain its own counsel, but the
fees and expenses of such counsel shall be at the expense of such
indemnified party unless (i) the indemnifying party and the
indemnified party shall have mutually agreed to the retention of
such counsel or (ii) the named parties to any such proceeding
(including any impleaded parties) include both the indemnifying
party and the indemnified party and representation of both
parties by the same counsel would be inappropriate due to actual
or potential differing interests between them. In no event shall
the indemnifying parties be liable for fees and expenses of more
than one counsel (in addition to any local counsel) separate from
their own counsel for all indemnified parties in connection with
any one action or separate but similar or related actions in the
same jurisdiction arising out of the same general allegations or
circumstances. In the case of any such separate counsel for the
Remarketing Dealer Indemnitees, such counsel shall be designated
in writing by the Remarketing Dealer. In the case of any such
separate counsel for the Company Indemnitees, such counsel shall
be designated in writing by the Company. The indemnifying party
shall not be liable for any settlement of any proceeding effected
without its written consent, but if settled with such consent or
if there be a final judgment for the plaintiff, the indemnifying
party agrees to indemnify the indemnified party from and against
any loss or liability by reason of such settlement or judgment in
accordance with this Agreement. No indemnifying party shall,
without the prior written consent of the indemnified parties,
settle or compromise or consent to the entry of any judgment with
respect to any litigation, or any investigation or proceeding by
any governmental agency or body, commenced or threatened, or any
claim whatsoever in respect of which indemnification or
contribution could be sought under this Section 9 or Section 10
hereof (whether or not the indemnified parties are actual or
potential parties thereto), unless such settlement, compromise or
consent (i) includes an unconditional release of each indemnified
party from all liability arising out of such litigation,
investigation, proceeding or claim and (ii) does not include a
statement as to or an admission of fault, culpability or a
failure to act by or on behalf of any indemnified party.
(d) The indemnity agreements contained in this
Section 9 shall remain operative and in full force and effect,
regardless of any investigation made by or on behalf of the
Remarketing Dealer or the Company, and shall survive the
termination or cancellation of this Agreement and the remarketing
of any ROARS hereunder.
Section 10. Contribution. If the indemnification
provided for in Section 9 hereof is for any reason unavailable to
or insufficient to hold harmless an indemnified party in respect
of any losses, liabilities, claims, damages or expenses referred
to therein, then each indemnifying party shall contribute to the
aggregate amount of such losses, liabilities, claims, damages and
expenses incurred by such indemnified party, as incurred, (i) in
such proportion as is appropriate to reflect the relative
benefits received by the Company on the one hand and the
Remarketing Dealer on the other hand from the remarketing of the
ROARS pursuant to this Agreement or (ii) if the allocation
provided by clause (i) is not permitted by applicable law, in
such proportion as is appropriate to reflect not only the
relative benefits referred to in clause (i) above but also the
relative fault of the Company on the one hand and of the
Remarketing Dealer on the other hand in connection with the acts,
failures to act, statements or omissions which resulted in such
losses, liabilities, claims, damages or expenses, as well as any
other relevant equitable considerations.
The relative benefits received by the Company on the one
hand and the Remarketing Dealer on the other hand in connection
with the remarketing of the ROARS pursuant to this Agreement
shall be deemed to be in the same respective proportions as (i)
the total net proceeds from the initial offering (before
deducting expenses) of the ROARS received by the Company, and
(ii) (A) the aggregate positive difference, if any, between the
price at which the ROARS are sold by the Remarketing Dealer in
the remarketing and the price paid by the Remarketing Dealer for
the ROARS on the Remarketing Date, plus (B) the total
underwriting discount and commissions received by the Remarketing
Dealer in the initial offering of the ROARS.
The relative fault of the Company on the one hand and the
Remarketing Dealer on the other hand shall be determined by
reference to, among other things, the responsibility hereunder of
the applicable party for any act or failure to act relating to
the losses, liabilities, claims, damages or expenses incurred or,
in the case of any losses, liabilities, claims, damages or
expenses arising out of any untrue or alleged untrue statement of
a material fact contained in the Registration Statement or the
Prospectus or the omission or alleged omission to state a
material fact therefrom, whether any such untrue or alleged
untrue statement of a material fact or omission or alleged
omission to state a material fact relates to information supplied
by the Company or by the Remarketing Dealer and the parties'
relative intent, knowledge, access to information and opportunity
to correct or prevent such statement or omission.
The Company and the Remarketing Dealer agree that it would
not be just and equitable if contribution pursuant to this
Section 10 were determined by pro rata allocation or by any other
method of allocation which does not take account of the equitable
considerations referred to above in this Section 10. The
aggregate amount of losses, liabilities, claims, damages and
expenses incurred by an indemnified party and referred to above
in this Section 10 shall be deemed to include any legal or other
expenses reasonably incurred by such indemnified party in
investigating, preparing or defending against any litigation, or
any investigation or proceeding by any governmental agency or
body, commenced or threatened, or any claim whatsoever based upon
any such act or failure to act or untrue or alleged untrue
statement or omission or alleged omission.
Notwithstanding the provisions of this Section 10, the
Remarketing Dealer shall not be required to contribute any amount
in excess of the amount by which the total price at which the
ROARS remarketed by it and resold to the public were sold to the
public exceeds the amount of any damages which the Remarketing
Dealer has otherwise been required to pay by reason of any act or
failure to act for which it is responsible hereunder or any
untrue or alleged untrue statement or omission or alleged
omission.
No person guilty of fraudulent misrepresentation (within the
meaning of Section 10(f) of the 1933 Act) shall be entitled to
contribution from any person who was not guilty of such
fraudulent misrepresentation.
For purposes of this Section 10, each person, if any, who
controls the Remarketing Dealer within the meaning of Section 15
of the 1933 Act or Section 20 of the 1934 Act shall have the same
rights to contribution as the Remarketing Dealer, and each
director of the Company, each officer of the Company who signed
the Registration Statement, and each person, if any, who controls
the Company within the meaning of Section 15 of the 1933 Act or
Section 20 of the 1934 Act shall have the same rights to
contribution as the Company.
Section 11. Termination of Remarketing Agreement or
Redetermination of Interest Rate to Maturity.
(a) This Agreement shall terminate as to the
Remarketing Dealer on the effective date of the resignation of
the Remarketing Dealer pursuant to Section 6 hereof or the
redemption of the ROARS by the Company pursuant to Section 4(g)
or 4(h) hereof or at 4:00 p.m. New York City time on the fifth
Business Day prior to the Remarketing Date if the Remarketing
Dealer has not elected to remarket the ROARS.
(b) In addition, the Remarketing Dealer may terminate
all of its obligations under this Agreement immediately by
notifying the Company and the Trustee of its election to do so,
at any time on or before the Remarketing Date, in the event that:
(i) any of the conditions referred to or set forth in
Section 8(a), (b) or (c) hereof have not been met or satisfied in
full, (ii) any of the events set forth in Section 8(d) shall have
occurred after the Remarketing Dealer elects on the Notification
Date to remarket the ROARS or (iii) the Remarketing Dealer
determines, in its reasonable discretion, after consultation with
the Company, that it shall not have received from the Company all
of the information it has requested, whether or not specifically
referenced herein, necessary to satisfy its due diligence
obligation under the 1933 Act in connection with the remarketing
of the ROARS or to fulfill its obligations under this Agreement.
(c) Notwithstanding any provision herein to the
contrary, in lieu of terminating this Agreement pursuant to
Section 11(b) above, upon the occurrence of any of the events set
forth therein, the Remarketing Dealer, in its sole discretion at
any time between the Determination Date and 10:30 a.m., New York
City time, on the Business Day immediately preceding the
Remarketing Date, may elect to purchase the ROARS for remarketing
and determine a new Interest Rate to Maturity in the manner
provided in Section 4(d) of this Agreement, except that for
purposes of determining the new Interest Rate to Maturity
pursuant to this paragraph the Determination Date referred to
therein shall be the date of such election and redetermination.
The Remarketing Dealer shall notify the Company, the Trustee and
DTC by telephone, confirmed in writing (which may include
facsimile or other electronic transmission), by 11:00 a.m., New
York City time, on the date of such election, of the new Interest
Rate to Maturity applicable to the ROARS. Thereupon, such new
Interest Rate to Maturity shall supersede and replace any
Interest Rate to Maturity previously determined by the
Remarketing Dealer and, absent manifest error, shall be binding
and conclusive upon the Beneficial Owners and Holders of the
ROARS on and after the Remarketing Date, the Company and the
Trustee; provided that the Remarketing Dealer, by redetermining
the Interest Rate to Maturity upon the occurrence of any event
set forth in Section 11(b) as set forth above, shall not thereby
be deemed to have waived its right to determine a new Interest
Rate to Maturity or terminate this Agreement upon the subsequent
occurrence of any other event set forth in Section 11(b). If the
Remarketing Dealer elects to purchase the ROARS in accordance
with this clause (c), the Company will retain the right to redeem
the ROARS as specified in Section 4(h) of this Agreement, subject
to the terms and conditions applicable to such redemption as
specified in this Agreement, provided that such election shall be
made no later than 12:30 p.m. New York City time on the Business
Day immediately preceding the Remarketing Date.
(d) If this Agreement is terminated pursuant to this
Section 11, such termination shall be without liability of any
party to any other party, except that, in the case of termination
pursuant to Section 11(b) of this Agreement, the Company shall
reimburse the Remarketing Dealer for all of its reasonable out-of-
pocket expenses incurred in connection with this Agreement or the
remarketing of the ROARS pursuant to this Agreement, including
the reasonable fees and disbursements of counsel for the
Remarketing Dealer, and except further as set forth in
Section 11(e) below. Sections 1, 9, 10, 11(d) and 11(e) shall
survive such termination and remain in full force and effect.
(e) In the case of either (i) termination of this
Agreement pursuant to Section 11(b), (ii) the occurrence, prior
to the Remarketing Dealer's election on the Notification Date to
remarket the ROARS, of any event set forth in Section 8(d)(ii) or
(v), (iii) any redemption or any failure by the Company to redeem
the ROARS following any election by the Company to effect such
redemption as specified in Section 4(h) (each a "Calculation
Event"), the Company shall immediately following the Calculation
Amount Determination Date (as defined below) pay the Remarketing
Dealer, in same-day funds by wire transfer to an account
designated by the Remarketing Dealer, the fair market value,
calculated as set forth below, of the Remarketing Dealer's right
to purchase and remarket the ROARS pursuant to this Agreement
(the "Calculation Amount").
The Calculation Amount will be determined by the Remarketing
Dealer in good faith and on a commercially reasonable basis and
will be equal to an amount, if any, that would be paid by the
Remarketing Dealer in consideration of an agreement between the
Remarketing Dealer and a Reference Corporate Dealer (other than
the Remarketing Dealer) to enter into a transaction that would
have the effect of preserving for the Remarketing Dealer the
economic equivalent of any payment or delivery (whether the
underlying obligation was absolute or contingent) by the
Remarketing Dealer and the Beneficial Owners that would, but for
the occurrence of the Calculation Event, have been required on
the Remarketing Date; provided that, if the Calculation Amount is
being determined with respect to a Calculation Event occurring on
or after the Remarketing Dealer's election on the Notification
Date to remarket the ROARS, the Calculation Amount will be equal
to the excess, if any, of (x) the Dollar Price over (y) the
aggregate principal amount of the ROARS then outstanding. In
determining the Calculation Amount, the Remarketing Dealer will
be entitled to assume that the ROARS are obligations issued by
the United States Department of the Treasury backed by the full
faith and credit of the United States of America. The
Remarketing Dealer shall determine the applicable Calculation
Amount as soon as practicable after the occurrence of any of the
events as described in (i) through (iii) in the preceding
paragraph (the "Calculation Amount Determination Date"). The
Remarketing Dealer shall promptly notify the Company of the
Calculation Amount Determination Date and the Calculation Amount
by telephone, confirmed in writing (which may include facsimile
or other electronic transmission). The Calculation Amount,
absent manifest error, shall be binding and conclusive upon the
parties hereto.
The parties acknowledge that there is no set of
circumstances under this Agreement whereby the Company would be
required to pay the Calculation Amount in the event that the
Remarketing Agent completes the purchase of the ROARS on the
Remarketing Date as contemplated hereby.
(f) This Agreement may not be terminated by the
Company.
Section 12. Remarketing Dealer's Performance; Duty of
Care. The duties and obligations of the Remarketing Dealer shall
be determined solely by the express provisions of this Agreement
and the Indenture. No implied covenants or obligations of or
against the Remarketing Dealer shall be read into this Agreement
or the Indenture. In the absence of bad faith on the part of the
Remarketing Dealer, the Remarketing Dealer may conclusively rely
upon any document furnished to it, which purports to conform to
the requirements of this Agreement and the Indenture, as to the
truth of the statements expressed in any of such documents. The
Remarketing Dealer shall be protected in acting upon any document
or communication reasonably believed by it to have been signed,
presented or made by the proper party or parties. In connection
with this Agreement, the Remarketing Dealer shall incur no
liability to the Company or to any Beneficial Owner or Holder of
ROARS in its individual capacity or as Remarketing Dealer for any
action or failure to act in connection with the remarketing or
otherwise, except that the foregoing shall not relieve the
Remarketing Dealer from (a) its obligations under Sections 4(d),
4(e) and 4(f) or (b) liability as a result of any gross
negligence or willful misconduct on its part.
Section 13. GOVERNING LAW. THIS AGREEMENT SHALL BE
GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE
STATE OF NEW YORK APPLICABLE TO CONTRACTS MADE AND TO BE
PERFORMED IN SUCH STATE.
Section 14. Term of Agreement. Unless otherwise
terminated in accordance with the provisions hereof, this
Agreement shall remain in full force and effect from the date
hereof until the earlier of the first day thereafter on which no
ROARS are outstanding or the completion of the remarketing of the
ROARS. Regardless of any termination of this Agreement pursuant
to any of the provisions hereof, the obligations of the Company
pursuant to Sections 9, 10, 11(d) and 11(e) hereof shall remain
operative and in full force and effect until fully satisfied.
Section 15. Successors and Assigns. The rights and
obligations of the Company hereunder may not be assigned or
delegated to any other person without the prior written consent
of the Remarketing Dealer. The rights and obligations of the
Remarketing Dealer hereunder may not be assigned or delegated to
any other person without the prior written consent of the
Company. This Agreement shall inure to the benefit of and be
binding upon the Company and the Remarketing Dealer and their
respective successors and assigns, and will not confer any
benefit upon any other person, partnership, association or
corporation other than persons, if any, controlling the
Remarketing Dealer within the meaning of Section 15 of the 1933
Act or Section 20 of the 1934 Act, or any indemnified party to
the extent provided in Section 9 hereof, or any person entitled
to contribution to the extent provided in Section 10 hereof. The
terms "successors" and "assigns" shall not include any purchaser
of any ROARS merely because of such purchase.
Section 16. Headings. Section headings have been
inserted in this Agreement as a matter of convenience of
reference only, and it is agreed that such section headings are
not a part of this Agreement and will not be used in the
interpretation of any provisions of this Agreement.
Section 17. Severability. If any provision of this
Agreement shall be held or deemed to be or shall, in fact, be
invalid, inoperative or unenforceable as applied in any
particular case in any or all jurisdictions because it conflicts
with any provision of any constitution, statute, rule or public
policy or for any other reason, such circumstances shall not have
the effect of rendering the provision in question invalid,
inoperative or unenforceable in any other case, circumstance or
jurisdiction, or of rendering any other provision or provisions
of this Agreement invalid, inoperative or unenforceable to any
extent whatsoever.
Section 18. Counterparts. This Agreement may be
executed in several counterparts, each of which shall be regarded
as an original and all of which shall constitute one and the same
document.
Section 19. Amendments. This Agreement may be amended
by any instrument in writing signed by each of the parties hereto
so long as this Agreement as amended is not inconsistent with the
Indenture in effect as of the date of any such amendment.
Section 20. Notices. Unless otherwise specified, any
notices, requests, consents or other communications given or made
hereunder or pursuant hereto shall be made in writing (which may
include facsimile or other electronic transmission) and shall be
deemed to have been validly given or made when delivered or
mailed, registered or certified mail, return receipt requested
and postage prepaid, addressed as follows:
(a) to the Company:
Stewart Enterprises, Inc.
110 Veterans Memorial Boulevard
Metairie, Louisiana 70005
Telephone: (504) 837-5880
Facsimile: (504) 849-2307
Attention: Chief Executive Officer
(b) to NMS:
NationsBanc Montgomery Securities LLC
100 North Tryon Street
Charlotte, North Carolina 28255
Telephone: 704-386-9690
Facsimile: 704-388-0502
Attention: Syndicate
or to such other address as the Company or the Remarketing Dealer
shall specify in writing.
IN WITNESS WHEREOF, each of the Company and the Remarketing
Dealer has caused this Remarketing Agreement to be executed in
its name and on its behalf by one of its duly authorized officers
as of the date first above written.
STEWART ENTERPRISES, INC.
By /s/ Ronald H. Patron
-----------------------------
Title: Chief Financial Officer,
President - Corporate Division and
Executive Vice President
NATIONSBANC MONTGOMERY
SECURITIES LLC
By /s/ Jeffrey M. Kane
-----------------------------
Title: Managing Director
1/Service Mark of NationsBanc Montgomery Securities LLC
STEWART ENTERPRISES, INC.
AND
CITIBANK, N.A.,
AS TRUSTEE
___________________
FIRST SUPPLEMENTAL INDENTURE
DATED AS OF APRIL 24, 1998
___________________
SUPPLEMENTING AND AMENDING THE INDENTURE
DATED AS OF
DECEMBER 1, 1996
<PAGE>
THIS FIRST SUPPLEMENTAL INDENTURE, dated as of April 24, 1998, is
between STEWART ENTERPRISES, INC., a corporation duly organized and
existing under the laws of the State of Louisiana (herein called the
"Company"), having its principal office at 110 Veterans Boulevard,
Metairie, Louisiana 70005, and CITIBANK, N.A., a national banking
association, as Trustee (herein called the "Trustee"). Any capitalized
term used in this First Supplemental Indenture and not defined herein shall
have the meaning specified in the Original Indenture (as defined below).
RECITALS OF THE COMPANY
The Company heretofore has made, executed and delivered to the Trustee
an Indenture dated as of December 1, 1996 (the "Original Indenture," and as
supplemented and amended by this First Supplemental Indenture, the
"Indenture") to provide for the issuance from time to time of unsecured
debentures, notes or other evidences of indebtedness of the Company (herein
called the "Securities"), to be issued in one or more series as provided in
the Original Indenture.
The Company has duly authorized and issued a series of $100,000,000 of
its 6.70% Notes due December 1, 2003 as Securities pursuant to the Original
Indenture.
It is deemed desirable to supplement and amend the Original Indenture
to clarify the terms under which a series of remarketable or redeemable
Securities will be issued under the Indenture.
Section 901 of the Original Indenture provides that under certain
conditions the Company and the Trustee, may, without the consent of any
Holders of Securities, from time to time and at any time, enter into an
indenture or indentures supplemental thereto, for the purpose, among other
things, of adding any additional Events of Default for the protection of
the Holders with respect to all or any series of the Securities (and if
such Event of Default is applicable to less than all series of the
Securities specifying the series to which such Event of Default is
applicable), establishing the form or terms of Securities of any series as
permitted by Sections 201 and 301 of the Indenture, curing any ambiguity
therein or supplementing any provision contained therein which may be
defective or inconsistent with any other provision contained therein or
making any other provisions as the Company may deem necessary or desirable,
provided that no such action shall adversely affect the interest of the
Holders of Securities.
All things necessary to authorize the execution and delivery of this
First Supplemental Indenture, to effect the modifications of the Original
Indenture provided for in this First Supplemental Indenture, and to make
the Original Indenture, as supplemented and amended by this First
Supplemental Indenture, a valid agreement of the Company, in accordance
with its terms, have been done.
The entry into the First Supplemental Indenture by the parties hereto
is in all respects authorized by the Original Indenture.
NOW, THEREFORE, THIS INDENTURE WITNESSETH:
For and in consideration of the premises, it is mutually agreed, for
the equal and proportionate benefit of all Holders of the Securities or of
a series thereof, as follows:
ARTICLE ONE
CONSTRUCTION
Section 1.1. CONSTRUCTION. All references herein to
Articles and Sections are references to Articles and Sections of this First
Supplemental Indenture and all references to Articles and Sections of the
Original Indenture specify such Original Indenture.
ARTICLE TWO
MODIFICATION OF THE ORIGINAL INDENTURE
Section 2.1. AMENDMENT OF SECTION 101 OF THE ORIGINAL
INDENTURE. Section 101 of the Original Indenture is hereby amended by
adding the following new definitions, which shall be inserted in the
definitions in appropriate alphabetical order:
"Remarketable Or Redeemable Securities" means remarketable
or redeemable Securities issued by the Company pursuant to the
provisions of Section 301, Section 312 and the other provisions
of this Indenture.
"Remarketing Agreement" means a remarketing agreement
between the Company and the Remarketing Dealer relating to the
Remarketable Or Redeemable Securities, as may be specified in
Board Resolutions or a supplemental indenture establishing a
series of Remarketable Or Redeemable Securities.
"Remarketing Date" means, with respect to a particular
series of Remarketable Or Redeemable Securities, the "Remarketing
Date" as set forth in such Securities.
"Remarketing Dealer" means NationsBanc Montgomery Securities
LLC and its successors and assigns.
Section 2.2. AMENDMENT OF ARTICLE THREE OF THE ORIGINAL
INDENTURE. Article Three of the Original Indenture is hereby amended by
adding a new Section 312, which shall read in its entirety as follows:
SECTION 312. REMARKETABLE OR REDEEMABLE SECURITIES. Without
limiting the provisions of Section 301, the Company may by action
taken pursuant to a Board Resolution or a supplemental indenture
establish one or more series of Remarketable Or Redeemable
Securities for authentication and delivery pursuant to the terms
of this Indenture.
Section 2.3. AMENDMENT OF SECTION 501 OF THE ORIGINAL
INDENTURE. Section 501 of the Original Indenture is amended by deleting
the period following Section 501(8), inserting a semicolon in lieu thereof,
adding the word "or" after such semicolon and inserting a new
Section 501(9) which shall read in its entirety as follows:
(9) Failure to pay principal of or accrued interest to the
Holders of any series of Remarketable Or Redeemable Securities on
the Remarketing Date.
Section 2.4. AMENDMENT OF SECTION 1104 OF THE ORIGINAL
INDENTURE. Section 1104 of the Original Indenture is amended by adding to
the end of such Section the following sentence:
Notwithstanding the foregoing, no notice shall be required of the
Company's optional or mandatory redemption of Remarketable Or
Redeemable Securities on the Remarketing Date specified for such
series.
Section 2.5. AMENDMENT OF SECTION 1105 OF THE ORIGINAL
INDENTURE. Section 1105 of the Original Indenture is amended by adding to
the end of such Section the following sentence:
Notwithstanding the foregoing, in connection with the optional or
mandatory redemption of Remarketable Or Redeemable Securities,
the Redemption Price must be deposited by the Company with the
Trustee in time for the Trustee to pay the Holders of the
Remarketable Or Redeemable Securities on the Remarketing Date in
accordance with customary procedures of the Trustee.
ARTICLE THREE
THE ROARS
Section 3.1. TITLE, TERMS AND FORM. There is hereby established
a series of Securities to be issued under the Indenture that have the terms
set forth in this ARTICLE THREE of this First Supplemental Indenture.
The title of the Securities of the series is "6.40% Remarketable Or
Redeemable Securities (ROARS{SM}) Due May 1, 2013 (Remarketing Date May 1,
2003)" (the "ROARS"). In connection with the issuance of the ROARS, the
Company will enter into a Remarketing Agreement, dated as of the date of
the issuance of the ROARS, with the Remarketing Dealer. The Remarketing
Date for the ROARS will be May 1, 2003. The stated maturity for the ROARS
will be May 1, 2013 (the "Stated Maturity Date").
The aggregate principal amount of the ROARS that may be authenticated
and delivered under this Indenture (except for ROARS authenticated and
delivered upon registration of transfer of, or in exchange for, or in lieu
of, other ROARS pursuant to Section 304, 305, 306, 906 or 1107 of the
Original Indenture) is limited to $200,000,000 (Two Hundred Million
Dollars).
The ROARS will bear interest at 6.40% per annum for the period from
the date of their original issuance to the Remarketing Date. If the ROARS
are purchased by the Remarketing Dealer on the Remarketing Date, on and
after the Remarketing Date the ROARS will bear interest at the rate
determined by the Remarketing Dealer in accordance with Section 3.4 (the
"Interest Rate to Maturity").
The ROARS will bear interest from the date of their original issuance,
payable semi-annually on November 1 and May 1 of each year (each, an
"Interest Payment Date"), commencing November 1, 1998, to the Persons in
whose names the ROARS are registered at the close of business on the
preceding October 15 and April 15, respectively (whether or not a Business
Day) (each, a "Regular Record Date"); provided, however, that interest
payable on the Remarketing Date and on the Stated Maturity Date will be
payable to the Person to whom principal shall be payable. Interest
payments will be in the amount of interest accrued from and including the
next preceding Interest Payment Date (or from and including the date of the
original issuance of the ROARS if no interest has been paid or duly
provided for with respect to the ROARS) to but excluding the relevant
Interest Payment Date, the Remarketing Date or the Stated Maturity Date, as
the case may be. Interest on the ROARS shall be computed on the basis of a
360-day year consisting of twelve 30-day months.
The ROARS will be unsubordinated and unsecured obligations of the
Company and will rank pari passu in right of payment with all other
unsubordinated and unsecured indebtedness of the Company. The ROARS will
be issued in denominations of $100,000 or integral multiples of $1,000 in
excess thereof. No ROARS shall be issuable as Bearer Securities. The
ROARS shall be denominated, and principal of and interest on the ROARS
shall be payable, in U.S. dollars. Prior to or on the Remarketing Date,
the ROARS shall not be subject to the satisfaction, discharge and
defeasance provisions of Section 403 of the Original Indenture, but shall
be subject to such provisions after the Remarketing Date.
The ROARS will be issued in fully registered book-entry form, will be
a "Book-Entry Security" under the Indenture and will be represented by one
or more fully registered global securities (the "Global Securities")
deposited with or on behalf of the Depository Trust Company or its
successor as Depository under the Indenture (the "Depository") and
registered in the name of the Depository or its nominee. Interests in the
Global Securities will be shown on, and transfers thereof will be effected
only through, records maintained by the Depository (with respect to its
participants' interests) and the Depository's participants (with respect to
beneficial owners of the ROARS ("Beneficial Owners")). So long as the
Depository or its nominee is the registered owner of a Global Security,
such registered owner will be considered the sole owner or Holder of the
ROARS represented by such Global Security for all purposes under the
Indenture.
Payments of principal of and interest on ROARS represented by a Global
Security registered in the name of the Depository or its nominee will be
made to the Depository or its nominee, as the case may be, as the
registered owner of the Global Security representing such ROARS. None of
the Company, the Trustee, any Paying Agent or the Security Registrar for
such ROARS will have any responsibility or liability for any aspect of the
records relating to or payments made on account of beneficial ownership
interests of the Global Security for such ROARS or for maintaining,
supervising or reviewing any records relating to such beneficial ownership
interests. The ROARS may be transferred or exchanged only through a
participant in the Depository.
The ROARS are not subject to any sinking fund, and, except as provided
in Sections 3.2, 3.5 and 3.6, the ROARS shall not be redeemable prior to
their Stated Maturity Date.
The ROARS shall be in substantially the form of Security attached
hereto as Exhibit A, with such additions and changes not contrary to the
Indenture as any officer delivering the Security shall, in his discretion,
approve, such approval to be conclusively evidenced by his delivery
thereof.
Section 3.2. MANDATORY TENDER ON REMARKETING DATE; PURCHASE
AND SETTLEMENT. (a) If the Remarketing Dealer gives notice to the
Company and the Trustee on the fifth Business Day prior to the Remarketing
Date (the "Notification Date") at no later than 4:00 p.m. New York City
time of its intention to purchase the ROARS for remarketing, each Security
will be automatically tendered, or deemed tendered, to the Remarketing
Dealer for purchase on the Remarketing Date in accordance with Section
3.2(b) below, except as set forth in Section 3.5 and 3.6 below. The
purchase price for the ROARS to be paid by the Remarketing Dealer will be
equal to 100% of the principal amount thereof, and the Company will pay
accrued interest, if any, to the Remarketing Date. If the ROARS are
tendered for remarketing, the Remarketing Dealer may remarket the ROARS for
its own account at varying prices to be determined by the Remarketing
Dealer at the time of each sale. From and after the Remarketing Date, the
ROARS will bear interest at the Interest Rate to Maturity. If the
Remarketing Dealer elects to remarket the ROARS, the obligation of the
Remarketing Dealer to purchase the ROARS on the Remarketing Date is subject
to the conditions set forth in the Remarketing Agreement. If for any
reason the Remarketing Dealer does not purchase all ROARS on the
Remarketing Date, the Company will be required to redeem the ROARS on the
Remarketing Date at a price equal to 100% of the principal amount thereof
plus all accrued and unpaid interest, if any, on the ROARS to the
Remarketing Date. No Beneficial Owners shall have any rights or claims
under the Remarketing Agreement or against the Company or the Remarketing
Dealer as a result of the Remarketing Dealer not purchasing the ROARS.
Each Holder and Beneficial Owner of a ROARS by its acceptance of ROARS will
agree to deliver its ROARS on the Remarketing Date for either purchase or
redemption as provided herein.
(b) Following the Notification Date, the tender and purchase of the
ROARS provided for in Section 3.2(a) above shall be effected as follows,
subject to Sections 3.5 and 3.6 below:
(i) All of the ROARS shall be delivered automatically to the
account of the Trustee, by book-entry through the Depository
pending payment of the purchase price therefor, on the
Remarketing Date.
(ii) The Remarketing Dealer will deliver the purchase price
for the ROARS to the Trustee by 3:00 p.m. New York City time on
the Business Day immediately preceding the Remarketing Date for
payment to the the Depository participant (each, a "Participant")
of each Beneficial Owner of ROARS, through the Depository in
accordance with the procedures of the Depository, against
delivery or deemed delivery through the Depository of such
Beneficial Owner's ROARS. The Company will make, or cause the
Trustee to make, payment of interest due on the Remarketing Date
to the Depository for distribution to each Beneficial Owner of
ROARS by book-entry through the Depository by the close of
business on the Remarketing Date.
Section 3.3. MAINTENANCE OF BOOK-ENTRY SYSTEM. (a) The
tender and settlement procedures set forth in Section 3.2(b) above shall be
subject to modification to the extent required by the Depository or, if the
book-entry system is no longer available for the ROARS at the time of the
remarketing, to the extent required to facilitate the tendering and
remarketing of ROARS in a form other than global form. In addition, the
Remarketing Dealer may modify (with the consent of the Trustee to the
extent required by the Indenture) the settlement procedures set forth
herein in order to facilitate the settlement process in any manner not
contrary to the Indenture or adverse to the interests of the Holders of the
ROARS; provided that such procedures must, in the reasonable opinion of the
Company, allow the Company sufficient time to fund the redemption of the
ROARS on the Remarketing Date.
(b) The Company hereby agrees with the Trustee and the Holders
of the ROARS that at all times, (i) it will use its best efforts to
maintain the ROARS in book-entry form with the Depository or any successor
thereto and to appoint a successor depository to the extent necessary to
maintain the ROARS in book-entry form and (ii) it will waive any
discretionary right that it otherwise may have under the Indenture to cause
the ROARS to be issued in a form other than global form.
Section 3.4. DETERMINATION OF INTEREST RATE TO MATURITY;
NOTIFICATION THEREOF. If the Remarketing Dealer elects to remarket
the ROARS as provided in Section 3.2(a), by 3:30 p.m. New York City
time, on the third Business Day immediately preceding the Remarketing Date
(the "Determination Date"), the Remarketing Dealer shall determine the
Interest Rate to Maturity to the nearest one thousandth (0.001) of one
percent per annum. The "Interest Rate to Maturity" shall be equal to the
sum of 5.44% per annum (the "Base Rate") and the Applicable Spread (as
defined below), which will be based on the Dollar Price (as defined below)
of the ROARS.
"Applicable Spread" shall be the lowest bid indication, expressed
as a spread (in the form of a percentage or in basis points) above the
Base Rate, obtained by the Remarketing Dealer on the Determination
Date from the bids quoted by five Reference Corporate Dealers (as
defined below) for the full aggregate principal amount of the ROARS at
the Dollar Price, but assuming (i) an issue date that is the
Remarketing Date, with settlement on such date without accrued
interest, (ii) a maturity date that is the Stated Maturity Date and
(iii) a stated annual interest rate equal to the Base Rate plus the
spread bid by the applicable Reference Corporate Dealer. If fewer
than five Reference Corporate Dealers bid as described above, then the
Applicable Spread shall be the lowest of such bid indications obtained
as described above. The Interest Rate to Maturity announced by the
Remarketing Dealer, absent manifest error, shall be binding and
conclusive upon the Beneficial Owners and Holders of the ROARS, the
Company and the Trustee.
"Comparable Treasury Issues" means the United States Treasury
security or securities selected by the Remarketing Dealer as having an
actual or interpolated maturity or maturities comparable to the
remaining term of the ROARS being purchased by the Remarketing Dealer.
"Comparable Treasury Price" means, with respect to the
Remarketing Date, (a) the offer prices for the Comparable Treasury
Issues (expressed in each case as a percentage of its principal
amount) on the Determination Date, as set forth on "Telerate Page 500"
(or such other page as may replace Telerate Page 500), or (b) if such
page (or any successor page) is not displayed or does not contain such
offer prices on the Determination Date, (i) the average of the
Reference Treasury Dealer Quotations (defined below) for the
Remarketing Date, after excluding the highest and lowest such
Reference Treasury Dealer Quotations, or (ii) if the Remarketing
Dealer obtains fewer than four such Reference Treasury Dealer
Quotations, the average of all such Reference Treasury Dealer
Quotations. "Telerate Page 500" means the display designated as
"Telerate Page 500" on Dow Jones Markets (or such other page as may
replace Telerate Page 500 on such service) or such other service
displaying the offer prices specified in (a) above as may replace Dow
Jones Markets.
"Dollar Price" means, with respect to the ROARS, the present
value, as of the Remarketing Date, of the Remaining Scheduled Payments
(as defined below) discounted to the Remarketing Date on a semi-annual
basis (assuming a 360-day year consisting of twelve 30-day months) at
the Treasury Rate (as defined below).
"Reference Corporate Dealer" means each of NationsBanc Montgomery
Securities LLC, Bear Stearns & Co., Citicorp Securities, Inc., and two
other dealers to be selected by the Company and their respective
successors; provided that if any of the foregoing or their affiliates
shall cease to be a leading dealer of publicly traded debt securities
of the Company (a "Primary Corporate Dealer"), the Remarketing Dealer
shall substitute therefor another Primary Corporate Dealer.
"Reference Treasury Dealer" means each of NationsBanc Montgomery
Securities LLC, Bear Stearns & Co., Citicorp Securities, Inc., and two
other dealers to be selected by the Company and their respective
successors; provided that if any of the foregoing or their affiliates
shall cease to be a primary U.S. Government securities dealer (a
"Primary Treasury Dealer"), the Remarketing Dealer shall substitute
therefor another Primary Treasury Dealer.
"Reference Treasury Dealer Quotations" means, with respect to
each Reference Treasury Dealer and the Remarketing Date, the offer
prices for the Comparable Treasury Issues (expressed in each case as a
percentage of its principal amount) quoted in writing to the
Remarketing Dealer by such Reference Treasury Dealer by 3:30 p.m. on
the Determination Date.
"Remaining Scheduled Payments" means, with respect to the ROARS,
the remaining scheduled payments of the principal thereof and interest
thereon, calculated at the Base Rate only, that would be due after the
Remarketing Date to and including the Stated Maturity Date; provided
that if the Remarketing Date is not an Interest Payment Date with
respect to the ROARS, the amount of the next succeeding scheduled
interest payment thereon, calculated at the Base Rate only, will be
reduced by the amount of interest accrued thereon, calculated at the
Base Rate only, to the Remarketing Date.
"Treasury Rate" means, with respect to the Remarketing Date, the
rate per annum equal to the semi-annual equivalent yield to maturity
or interpolated (on a day count basis) yield to maturity of the
Comparable Treasury Issues, assuming a price for the Comparable
Treasury Issues (expressed as a percentage of its principal amount),
equal to the Comparable Treasury Price for the Remarketing Date.
If the Remarketing Dealer elects to remarket the ROARS, the
Remarketing Dealer will notify the Company, the Trustee and the Depository
by telephone, confirmed in writing (which may include facsimile or other
electronic transmission), by 4:00 p.m. New York City time on the
Determination Date of the Interest Rate to Maturity applicable to the ROARS
effective from and including the Remarketing Date.
Upon the occurrence of certain termination events set forth in the
Remarketing Agreement, the Remarketing Dealer, in its sole discretion, in
lieu of terminating the Remarketing Agreement, at any time between the
Determination Date and 10:30 a.m. New York City time, on the Business Day
immediately preceding the Remarketing Date, may elect to purchase the ROARS
for remarketing and determine a new Interest Rate to Maturity in the manner
set forth above in this Section 3.4, except that for purposes of
determining the new Interest Rate to Maturity pursuant to this provision,
the Determination Date referred to above shall be the date of such election
and redetermination. The Remarketing Dealer shall notify the Company, the
Trustee and the Depository by telephone, confirmed in writing (which may
include facsimile or other electronic transmission), by 11:00 a.m. New York
City time, on the date of such election, of the new Interest Rate to
Maturity applicable to the ROARS. Thereupon, such new Interest Rate to
Maturity shall supersede and replace any Interest Rate to Maturity
previously determined by the Remarketing Dealer and, absent manifest error,
shall be binding and conclusive upon the Beneficial Owners and Holders of
the ROARS on and after the Remarketing Date, the Company and the Trustee.
Notwithstanding the foregoing, the Remarketing Dealer, by redetermining the
Interest Rate to Maturity upon the occurrence of any such termination
event, shall not thereby be deemed to have waived its right to determine a
new Interest Rate to Maturity or to terminate the Remarketing Agreement
upon the subsequent occurrence of another such termination event. If the
Remarketing Dealer elects to purchase the ROARS and redetermine the
Interest Rate to Maturity in accordance with the foregoing provisions in
this paragraph, the Company will retain the right to redeem the ROARS as
specified in Section 3.6, provided that such election shall be made no
later than 12:30 p.m. New York City time on the Business Day immediately
preceding the Remarketing Date.
Section 3.5. MANDATORY REDEMPTION. Subject to the
Remarketing Dealer's right to elect to purchase the ROARS and redetermine
the Interest Rate to Maturity described in the immediately preceding
paragraph, the Company shall redeem the ROARS as a whole on the Remarketing
Date at a price equal to 100% of the principal amount thereof plus all
accrued and unpaid interest, if any, on the ROARS to the Remarketing Date
in the event that (a) the Remarketing Dealer for any reason does not notify
the Company of the Interest Rate to Maturity by 4:00 p.m. New York City
time on the Determination Date, (b) prior to the Remarketing Date, the
Remarketing Dealer has resigned and no successor has been appointed on or
before the Determination Date, (c) at any time after the Remarketing Dealer
elects on the Notification Date to remarket the ROARS, the Remarketing
Dealer shall have elected to terminate the Remarketing Agreement in
accordance with the terms thereof, (d) the Remarketing Dealer does not give
notice to the Company and the Trustee by 4:00 p.m. New York City time on
the Notification Date of its intention to purchase the ROARS on the
Remarketing Date, (e) the Remarketing Dealer for any reason fails to
deliver the purchase price of the ROARS to the Trustee by 3:00 p.m. New
York City time on the Business Day immediately preceding the Remarketing
Date, or (f) the Company fails for any reason to redeem the ROARS following
its election to effect such redemption as specified in Section 3.6. In any
such case, payment shall be made by the Company through the Trustee to the
Participant of each Beneficial Owner of ROARS, by book-entry through the
Depository, by the close of business on the Remarketing Date against
delivery or deemed delivery through the Depository of such Beneficial
Owner's ROARS. No defense or right against the Remarketing Dealer shall
relieve the Company of its obligations to the Holders of the ROARS to make
such mandatory redemption.
Section 3.6. OPTIONAL REDEMPTION. (a) Notwithstanding any
election by the Remarking Dealer to remarket the ROARS, the tendering of
the ROARS for purchase by the Remarketing Dealer shall be subject to the
right of the Company to redeem the ROARS as provided in Section 3.6(b)
below.
(b) The Company, in its sole and absolute discretion, shall have
the right, upon notice to the Remarketing Dealer and the Trustee not later
than 4:00 p.m. New York City time on the Business Day immediately preceding
the Determination Date, to irrevocably elect to redeem the ROARS, in whole
but not in part, on the Remarketing Date. If the Remarketing Dealer elects
to purchase the ROARS and redetermine the Interest Rate to Maturity under
the circumstances described in the last paragraph of Section 3.4 above, the
Company will retain the right to redeem the ROARS, provided that such
election must be made by 12:30 p.m. New York City time on the Business Day
immediately preceding the Remarketing Date. If the Company gives such
notice to the Remarketing Dealer and the Trustee, then (i) the Remarketing
Dealer will be deemed to have elected not to remarket the ROARS, (ii) the
Company shall redeem the ROARS from Holders as a whole on the Remarketing
Date at a price equal to 100% of the aggregate principal amount of the
ROARS plus all accrued and unpaid interest, if any, on the ROARS to the
Remarketing Date (such payment to be made by the Company through the
Trustee to the Depository for distribution to the Depository Participant of
each Beneficial Owner of ROARS, by the close of business on the Remarketing
Date against delivery through the Depository of such Beneficial Owner's
ROARS) and (iii) the Company will pay to the Remarketing Dealer the
Calculation Amount, as defined in the Remarketing Agreement.
Section 3.7. PURCHASE OF THE ROARS BY THE COMPANY. As
long as the Remarketing Agreement is in effect, neither the Company, nor
any Person whose acquisition of ROARS would cause such ROARS not to be
outstanding, will defease, purchase or otherwise acquire any of the ROARS
prior to the Remarketing Date, other than in connection with the
fulfillment of its obligation to redeem the ROARS on the Remarketing Date
under the circumstances described herein. After the Remarketing Date, the
Company may at any time purchase the ROARS at any price in the open market
or otherwise. The ROARS so purchased by the Company may, at its
discretion, be held, resold or surrendered to the Trustee for cancellation.
Section 3.8. PAYMENT AND PAYMENT AGENTS. Principal of
and interest on the ROARS shall be payable at the office or agency of the
Company to be maintained in the Borough of Manhattan, The City of New York,
initially at the Corporate Trust Office of the Trustee, 111 Wall Street,
New York, New York; provided, however, that at the option of the Company
payment of interest may be made by check mailed to the address of the
person entitled thereto as such address shall appear in the Security
Register. Notwithstanding the foregoing, payments of principal and interest
on the ROARS represented by one or more Book-Entry Securities will be made
as provided above.
ARTICLE FOUR
ADDITIONAL REPRESENTATIONS
AND COVENANTS OF THE COMPANY
Section 4.1. AUTHORITY OF THE COMPANY. The Company
represents and warrants that it is duly authorized by a resolution of the
Board of Directors to execute and deliver this First Supplemental
Indenture, and all corporate action on its part required for the execution
and delivery of this First Supplemental Indenture has been duly and
effectively taken.
Section 4.2. RECITALS AND STATEMENTS. The Company
warrants that the recitals of fact and statements contained in this First
Supplemental Indenture are true and correct, and that the recitals of fact
and statements contained in all certificates and other documents furnished
hereunder will be true and correct.
ARTICLE FIVE
CONCERNING THE TRUSTEE
Section 5.1. ACCEPTANCE OF TRUSTS. The Trustee accepts
the trust hereunder and agrees to perform the same, but only upon the terms
and conditions set forth in the Original Indenture and in this First
Supplemental Indenture, to which the Company and the respective Holders of
Securities at any time hereafter outstanding agree by their acceptance
thereof.
Section 5.2. RESPONSIBILITY OF TRUSTEE FOR RECITALS,
ETC. The recitals and statements contained in this First Supplemental
Indenture shall be taken as the recitals and statements of the Company, and
the Trustee assumes no responsibility for the correctness of the same. The
Trustee makes no representations as to the validity or sufficiency of this
First Supplemental Indenture.
ARTICLE SIX
MISCELLANEOUS PROVISIONS
Section 6.1. RELATION TO THE INDENTURE. The provisions
of this First Supplemental Indenture shall become effective immediately
upon the execution and delivery hereof. This First Supplemental Indenture
and all the terms and provisions contained herein shall form a part of the
Indenture as fully and with the same effect as if all such terms and
provisions had been set forth in the Original Indenture. The Original
Indenture is hereby ratified and confirmed and shall remain and continue in
full force and effect in accordance with the terms and provision thereof,
as supplemented and amended by this First Supplemental Indenture and the
Original Indenture and this First Supplemental Indenture shall be read,
taken and construed together as one instrument.
Section 6.2. COUNTERPARTS OF FIRST SUPPLEMENTAL
INDENTURE. This First Supplemental Indenture may be executed in any number
of counterparts, each of which so executed shall be deemed to be an
original, but all such counterparts shall together constitute but one and
the same instrument.
Section 6.3. GOVERNING LAW. This First Supplemental
Indenture shall be governed by and construed in accordance with the laws of
the State of New York, without regard to principles of conflicts of laws.
IN WITNESS WHEREOF, the parties hereto have caused this Indenture to
be duly executed, all as of the day and year first above written.
COMPANY
STEWART ENTERPRISES, INC.
By: /s/ Ronald H. Patron
-----------------------
TRUSTEE
CITIBANK, N.A., as Trustee
By: Arthur W. Aslanian
-----------------------
<PAGE>
EXHIBIT A IS FILED AS EXHIBIT 4.2 TO THE COMPANY'S FORM 8-K
TO WHICH THIS FIRST SUPPLEMENTAL INDENTURE IS AN EXHIBIT
[Form of Face of Security]
Unless this certificate is presented by an authorized representative
of The Depository Trust Company, a New York corporation ("DTC"), to the
issuer or its agent for registration of transfer, exchange, or payment, and
any certificate issued is registered in the name of Cede & Co. or in such
other name as is requested by an authorized representative of DTC (and any
payment is made to Cede & Co. or to such other entity as is requested by an
authorized representative of DTC), ANY TRANSFER, PLEDGE OR OTHER USE HEREOF
FOR VALUE OR OTHERWISE BY OR TO ANY PERSON IS WRONGFUL inasmuch as the
registered owner hereof, Cede & Co., has an interest herein.
This Security is a Book-Entry Security within the meaning of the
Indenture hereinafter referred to and is registered in the name of a
Depository or a nominee of a Depository. This Security is exchangeable for
Securities registered in the name of a Person other than the Depository or
its nominee only in the limited circumstances described in the Indenture,
and no transfer of this Security (other than a transfer of this Security as
a whole by the Depository to a nominee of the Depository or by a nominee of
the Depository to the Depository or another nominee of the Depository) may
be registered except in such limited circumstances.
STEWART ENTERPRISES, INC.
6.40% REMARKETABLE OR REDEEMABLE SECURITIES (ROARS{SM}) {1}
DUE MAY 1, 2013
(REMARKETING DATE MAY 1, 2003)
No. 1 CUSIP No: 860370AB1
$200,000,000
Stewart Enterprises, Inc., a Louisiana corporation (herein called the
"Company," which term shall include any successor under the Indenture
hereinafter referred to), for value received, hereby promises to pay to
CEDE & CO., or registered assigns, the principal sum of $200,000,000 (Two
Hundred Million Dollars) at the Company's office or agency for said purpose
in the Borough of Manhattan, the City of New York on May 1, 2013 (the
"Stated Maturity Date") in such coin or currency of the United States of
America as at the time of payment is legal tender for the payment of public
and private debts, and to pay interest thereon in like coin or currency
semi-annually on November 1 and May 1 of each year (each, an "Interest
Payment Date"), commencing November 1, 1998, on said principal sum at the
rate of 6.40% per annum (except that on and after the Remarketing Date
(defined below), such rate shall be the Interest Rate to Maturity (defined
below)) at said office or agency from the date of the original issuance of
the ROARS or from the most recent Interest Payment Date to which interest
on this ROARS has been paid or duly provided for until payment of said
principal sum has been made or duly provided for. The interest so payable
on any Interest Payment Date will, except as otherwise provided in the
Indenture referred to on the reverse hereof, be paid to the Person in whose
name this ROARS is registered at the close of business on the October 15 or
April 15 preceding such November 1 or May 1, whether or not such day is a
Business Day (as defined below); provided, however, that interest payable
on the Remarketing Date and on the Stated Maturity Date will be payable to
the Person to whom principal shall be payable. Interest payments will be
in the amount of interest accrued from and including the next preceding
Interest Payment Date (or from and including the date of the original
issuance of the ROARS if no interest has been paid or duly provided for
with respect to the ROARS) to but excluding the relevant Interest Payment
Date, the Remarketing Date or the Stated Maturity Date, as the case may be.
Interest may be paid, at the option of the Company, if this ROARS is no
longer in the form of a Registered Security in global form, by mailing a
check therefor payable to the registered holder entitled thereto at his
last address as it appears on the Security Register (as defined in the
Indenture). Interest on this ROARS shall be computed on the basis of a
360-day year consisting of twelve 30-day months.
On May 1, 2003 (the "Remarketing Date"), pursuant to the Remarketing
Agreement dated as of the date hereof (the "Remarketing Agreement"),
between the Company and NationsBanc Montgomery Securities LLC, or its
successor, as Remarketing Dealer (the "Remarketing Dealer"), the ROARS will
either be (i) mandatorily tendered to and purchased by the Remarketing
Dealer, in which case the Remarketing Dealer shall pay 100% of the
principal amount of the ROARS and the Company shall pay accrued and unpaid
interest, if any, to the Remarketing Date, or (ii) redeemed by the Company
at 100% of the principal amount thereof plus accrued and unpaid interest,
if any, to the Remarketing Date. If the ROARS are purchased by the
Remarketing Dealer on the Remarketing Date, the ROARS shall bear interest
for the period on and after the Remarketing Date to the Stated Maturity
Date at the Interest Rate to Maturity determined in accordance with the
procedures set forth on the reverse hereof.
ADDITIONAL PROVISIONS OF THIS SECURITY ARE CONTAINED ON THE REVERSE HEREOF
AND SUCH PROVISIONS SHALL FOR ALL PURPOSES HAVE THE SAME EFFECT AS THOUGH
FULLY SET FORTH AT THIS PLACE.
This Security shall not be entitled to any benefit under the Indenture
hereinafter referred to, or become valid or obligatory for any purpose,
until the Trustee under the Indenture shall have signed the form of
certificate of authentication endorsed hereon.
In Witness Whereof, the Company has caused this instrument to be duly
executed under its corporate seal.
Dated: April 24, 1998 STEWART ENTERPRISES, INC.
By: SPECIMEN
Ronald H. Patron
Chief Financial Officer,
President-Corporate Division and
Executive Vice President
[CORPORATE SEAL]
Attest:
Kenneth C. Budde
Secretary
This is one of the Securities of the series designated therein
referred to in the within-mentioned Indenture.
CITIBANK, N.A., as Trustee
By:
Authorized Signatory
[Form of Reverse of Security]
STEWART ENTERPRISES, INC.
6.40% Remarketable Or Redeemable Securities (ROARS{SM}){1}
due May 1, 2013
(Remarketing Date May 1, 2003)
1. INDENTURE. (a) This Security is one of a duly authorized issue
of debt securities of the Company designated as its 6.40% Remarketable Or
Redeemable Securities (ROARS{SM}) due May 1, 2013 (Remarketing Date May 1,
2003) (the "ROARS"), limited to the aggregate principal amount of
$200,000,000 (Two Hundred Million Dollars) (except as otherwise provided in
the Indenture mentioned below), issued or to be issued pursuant to an
indenture dated as of December 1, 1996, duly executed and delivered by the
Company to Citibank, N.A., as trustee (herein called the "Trustee," which
term includes any successor trustee under the Indenture), as supplemented
by the First Supplemental Indenture dated April 24, 1998 between the
Company and the Trustee, as the same shall be further amended and
supplemented from time to time as provided in the Indenture (as so amended
and supplemented, the "Indenture"). The terms of the ROARS include those
in the Indenture. Reference is hereby made to the Indenture and all other
indentures supplemental thereto for a description of the rights,
limitations of rights, obligations, duties and immunities thereunder of the
Trustee, the Company and the Holders of the ROARS. Capitalized terms used
but not defined herein which are defined in the Indenture have the meanings
assigned to them in the Indenture.
(b) If an Event of Default with respect to Securities of this
series shall occur and be continuing, the principal of the Securities of
this series may be declared due and payable in the manner and with the
effect provided in the Indenture. The Indenture provides that under
certain circumstances a declaration of acceleration and its consequences
may be rescinded and annulled by the Holders of a majority in principal
amount of the Outstanding Securities of the series.
(c) The Indenture permits, with certain exceptions as therein
provided, the amendment thereof and the modification of the rights and
obligations of the Company and the rights of the Holders of the Securities
of each series to be affected under the Indenture at any time by the
Company and the Trustee with the consent of the Holders of a majority in
principal amount of the Outstanding Securities of each series to be
affected (acting as one class). The Indenture provides that the Holders of
a majority in principal amount of the Outstanding Securities of any series
(or, in certain cases, of all Outstanding Securities) may, on behalf of the
Holders of all the Securities of such series (or, in certain cases, of all
Securities under the Indenture) waive certain past defaults under the
Indenture. The Indenture also provides that the Holders of a majority in
principal amount of the Outstanding Securities of all series affected
(acting as one class) may waive compliance by the Company with certain
restrictive provisions of the Indenture. Any such consent or waiver by the
Holder of this Security shall be conclusive and binding upon such Holder
and upon all future Holders of this Security and of any Security issued in
exchange or substitution or hereof upon registration of transfer hereof
whether or not notation of such consent or waiver is made upon this
Security or such other Securities.
(d) The Indenture contains provisions for the legal defeasance
at any time of the entire indebtedness of the Company on this Security upon
compliance by the Company with certain conditions set forth therein, which
provisions apply to this Security after the Remarketing Date. Upon
compliance with such provisions, the Company shall be deemed to have paid
and discharged the entire indebtedness on this Security and the Company's
obligation to pay the principal of (and premium, if any) and interest on
this Security shall cease, terminate and be completely discharged.
(e) The Indenture provides that no Holder of any Securities may
enforce any remedy under the Indenture except in the case of refusal or
neglect of the Trustee to act after notice of default and request by the
Holders of 25% in principal amount of Outstanding Securities in the series
for which a remedy is sought to be enforced and the offer to the Trustee of
reasonable indemnity.
(f) The ROARS do not have the benefit of any sinking fund
obligation and are redeemable only as provided herein.
(g) No reference herein to the Indenture and no provision of the
ROARS or of the Indenture shall alter or impair the obligation of the
Company, which is absolute and unconditional, to pay the principal of and
interest on the ROARS at the place, times and rate, and in the currency,
herein prescribed.
(h) The Securities of this series are issuable only in
registered form without coupons in denominations of $100,000 and any
integral multiples of $1,000 in excess thereof. As provided in the
Indenture and subject to certain limitations therein set forth, Securities
of this series are exchangeable for a like aggregate principal amount of
Securities of this series of a different authorized denomination, as
requested by the Holder surrendering the same.
(i) As provided in the Indenture and subject to certain
limitations therein set forth, the transfer of the ROARS is registrable in
the Security Register, upon surrender of the ROARS for registration of
transfer at the office or agency of the Company in any place where the
principal of (and premium, if any) and interest on the ROARS are payable,
duly endorsed by, or accompanied by a written instrument of transfer in
form satisfactory to the Company and the Security Registrar duly executed
by, the Holder hereof or his attorney duly authorized in writing, and
thereupon one or more new Securities of this series, of authorized
denominations and for the same aggregate principal amount, will be issued
to the designated transferee or transferees.
(j) No service charge shall be made for any such registration of
transfer or exchange, but the Company may require payment of a sum
sufficient to cover any tax or other governmental charge payable in
connection therewith.
(k) Prior to surrender of the ROARS for registration of
transfer, the Company, the Trustee and any agent of the Company or the
Trustee, may deem and treat the registered Holder hereof as the absolute
owner of the ROARS (whether or not the ROARS shall be overdue and
notwithstanding any notation of ownership or other writing hereon), for the
purpose of receiving payment of, or on account of, the principal hereof
and interest hereon and for all other purposes, and neither the Company
nor the Trustee nor any agent of the Company or the Trustee shall be
affected by any notice to the contrary. Notwithstanding the foregoing,
payment of principal of and interest on any Security of this series in
permanent global form should be made in the manner provided in the
arrangements of the Company with the Depository.
(l) The Indenture and the ROARS shall be governed by and
construed in accordance with the laws of the State of New York.
2. MANDATORY TENDER ON REMARKETING DATE; PURCHASE AND SETTLEMENT.
(a) If the Remarketing Dealer gives notice to the Company and the Trustee
on the fifth Business Day prior to the Remarketing Date (the "Notification
Date") at no later than 4:00 p.m. New York City time of its intention to
purchase the ROARS for remarketing, each ROARS will be automatically
tendered, or deemed tendered, to the Remarketing Dealer for purchase on the
Remarketing Date in accordance with Paragraph 2(b) below, except as set
forth in Paragraphs 5 and 6 below. The purchase price for the ROARS to be
paid by the Remarketing Dealer will be equal to 100% of the principal
amount thereof, and the Company will pay accrued interest, if any, to the
Remarketing Date. If the ROARS are tendered for remarketing, the
Remarketing Dealer may remarket the ROARS for its own account at varying
prices to be determined by the Remarketing Dealer at the time of each sale.
From and after the Remarketing Date, the ROARS will bear interest at the
Interest Rate to Maturity (defined in Paragraph 4 below). If the
Remarketing Dealer elects to remarket the ROARS, the obligation of the
Remarketing Dealer to purchase the ROARS on the Remarketing Date is subject
to the conditions set forth in the Remarketing Agreement. If for any
reason the Remarketing Dealer does not purchase all ROARS on the
Remarketing Date, the Company will be required to redeem the ROARS on the
Remarketing Date at a price equal to 100% of the principal amount thereof
plus all accrued and unpaid interest, if any, on the ROARS to the
Remarketing Date. No holders of beneficial interests in the ROARS (the
"Beneficial Owners") shall have any rights or claims under the Remarketing
Agreement or against the Company or the Remarketing Dealer as a result of
the Remarketing Dealer not purchasing the ROARS. Each Holder and
Beneficial Owner of a ROARS by its acceptance hereof agrees to deliver its
ROARS on the Remarketing Date for either purchase or redemption as provided
herein.
(b) Following the Notification Date, the tender and purchase of
the ROARS provided for in Paragraph 2(a) above shall be effected as
follows, subject to Paragraphs 5 and 6 below:
(i) All of the ROARS shall be delivered automatically to the
account of the Trustee, by book-entry through The Depository
Trust Company or any successor thereto ("DTC") pending payment of
the purchase price therefor, on the Remarketing Date.
(ii) The Remarketing Dealer shall deliver the purchase price
for the ROARS to the Trustee by 3:00 p.m. New York City time on
the Business Day immediately preceding the Remarketing Date for
payment to the DTC participant (each, a "Participant") of each
Beneficial Owner of ROARS, through DTC in accordance with the
procedures of DTC, against delivery or deemed delivery through
DTC of such Beneficial Owner's ROARS. The Company will make, or
cause the Trustee to make, payment of interest due on the
Remarketing Date to DTC for distribution to each Beneficial Owner
of ROARS by book-entry through DTC by the close of business on
the Remarketing Date.
3. MAINTENANCE OF BOOK-ENTRY SYSTEM. (a) The tender and settlement
procedures set forth in Paragraph 2(b) above shall be subject to
modification to the extent required by DTC or, if the book-entry system is
no longer available for the ROARS at the time of the remarketing, to the
extent required to facilitate the tendering and remarketing of ROARS in a
form other than global form. In addition, the Remarketing Dealer may
modify (with the consent of the Trustee to the extent required by the
Indenture) the settlement procedures set forth herein in order to
facilitate the settlement process in any manner not contrary to the
Indenture or adverse to the interests of the Holders of the ROARS; provided
that such procedures must, in the reasonable opinion of the Company, allow
the Company sufficient time to fund the redemption of the ROARS on the
Remarketing Date.
(b) The Company hereby agrees with the Trustee and the Holders
of the ROARS that at all times, (i) it will use its best efforts to
maintain the ROARS in book-entry form with DTC or any successor thereto and
to appoint a successor depository to the extent necessary to maintain the
ROARS in book-entry form and (ii) it will waive any discretionary right
that it otherwise may have under the Indenture to cause the ROARS to be
issued in a form other than global form.
4. DETERMINATION OF INTEREST RATE TO MATURITY; NOTIFICATION THEREOF.
If the Remarketing Dealer elects to remarket the ROARS as provided in
Paragraph 2(a), by 3:30 p.m. New York City time, on the third Business Day
immediately preceding the Remarketing Date (the "Determination Date"), the
Remarketing Dealer shall determine the Interest Rate to Maturity to the
nearest one thousandth (0.001) of one percent per annum. The "Interest
Rate to Maturity" shall be equal to the sum of 5.44% per annum (the "Base
Rate") and the Applicable Spread (as defined below), which will be based on
the Dollar Price (as defined below) of the ROARS.
"Applicable Spread" shall be the lowest bid indication, expressed
as a spread (in the form of a percentage or in basis points) above the
Base Rate, obtained by the Remarketing Dealer on the Determination
Date from the bids quoted by five Reference Corporate Dealers (as
defined below) for the full aggregate principal amount of the ROARS at
the Dollar Price, but assuming (i) an issue date that is the
Remarketing Date, with settlement on such date without accrued
interest, (ii) a maturity date that is the Stated Maturity Date and
(iii) a stated annual interest rate equal to the Base Rate plus the
spread bid by the applicable Reference Corporate Dealer. If fewer
than five Reference Corporate Dealers bid as described above, then the
Applicable Spread shall be the lowest of such bid indications obtained
as described above. THE INTEREST RATE TO MATURITY ANNOUNCED BY THE
REMARKETING DEALER, ABSENT MANIFEST ERROR, SHALL BE BINDING AND
CONCLUSIVE UPON THE BENEFICIAL OWNERS AND HOLDERS OF THE ROARS, THE
COMPANY AND THE TRUSTEE.
"Comparable Treasury Issues" means the United States Treasury
security or securities selected by the Remarketing Dealer as having an
actual or interpolated maturity or maturities comparable to the
remaining term of the ROARS being purchased by the Remarketing Dealer.
"Comparable Treasury Price" means, with respect to the
Remarketing Date, (a) the offer prices for the Comparable Treasury
Issues (expressed in each case as a percentage of its principal
amount) on the Determination Date, as set forth on "Telerate Page 500"
(or such other page as may replace Telerate Page 500), or (b) if such
page (or any successor page) is not displayed or does not contain such
offer prices on the Determination Date, (i) the average of the
Reference Treasury Dealer Quotations (defined below) for the
Remarketing Date, after excluding the highest and lowest such
Reference Treasury Dealer Quotations, or (ii) if the Remarketing
Dealer obtains fewer than four such Reference Treasury Dealer
Quotations, the average of all such Reference Treasury Dealer
Quotations. "Telerate Page 500" means the display designated as
"Telerate Page 500" on Dow Jones Markets (or such other page as may
replace Telerate Page 500 on such service) or such other service
displaying the offer prices specified in (a) above as may replace Dow
Jones Markets.
"Dollar Price" means, with respect to the ROARS, the present
value, as of the Remarketing Date, of the Remaining Scheduled Payments
(as defined below) discounted to the Remarketing Date on a semi-annual
basis (assuming a 360-day year consisting of twelve 30-day months) at
the Treasury Rate (as defined below).
"Reference Corporate Dealer" means each of NationsBanc Montgomery
Securities LLC, Bear Stearns & Co., Citicorp Securities, Inc., and two
other dealers to be selected by the Company and their respective
successors; provided that if any of the foregoing or their affiliates
shall cease to be a leading dealer of publicly traded debt securities
of the Company (a "Primary Corporate Dealer"), the Remarketing Dealer
shall substitute therefor another Primary Corporate Dealer.
"Reference Treasury Dealer" means each of NationsBanc Montgomery
Securities LLC, Bear Stearns & Co., Citicorp Securities, Inc., and two
other dealers to be selected by the Company and their respective
successors; provided that if any of the foregoing or their affiliates
shall cease to be a primary U.S. Government securities dealer (a
"Primary Treasury Dealer"), the Remarketing Dealer shall substitute
therefor another Primary Treasury Dealer.
"Reference Treasury Dealer Quotations" means, with respect to
each Reference Treasury Dealer and the Remarketing Date, the offer
prices for the Comparable Treasury Issues (expressed in each case as a
percentage of its principal amount) quoted in writing to the
Remarketing Dealer by such Reference Treasury Dealer by 3:30 p.m. on
the Determination Date.
"Remaining Scheduled Payments" means, with respect to the ROARS,
the remaining scheduled payments of the principal thereof and interest
thereon, calculated at the Base Rate only, that would be due after the
Remarketing Date to and including the Stated Maturity Date; provided
that if the Remarketing Date is not an Interest Payment Date with
respect to the ROARS, the amount of the next succeeding scheduled
interest payment thereon, calculated at the Base Rate only, will be
reduced by the amount of interest accrued thereon, calculated at the
Base Rate only, to the Remarketing Date.
"Treasury Rate" means, with respect to the Remarketing Date, the
rate per annum equal to the semi-annual equivalent yield to maturity
or interpolated (on a day count basis) yield to maturity of the
Comparable Treasury Issues, assuming a price for the Comparable
Treasury Issues (expressed as a percentage of its principal amount),
equal to the Comparable Treasury Price for the Remarketing Date.
If the Remarketing Dealer elects to remarket the ROARS, the
Remarketing Dealer will notify the Company, the Trustee and DTC by
telephone, confirmed in writing (which may include facsimile or other
electronic transmission), by 4:00 p.m. New York City time on the
Determination Date of the Interest Rate to Maturity applicable to the ROARS
effective from and including the Remarketing Date.
Upon the occurrence of certain termination events set forth in the
Remarketing Agreement, the Remarketing Dealer, in its sole discretion, in
lieu of terminating the Remarketing Agreement, at any time between the
Determination Date and 10:30 a.m. New York City time, on the Business Day
immediately preceding the Remarketing Date, may elect to purchase the ROARS
for remarketing and determine a new Interest Rate to Maturity in the manner
set forth above in this Paragraph 4, except that for purposes of
determining the new Interest Rate to Maturity pursuant to this provision,
the Determination Date referred to above shall be the date of such election
and redetermination. The Remarketing Dealer shall notify the Company, the
Trustee and DTC by telephone, confirmed in writing (which may include
facsimile or other electronic transmission), by 11:00 a.m. New York City
time, on the date of such election, of the new Interest Rate to Maturity
applicable to the ROARS. THEREUPON, SUCH NEW INTEREST RATE TO MATURITY
SHALL SUPERSEDE AND REPLACE ANY INTEREST RATE TO MATURITY PREVIOUSLY
DETERMINED BY THE REMARKETING DEALER AND, ABSENT MANIFEST ERROR, SHALL BE
BINDING AND CONCLUSIVE UPON THE BENEFICIAL OWNERS AND HOLDERS OF THE ROARS
ON AND AFTER THE REMARKETING DATE, THE COMPANY AND THE TRUSTEE.
Notwithstanding the foregoing, the Remarketing Dealer, by redetermining the
Interest Rate to Maturity upon the occurrence of any such termination
event, shall not thereby be deemed to have waived its right to determine a
new Interest Rate to Maturity or to terminate the Remarketing Agreement
upon the subsequent occurrence of another such termination event. If the
Remarketing Dealer elects to purchase the ROARS and redetermine the
Interest Rate to Maturity in accordance with the foregoing provisions in
this paragraph, the Company will retain the right to redeem the ROARS as
specified in Paragraph 6, provided that such election shall be made no
later than 12:30 p.m. New York City time on the Business Day immediately
preceding the Remarketing Date.
5. MANDATORY REDEMPTION. Subject to the Remarketing Dealer's right
to elect to purchase the ROARS and redetermine the Interest Rate to
Maturity described in the immediately preceding paragraph, the Company
shall redeem the ROARS as a whole on the Remarketing Date at a price equal
to 100% of the principal amount thereof plus all accrued and unpaid
interest, if any, on the ROARS to the Remarketing Date in the event that
(a) the Remarketing Dealer for any reason does not notify the Company of
the Interest Rate to Maturity by 4:00 p.m. New York City time, on the
Determination Date, (b) prior to the Remarketing Date, the Remarketing
Dealer has resigned and no successor has been appointed on or before the
Determination Date, (c) at any time after the Remarketing Dealer elects on
the Notification Date to remarket the ROARS, the Remarketing Dealer shall
have elected to terminate the Remarketing Agreement in accordance with the
terms thereof, (d) the Remarketing Dealer does not give notice to the
Company and the Trustee by 4:00 p.m. New York City time on the Notification
Date of its intention to purchase the ROARS on the Remarketing Date, (e)
the Remarketing Dealer for any reason fails to deliver the purchase price
of the ROARS to the Trustee by 3:00 p.m. New York City time on the Business
Day immediately preceding the Remarketing Date, or (f) the Company fails
for any reason to redeem the ROARS following its election to effect such
redemption as specified in Paragraph 6. In any such case, payment shall be
made by the Company through the Trustee to the Participant of each
Beneficial Owner of ROARS, by book-entry through DTC, by the close of
business on the Remarketing Date against delivery or deemed delivery
through DTC of such Beneficial Owner's ROARS. No defense or right against
the Remarketing Dealer shall relieve the Company of its obligations to the
Holders of the ROARS to make such mandatory redemption.
6. OPTIONAL REDEMPTION. (a) Notwithstanding any election by the
Remarketing Dealer to remarket the ROARS, the tendering of the ROARS for
purchase by the Remarketing Dealer shall be subject to the right of the
Company to redeem the ROARS as provided in Paragraph 6(b) below.
(b) The Company, in its sole and absolute discretion, shall have
the right, upon notice to the Remarketing Dealer and the Trustee not later
than 4:00 p.m. New York City time on the Business Day immediately preceding
the Determination Date, to irrevocably elect to redeem the ROARS, in whole
but not in part, on the Remarketing Date. If the Remarketing Dealer elects
to purchase the ROARS and redetermine the Interest Rate to Maturity under
the circumstances described in the last paragraph of Paragraph 4 above, the
Company will retain the right to redeem the ROARS, provided that such
election must be made by 12:30 p.m. New York City time on the Business Day
immediately preceding the Remarketing Date. If the Company gives such
notice to the Remarketing Dealer and the Trustee, then (i) the Remarketing
Dealer will be deemed to have elected not to remarket the ROARS, (ii) the
Company shall redeem the ROARS from Holders as a whole on the Remarketing
Date at a price equal to 100% of the aggregate principal amount of the
ROARS plus all accrued and unpaid interest, if any, on the ROARS to the
Remarketing Date (such payment to be made by the Company through the
Trustee to DTC for distribution to the DTC Participant of each Beneficial
Owner of ROARS, by the close of business on the Remarketing Date against
delivery through DTC of such Beneficial Owner's ROARS) and (iii) the
Company will pay to the Remarketing Dealer the Calculation Amount, as
defined in the Remarketing Agreement.
7. PURCHASE OF THE ROARS BY THE COMPANY. As long as the Remarketing
Agreement is in effect, neither the Company, nor any Person whose
acquisition of ROARS would cause such ROARS not to be outstanding, will
defease, purchase or otherwise acquire any of the ROARS prior to the
Remarketing Date, other than in connection with the fulfillment of its
obligation to redeem the ROARS on the Remarketing Date under the
circumstances described herein. After the Remarketing Date, the Company
may at any time purchase the ROARS at any price in the open market or
otherwise. The ROARS so purchased by the Company may, at its discretion,
be held, resold or surrendered to the Trustee for cancellation.
**FOOTNOTES**
1/ Service Mark of NationsBanc Montgomery Securities LLC
