AS FILED WITH THE SECURITIES AND EXCHANGE COMMISSION ON NOVEMBER 2, 1994
REGISTRATION NO. 33-52331
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
Amendment No. 1
to
FORM S-3
REGISTRATION STATEMENT
Under
The Securities Act of 1933
AMERICAN STORES COMPANY
(Exact name of registrant as specified in its charter)
Delaware 87-0207226
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
_______________________
709 East South Temple
Salt Lake City, Utah 84102
(801) 539-0112
(Address and telephone number of principal executive office)
Kathleen E. McDermott, Esq.
Executive Vice President,
General Counsel and Assistant Secretary
American Stores Company
709 East South Temple
Salt Lake City, Utah 84102
(801) 539-0112
(Name, address and telephone number of agent for service)
Copies to:
Eric S. Robinson, Esq. Richard J. Sandler, Esq.
Wachtell, Lipton, Rosen & Katz Davis Polk & Wardwell
51 West 52nd Street 450 Lexington Avenue
New York, New York 10019 New York, New York 10017
(212) 403-1000 (212) 450-4000
Approximate date of commencement of proposed sale to public: From time
to time after the effective date of this Registration Statement.
If the only securities being registered on this Form are being offered
pursuant to dividend or interest reinvestment plans, please check the
following box. | |
If any of these securities being registered on this Form are to be
offered on a delayed or continuous basis pursuant to Rule 415 under the
Securities Act of 1933, other than securities offered only in connection with
dividend or interest reinvestment plans, check the following box. |X|
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CALCULATION OF REGISTRATION FEE
<TABLE>
<S> <C> <C> <C> <C>
--------------+--------------+--------------+----------------+-------------
| | Proposed | Proposed |
Title of | | Maximum | Maximum | Amount of
Securities | Amount to be| Offering | Aggregate | Registration
to be | Registered | Price | Offering | Fee
Registered | | Per Unit(1)| Price(1) |
--------------+--------------+--------------+----------------+-------------
Debt | $800,000,000 | 100% | $800,000,000| $275,864(2)
Securities | | | |
--------------+--------------+--------------+----------------+-------------
</TABLE>
(1) Estimated solely for the purpose of computing the registration fee.
(2) Previously paid upon filing of Registration Statement.
THE REGISTRANT HEREBY AMENDS THIS REGISTRATION STATEMENT ON SUCH DATE
OR DATES AS MAY BE NECESSARY TO DELAY ITS EFFECTIVE DATE UNTIL THE
REGISTRANT SHALL FILE A FURTHER AMENDMENT WHICH SPECIFICALLY STATES THAT
THIS REGISTRATION STATEMENT SHALL THEREAFTER BECOME EFFECTIVE IN ACCORDANCE
WITH SECTION 8(A) OF THE SECURITIES ACT OF 1933 OR UNTIL THE REGISTRATION
STATEMENT SHALL BECOME EFFECTIVE ON SUCH DATE AS THE COMMISSION, ACTING
PURSUANT TO SAID SECTION 8(A), MAY DETERMINE.
PAGE
<PAGE>
SUBJECT TO COMPLETION, DATED NOVEMBER 2, 1994
American Stores Company
Debt Securities
American Stores Company (the "Company") from time to
time may offer up to $800,000,000 aggregate principal amount of
its debt securities consisting of debentures, notes and/or
other unsecured evidences of indebtedness (the "Debt Securi-
ties"). The Debt Securities may be offered as separate series
in amounts, at prices and on terms to be set forth in supple-
ments to this Prospectus. The Company may sell Debt Securities
directly to other purchasers or to or through underwriters,
dealers or agents. See "Plan of Distribution".
The terms of the Debt Securities, including, where
applicable, the ranking as senior or subordinated Debt Securi-
ties, the specific designation, aggregate principal amount,
denominations, maturity, redeemability, premium, if any, rate
(which may be fixed or variable) and time of payment of inter-
est, if any, terms for redemption at the option of the Company
or the Holder, terms for sinking fund payments, the initial
public offering price, the names of, and the principal amounts,
if any, to be purchased by underwriters and the compensation of
such underwriters, the names of any agents involved in the sale
of the Debt Securities and the applicable agent's commission,
and the other terms in connection with the offering and sale of
the Debt Securities in respect of which this Prospectus is
being delivered, are set forth in the accompanying Prospectus
Supplement or Prospectus Supplements (the "Prospectus Supple-
ment").
As used herein, Debt Securities shall include securi-
ties denominated in U.S. dollars, or at the option of the Com-
pany if so specified in the applicable Prospectus Supplement,
in any other currency or in composite currencies or in amounts
determined by reference to an index.
THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE
SECURITIES AND EXCHANGE COMMISSION OR ANY STATE SECURITIES
COMMISSION NOR HAS THE SECURITIES AND EXCHANGE
COMMISSION OR ANY STATE SECURITIES COMMISSION
PASSED UPON THE ACCURACY OR ADEQUACY OF THIS
PROSPECTUS. ANY REPRESENTATION TO THE
CONTRARY IS A CRIMINAL OFFENSE.
The date of this Prospectus is , 199
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Information contained herein is subject to completion or amendment. A
registration statement relating to these securities has been filed with
the Securities and Exchange Commission. These securities may not be sold
nor may offers to buy be accepted prior to the time the registration
statement becomes effective. This prospectus shall not constitute an
offer to sell or the solicitation of an offer to buy nor shall there be
any sale of these securities in any State in which such offer,
solicitation or sale would be unlawful prior to registration or
qualification under the securities laws of any such State.
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<PAGE>
NO DEALER, SALESPERSON OR OTHER PERSON HAS BEEN
AUTHORIZED TO GIVE ANY INFORMATION OR TO MAKE ANY REPRESENTA-
TIONS OTHER THAN THOSE CONTAINED IN THIS PROSPECTUS OR THE PRO-
SPECTUS SUPPLEMENT IN CONNECTION WITH THE OFFER CONTAINED HERE-
IN OR THEREIN, AND, IF GIVEN OR MADE, SUCH INFORMATION OR
REPRESENTATIONS MUST NOT BE RELIED UPON AS HAVING BEEN AUTHO-
RIZED BY THE COMPANY OR ANY UNDERWRITER. THIS PROSPECTUS AND
THE PROSPECTUS SUPPLEMENT DO NOT CONSTITUTE AN OFFER TO SELL,
OR A SOLICITATION OF ANY OFFER TO BUY, ANY SECURITIES OTHER
THAN THE DEBT SECURITIES OR AN OFFER TO SELL, OR A SOLICITATION
OF ANY OFFER TO BUY, DEBT SECURITIES IN ANY JURISDICTION IN
WHICH, OR TO ANY PERSON TO WHOM, SUCH OFFER OR SOLICITATION
WOULD BE UNLAWFUL. NEITHER THE DELIVERY OF THIS PROSPECTUS OR
THE PROSPECTUS SUPPLEMENT NOR ANY SALE MADE HEREUNDER OR THERE-
UNDER SHALL, UNDER ANY CIRCUMSTANCES, CREATE AN IMPLICATION
THAT THERE HAS BEEN NO CHANGE IN THE AFFAIRS OF THE COMPANY
SINCE THE DATE HEREOF OR THEREOF OR THAT THE INFORMATION HEREIN
OR THEREIN IS CORRECT AS OF ANY TIME SUBSEQUENT TO THEIR
RESPECTIVE DATES.
AVAILABLE INFORMATION
Additional information regarding the Company and the
Debt Securities is contained in the Registration Statement and
the exhibits relating thereto, filed with the Securities and
Exchange Commission (the "Commission") under the Securities Act
of 1933, as amended (the "Securities Act"). For such infor-
mation, reference is made to the Registration Statement and the
exhibits thereto. The Registration Statement and the exhibits
thereto may be inspected without charge at the office of the
Commission, 450 Fifth Street, N.W., Washington, D.C. 20549 and
copies thereof may be obtained from the Commission at pre-
scribed rates.
The Company is subject to the information require-
ments of the Securities Exchange Act of 1934, as amended (the
"Exchange Act"), and, in accordance therewith, files reports,
proxy statements and other information with the Commission.
Such reports, proxy statements and other information can be
inspected and copied at the public reference facilities main-
tained by the Commission at Room 1024, Judiciary Plaza, 450
Fifth Street, N.W. Washington, D.C. 20549; Citicorp Center, 500
West Madison Street, Chicago, Illinois 60661, Suite 1400, and 7
World Trade Center, New York, New York 10048. Copies of such
material can be obtained at prescribed rates from the Public
Reference Section of the Commission at Judiciary Plaza, 450
Fifth Street, N.W. Washington, D.C. 20549. Such reports, proxy
statements and other information are also available for in-
spection and copying at the offices of each of the following
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exchanges on which the Company's Common Stock is listed: New
York Stock Exchange, Inc., 20 Broad Street, New York, New York
10005, the Midwest Stock Exchange, Inc., 440 South LaSalle
Street, Chicago, Illinois 60605, the Pacific Stock Exchange,
Inc., 301 Pine Street, San Francisco, California 94104, and the
Philadelphia Stock Exchange, Inc., 1900 Market Street, Phila-
delphia, Pennsylvania 19103.
INCORPORATION OF CERTAIN DOCUMENTS BY REFERENCE
The following documents heretofore filed by the Com-
pany with the Commission are incorporated herein by reference:
1. The Company's Annual Report on Form 10-K for the
fiscal year ended January 29, 1994, which incorporates by
reference certain portions of: (a) the Company's 1993
Annual Report to Shareholders; and (b) the Company's proxy
statement for the 1994 Annual Meeting of Shareholders;
2. The Company's Quarterly Reports on Form 10-Q for
the thirteen weeks ended April 30, 1994 and the thirteen
weeks ended July 30, 1994; and
3. The Company's Report on Form 8-K dated March 1,
1994.
All documents filed by the Company with the Commis-
sion pursuant to Section 13(a), 13(c), 14 or 15(d) of the
Exchange Act subsequent to the date of this Prospectus and
prior to the termination of the offering described herein shall
be deemed to be incorporated by reference in this Prospectus
and to be part hereof from their respective dates of filing.
Any statement contained in this Prospectus or in a document
incorporated or deemed to be incorporated herein by reference
shall be deemed to be modified or superseded for all purposes
to the extent that a statement contained in this Prospectus or
in any other subsequently filed document which is or is deemed
to be incorporated by reference herein modifies or supersedes
such statement.
The Company will provide without charge to each per-
son to whom this Prospectus is delivered, upon the written or
oral request of such person, a copy of any or all of the docu-
ments which have been or may be incorporated herein by refer-
ence (other than exhibits to such documents unless such
exhibits are specifically incorporated by reference into such
documents). Requests for such copies should be directed to
American Stores Company, 709 East South Temple, Salt Lake City,
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Utah 84102, P.O. Box 27447, Salt Lake City, Utah 84127-0447,
Attention: Investor Relations (telephone: 801-539-0112).
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THE COMPANY
American Stores Company is one of the nation's lead-
ing food and drug retailers with annual sales in its fiscal
year ended January 29, 1994 exceeding $18 billion. The Company
is principally engaged in a single industry segment, the retail
sale of food and drug merchandise. Through its wholly-owned
subsidiaries, the Company operates stand-alone food and drug
stores and combination food/drug store units, which are gener-
ally located in major metropolitan markets. The Company's food
stores operate under the Lucky Stores, Jewel Food Stores, Acme
Markets and Jewel Osco names. The Company's drug stores
operate under the Osco Drug and Sav-on names. As of September
24, 1994, the Company operated 1,635 stores in 27 states,
including 149 Jewel Osco combination stores which are jointly
operated by Osco Drug and Jewel Food Stores and counted as two
separate stores.
The Company's principal executive offices are located
at 709 East South Temple, Salt Lake City, Utah 84102 (tele-
phone: 801-539-0112). References to the "Company" in this
Prospectus include American Stores Company and its subsidiaries
unless the context otherwise requires.
USE OF PROCEEDS
Unless otherwise set forth in the applicable Prospec-
tus Supplement, the net proceeds from the sale of the Debt
Securities will be used for general corporate purposes,
including the repayment of existing indebtedness, additions to
working capital and capital expenditures. Any specific alloca-
tion of the net proceeds of an offering of Debt Securities to a
specific purpose will be described in the related Prospectus
Supplement. The Company anticipates that it will raise addi-
tional funds from time to time through equity or debt financ-
ings to refinance outstanding indebtedness and to finance its
businesses.
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RATIO OF EARNINGS TO FIXED CHARGES
The ratio of earnings to fixed charges for the Com-
pany for each of the fiscal years ended January 29, 1994,
January 30, 1993, February 1, 1992, February 2, 1991 and
February 3, 1990 was 2.68, 2.21, 2.17, 1.76 and 1.47, respec-
tively, and for the twenty-six week periods ended July 30, 1994
and July 31, 1993 was 2.53 and 2.40, respectively. In the com-
putation of the ratio of earnings to fixed charges for the Com-
pany, earnings consist of earnings before income taxes and
before cumulative effect of changes in accounting principles
plus fixed charges (adjusted for capitalized interest). Fixed
charges consist of interest, whether expensed or capitalized
(including the amortization of debt expense), plus the amount
of rental expense which is representative of the interest
factor in the particular case.
DESCRIPTION OF DEBT SECURITIES
The following descriptions of the terms of the Debt
Securities set forth certain general terms and provisions of
the Debt Securities to which any Prospectus Supplement may
relate. The particular terms of the Debt Securities offered by
any Prospectus Supplement (the "Offered Debt Securities") and
the extent, if any, to which such general provisions may apply
to the Debt Securities so offered will be described in the Pro-
spectus Supplement relating to such Offered Debt Securities.
The Debt Securities which will constitute senior debt
of the Company are to be issued under an Indenture (the "Senior
Debt Indenture"), to be entered into between the Company and
The First National Bank of Chicago as Trustee (the "Senior
Trustee"), and Debt Securities which will constitute subordi-
nated debt of the Company are to be issued under an Indenture
(the "Subordinated Debt Indenture" and, collectively with the
Senior Debt Indenture, the "Indentures"), to be entered into
between the Company and a trustee to be determined (the "Subor-
dinated Trustee"), the forms of which have been filed as exhib-
its to the Registration Statement. The following summaries of
certain provisions of the Debt Securities and the Indentures do
not purport to be complete and are subject to, and are quali-
fied in their entirety by reference to, all the provisions of
the respective Indentures, including the definitions therein of
certain terms. Whenever particular provisions or defined terms
in the Indentures are referred to herein, such provisions or
defined terms are incorporated by reference.
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GENERAL
The Debt Securities will be unsecured senior or sub-
ordinated obligations of the Company.
The Indentures do not limit the amount of Debt Secu-
rities that may be issued thereunder and provide that Debt
Securities may be issued thereunder from time to time in one or
more series.
Reference is made to the Prospectus Supplement for
the following terms of and information relating to the Offered
Debt Securities (to the extent such terms are applicable to
such Debt Securities): (i) classification as senior or subor-
dinated Debt Securities, the specific designation, aggregate
principal amount, purchase price and denomination; (ii) the
currency or units based on or relating to currencies in which
such Debt Securities are denominated and/or in which principal
(and premium, if any) and/or any interest will or may be pay-
able; (iii) any date of maturity; (iv) the method by which
amounts payable in respect of principal, premium (if any) or
interest on, or upon the redemption of, such Debt Securities
may be calculated, and any currencies or indices, or value,
rate or price, relevant to such calculation; (v) interest rate
or rates (or the method by which such rate will be determined),
if any; (vi) the date or dates on which any such interest will
be payable; (vii) the place or places where the principal of
and interest, if any, on the Offered Debt Securities will be
payable; (viii) any redemption, repayment or sinking fund pro-
visions; (ix) whether the Offered Debt Securities will be issu-
able in registered form or bearer form ("Bearer Securities") or
both and, if Bearer Securities are issuable, any restrictions
applicable to the exchange of one form for another and to the
offer, sale and delivery of Bearer Securities; (x) any appli-
cable United States federal income tax consequences, including
whether and under what circumstances the Company will pay addi-
tional amounts on Offered Debt Securities held by a person who
is not a U.S. person (as defined in the Prospectus Supplement)
in respect of any tax, assessment or governmental charge with-
held or deducted and, if so, whether the Company will have the
option to redeem such Debt Securities rather than pay such
additional amounts; and (xi) any other specific terms of the
Offered Debt Securities, including any additional or different
events of default, remedies or covenants provided for with
respect to such Debt Securities, and any terms which may be
required by or advisable under applicable laws or regulations.
Debt Securities may be presented for exchange and
registered Debt Securities may be presented for transfer in the
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manner, at the places and subject to the restrictions set forth
in the Debt Securities and the Prospectus Supplement. Such
services will be provided without charge, other than any tax or
other governmental charge payable in connection therewith, but
subject to the limitations provided in the applicable Inden-
ture. Bearer Securities and the coupons, if any ("Coupons"),
appertaining thereto will be transferable by delivery.
Debt Securities may bear interest at a fixed rate (a
"Fixed Rate Security") or a floating rate (a "Floating Rate
Security"). Debt Securities bearing no interest or interest at
a rate that at the time of issuance is below the prevailing
market rate may be sold at a discount below their stated prin-
cipal amount. Special United States federal income tax consid-
erations applicable to any such discounted Debt Securities or
to certain Debt Securities issued at par which are treated as
having been issued at a discount for United States federal
income tax purposes will be described in the relevant Prospec-
tus Supplement.
Debt Securities may be issued from time to time with
payment terms which are calculated by reference to the value or
price of one or more currencies or indices. Holders of such
Debt Securities may receive a payment of the principal amount
on any principal payment date, or a payment of interest on any
interest payment date, that is greater than or less than the
amount of principal or interest otherwise payable on such
dates, or a redemption amount on any redemption date that is
greater than or less than the principal amount of such Debt
Securities, depending upon the value or price on such dates of
the applicable currency or index. Information for determining
the amount of principal, premium (if any), interest or redemp-
tion amounts payable on any date, the currencies, commodities
or indices to which the amount payable on such date is linked
and certain additional tax considerations will be set forth in
the relevant Prospectus Supplement.
Substantially all of the Company's assets are held by
the Company's subsidiaries. The rights of the Company and its
creditors, including the Holders of the Debt Securities, to
participate in the assets of any subsidiary upon any liquida-
tion or reorganization of such subsidiary or otherwise will be
effectively subordinated to and subject to the prior claims of
creditors of such subsidiary, except to the extent that the
Company may itself be a creditor with recognized claims against
the subsidiary. As of July 30, 1994, the Company's subsid-
iaries had approximately $3,557 million of debt and other
obligations. The ability of the Company to pay principal of
and premium, if any, and interest on the Debt Securities will
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be dependent upon the receipt of funds from its subsidiaries by
way of dividends, interest, loans or otherwise.
SENIOR DEBT
The Debt Securities and Coupons, if any, appertaining
thereto that will constitute part of the senior debt of the
Company will be issued under the Senior Debt Indenture and will
rank pari passu with all other unsecured and unsubordinated
debt of the Company.
The Senior Debt Indenture also provides the following
covenants:
Limitations on Liens. The Company covenants that, so
long as any Debt Securities under the Senior Debt Indenture
remain outstanding, it will not, and will not permit any Re-
stricted Subsidiary (as defined below) to issue, assume or
guarantee any Indebtedness (as defined below) which is secured
by a mortgage, pledge, security interest, lien or encumbrance
(each a "lien") upon any Operating Property or Operating Asset,
whether now owned or hereafter acquired, of the Company or any
Restricted Subsidiary without effectively providing that such
Debt Securities (together with, if the Company shall so
determine, any other Indebtedness of the Company ranking
equally with such Debt Securities) shall be equally and ratably
secured by a lien on such assets ranking ratably with or equal
to (or at the Company's option prior to) such secured Indebted-
ness, except that the foregoing restriction shall not apply to
(a) liens on any property or assets of any corporation existing
at the same time such corporation becomes a Restricted Subsid-
iary provided that such lien does not extend to any other prop-
erty of the Company or any of its Restricted Subsidiaries; (b)
liens on any property or assets (including stock) existing at
the time of acquisition thereof, or to secure the payment of
the purchase price of such property or assets, or to secure
indebtedness incurred, assumed or guaranteed by the Company or
a Restricted Subsidiary for the purpose of financing the pur-
chase price of such property or of improvements or construction
thereon, which indebtedness is incurred, assumed or guaranteed
prior to, at the time of, or within 18 months after such acqui-
sition (or in the case of real property, completion of such
improvement or construction or commencement of full operations
at such property, whichever is later (which in the case of a
retail store is the opening of the store for business to the
public)) provided that such lien does not extend to any other
property of the Company or any of its Restricted Subsidiaries;
(c) liens securing indebtedness owing by any Restricted Subsid-
iary to the Company or another Restricted
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Subsidiary; (d) liens on any property or assets of a corpora-
tion existing at the time such corporation is merged into or
consolidated with the Company or a Restricted Subsidiary or at
the time of a purchase, lease or other acquisition of the
assets of a corporation or firm as an entirety or substantially
as an entirety by the Company or a Restricted Subsidiary pro-
vided that such lien does not extend to any other property of
the Company or any of its Restricted Subsidiaries; (e) liens on
any property or assets of the Company or a Restricted Subsid-
iary in favor of the United States of America or any State
thereof, or in favor of any other country, or political sub-
division thereof, to secure certain payments pursuant to any
contract or statute or to secure any indebtedness incurred or
guaranteed for the purpose of financing all or any part of the
purchase price (or, in the case of real property, the cost of
construction) of the property or assets subject to such liens
(including but not limited to, liens incurred in connection
with pollution control, industrial revenue or similar financ-
ing); (f) any extension, renewal or replacement (or successive
extensions, renewals or replacements) in whole or in part, of
any lien referred to in the foregoing clauses (a) to (e),
inclusive; (g) certain statutory liens or other similar liens
arising in the ordinary course of business of the Company or a
Restricted Subsidiary, or certain liens arising out of gov-
ernmental contracts; (h) certain pledges, deposits or liens
made or arising under worker's compensation or similar legis-
lation or in certain other circumstances; (i) certain liens in
connection with legal proceedings, including certain liens
arising out of judgments or awards; (j) liens for certain taxes
or assessments, landlord's liens and liens and charges inci-
dental to the conduct of the business, or the ownership of the
property or assets of the Company or of a Restricted Subsid-
iary, which were not incurred in connection with the borrowing
of money and which do not in the opinion of the Company,
materially impair the use of such property or assets in the
operation of the business of the Company or such Restricted
Subsidiary or the value of such property or assets for the
purposes thereof; or (k) liens not permitted by the foregoing
clauses (a) to (j), inclusive, if at the time of and after
giving effect to, the creation or assumption of such liens, the
aggregate amount of all Indebtedness of the Company and its
Restricted Subsidiaries secured by all liens not so permitted
by the foregoing clauses (a) through (j), inclusive, together
with the Attributable Debt (as defined below) in respect of
Sale and Lease-Back Transactions permitted by clause (a) under
"Limitation on Sale and Lease-Back Transactions" below, does
not exceed the greater of (i) $250 million or (ii) 15% of
Consolidated Net Tangible Assets (as defined below).
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Limitation on Sale and Lease-Back Transactions. So
long as any Debt Securities under the Senior Debt Indenture are
outstanding, the Company will not, and will not permit any
Restricted Subsidiary to, enter into any arrangement with any
person providing for the leasing by the Company or a Restricted
Subsidiary of any Operating Property or Operating Asset (other
than any such arrangement involving a lease for a term, includ-
ing renewal rights, for not more than three years and leases
between the Company and a Subsidiary or between Subsidiaries),
whereby such Operating Property or Operating Asset has been or
is to be sold or transferred by the Company or a Restricted
Subsidiary to such person (a "Sale and Lease-Back Transaction")
unless (a) the Company or such Restricted Subsidiary would, at
the time of entering into a Sale and Lease-Back Transaction, be
entitled to incur Indebtedness secured by a lien on the Operat-
ing Property or Operating Asset to be leased in an amount at
least equal to the Attributable Debt in respect of such trans-
action without equally and ratably securing the Debt Securities
pursuant to the provisions described under "Limitations on
Liens" above, or (b) the proceeds of the sale of the Operating
Property or Operating Assets to be leased are at least equal to
their fair market value and an amount in cash equal to the net
proceeds is applied, within 180 days of the effective date of
such transaction to the purchase or acquisition (or, in the
case of Operating Property, the construction) of Operating
Property or Operating Assets or to the retirement (other than
at maturity or pursuant to a mandatory sinking fund or
redemption provision and other than Indebtedness owned by the
Company or any Restricted Subsidiary) of Debt Securities or of
Funded Indebtedness (as defined below) of the Company ranking
on a parity with or senior to the Debt Securities, or in the
case of a Sale and Lease-Back Transaction by a Restricted
Subsidiary, of Funded Indebtedness of such Restricted
Subsidiary, provided that in connection with any such
retirement, any related loan commitment or the like shall be
reduced in an amount equal to the principal amount so retired.
The foregoing restriction shall not apply to, in the case of
any Operating Property or Operating Asset acquired or
constructed subsequent to the date eighteen months prior to the
date of the Indenture, any Sale and Lease-Back Transaction with
respect to such Operating Asset or Operating Property (in-
cluding presently owned real property upon which such Operating
Property is to be constructed) if a binding commitment is
entered into with respect to such Sale and Lease-Back Trans-
action within 18 months after the later of the acquisition of
the Operating Property or Operating Asset or the completion of
improvements or construction thereon or commencement of full
operations at such Operating Property (which in the case of a
retail store is the opening of the store for business to the
public).
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Definitions. "Attributable Debt" means in connection
with a Sale and Lease-Back Transaction the aggregate of present
values (discounted at a rate per annum equal to the average
interest borne by all outstanding Debt Securities determined on
a weighted average basis and compounded semi-annually) of the
obligations of the Company or any Subsidiary for net rental
payments during the remaining term of the applicable lease
(including any period for which such lease has been extended or
may, at the option of the lessor, be extended).
"Capital Lease" means any lease of property which, in
accordance with generally accepted accounting principles,
should be capitalized on the lessee's balance sheet or for
which the amount of the asset and liability thereunder as if so
capitalized should be disclosed in a note to such balance
sheet; and "Capitalized Lease Obligation" means the amount of
the liability which should be so capitalized or disclosed.
"Consolidated" when used with respect to any of the
terms defined in the Indenture, refers to such terms as re-
flected in a consolidation of the accounts of the Company and
its Restricted Subsidiaries in accordance with generally ac-
cepted accounting principles.
"Funded Indebtedness" means any Indebtedness maturing
by its terms more than one year from the date of the determina-
tion thereof, including any Indebtedness renewable or extend-
ible at the option of the obligor to a date later than one year
from the date of the determination thereof.
"Indebtedness" means all obligations (other than the
Debt Securities of such series) of, or guaranteed or assumed
by, the Company or any Restricted Subsidiary for borrowed money
or evidenced by bonds, debentures, notes or other similar
instruments.
"Net Tangible Assets" means the total amounts of
assets (less depreciation and valuation reserves and other
reserves and items deductible from gross book value of specific
asset accounts under generally accepted accounting principles)
which under generally accepted accounting principles would be
included on a balance sheet after deducting therefrom (a) all
liability items except Funded Indebtedness, Capitalized Lease
Obligations, stockholders' equity and reserves for deferred
income taxes and (b) all goodwill, trade names, trademarks,
patents, unamortized debt discount and expense and other like
intangibles, which in each case would be so included on such
balance sheet.
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"Operating Assets" means all merchandise inventories,
furniture, fixtures and equipment (including all transportation
and warehousing equipment but excluding office equipment and
data processing equipment) owned or leased pursuant to Capital
Leases by the Company or a Restricted Subsidiary.
"Operating Property" means all real property and im-
provements thereon owned or leased pursuant to Capital Leases
by the Company or a Restricted Subsidiary and constituting,
without limitation, any store, warehouse, service center or
distribution center wherever located, provided that such term
shall not include any store, warehouse, service center or dis-
tribution center which the Company's Board of Directors
declares by written resolution not to be of material importance
to the business of the Company and its Restricted Subsidiaries.
"Restricted Subsidiaries" means all Subsidiaries
other than Non-Restricted Subsidiaries. "Non-Restricted Sub-
sidiary" means any Subsidiary that the Company's Board of
Directors has in good faith declared pursuant to a written
resolution not to be of material importance, either singly or
together with all other Non-Restricted Subsidiaries, to the
business of the Company and its consolidated Subsidiaries taken
as a whole. Initially the Company will have no Non-Restricted
Subsidiaries.
"Subsidiary" means (i) any corporation or other
entity of which securities or other ownership interests having
ordinary voting power to elect a majority of the board of
directors or other persons performing similar functions are at
the time directly or indirectly owned by the Company or (ii)
any partnership of which more than 50% of the partnership
interest are owned by the Company or any Subsidiary.
Unless otherwise specified in the Prospectus Supple-
ment relating to a particular series of Offered Debt Securi-
ties, the covenants applicable to the Debt Securities would not
necessarily afford holders protection in the event of a highly
leveraged or other transaction involving the Company or in the
event of a material adverse change in the Company's financial
condition or results of operation. Unless otherwise specified
in the Prospectus Supplement relating to a particular series of
Offered Debt Securities, the Debt Securities do not contain any
other provisions that are designed to afford protection in the
event of a highly leveraged transaction involving the Company.
SUBORDINATED DEBT
The Debt Securities and Coupons, if any, appertaining
thereto that will constitute part of the subordinated debt of
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the Company (the "Subordinated Debt Securities") will be issued
under the Subordinated Debt Indenture and will be subordinate
and junior in right of payment, to the extent and in the manner
set forth in the Subordinated Debt Indenture, to all "Senior
Indebtedness" of the Company. The Subordinated Debt Indenture
defines "Senior Indebtedness" as all indebtedness of, or guar-
anteed or assumed by, the Company for borrowed money or evi-
denced by bonds, debentures, notes, letters of credit, interest
rate exchange agreements, currency exchange agreements, commod-
ity forward contracts or other similar instruments, or indebt-
edness or obligations with respect to any lease of real or
personal property whether existing on the date hereof or here-
inafter incurred, and any guarantee, amendments, renewals,
extensions, modifications and refundings of any such indebted-
ness or obligation, provided that Senior Indebtedness shall not
include (i) obligations that, when incurred and without respect
to any election under Section 1111(b) of Title 11, United
States Code, were without recourse to the Issuer, (ii) obliga-
tions of the Company to any Subsidiary, and (iii) any other
obligations which by the terms of the instrument creating or
evidencing the same are specifically designated as not being
senior in right of payment to the Subordinated Debt Securities.
In the event (a) of any insolvency or bankruptcy pro-
ceedings, or any receivership, liquidation or other similar
proceedings including reorganization in respect of the Company
or a substantial part of its property or (b) that (i) a default
shall have occurred with respect to the payment of principal of
(and premium, if any) or any interest on or other monetary
amounts due and payable on any Senior Indebtedness or (ii)
there shall have occurred an event of default (other than a
default in the payment of principal, premium, if any, or inter-
est, or other monetary amounts due and payable) with respect to
any Senior Indebtedness, as defined therein or in the instru-
ment under which the same is outstanding, permitting the holder
or holders thereof to accelerate the maturity thereof, and such
default or event of default shall not have been cured or waived
or shall not have ceased to exist, unless, in the case of a
default under clause (ii) above, the default with respect to
the Senior Indebtedness is cured or waived, or 180 days pass
after notice of the default is given to the holders of Senior
Indebtedness (unless the maturity of such Senior Indebtedness
has been accelerated), then the holders of all Senior Indebted-
ness shall first be entitled to receive payment of the full
amount unpaid thereon, or provision shall be made, in accor-
dance with the relevant Senior Indebtedness, for such payment
in money or money's worth, before the holders of any of the
Subordinated Debt Securities or Coupons are entitled to receive
a payment on account of the principal of (and premium, if any)
or any interest on the indebtedness
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evidenced by such Subordinated Debt Securities or of such
Coupons. No new period of suspension of payments under clause
(ii) above may be commenced by reason of the same event of
default (or any other event of default that existed or was
continuing on the date of the commencement of such period)
within twelve months after the first such notice relating
thereto. Without limitation of the foregoing, upon any
acceleration of the Subordinated Debt Securities because of an
Event of Default, the Company must promptly notify the holders
of Senior Indebtedness of such acceleration, and may not pay
the Subordinated Debt Securities unless (A) 120 days pass after
such acceleration and (B) the terms of the Subordinated Debt
Indenture permit such payment at such time.
By reason of such subordination, in the event of
bankruptcy, insolvency or liquidation of the Company, creditors
of the Company who are holders of Senior Indebtedness and gen-
eral creditors of the Company may recover more, ratably, than
holders of the Subordinated Debt Securities.
Substantially all of the Company's assets are held by
the Company's subsidiaries and the Subordinated Debt Securities
are effectively subordinated to the obligations of each subsid-
iary of the Company to the extent of the assets of each such
subsidiary. As of July 30, 1994, the Company had approximately
$2,171 million of debt and other obligations which would have
constituted Senior Indebtedness and the Company's subsidiaries
had approximately $3,557 million of debt and other obligations
to which the Subordinated Debt Securities would have been
effectively subordinated. Certain contingent obligations of
the Company, including certain guarantees, letters of credit,
interest rate exchange agreements, currency exchange agreements
and commodity forward contracts, would constitute Senior
Indebtedness if such contingent obligations became payable by
the Company.
The Company expects from time to time to incur
additional indebtedness constituting Senior Indebtedness. The
Subordinated Debt Indenture does not prohibit or limit the
incurrence of additional Senior Indebtedness or any other
indebtedness and does not contain financial covenants or simi-
lar restrictions on the Company.
MERGER AND CONSOLIDATION
Each Indenture provides that the Company will not
merge or consolidate with any corporation, partnership or other
entity and will not sell, lease or convey all or substantially
all its assets to any entity, unless the Company shall be the
surviving entity, or the surviving entity or the successor
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entity that acquires all or substantially all the assets of the
Company shall be a corporation or partnership organized under
the laws of the United States or a State thereof or the Dis-
trict of Columbia and shall expressly assume all obligations of
the Company under such Indenture and the Debt Securities issued
thereunder, and immediately after such merger, consolidation,
sale, lease or conveyance, the Company or such successor entity
shall not be in default in the performance of the covenants and
conditions of the Indenture to be performed or observed by the
Company.
EVENTS OF DEFAULT
An Event of Default is defined under each Indenture
with respect to Debt Securities of any series issued under such
Indenture as being: (a) default in payment of any principal of
the Debt Securities of such series, either at maturity (or upon
a redemption), by declaration or otherwise (including any sink-
ing fund payment); (b) default for 30 days in payment of any
interest on any Debt Securities of such series; (c) default for
60 days after written notice thereof to the Company by the
Trustee, or to the Company and the Trustee by the holders of
not less than 25% in principal amount of outstanding Debt Secu-
rities of such series, in the observance or performance of any
other covenant or agreement in the Debt Securities of such
series or the Indenture other than a covenant included in the
Indenture solely for the benefit of a series of Debt Securities
other than such series; (d) certain events of bankruptcy,
insolvency or reorganization relating to the Company or any
Significant Subsidiary (as such term is defined in Regulation
S-X under the Exchange Act). In addition, with respect to
Senior Debt Securities, the Senior Debt Indenture defines an
event of default as being: (e) failure by the Company or any
Significant Subsidiary to make any payment at maturity, includ-
ing any applicable grace period, in respect of indebtedness, in
an amount in excess of $25,000,000 or the equivalent thereof in
any other currency or composite currency and continuance of
such failure for a period of 30 days after written notice
thereof to the Company by the Trustee, or to the Company and
the Trustee by the holders of not less than 25% in principal
amount of outstanding Debt Securities of such series; (f) a
default with respect to any indebtedness of the Company or any
Significant Subsidiary, which default results in the accelera-
tion of any indebtedness (other than non-recourse obligations
or the Debt Securities of such series) in an amount in excess
of $25,000,000 without such indebtedness having been discharged
or such acceleration having been cured, waived, rescinded or
annulled for a period of 30 days after written notice thereof
to the Company by the Trustee, or to the Company
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and the Trustee by the holders of not less than 25% in prin-
cipal amount of outstanding Debt Securities of such series,
indebtedness being defined to mean all obligations of, or guar-
anteed or assumed by, the Company or any Significant Subsidiary
for borrowed money or evidenced by bonds, debentures, notes or
other similar instruments; provided, however, that if any such
failure, default or acceleration referred to in clause (e) or
(f) above shall cease to exist or be cured, waived, rescinded
or annulled, then the Event of Default by reason thereof shall
be deemed likewise to have been thereupon cured and (g) any
other Event of Default provided with respect to Debt Securities
of that series.
Each Indenture provides that, if an Event of Default
shall have occurred and be continuing (other than an Event of
Default specified in clause (d) above relating to the Company),
either the Trustee or the holders of not less than 25% in the
principal amount of the Debt Securities of such series then
outstanding may declare the principal of all Debt Securities of
such series and interest accrued thereon to be due and payable
immediately, but upon certain conditions such declarations may
be annulled and past defaults may be waived (except a continu-
ing default in payment of principal (including any required
purchase) of (or premium, if any) or interest on such Debt
Securities) by the holders of a majority in principal amount of
the Debt Securities of such series then outstanding. If an
Event of Default specified in clause (d) above relating to the
Company occurs, such principal amount shall ipso facto become
and be immediately due and payable without any declaration or
other act on the part of the Trustee or any holder.
Each Indenture provides that the Trustee, subject to
the duty of the Trustee during a default to act with the
required standard of care, has no obligation to exercise any
right or power granted it under the Indenture at the request of
holders of Debt Securities unless the Trustee is indemnified by
such holders. Subject to such provisions in each Indenture for
the indemnification of the Trustee and certain other limita-
tions, the holders of a majority in principal amount of the
outstanding Debt Securities of each series issued under such
Indenture may direct the time, method and place of conducting
any proceeding for any remedy available to the Trustee, or
exercising any trust or power conferred on the Trustee.
Each Indenture provides that no holder of Debt Secu-
rities of any series issued under such Indenture may institute
any action against the Company under such Indenture (except
actions for payment of overdue principal, premium (if any) or
interest) unless such holder previously shall have given to the
Trustee written notice of default and continuance thereof and
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the holders of not less than 25% in principal amount of the
Debt Securities of such series issued under such Indenture then
outstanding shall have requested the Trustee to institute such
action and shall have offered the Trustee reasonable indemnity,
the Trustee shall not have instituted such action within 60
days of such request and the Trustee shall not have received
direction inconsistent with such written request by the holders
of a majority in principal amount of the Debt Securities of
such series issued under such Indenture and then outstanding.
Under each Indenture, the Company is required to file
annually with the Trustee a certificate of no default or a cer-
tificate specifying any default that exists.
DISCHARGE, DEFEASANCE AND COVENANT DEFEASANCE
Unless otherwise specified in the applicable Prospec-
tus Supplement, the Company can discharge or defease its obli-
gations with respect to each series of Debt Securities as set
forth below.
Under terms satisfactory to the Trustee, the Company
may discharge certain obligations to holders of any series of
Debt Securities issued under such Indenture which have not
already been delivered to the Trustee for cancellation and
which have either become due and payable or are by their terms
due and payable within one year (or scheduled for redemption
within one year) by irrevocably depositing with the Trustee
cash or, in the case of Debt Securities payable only in U.S.
dollars, U.S. Government Obligations (as defined in such Inden-
ture) as trust funds in an amount certified to be sufficient to
pay at maturity (or upon redemption) the principal of and
interest on such Debt Securities.
The Company may also discharge any and all of its
obligations to holders of any series of Debt Securities issued
under an Indenture at any time ("defeasance"), but may not
thereby avoid its duty to register the transfer or exchange of
such series of Debt Securities, to replace any temporary, muti-
lated, destroyed, lost, or stolen series of Debt Securities or
to maintain an office or agency in respect of such series of
Debt Securities. Defeasance may be effected only if, among
other things: (i) the Company irrevocably deposits with the
Trustee cash or, in the case of Debt Securities payable only in
U.S. dollars, U.S. Government Obligations, as trust funds in an
amount certified to be sufficient to pay at maturity (or upon
redemption) the principal of and interest on all outstanding
Debt Securities of such series issued under the Indenture; (ii)
the Company delivers to the Trustee an opinion of counsel to
the effect that the holders of such series of Debt Securities
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will not recognize income, gain or loss for United States fed-
eral income tax purposes as a result of such defeasance and
that defeasance will not otherwise alter such holders' United
States federal income tax treatment of principal and interest
payments on such series of Debt Securities (such opinion must
be based on a ruling of the Internal Revenue Service or a
change in United States federal income tax law occurring after
the date of such Indenture, since such a result would not occur
under current tax law); and (iii) in the case of the Subordi-
nated Debt Indenture (a) no event or condition shall exist
that, pursuant to certain provisions described under "Subordi-
nated Debt" above, would prevent the Company from making pay-
ments of principal of (and premium, if any) and interest on the
Subordinated Debt Securities at the date of the irrevocable
deposit referred to above or at any time during the period end-
ing on the 121st day after such deposit date and (b) the Com-
pany delivers to the Trustee for the Subordinated Debt Inden-
ture an opinion of counsel to the effect that (1) the trust
funds will not be subject to any rights of holders of Senior
Indebtedness and (2) after the 121st day following the deposit,
the trust funds will not be subject to the effect of any appli-
cable bankruptcy, insolvency, reorganization or similar laws
affecting creditors' rights generally, except that if a court
were to rule under any such law in any case or proceeding that
the trust funds remained property of the Company, then the
Trustee and the holders of the Subordinated Debt Securities
would be entitled to certain rights as secured creditors in
such trust funds.
MODIFICATION OF THE INDENTURE
Each Indenture provides that the Company and the
Trustee may enter into supplemental indentures without the con-
sent of the holders of Debt Securities to: (a) secure such
Debt Securities, (b) evidence the assumption by a successor
entity of the obligations of the Company, (c) add covenants for
the protection of the holders of such Debt Securities, (d) evi-
dence the acceptance of appointment by a successor trustee or
(e) cure any ambiguity or correct any inconsistency in the
Indenture or amend the Indenture in any other manner which the
Company may deem necessary or desirable and which will not
adversely affect the interests of the holders of Debt Securi-
ties issued thereunder.
Each Indenture also contains provisions permitting
the Company and the Trustee, with the consent of the holders of
not less than a majority in principal amount of Debt Securities
of any series issued under such Indenture then outstanding and
affected, to add any provisions to, or change in any manner or
eliminate any of the provisions of, such Indenture or modify in
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any manner the rights of the holders of the Debt Securities of
such series; provided that the Company and the Trustee may not,
without the consent of the holder of each outstanding Debt
Security affected thereby, (a) change the stated maturity of
the principal of any Debt Security, or reduce the principal
amount thereof or any premium thereon or reduce the rate or
extend the time of payment of interest thereon, or reduce any
amount payable on redemption thereof or otherwise change the
redemption provisions in a manner adverse to holders or change
the currency in which the principal thereof or interest thereon
is payable or reduce the amount of any original issue discount
security payable upon acceleration or provable in bankruptcy or
alter certain provisions of the Indenture relating to the Debt
Securities issued thereunder not denominated in U.S. dollars or
impair the right to institute suit for the enforcement of any
payment on any Debt Security when due or (b) reduce the afore-
said percentage in principal amount of Debt Securities of any
series issued under such Indenture, the consent of the holders
of which is required for any such modification.
The Subordinated Debt Indenture may not be amended to
alter the subordination of any outstanding Subordinated Debt
Securities without the consent of each holder of Senior Indebt-
edness then outstanding that would be adversely affected
thereby.
CONCERNING THE TRUSTEES
The Trustees, in their individual or any other capac-
ity, have performed and may perform services for the Company
and may otherwise deal with the Company as if they were not the
Trustees. An affiliate of the Senior Trustee is a participat-
ing bank under the Company's principal bank credit agreement
and has other banking relationships with the Company. If a
Trustee has or shall acquire any conflicting interest (as
defined in Section 310(b) of the Trust Indenture Act of 1939,
as amended, after a default under the relevant indenture) the
Trustee shall either eliminate such conflicting interest or
resign as Trustee.
PLAN OF DISTRIBUTION
The Company may sell the Debt Securities being of-
fered hereby in three ways: (i) through agents, (ii) through
underwriters and (iii) through dealers.
The distribution of Debt Securities may be effected
from time to time in one or more transactions at a fixed price
or prices, which may be changed, or at market prices prevailing
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at the time of the sale, at prices related to such prevailing
market prices or at negotiated prices. The Prospectus Supple-
ment will describe the method of distribution of the Debt Secu-
rities.
Offers to purchase Debt Securities may be solicited
by agents designated by the Company from time to time. Any
such agent, who may be deemed to be an underwriter as the term
is defined in the Securities Act, involved in the offer or sale
of the Debt Securities in respect of which this Prospectus is
delivered will be named, and any commissions payable by the
Company to such agent set forth, in the Prospectus Supplement.
Unless otherwise indicated in the Prospectus Supplement, any
such agent will be acting on a best efforts basis for the
period of its appointment. Agents may be entitled under agree-
ments which may be entered into with the Company to indemnifi-
cation by the Company against certain civil liabilities,
including liabilities under the Securities Act, and may be cus-
tomers of, engage in transactions with or perform services for
the Company in the ordinary course of business.
If any underwriters are utilized in the sale of Debt
Securities, the Company will enter into an underwriting agree-
ment with such underwriters at the time of such sale to them
and the names of the underwriters and the terms of the trans-
action will be set forth in the Prospectus Supplement, which
will be used by the underwriters to make resales of the Debt
Securities in respect of which this Prospectus is delivered to
the public. The underwriters may be entitled, under the rel-
evant underwriting agreement, to indemnification by the Company
against certain liabilities, including liabilities under the
Securities Act, and may be customers of, engage in transactions
with or perform services for the Company in the ordinary course
of business.
If a dealer is utilized in the sale of the Debt Secu-
rities in respect of which this Prospectus is delivered, the
Company will sell such Debt Securities to the dealer, as prin-
cipal. The dealer may then resell such Debt Securities to the
public at varying prices to be determined by such dealer at the
time of resale. Dealers may be entitled to indemnification by
the Company against certain liabilities, including liabilities
under the Securities Act, and may be customers of, engage in
transactions with or perform services for the Company in the
ordinary course of business.
Debt Securities may also be offered and sold, if so
indicated in the Prospectus Supplement, in connection with a
remarketing upon their purchase, in accordance with a redemp-
tion or repayment pursuant to their terms, or otherwise, by one
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or more firms ("remarketing firms"), acting as principals for
their own accounts or as agents for the Company. Any remarket-
ing firm will be identified and the terms of its agreement, if
any, with the Company and its compensation will be described in
the Prospectus Supplement. Remarketing firms may be deemed to
be underwriters in connection with the Debt Securities remark-
eted thereby. Remarketing firms may be entitled under agree-
ments which may be entered into with the Company to indemnifi-
cation by the Company against certain civil liabilities,
including liabilities under the Securities Act, and may be cus-
tomers of, engage in transactions with or perform services for
the Company in the ordinary course of business.
If so indicated in the Prospectus Supplement, the
Company will authorize agents and underwriters or dealers to
solicit offers by certain purchasers to purchase the relevant
Offered Debt Securities from the Company at the public offering
price set forth in the Prospectus Supplement pursuant to
delayed delivery contracts providing for payment and delivery
on a specified date in the future. Such contracts will be sub-
ject to only those conditions set forth in the Prospectus
Supplement, and the Prospectus Supplement and the Prospectus
Supplement will set forth the commission payable for solicita-
tion of such offers.
LEGAL MATTERS
The legality of the Debt Securities offered hereby
will be passed upon for the Company by Wachtell, Lipton, Rosen
& Katz, New York, New York.
EXPERTS
The consolidated financial statements of American
Stores Company incorporated by reference in the Company's
Annual Report on Form 10-K for the year ended January 29, 1994
have been audited by Ernst & Young LLP, independent auditors,
as set forth in their report thereon included therein and
incorporated herein by reference. Such financial statements
are, and audited financial statements to be included in sub-
sequently filed documents will be, incorporated herein in
reliance upon the reports of Ernst & Young LLP pertaining to
such financial statements (to the extent covered by consents
filed with the Commission) given upon the authority of such
firm as experts in accounting and auditing.
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PART II
INFORMATION NOT REQUIRED IN PROSPECTUS
Item 14. Other Expenses of Issuance and Distribution*
S.E.C. Filing Fee........................ $275,864
Printing Expenses........................ 150,000
Accounting Fees.......................... 75,000
Blue Sky Fees and Expenses............... 30,000
Rating Agency Fees....................... 540,000
Trustees' Fees........................... 20,000
Legal Fees............................... 125,000
Miscellaneous............................ 9,136
---------
Total............................... $1,225,000
==========
* All of the above amounts, except for the S.E.C. filing
fee, have been estimated.
Item 15. Indemnification of Directors and Officers
Reference is made to Section 145 of the Delaware Gen-
eral Corporation Law which provides for indemnification of
directors and officers in certain circumstances. Article Nine
of the Restated Certificate of Incorporation of the Registrant
provides the following:
9.01 Elimination of Certain Liability of Directors.
A Director of the Corporation shall not be personally liable to
the Corporation or its stockholders for monetary damages for
breach of fiduciary duty as a Director, except for liability
(i) for any breach of the Director's duty of loyalty to the
Corporation or its stockholders, (ii) for acts or omissions not
in good faith or which involve intentional misconduct or a
knowing violation of law, (iii) under Section 174 of the Dela-
ware General Corporation Law, or (iv) for any transaction from
which the Director derived an improper personal benefit. If
the Delaware General Corporation Law is amended after approval
by the stockholders of this Article to authorize corporate
action further eliminating or limiting the personal liability
of directors, then the liability of a director of the corpora-
tion shall be eliminated or limited to the fullest extent per-
mitted by the Delaware General Corporation Law, as so amended.
Any repeal or modification of the foregoing paragraph
by the stockholders of the Corporation shall not adversely
affect any right or protection of a Director of the corporation
existing at the time of such repeal or modification.
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9.02 Indemnification and Insurance.
(a) Right to Indemnification. Each person who was
or is made party or is threatened to be made a party to or is
involved in any action, suit or proceeding, whether civil,
criminal, administrative or investigative (hereinafter a "pro-
ceeding"), by reason of the fact that he or she, or a person of
whom he or she is the legal representative, is or was a Direc-
tor or officer of the Corporation or while serving as a Direc-
tor or officer of the Corporation is or was also serving at the
request of the Corporation as a director, officer, employee or
agent of another Corporation or of a partnership, joint ven-
ture, trust or other enterprise, including service with respect
to employee benefit plans, shall be indemnified and held harm-
less by the Corporation to the fullest extent authorized by the
Delaware General Corporation Law, as the same exists or may
hereafter be amended (but, in the case of any such amendment,
only to the extent that such amendment permits the Corporation
to provide broader indemnification rights than said law permit-
ted the Corporation to provide prior to such amendment),
against all expense, liability and loss (including attorneys'
fees, judgments, fines, ERISA excise taxes or penalties and
amounts paid or to be paid in settlement) reasonably incurred
or suffered by such person in connection therewith and such
indemnification shall continue as to a person who has ceased to
be a Director or officer, and shall inure to the benefit of his
or her heirs, executors and administrators; provided, however,
that, except as provided in paragraph (b) hereof, the Corpora-
tion shall indemnify any such person seeking indemnification in
connection with a proceeding (or part thereof) initiated by
such person only if such proceeding (or part thereof) was
authorized by the Board of Directors of the Corporation. The
right to indemnification conferred in this Section shall be a
contract right (which may not be reduced or limited by any
repeal or modification of this Section 9.02) and shall include
the right to be paid by the Corporation the expenses incurred
in defending any such proceeding in advance of its final dispo-
sition; provided, however, that, if the Delaware General Corpo-
ration Law requires, the payment of such expenses incurred by a
Director or officer in his or her capacity as a Director or
officer (and not in any other capacity in which service was or
is rendered by such person while a Director or officer, includ-
ing, without limitation, service to an employee benefit plan)
in advance of the final disposition of a proceeding, shall be
made only upon delivery to the Corporation of an undertaking,
by or on behalf of such Director or officer, to repay all
amounts so advanced if it shall ultimately be determined that
such Director or officer is not entitled to be indemnified
under this Section or otherwise. The Corporation
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may, by action of its Board of Directors, provide indemnifi-
cation to employees and agents of the Corporation with the same
scope and effect as the foregoing indemnification of Directors
and officers.
(b) Right of Claimant to Bring Suit. If a claim
under paragraph (a) of this Section is not paid in full by the
Corporation within thirty days after a written claim has been
received by the Corporation, the claimant may at any time
thereafter bring suit against the Corporation to recover the
unpaid amount of the claim and, if successful in whole or in
part, the claimant shall be entitled to be paid also the
expense of prosecuting such claim. It shall be a defense to
any such action (other than an action brought to enforce a
claim for expenses incurred in defending any proceeding in
advance of its final disposition where the required undertak-
ing, if any is required, has been tendered to the Corporation)
that the claimant has not met the standards of conduct which
make it permissible under the Delaware General Corporation Law
for the Corporation to indemnify the claimant for the amount
claimed, but the burden of proving such defense shall be on the
Corporation. Neither the failure of the Corporation (including
its Board of Directors, independent legal counsel, or its
stockholders) to have made a determination prior to the com-
mencement of such action that indemnification of the claimant
is proper in the circumstances because he or she has met the
applicable standard of conduct set forth in the Delaware Gen-
eral Corporation Law nor an actual determination by the Corpo-
ration (including its Board of Directors, independent legal
counsel, or its stockholders) that the claimant has not met
such applicable standard of conduct, shall be a defense to the
action or create a presumption that the claimant has not met
the applicable standard of conduct.
(c) Non-Exclusivity of Rights. The right to indem-
nification and the payment of expenses incurred in defending a
proceeding in advance of its final disposition conferred in
this Section shall not be exclusive of any other right which
any person may have or hereafter acquire under any statute,
provision of the Certificate of Incorporation, by-law, agree-
ment, vote of stockholders or disinterested Directors or other-
wise.
(d) Insurance. The Corporation may maintain insur-
ance, at its expense, to protect itself and any director,
officer, employee or agent of the Corporation or another corpo-
ration, partnership, joint venture, trust or other enterprise
against any such expense, liability or loss whether or not the
Corporation would have the power to indemnify such person
II-3
PAGE
<PAGE>
against such expense, liability to or loss under the Delaware
General Corporation Law.
In addition, the Registrant maintains a directors'
and officers' liability insurance policy.
Item 16. Exhibits
Exhibit
Number Description of Exhibits
1.1 Form of Underwriting Agreement.
1.2 Form of Agency Agreement.
4.1 Form of Senior Indenture between American Stores
Company and The First National Bank of Chicago.
4.2 Form of Subordinated Indenture.
4.3 Credit Agreement dated as of June 28, 1994 among
the Company, the banks listed therein and Morgan
Guaranty Trust Company of New York, as Agent.
5 Opinion of Wachtell, Lipton, Rosen & Katz.
12 Computation of Ratio of Earnings to Fixed
Charges.
23.1 Consent of Ernst & Young LLP, Independent Audi-
tors.
23.2 Consent of Wachtell, Lipton, Rosen & Katz (con-
tained in the opinion filed as Exhibit 5 to this
Registration Statement).
24 Powers of Attorney.
25 Form T-1 Statement of Eligibility and Qualifica-
tion under the Trust Indenture Act of 1939, as
amended, of The First National Bank of Chicago.+
+ Filed with initial Registration Statement.
Note: No other long-term debt instrument issued by Ameri-
can Stores Company exceeds 10% of the consolidated assets
of American Stores Company and its subsidiaries. In ac-
cordance with paragraph 4(iii) of Item 601 of Regulation
S-K, American Stores Company will furnish to the Commis-
sion upon request copies of its long-term debt instruments
and related agreements.
Item 17. Undertakings
The undersigned registrant hereby undertakes:
(1) To file, during any period in which offers or
sales of the registered securities are being made, a post-
effective amendment to this registration statement:
II-4
PAGE
<PAGE>
(i) To include any prospectus required by Sec-
tion 10(a)(3) of the Securities Act of 1933;
(ii) To reflect in the prospectus any facts or
events arising after the effective date of the regis-
tration statement (or the most recent post-effective
amendment thereof) which, individually or in the
aggregate, represent a fundamental change in the
information set forth in the registration statement;
(iii) To include any material information with
respect to the plan of distribution not previously
disclosed in the registration statement or any mate-
rial change to such information in the registration
statement;
provided, however, that paragraphs (i) and (ii) shall not
apply if the information required to be included in a
post-effective amendment by those paragraphs is contained
in periodic reports filed by the registrant pursuant to
Section 13 or Section 15(d) of the Securities Exchange Act
of 1934 that are incorporated by reference in the regis-
tration statement.
(2) That, for the purpose of determining any liabil-
ity under the Securities Act of 1993, each such post-
effective amendment shall be deemed to be a new registra-
tion statement relating to the securities offered therein,
and the offering of such securities at that time shall be
deemed to be the initial bona fide offering thereof.
(3) To remove from registration by means of a post-
effective amendment any of the securities being registered
which remain unsold at the termination of the offering.
(4) That, for purposes of determining any liability
under the Securities Act of 1933, each filing of the reg-
istrant's annual report pursuant to Section 13(a) or Sec-
tion 15(d) of the Securities Exchange Act of 1934 that is
incorporated by reference in the registration statement
shall be deemed to be a new registration statement relat-
ing to the securities offered therein, and the offering of
such securities at the time shall be deemed to be the ini-
tial bona fide offering thereof.
Insofar as indemnification for liabilities arising
under the Securities Act of 1933 may be permitted to directors,
officers and controlling persons of the registrant pursuant to
II-5
PAGE
<PAGE>
the provisions described under Item 15 above or otherwise, the
registrant has been advised that in the opinion of the Securi-
ties and Exchange Commission such indemnification is against
public policy as expressed in the Act and is, therefore, unen-
forceable. In the event that a claim for indemnification
against such liabilities (other than the payment by the regis-
trant of expenses incurred or paid by a director, officer or
controlling person of the registrant in the successful defense
of any action, suit or proceeding) is asserted against the reg-
istrant by such director, officer or controlling person in con-
nection with the securities being registered, the registrant
will, unless in the opinion of its counsel the matter has been
settled by controlling precedent, submit to a court of appro-
priate jurisdiction the question whether such indemnification
by it is against public policy as expressed in the Act and will
be governed by the final adjudication of such issue.
II-6
PAGE
<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Act of
1933, the registrant certifies that it has reasonable grounds
to believe that it meets all of the requirements for filing on
Form S-3, and has duly caused this amendment to the
Registration Statement to be signed on its behalf by the
undersigned, thereunto duly authorized, in Salt Lake City, Utah
on the 1st day of November 1994.
AMERICAN STORES COMPANY
By: /s/ Victor L. Lund
Victor L. Lund
President and Chief
Executive Officer
Pursuant to the requirements of the Securities Act of
1933, this amendment to the Registration Statement has been
signed below by the following persons in the capacities and on
the dates indicated.
Signature Title Date
* Chairman of the Board and November 1, 1994
L.S. Skaggs Director
/s/ Victor L. Lund President and Chief November 1, 1994
Victor L. Lund Executive Officer and
Director (Principal
Executive Officer)
/s/ Teresa Beck Executive Vice President, November 1, 1994
Teresa Beck Chief Financial Officer
and Assistant Secretary
(Principal Financial
Officer)
/s/ Bradley M. Vierig Vice President and November 1, 1994
Bradley M. Vierig Controller (Principal
Accounting Officer)
II-7
PAGE
<PAGE>
Director November 1, 1994
Henry I. Bryant
* Director November 1, 1994
Louis H. Callister
* Director November 1, 1994
Arden B. Engebretsen
* Director November 1, 1994
James B. Fisher
Director November 1, 1994
Fernando R. Gumucio
* Director November 1, 1994
Leon G. Harmon
* Director November 1, 1994
Donald B. Holbrook
Director November 1, 1994
John E. Masline
* Director November 1, 1994
Michael T. Miller
* Director November 1, 1994
L. Tom Perry
* Director November 1, 1994
Barbara S. Preiskel
* Director November 1, 1994
J. L. Scott
* Director November 1, 1994
Don L. Skaggs
II-8
PAGE
<PAGE>
* Director November 1, 1994
Arthur K. Smith
*By: /s/ Victor L. Lund , as Attorney-in-Fact
Victor L. Lund
II-9
PAGE
<PAGE>
EXHIBIT INDEX
Exhibit Page
Number Description of Exhibits Number
1.1 Form of Underwriting Agreement...................
1.2 Form of Agency Agreement.........................
4.1 Form of Senior Indenture between American
Stores Company and The First National
Bank of Chicago..................................
4.3 Credit Agreement dated as of June 28, 1994
among the Company, the banks listed therein
and Morgan Guaranty Trust Company of New
York, as Agent...................................
5 Opinion of Wachtell, Lipton, Rosen & Katz........
12 Computation of Ratio of Earnings to Fixed
Charges..........................................
23.1 Consent of Ernst & Young L.L.P., Independent
Auditors.........................................
23.2 Consent of Wachtell, Lipton, Rosen &
Katz (contained in the opinion filed as
Exhibit 5 to this Registration Statement)........
24 Powers of Attorney...............................
II-10
<PAGE>
/dpw/cw/038/14013/322/UA/EDGAR/ua.ed
Exhibit 1.1
[$ ]
AMERICAN STORES COMPANY
______% Notes due ________
Underwriting Agreement
___________, 199_
[Names of Underwriters]
Dear Sirs:
American Stores Company, a Delaware corporation (the
"Company"), proposes to issue and sell to the underwriters listed in Schedule
I hereto (the "Underwriters"), $[ ] principal amount of its [
]% [Notes] due [ ] (the "Securities"). The Securities will be
issued pursuant to the provisions of an Indenture dated as of _____________,
199_ between the Company and The First National Bank of Chicago, as Trustee
(the "Trustee").
The Company has prepared and filed with the Securities and
Exchange Commission (the "Commission") in accordance with the provisions of
the Securities Act of 1933, as amended, and the rules and regulations of the
Commission thereunder (collectively, the "Securities Act"), a registration
statement, including a prospectus, relating to the Securities. The
registration statement as amended at the time when it became effective, or, if
a post-effective amendment is filed with respect thereto, as amended by such
posteffective amendment at the time of its effectiveness, is referred to in
this Agreement as the "Registration Statement", and the prospectus (including
the prospectus supplement specifically relating to the Securities) in the form
first used to confirm sales of Securities is referred to in this Agreement as
the "Prospectus". Any reference in this Agreement to the Registration
Statement, any preliminary prospectus or the Prospectus shall be deemed to
refer to and include the documents incorporated by reference therein pursuant
to Item 12 of Form S-3 under the Securities Act, as of the effective date of
the Registration Statement or the date of such preliminary prospectus or the
Prospectus, as the case may be, and any reference to "amend", "amendment" or
"supplement" with respect to the Registration Statement, any preliminary
prospectus or the Prospectus shall be deemed to refer to and include any
documents filed after such date under the Securities Exchange Act of 1934, as
amended, and the rules and regulations of the Commission thereunder
(collectively, the "Exchange Act") that are deemed to be incorporated by
reference therein.
The Company hereby agrees with the Underwriters as follows:
1. The Company agrees to issue and sell the Securities to the
several Underwriters as hereinafter provided, and each Underwriter, upon the
basis of the representations and warranties herein contained, but subject to
the conditions hereinafter stated, agrees to purchase, severally and not
jointly, from the Company the respective principal amount of Securities set
forth opposite such Underwriter's name in Schedule I hereto at a price (the
"Purchase Price") equal to [ ]% of their principal amount, plus accrued
interest, if any, from [ ] to the date of payment and delivery.
2. The Underwriters intend (i) to make a public offering of
their respective portions of the Securities as soon after this Agreement has
become effective as in the judgment of the Underwriters is advisable and (ii)
initially to offer the Securities upon the terms set forth in the Prospectus.
3. Payment for the Securities shall be made to the Company or
to its order by certified or official bank check or checks payable in New York
Clearing House or other next day funds at the office of Davis Polk & Wardwell,
450 Lexington Avenue, New York, New York 10017 at 10:00 A.M., New York City
time on [ ], or at such other time on the same or such other date,
not later than the fifth Business Day thereafter, as the Underwriters and the
Company may agree upon in writing. The time and date of such payment for the
Securities are referred to herein as the Closing Date. As used herein, the
term "Business Day" means any day other than a day on which banks are
permitted or required to be closed in New York City.
Payment for the Securities shall be made against delivery to
the Underwriters of the Securities registered in such names and in such
denominations as the Underwriters shall request in writing not later than two
full Business Days prior to the Closing Date with any transfer taxes payable
in connection with the transfer to the Underwriters of the Securities duly
paid by the Company. The certificates for the Securities will be made
available for inspection and packaging by the Underwriters at the office of
_____________, [address] not later than 1:00 P.M., New York City time, on the
Business Day prior to the Closing Date.
4. The Company represents and warrants to each Underwriter
that:
(a) no order preventing or suspending the use of any
preliminary prospectus has been issued by the Commission, and each
preliminary prospectus filed as part of the Registration Statement as
originally filed or as part of any amendment thereto, or filed
pursuant to Rule 424 under the Securities Act, complied when so filed
in all material respects with the Securities Act, and did not contain
an untrue statement of a material fact or omit to state a material
fact required to be stated therein or necessary to make the statements
therein, in the light of the circumstances under which they were
made, not misleading; provided that this representation and warranty
shall not apply to any statements or omissions made in reliance upon
and in conformity with information furnished to the Company in a
letter from the Underwriters expressly for use therein;
(b) no stop order suspending the effectiveness of the
Registration Statement has been issued and no proceeding for that
purpose has been instituted or, to the knowledge of the Company,
threatened by the Commission; and, except for statements in such
documents which do not constitute part of the Registration Statement
or the Prospectus pursuant to Rule 412 of Regulation C under the
Securities Act and after substituting therefor any modifying or
superseding statements, the Registration Statement and Prospectus (as
amended or supplemented if the Company shall have furnished any
amendments or supplements thereto) conform, or will conform, as the
case may be, in all material respects with the Securities Act and the
Trust Indenture Act of 1939, as amended, and the rules and
regulations of the Commission thereunder (collectively, the "Trust
Indenture Act") and do not and will not, as of the applicable
effective date as to the Registration Statement and any amendment
thereto and as of the date of the Prospectus and any amendment or
supplement thereto, contain 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 Closing Date, if
applicable, will not contain any untrue statement of a material fact
or omit to state a material fact necessary to make the statements
therein, in the light of the circumstances under which they are made,
not misleading; except that the foregoing representations and
warranties shall not apply to (i) that part of the Registration
Statement which constitutes the Statement of Eligibility and
Qualification (Form T-1) of the Trustee under the Trust Indenture
Act, and (ii) statements or omissions in the Registration Statement
or the Prospectus made in reliance upon and in conformity with
information furnished to the Company in a letter from the
Underwriters expressly for use therein;
(c) except for statements in such documents which do not
constitute part of the Registration Statement or the Prospectus
pursuant to Rule 412 of Regulation C under the Securities Act and
after substituting therefor any modifying or superseding statements,
the documents incorporated by reference in the Prospectus, when they
were filed with the Commission, as amended at or prior to the date
the Registration Statement became effective, conformed in all
material respects to the requirements of the Exchange Act and none of
such documents contained an untrue statement of a material fact or
omitted to state a material fact necessary to make the statements
therein, in the light of the circumstances under which they were
made, not misleading; and any further documents so filed and
incorporated by reference in the Prospectus, when such documents are
filed with the Commission, will conform in all material respects to
the requirements of the Exchange Act, and will not contain an untrue
statement of a material fact or omit to state a material fact
necessary to make the statements therein, in the light of the
circumstances under which they were made, not misleading;
(d) the financial statements, and the related notes thereto,
included or incorporated by reference in the Registration Statement
and the Prospectus present fairly, in all material respects, the
financial position of the Company and its consolidated subsidiaries
as of the dates indicated and the results of their operations and the
changes in their consolidated cash flows for the periods specified;
said financial statements have been prepared in conformity with
generally accepted accounting principles applied on a consistent
basis, and the supporting schedules included or incorporated by
reference in the Registration Statement present fairly, in all
material respects, the information required to be stated therein as
of the dates indicated;
(e) since the respective dates as of which information is
given in the Registration Statement and the Prospectus, there has not
been any material adverse change in the business, business prospects,
financial position, stockholders' equity or results of operations of
the Company and its subsidiaries, taken as a whole, otherwise than as
set forth or contemplated in the Prospectus;
(f) the Company has been duly incorporated and is validly
existing as a corporation in good standing under the laws of the
State of Delaware, with power and authority (corporate and other) to
own its properties and conduct its business as described in the
Prospectus, and has been duly qualified as a foreign corporation for
the transaction of business and is in good standing under the laws of
each other jurisdiction in which it owns or leases properties, or
conducts any business, so as to require such qualification, other
than where the failure to be so qualified or in good standing would
not have a material adverse effect on the Company and its
subsidiaries taken as a whole;
(g) each Significant Subsidiary (as defined in Regulation S-X
promulgated by the Commission) of the Company has been duly
incorporated and is validly existing as a corporation under the laws
of its jurisdiction of incorporation, with power and authority
(corporate and other) to own its properties and conduct its business
as described in the Prospectus, and has been duly qualified as a
foreign corporation for the transaction of business and is in good
standing under the laws of each jurisdiction in which it owns or
leases properties or conducts any business so as to require such
qualification, other than where the failure to be so qualified or in
good standing would not have a material adverse effect on the Company
and its subsidiaries taken as a whole; and all the outstanding shares
of capital stock of each Significant Subsidiary have been duly
authorized and validly issued, are fully-paid and non-assessable, and
are owned by the Company, directly or indirectly, free and clear of
all liens, encumbrances, security interests and claims;
(h) this Agreement has been duly authorized, executed and
delivered by the Company;
(i) the Securities have been duly authorized, and when
validly authenticated and when issued and delivered in accordance
with the Indenture and sold to the Underwriters pursuant to this
Agreement, will have been duly executed, issued and delivered and will
constitute valid and binding obligations of the Company entitled to
the benefits provided by the Indenture; the Indenture has been duly
authorized and has been duly qualified under the Trust Indenture Act
and, when executed and delivered by the Company and the Trustee, the
Indenture will constitute a valid and binding instrument; and the
Securities and the Indenture will conform to the descriptions thereof
in the Prospectus;
(j) neither the Company nor any Significant Subsidiary is, or
with the giving of notice or lapse of time or both would be, in
violation of or in default under, its Certificate of Incorporation or
By-Laws or any indenture, mortgage, deed of trust, loan agreement or
other agreement or instrument to which the Company or any Significant
Subsidiary is a party or by which it or any of them or any of their
respective properties is bound, except for violations and defaults
which individually and in the aggregate would not have a material
adverse effect on the Company and its subsidiaries taken as a whole;
the issue and sale of the Securities and the performance by the
Company of all of the provisions of its obligations under the
Securities, the Indenture and this Agreement and the consummation of
the transactions herein and therein contemplated will not conflict
with or result in a breach of any of the terms or provisions of, or
constitute a default under, any material indenture, mortgage, deed of
trust, loan agreement or other material agreement or instrument to
which the Company or any Significant Subsidiary is a party or by which
the Company or any Significant Subsidiary is bound or to which any of
the property or assets of the Company or any Significant Subsidiary
is subject, nor will any such action result in any violation of the
provisions of the Restated Certificate of Incorporation or the
By-Laws of the Company or any material violation of any applicable
law or statute or any order, rule or regulation of any court or
governmental agency or body having jurisdiction over the Company, any
Significant Subsidiary or any of their respective properties; and no
consent, approval, authorization, order, registration or
qualification of or with any such court or governmental agency or
body is required for the issue and sale of the Securities or the
consummation by the Company of the transactions contemplated by this
Agreement or the Indenture, except such consents, approvals,
authorizations, registrations or qualifications as have been obtained
under the Securities Act and the Trust Indenture Act and as may be
required under the applicable securities or Blue Sky Laws of the
various states and other jurisdictions in connection with the issue,
sale and distribution of the Securities;
(k) other than as set forth or contemplated in the Prospectus,
there are no legal or governmental proceedings pending or, to the
knowledge of the Company, threatened to which the Company or any
Significant Subsidiary is or may be a party or to which any property
of the Company or any Significant Subsidiary is or may be the subject
that are required to be described in the Registration Statement or the
Prospectus that are not so described; and there are no contracts or
other documents of a character required to be filed as an exhibit to
the Registration Statement or required to be described in the
Registration Statement or the Prospectus which are not filed or
described as required; and
(l) the Company has complied with and will comply with all
provisions of Section 517.075, Florida Statutes (Chapter 92-198, Laws
of Florida).
5. The Company covenants and agrees with the several
Underwriters as follows:
(a) to use its best efforts to cause any post-effective
amendment to the Registration Statement to become effective at the
earliest possible time and, if required, to file the final Prospectus
with the Commission within the time periods specified by Rule 424(b)
under the Securities Act;
(b) to deliver, at the expense of the Company, to the
Underwriters, three signed copies of the Registration Statement (as
originally filed) and each amendment thereto, in each case including
exhibits and documents incorporated by reference therein, and, during
the period mentioned in paragraph (e) below, to each of the
Underwriters as many copies of the Prospectus (including all
amendments and supplements thereto and documents incorporated by
reference therein) as the Underwriters may reasonably request;
(c) before filing any amendment or supplement to the
Registration Statement or the Prospectus, to furnish to the
Underwriters a copy of the proposed amendment or supplement for
review a reasonable time prior to filing and to discuss such proposed
amendment or supplement in good faith with the Underwriters if
requested;
(d) to advise the Underwriters promptly, and to confirm such
advice in writing, (i) when any amendment to the Registration
Statement shall have become effective, (ii) of any request by the
Commission for any amendment to the Registration Statement or any
amendment or supplement to the Prospectus or for any additional
information, (iii) of the issuance by the Commission of any stop
order suspending the effectiveness of the Registration Statement or
the initiation or threatening of any proceeding for that purpose, and
(iv) of the receipt by the Company of any notification with respect
to any suspension of the qualification of the Securities for offer
and sale in any jurisdiction or the initiation or threatening of any
proceeding for such purpose; and to use its best efforts to prevent
the issuance of any such stop order or notification and, if issued,
to obtain as soon as possible the withdrawal thereof;
(e) if, during such period after the first date of the public
offering of the Securities as in the opinion of counsel for the
Underwriters a prospectus relating to the Securities is required by
law to be delivered in connection with sales by an Underwriter or
dealer, any event shall occur as a result of which it is necessary to
amend or supplement the Prospectus in order to make the statements
therein, in the light of the circumstances when the Prospectus is
delivered to a purchaser, not misleading, or if it is necessary to
amend or supplement the Prospectus to comply with law, forthwith to
prepare and furnish, at the expense of the Company, to the
Underwriters and to the dealers (whose names and addresses the
Underwriters will furnish to the Company) to which Securities may
have been sold by the Underwriters and to any other dealers upon
request, such amendments or supplements to the Prospectus as may be
necessary so that the statements in the Prospectus as so amended or
supplemented will not, in the light of the circumstances when the
Prospectus is delivered to a purchaser, be misleading or so that the
Prospectus will comply with law;
(f) to take such actions as the Underwriters may reasonably
request to qualify the Securities for offer and sale under the
securities or Blue Sky laws of such jurisdictions as the Underwriters
shall reasonably request and to continue such qualification in effect
so long as reasonably required for distribution of the Securities;
provided that the Company shall not be obligated to subject itself to
any material additional tax liabilities, to qualify as a foreign
corporation or as a dealer in securities in any jurisdiction in which
it is not so qualified or required to file a general consent to
service of process in any jurisdiction;
(g) to make generally available to its security holders and to
the Underwriters as soon as practicable an earnings statement
covering a period of at least twelve months beginning with the first
fiscal quarter of the Company occurring after the effective date of
the Registration Statement, which shall satisfy the provisions of
Section 11(a) of the Securities Act and Rule 158 of the Commission
promulgated thereunder;
(h) so long as the Securities are outstanding, to furnish to
the Underwriters copies of all reports or other communications
(financial or other) furnished to holders of the Securities, and
copies of any reports and financial statements publicly filed with the
Commission;
(i) during the period beginning on the date hereof and
continuing to and including the Business Day following the Closing
Date, not to offer, sell, contract to sell or otherwise dispose of
any debt securities of or guaranteed by the Company which are
substantially similar to the Securities without the prior written
consent of the Underwriters; and
(j) to pay all costs and expenses incident to the performance
of its obligations hereunder, including without limiting the
generality of the foregoing, all costs and expenses (i) incident to
the preparation, issuance, execution, authentication and delivery of
the Securities, including any expenses of the Trustee, (ii) incident
to the preparation, printing and filing under the Securities Act of
the Registration Statement, the Prospectus and any preliminary
prospectus (including in each case all exhibits, amendments and
supplements thereto), (iii) incurred in connection with the
registration or qualification and determination of eligibility for
investment of the Securities under the laws of such jurisdictions as
the Underwriters may designate (including reasonable fees and
disbursements of counsel for the Underwriters in connection
therewith, not to exceed $15,000), (iv) in connection with the
printing (including word processing and duplication costs) and
delivery of this Agreement, the Indenture, the Preliminary and
Supplemental Blue Sky Memoranda and any Legal Investment Survey and
the furnishing to Underwriters and dealers of copies of the
Registration Statement and the Prospectus, including mailing and
shipping to the Underwriters, as herein provided and (v) payable to
rating agencies in connection with the rating of the Securities.
6. The several obligations of the Underwriters hereunder to
purchase the Securities are subject to the performance by the Company of its
obligations hereunder and to the following additional conditions:
(a) no stop order suspending the effectiveness of the
Registration Statement shall be in effect, and no proceedings for
such purpose shall be pending before or threatened by the Commission;
and all requests for additional information on the part of the
Commission shall have been complied with to the reasonable
satisfaction of the Underwriters;
(b) the representations and warranties of the Company
contained herein are true and correct in all material respects on and
as of the Closing Date as if made on and as of the Closing Date and
the Company shall have complied in all material respects with all
agreements on its part to be performed hereunder at or prior to the
Closing Date;
(c) subsequent to the execution and delivery of this
Agreement and prior to the Closing Date, there shall not have
occurred any downgrading, nor shall any notice have been given of any
intended or potential downgrading or other negative review in the
rating accorded any senior unsecured securities of the Company by any
of Standard & Poor's Corporation, Moody's Investors Service, Inc.,
Duff & Phelps Inc. or Fitch Investors Service, Inc.;
(d) since the respective dates as of which information is
given in the Prospectus there shall not have been any material
adverse change in the business, business prospects, financial
position, stockholders' equity or results of operations of the
Company and its subsidiaries, taken as a whole, otherwise than as set
forth or contemplated in the Prospectus, the effect of which in the
judgment of the Underwriters makes it impracticable to proceed with
the public offering or the delivery of the Securities on the terms
and in the manner contemplated in the Prospectus;
(e) the Underwriters shall have received on and as of the
Closing Date a certificate of the Company (signed by an executive
officer) reasonably satisfactory to the Underwriters to the effect set
forth in subsections (a) through (c) of this Section and to the
further effect that, except as set forth in such certificate, since
the respective dates as of which information is given in the
Prospectus, there has not occurred any material adverse change in the
business, business prospects, financial position, stockholders'
equity or results of operations of the Company and its subsidiaries
taken as a whole from that set forth or contemplated in the
Prospectus;
(f) Wachtell, Lipton, Rosen & Katz, special counsel for the
Company, shall have furnished to the Underwriters their written
opinion, dated the Closing Date, in form and substance reasonably
satisfactory to the Underwriters, to the effect that:
(i) this Agreement has been duly authorized, executed
and delivered by the Company;
(ii) the Securities are in a form contemplated by the
Indenture, have been duly authorized, executed and delivered by
the Company and, when duly authenticated in accordance with the
terms of the Indenture and delivered to and paid for by the
Underwriters in accordance with the terms of this Agreement,
will constitute valid and binding obligations of the Company
entitled to the benefits provided by the Indenture, subject to
the effect of (A) bankruptcy, insolvency, reorganization,
moratorium or other similar laws relating to or affecting the
rights of creditors generally and (B) the application of general
principles of equity (regardless of whether enforcement is
considered in proceedings at law or in equity);
(iii) the Indenture has been duly authorized, executed and
delivered by the Company and constitutes a valid and binding
instrument of the Company, subject to the effect of (A)
bankruptcy, insolvency, reorganization, moratorium or other
similar laws relating to or affecting the rights of creditors
generally and (B) the application of general principles of
equity (regardless of whether enforcement is considered in
proceedings at law or in equity); and the Indenture has been
duly qualified under the Trust Indenture Act;
(iv) the issue and sale of the Securities and the
performance by the Company of its obligations under the
Securities, the Indenture and this Agreement and the
consummation of the transactions herein and therein
contemplated will not (a) conflict with or result in a breach
of any of the terms or provisions of, or constitute a default
under, any indenture, mortgage, deed of trust or loan agreement
set forth on a Schedule previously furnished to the
Underwriters (such counsel may assume compliance with the
financial covenants contained therein), (b) result in any
violation of the provisions of the Restated Certificate of
Incorporation or the By-Laws of the Company or (c) violate the
federal securities laws or regulations, the Delaware General
Corporation Law or any law, statute, order, rule or regulation
known to such counsel (without independent investigation) of
any court or governmental agency or body of the State of New
York having jurisdiction over the Company, any Significant
Subsidiary or any of their respective properties, except, in
the case of clauses (a) and (c), for conflicts, breaches,
defaults or violations which would not have a material adverse
effect on the financial condition, results of operations, assets
or business of the Company and its subsidiaries taken as a
whole; (v) no consent, approval, authorization, order,
registration or qualification of or with any court or
governmental agency or body is required for the issue and sale
of the Securities, except such consents, approvals,
authorizations, registrations or qualifications as have been
obtained under the Securities Act and the Trust Indenture Act
and as may be required under the securities or Blue Sky laws of
the various states and other jurisdictions which are applicable
in connection with the issue, sale and distribution of the
Securities;
(vi) the Securities and the Indenture conform in all
material respects to the descriptions thereof in the
Prospectus; and
(vii) (A) each document incorporated by reference in the
Registration Statement and the Prospectus (except for the
financial statements and related schedules and notes or other
financial or statistical data included or incorporated by
reference therein as to which such counsel need express no
opinion) complied as to form, in all material respects, as
amended as of the time the Registration Statement became
effective, with the Exchange Act; and (B) the Registration
Statement and the Prospectus as amended or supplemented (except
for the financial statements and related schedules and notes or
other financial or statistical data included or incorporated by
reference therein as to which such counsel need express no
opinion) comply as to form in all material respects with the
requirements of the Securities Act. In rendering such
opinions, such counsel may rely (A) upon the opinion furnished
to the Underwriters pursuant to Section 6(g); (B) upon oral
advice of the staff of the Commission; and (C) as to matters of
fact, to the extent such counsel deems proper, on certificates
of responsible officers of the Company and certificates or
other written statements of officials of jurisdictions having
custody of documents respecting the corporate existence or good
standing of the Company. With respect to the matters to be
covered in subparagraph (vii) above counsel may state their
opinion is based upon their participation in the preparation of
the Registration Statement and the Prospectus and any amendment
or supplement thereto (excluding any documents incorporated by
reference thereto, in which case such opinion is based upon
their review of such documents) and discussions with
representatives of the Company and its auditors (including
discussions in which the Underwriters and their counsel
participated) but is without independent check or verification
except as specified. Such counsel shall state that in the
course of such participation, review and discussions no facts
have come to such counsel's attention which lead such counsel
to believe that (except for the financial statements and related
schedules and notes or other financial or statistical data
included or incorporated by reference therein as to which such
counsel need express no belief and except for that part of the
Registration Statement which constitutes the Form T-1 of the
Trustee under the Trust Indenture Act) the Registration
Statement and the prospectus included therein at the time the
Registration Statement became effective contained any untrue
statement of a material fact or omitted to state a material
fact required to be stated therein or necessary to make the
statements therein not misleading, and that the Prospectus as
amended or supplemented, if applicable, contains any untrue
statement of a material fact or omits to state a material fact
necessary in order to make the statements therein, in the light
of the circumstances under which they were made, not
misleading. Such counsel may further state that such counsel
have not verified, and are not passing upon and do not assume
any responsibility for, the accuracy, completeness or fairness
of the statements contained in the Registration Statement or
the Prospectus (other than those statements referred to in
subparagraph (vi) above).
(g) Kathleen E. McDermott, Executive Vice President,
General Counsel and Assistant Secretary of the Company, shall have
furnished to the Underwriters her written opinion, dated the Closing
Date, in form and substance reasonably satisfactory to the
Underwriters, to the effect that:
(i) the Company has been duly
incorporated and is validly existing as a corporation in
good standing under the laws of the State of Delaware,
with power and authority (corporate and other) to own its
properties and conduct its business as described in the
Prospectus;
(ii) the Company has been duly qualified as a
foreign corporation for the transaction of business and
is in good standing under the laws of each other
jurisdiction in which it owns or leases properties, or
conducts any business, so as to require such
qualification, other than where the failure to be so
qualified or in good standing would not have a material
adverse effect on the Company and its subsidiaries taken
as a whole;
(iii) each Significant Subsidiary has
been duly incorporated and is validly existing as a
corporation under the laws of its jurisdiction of
incorporation, with power and authority (corporate and
other) to own its properties and conduct its business as
described in the Prospectus, and has been duly qualified
as a foreign corporation for the transaction of business
and is in good standing under the laws of each other
jurisdiction in which it owns or leases properties, or
conducts any business, so as to require such
qualification, other than where the failure to be so
qualified or in good standing would not have a material
adverse effect on the Company and its subsidiaries taken
as a whole; and all of the outstanding shares of capital
stock of each Significant Subsidiary have been duly
authorized and validly issued, are fully paid and
non-assessable, and are owned directly or indirectly by
the Company, free and clear of all material liens,
encumbrances, equities or claims;
(iv) other than as set forth or contemplated in
the Prospectus, such counsel does not know of any legal
or governmental proceedings pending to which the Company
or any Significant Subsidiary is a party or to which any
property of the Company or any Significant Subsidiary is
the subject which are required to be described in the
Prospectus as amended or supplemented which are not
described as required; and such counsel does not know of
any contracts or other documents of a character required
to be filed as an exhibit to the Registration Statement
or required to be described in the Registration Statement
or the Prospectus which are not filed or described as
required; and
(v) the statements in the Prospectus incorporated
by reference from Item 3 of Part I of the Company's
Annual Report on Form 10-K for the year ended January 29,
1994, Item 1 of Part II of the Company's Quarterly Report
on Form 10-Q for the period ended April 30, 1994, and
Item 1 of Part II of the Company's Quarterly Report on
Form 10-Q for the period ended July 30, 1994, each as
modified or amended by any subsequent documents
incorporated by reference in the Registration Statement
or 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
or proceedings.
(h) on the Closing Date, Ernst & Young shall have
furnished to the Underwriters a letter, dated the Closing Date,
in form and substance reasonably satisfactory to the
Underwriters, containing statements and information of the type
customarily included in accountants' "comfort letters" to
underwriters with respect to the financial statements and
certain financial information contained or incorporated by
reference in the Registration Statement and the Prospectus; and
(i) the Underwriters shall have received on and as of the
Closing Date an opinion of Davis Polk & Wardwell, counsel to
the Underwriters, with respect to the validity of the
Indenture and the Securities, the Registration Statement,
the Prospectus and other related matters as the Underwriters
may reasonably request, and such counsel shall have received
such papers and information as they may reasonably request
to enable them to pass upon such matters.
7. The Company agrees to indemnify and hold harmless each
Underwriter and each person, if any, who controls any Underwriter within the
meaning of either Section 15 of the Securities Act or Section 20 of the
Exchange Act, from and against any and all losses, claims, damages and
liabilities (including without limitation the reasonable legal fees and other
expenses incurred in connection with investigating, preparing to defend or
defending any suit, action or proceeding or any claim asserted which shall be
reimbursed as such legal fees and other expenses are incurred) arising out of
or based upon 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 arising out of or based upon any
omission or alleged omission to state therein a material fact required to be
stated therein or, in the case of the Registration Statement or the Prospectus
(as amended or supplemented), necessary to make the statements therein not
misleading or, in the case of any preliminary prospectus, necessary to make
the statements therein, in light of the circumstances under which they were
made, not misleading, except insofar as such losses, claims, damages or
liabilities arise out of or are based upon any untrue statement or omission or
alleged untrue statement or omission made in reliance upon and in conformity
with information furnished to the Company in a letter from the Underwriters
expressly for use therein; provided that the foregoing indemnity with respect
to any preliminary prospectus shall not inure to the benefit of any Underwriter
(or to the benefit of any person controlling such Underwriter) for any such
losses, claims, damages or liabilities (a) resulting solely from the
Underwriter having sold Securities to a person to whom there was not sent or
given, if required by law, at or prior to the time of written confirmation of
such sale, a copy of the Prospectus (as amended or supplemented if the Company
shall have furnished any amendments or supplements thereto) or (b) if such
losses, claims, damages or liabilities results from an untrue statement or
omission or alleged untrue statement or omission made in such preliminary
prospectus that is eliminated or remedied in the Prospectus (as amended or
supplemented if the Company shall have furnished any amendments or supplements
thereto) and, if required by law, a copy of the Prospectus (as so amended or
supplemented) shall not have been furnished to such person at or prior to the
written confirmation of the sale of such Securities to such person.
Each Underwriter agrees, severally and not jointly, to
indemnify and hold harmless the Company, its directors, its officers and each
person who controls the Company within the meaning of either Section 15 of the
Securities Act or Section 20 of the Exchange Act to the same extent as the
foregoing indemnity from the Company to each Underwriter, but only with
reference to any untrue statement or omission or alleged untrue statement or
omission made in reliance upon and in conformity with information furnished
to the Company in a letter from the Underwriters expressly for use in the
Registration Statement, the Prospectus, any amendment or supplement thereto,
or any preliminary prospectus.
If any suit, action, proceeding (including any governmental or
regulatory investigation), claim or demand shall be brought or asserted
against any person in respect of which indemnity may be sought pursuant to
either of the two preceding paragraphs, such person (the "Indemnified Person")
shall promptly notify the person against whom such indemnity may be sought
(the "Indemnifying Person"), "in writing, and the Indemnifying Person shall be
entitled to participate in and, to the extent that it shall desire, to assume
the defense thereof, with counsel reasonably satisfactory to the Indemnified
Person to represent the Indemnified Person and any others the Indemnifying
Person may designate in such proceeding and shall pay the fees and expenses of
such counsel related to such proceeding. In any such proceeding, any
Indemnified Person 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
Person unless (i) the Indemnifying Person and the Indemnified Person shall
have mutually agreed to the contrary, (ii) the Indemnifying Person has failed
within a reasonable time to retain counsel reasonably satisfactory to the
Indemnified Person or (iii) the named parties in any such proceeding
(including any impleaded parties) include both the Indemnifying Person and the
Indemnified Person and representation of both parties by the same counsel
would be inappropriate due to actual or potential conflicts of interests
between them. It is understood that the Indemnifying Person shall not, in
connection with any proceeding or related proceeding in the same jurisdiction,
be liable for the fees and expenses of more than one separate firm (in
addition to any local counsel) for all Indemnified Persons, and that all such
fees and expenses shall be reimbursed as they are incurred. Any such separate
firm for the Underwriters and such control persons of Underwriters shall be
designated in writing by ______________ and any such separate firm for the
Company, its directors, its officers and such control persons of the Company
shall be designated in writing by the Company. The Indemnifying Person 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 Person agrees to indemnify any
Indemnified Person from and against any loss or liability by reason of such
settlement or judgment to the extent set forth in this Section 7. No
Indemnifying Person shall, without the prior written consent of the Indemnified
Person, effect any settlement of any pending proceeding in respect of which
any Indemnified Person is a party and with respect to which such Indemnified
Person could reasonably have been entitled to indemnity hereunder from such
Indemnifying Person, unless such settlement includes an unconditional release
of such Indemnified Person from all liability on claims that are the subject
matter of such proceeding.
If the indemnification provided for in the first and second
paragraphs of this Section 7 is unavailable to an Indemnified Person in
respect of any losses, claims, damages or liabilities referred to therein,
then each Indemnifying Person under such paragraph, in lieu of indemnifying
such Indemnified Person thereunder, shall contribute to the amount paid or
payable by such Indemnified Person as a result of such losses, claims, damages
or liabilities (i) in such proportion as is appropriate to reflect the relative
benefits received by the Company on the one hand and the Underwriters on the
other hand from the offering of the Securities 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 Underwriters on the other in connection with the
statements or omissions that resulted in such losses, claims, damages or
liabilities, as well as any other relevant equitable considerations. The
relative benefits received by the Company on the one hand and the Underwriters
on the other shall be deemed to be in the same respective proportions as the
net proceeds from the offering (before deducting expenses) received by the
Company and the total underwriting discounts and commissions received by the
Underwriters in each case as set forth in the table on the cover of the
Prospectus, bear to the aggregate public offering price of the Securities. The
relative fault of the Company on the one hand and the Underwriters 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 or
alleged omission to state a material fact relates to information supplied by
the Company or by the underwriters and the parties, relative intent,
knowledge, access to information and opportunity to correct or prevent such
statement or omission.
The Company and the Underwriters agree that it would not be
just and equitable if contribution pursuant to this Section 7 were determined
by pro rata allocation (even if the Underwriters were treated as one entity
for such purpose) or by any other method of allocation that does not take
account of the equitable considerations referred to in the immediately
preceding paragraph. The amount paid or payable by an Indemnified Person as a
result of the losses, claims, damages and liabilities referred to in the
immediately preceding paragraph shall be deemed to include, subject to the
limitations set forth above, any legal or other expenses incurred by such
Indemnified Person in connection with investigating or defending any such
action or claim. Notwithstanding the provisions of this Section 7, in no event
shall an Underwriter be required to contribute any amount in excess of the
amount by which the total price at which the Securities underwritten by it and
distributed to the public were offered to the public exceeds the amount of any
damages that such Underwriter has otherwise been required to pay by reason of
such untrue or alleged untrue statement or omission or alleged omission. No
person guilty of fraudulent misrepresentation (within the meaning of Section
11(f) of the Securities Act) shall be entitled to contribution from any person
who was not guilty of such fraudulent misrepresentation. The Underwriters,
obligations to contribute pursuant to this Section 7 are several in proportion
to the respective principal amount of the Securities set forth opposite their
names in Schedule I hereto, and not joint.
The indemnity and contribution agreements contained in this
Section 7 are in addition to any liability which the Indemnifying Persons may
otherwise have to the Indemnified Persons referred to above.
The indemnity and contribution agreements contained in this
Section 7 and the representations and warranties of the Company set forth in
this Agreement shall remain operative and in full force and effect regardless
of (i) any termination of this Agreement, (ii) any investigation made by or on
behalf of any Underwriter or any person controlling any Underwriter or by or
on behalf of the Company, its officers or directors or any other person
controlling the Company and (iii) acceptance of and payment for any of the
Securities.
8. Notwithstanding anything herein contained, this Agreement
may be terminated in the absolute discretion of the Underwriters, by notice
given to the Company, if after the execution and delivery of this Agreement
and prior to the Closing Date (i) trading generally shall have been suspended
or materially limited on or by the New York Stock Exchange, (ii) trading of
any securities of the Company shall have been suspended on any exchange or in
any over-the-counter market, (iii) a general moratorium on commercial banking
activities in New York shall have been declared by either Federal or New York
State authorities, or (iv) there shall have occurred any outbreak or
escalation of hostilities or other calamity or crisis (including a crisis in
the financial markets) the effect of which, in the case of any of the
foregoing clauses (i) through (iv), is so material and adverse as to make it,
in the judgment of the Underwriters, impracticable to market the Securities on
the terms and in the manner contemplated in the Prospectus.
9. This Agreement shall become effective upon the execution
and delivery hereof by the parties hereto. If, on the Closing Date any one or
more of the Underwriters shall fail or refuse to purchase Securities which it
or they have agreed to purchase hereunder on such date, and the aggregate
principal amount of Securities 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 Securities to be purchased
on such date, the other Underwriters shall be obligated severally in the
proportions that the principal amount of Securities set forth opposite their
respective names in Schedule I hereto bears to the aggregate principal amount
of Securities set forth opposite the names of all such non-defaulting
Underwriters, or in such other proportions as they Underwriters may specify,
to purchase the Securities 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 Securities that any Underwriter has agreed
to purchase pursuant to Section 1 be increased pursuant to this Section 9 by
an amount in excess of one-ninth of such principal amount of Securities without
the written consent of such Underwriter. If, on the Closing Date any
Underwriter or Underwriters shall fail or refuse to purchase Securities which
it or they have agreed to purchase hereunder on such date, and the aggregate
principal amount of Securities with respect to which such default occurs is
more than one-tenth of the aggregate principal amount of Securities to be
purchased on such date, and arrangements satisfactory to the Underwriters and
the Company for the purchase of such Securities 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
the Underwriters 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.
10. If this Agreement shall be terminated pursuant to Section
8 or 9 hereof, the Company shall not be under any liability to any Underwriter
except as provided in Section 5(j) and Section 7. If this Agreement shall be
terminated by the Underwriters, or any of them, because of any failure or
refusal on the part of the Company to comply with the terms or to fulfill any
of the conditions of this Agreement, or if for any reason the Company shall be
unable to perform its obligations under this Agreement or any condition of the
Underwriters' obligations cannot be fulfilled, the Company agrees to reimburse
the Underwriters or such Underwriters as have so terminated this Agreement
with respect to themselves, severally, for all reasonable out-of-pocket
expenses (including the reasonable fees and expenses of their counsel)
reasonably incurred by such Underwriters in connection with this Agreement or
the offering contemplated hereunder.
11. This Agreement shall inure to the benefit of and be
binding upon the Company, the Underwriters, and, to the extent provided in
Section 7, any controlling persons of any Underwriter and the officers,
directors and controlling persons of the Company, and their respective heirs,
executors, administrators, 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. No
purchaser of Securities from any Underwriter shall be deemed to be a successor
or assign by reason merely of such purchase.
12. Any action by the Underwriters hereunder may be taken by
the Underwriters jointly or by _________________ alone on behalf of the
Underwriters, and any such action taken by the Underwriters jointly or by
___________________ alone shall be binding upon the Underwriters. All notices
and other communications hereunder shall be in writing and shall be deemed to
have been duly given if mailed or transmitted by any standard form of
telecommunication and shall be effective upon receipt. Notices to the
Underwriters shall be given to the Underwriters c/o ________________,
[address] (telecopy: (212) [ ]-[ ]); Attention: [ ]. Notices
to the Company shall be given to it at 709 East South Temple, Salt Lake City,
Utah 84102 (telecopy: [(801) 537-7808)]; Attention: Kathleen E. McDermott.
13. This Agreement may be signed in counterparts, each of
which shall be an original and all of which together shall constitute one and
the same instrument. This Agreement shall be governed by and construed in
accordance with the laws of the State of New York, without giving effect to the
conflicts of laws provisions thereof. If the foregoing is in accordance with
your understanding, please sign and return four counterparts hereof.
Very truly yours,
AMERICAN STORES COMPANY
By:________________________
Title:
Accepted: _____________, 199_
[ ]
Acting severally on behalf of
themselves and the several
Underwriters named herein
By [ ]
By:_______________________________
Title:
SCHEDULE I
Principal Amount
of Securities
Underwriter To Be Purchased
[ ] $[ ]
[ ] [ ]
----------------
Total:............ $[ ]
WLR&K Draft
10/31/94
Exhibit 1.2
U.S. $ ,000,000*
AMERICAN STORES COMPANY
MEDIUM-TERM NOTES, SERIES B
AGENCY AGREEMENT
, 199
[Name and addresses of Agents]
Dear Sirs:
American Stores Company, a Delaware corporation (the
"Company"), confirms its agreement with each of you (individu-
ally, an "Agent" and collectively, the "Agents"), with respect
to the issuance and sale by the Company of up to an aggregate
of $ ,000,000* in gross proceeds of its Medium-Term Notes,
Series B (the "Notes"). The Notes are to be issued from time
to time pursuant to an indenture, dated as of November , 1994
(as it may be supplemented or amended from time to time, the
"Indenture"), between the Company and The First National Bank
of Chicago, as trustee (the "Trustee").
The Notes shall have the maturity ranges, applicable
interest rates or interest rate formulas, specified currency,
issue price, redemption and repayment provisions and other
terms set forth in the Prospectus referred to in Section 1(a)
as it may be amended or supplemented from time to time, includ-
ing any supplement providing solely for the interest rate,
_____________________
* Or the U.S. dollar equivalent in certain specified foreign
currencies or currency units.
PAGE
<PAGE>
maturity and other pricing terms of any Note (a "Pricing Sup-
plement"). The Notes will be issued, and the terms thereof
established, from time to time, by the Company in accordance
with the Indenture and the Procedures referred to below. This
Agreement shall only apply to sales of the Notes and not to
sales of any other securities or evidences of indebtedness of
the Company and only on the specific terms set forth herein.
SECTION 1. REPRESENTATIONS AND WARRANTIES.
The Company represents and warrants to each Agent as
of the date hereof and as of the times referred to in Sections
6(a) and 6(b) hereof (each such time being hereinafter some-
times referred to as a "Representation Date"), as follows:
(a) General. A registration statement on Form S-3
with respect to the Notes has been prepared and filed by the
Company in conformity with the requirements of the Securities
Act of 1933, as amended (the "Act"), and the rules and regu-
lations (the "Rules and Regulations") of the Securities and
Exchange Commission (the "Commission") thereunder, and has
become effective under the Act. The Indenture has been qual-
ified under the Trust Indenture Act of 1939, as amended (the
"Trust Indenture Act"). As used in this Agreement, (i) "Reg-
istration Statement" means such registration statement when it
became effective under the Act, and as from time to time
amended or supplemented thereafter (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); (ii) "Basic Prospectus" means the
prospectus (including all documents incorporated therein by
reference) included in the Registration Statement; and (iii)
"Prospectus" means the Basic Prospectus (together with all
documents incorporated therein by reference), the Prospectus
Supplement dated , 199 relating to the Notes and
any amendments or supplements thereto (including the applicable
Pricing Supplement) relating to the Notes, as filed with the
Commission pursuant to paragraph (b) of Rule 424 of the Rules
and Regulations. The Commission has not issued any order pre-
venting or suspending the use of the Registration Statement or
Prospectus and no stop order proceeding has been initiated or,
to the knowledge of the Company, threatened by the Commission.
(b) Registration Statement, Prospectus and Inden-
ture: Contents. Except for statements in documents incorpo-
rated therein by reference which do not constitute part of the
Registration Statement or the Prospectus pursuant to Rule 412
of Regulation C under the Act and after substituting therefor
any modifying or superseding statements, the Registration
-2-
PAGE
<PAGE>
Statement and each Prospectus conformed, and the Registration
Statement and each Prospectus will, as of the applicable Repre-
sentation Date, conform, in all material respects to the
requirements of the Act, the Trust Indenture Act, and the rules
and regulations of the Commission under such Acts; the Inden-
ture, including any amendments and supplements thereto, con-
forms in all material respects with the requirements of the
Trust Indenture Act and the rules and regulations of the Com-
mission thereunder; the Registration Statement does not, and
will not as of the applicable Representation Date, contain any
untrue statement of a material fact or omit to state any mate-
rial fact required to be stated therein or necessary to make
the statements therein not misleading; the Prospectus does not,
and will not as of the applicable Representation Date, contain
any untrue statement of a material fact or omit to state any
material fact necessary in order to make the statements there-
in, in light of the circumstances under which they were made,
not misleading; provided, however, that the Company makes no
representation or warranty as to information contained in or
omitted from the Registration Statement or any Prospectus in
reliance upon and in conformity with written information fur-
nished to the Company by the Agents specifically for inclusion
therein or as to that part of the Registration Statement which
shall constitute the Statement of Eligibility and Qualification
on Form T-1 (the "Form T-1") of the Trustee under the Trust In-
denture Act.
(c) Validity of the Indenture and the Notes. The
Indenture has been duly authorized, executed and delivered by
the Company and constitutes the valid and binding instrument of
the Company, subject to the effect of (i) bankruptcy, insol-
vency, reorganization, moratorium and other laws relating to or
affecting creditors' rights generally and (ii) the application
of general principles of equity. The Notes have been validly
authorized for issuance and sale pursuant to this Agreement
and, when the terms of the Notes and of their issue and sale
have been duly established in accordance with the Indenture and
this Agreement, and the Notes have been duly executed, authen-
ticated, delivered and paid therefor as provided in this Agree-
ment and the Indenture, the Notes will be validly issued and
outstanding, and will constitute valid and binding obligations
of the Company entitled to the benefits of the Indenture, sub-
ject to the effect of (i) bankruptcy, insolvency, reorganiza-
tion, moratorium and other laws relating to or affecting credi-
tors' rights generally and (ii) the application of general
principles of equity; and the Notes will conform to the
description thereof contained in the Prospectus.
(d) Documents Incorporated by Reference. Except for
statements in such documents which do not constitute part of
-3-
PAGE
<PAGE>
the Registration Statement or the Prospectus pursuant to Rule
412 of Regulation C under the Act and after substituting there-
for any modifying or superseding statements, the documents
incorporated by reference into any Prospectus, when they were
filed with the Commission, as amended at or prior to the date
the Registration Statement became effective, conformed in all
material respects to the requirements of the Act and the Rules
and Regulations and the Securities Exchange Act of 1934, as
amended (the "Exchange Act"), and the rules and regulations of
the Commission thereunder and none of such documents contained
an untrue statement of a material fact or omitted to state a
material fact necessary to make the statements therein, in
light of the circumstances under which they were made, not mis-
leading; and any further documents so filed and incorporated by
reference in the Prospectus, when such documents are filed with
the Commission, will conform in all material respects to the
requirements of the Exchange Act, and will not contain an
untrue statement of a material fact or omit to state a material
fact necessary to make the statements therein, in the light of
the circumstances under which they were made, not misleading.
(e) Financial Statements. The financial statements,
and the related notes thereto, included or incorporated by ref-
erence in the Registration Statement and the Prospectus present
fairly, in all material respects, the financial position of the
Company and its consolidated subsidiaries as of the dates indi-
cated and the results of their operations and the changes in
their consolidated cash flows for the periods specified; said
financial statements have been prepared in conformity with gen-
erally accepted accounting principles applied on a consistent
basis, and the supporting schedules included or incorporated by
reference in the Registration Statement present fairly, in all
material respects, the information required to be stated there-
in as of the dates indicated.
(f) Due Incorporation and Qualification. Each of
the Company and each Significant Subsidiary (as defined in Reg-
ulation S-X promulgated by the Securities and Exchange Commis-
sion) of the Company has been duly incorporated and is validly
existing as a corporation in good standing under the laws of
the respective jurisdiction of incorporation, with power and
authority (corporate and other) to own its properties and con-
duct its business as presently conducted, and has been duly
qualified as a foreign corporation for the transaction of busi-
ness and is in good standing under the laws of each other
jurisdiction in which it owns or leases properties, or conducts
any business, so as to require such qualification, other than
where the failure to be so qualified or in good standing would
not have a material adverse effect on the Company and its sub-
sidiaries taken as a whole; and all the outstanding shares of
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capital stock of each Significant Subsidiary have been duly
authorized and validly issued, are fully-paid and nonassess-
able, and are owned by the Company, directly or indirectly,
free and clear of all liens, encumbrances, security interests
and claims.
(g) Authorization of Agreement. This Agreement has
been duly authorized, executed and delivered by the Company.
(h) No Defaults. Neither the Company nor any Sig-
nificant Subsidiary is, or with the giving of notice or lapse
of time or both would be, in violation of or in default under,
its Certificate of Incorporation or By-Laws (or other charter
documents) or any indenture, mortgage, deed of trust, loan
agreement or other agreement or instrument to which the Company
or any Significant Subsidiary is a party or by which it or any
of them or any of their respective properties is bound, except
for violations and defaults which individually and in the
aggregate would not have a material adverse effect on the Com-
pany and its subsidiaries taken as a whole; the issuance and
sale of the Notes and the performance by the Company of all of
the provisions of its obligations under the Notes, the Inden-
ture and this Agreement and the consummation of the transac-
tions herein and therein contemplated will not conflict with or
result in a breach of any of the terms or provisions of, or
constitute a default under, any material indenture, mortgage,
deed of trust, loan agreement or other material agreement or
instrument to which the Company or any Significant Subsidiary
is a party or by which the Company or any Significant Subsid-
iary is bound or to which any of the property or assets of the
Company or any Significant Subsidiary is subject, nor will any
such action result in any violation of the provisions of the
Restated Certificate of Incorporation or the By-Laws of the
Company or any material violation of any applicable law or
statute or any order, rule or regulation of any court or gov-
ernmental agency or body having jurisdiction over the Company,
any Significant Subsidiary or any of their respective proper-
ties; and except as required by the Act, the Trust Indenture
Act, the Exchange Act and the applicable securities or Blue Sky
laws of the various states and other jurisdictions, no consent,
approval, authorization, order, registration or qualification
of or with any such court or governmental agency or body is
required for the issue and sale of the Notes or the consumma-
tion by the Company of the transactions contemplated by this
Agreement or the Indenture.
(i) Litigation; Contracts. There are no legal or
governmental proceedings pending or, to the knowledge of the
Company, threatened to which the Company or any Significant
Subsidiary is a party or to which any property of the Company
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or any Significant Subsidiary is the subject that are required
to be described in the Registration Statement or the Prospectus
that are not so described; and there are no contracts or other
documents of a character required to be filed as an exhibit to
the Registration Statement or required to be described in the
Registration Statement or the Prospectus which are not filed or
described as required.
SECTION 2. SOLICITATIONS AS AGENT
(a) Appointment. Subject to the terms and condi-
tions stated herein, and subject to the reservation by the Com-
pany of the right to sell Notes, the Company hereby appoints
each of the Agents as the agents of the Company for the purpose
of soliciting or receiving offers to purchase the Notes from
the Company by others. On the basis of the representations and
warranties contained herein, but subject to the terms and con-
ditions herein set forth, each Agent agrees, as the agents of
the Company, to use its reasonable best efforts to solicit
offers to purchase the Notes upon the terms and conditions set
forth in the Prospectus. The Company reserves the right to
sell Notes directly to investors in jurisdictions in which it
is authorized to do so and, upon prior written notice to each
of the Agents, to appoint other persons, partnerships or corpo-
rations ("Additional Agents") to act as its agent to solicit
offers for the purchase of Notes pursuant to this Agreement;
provided that each Additional Agent shall execute this Agree-
ment and become a party hereto (or an agency agreement substan-
tially identical to this agreement) and thereafter the term
"Agent" as used in this Agreement shall mean the Agents and
such Additional Agents.
(b) Suspension of Solicitation. The Company re-
serves the right, in its sole discretion, to suspend solicita-
tion of offers to purchase the Notes commencing at any time for
any period of time or indefinitely. Promptly after receipt of
notice from the Company, but in any event not later than the
next business day thereafter, the Agents will suspend solicita-
tion of offers to purchase Notes from the Company until such
time as the Company has advised the Agents that such solicita-
tion may be resumed. For the purpose of the foregoing sen-
tence, "business day" shall mean any day which is not a
Saturday or Sunday and which in New York City is not a day on
which banking institutions are generally authorized or obli-
gated by law to close.
(c) Agents' Commission. Promptly upon the closing
of the sale of any Notes sold by the Company as a result of a
solicitation made by an Agent, the Company agrees to pay such
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Agent a commission in accordance with the schedule relating to
the Notes set forth in Exhibit A hereto.
(d) Solicitation of Offers. The Agents are autho-
rized to solicit offers to purchase the Notes only in denomi-
nations as are specified in the Prospectus at a purchase price
and such other terms as shall be specified by the Company.
Each Agent shall communicate to the Company, orally or in writ-
ing, each reasonable offer to purchase Notes received by it as
an Agent. The Company shall have the sole right to accept of-
fers to purchase the Notes and may reject any such offer in
whole or in part. Each Agent shall have the right, in its dis-
cretion reasonably exercised without advising the Company, to
reject any offer to purchase the Notes received by it, in whole
or in part, and any such rejection shall not be deemed a breach
of its agreement contained herein. Each Agent agrees that it
will not solicit an offer to purchase Notes or deliver any of
the Notes in any jurisdiction outside the United States of
America except under circumstances that will not result in a
violation of the applicable laws thereof. Each Agent under-
stands that no action has been taken to permit a public offer-
ing in any jurisdiction outside the United States of America
where action would be required for such purpose. The Agents
further undertake that in connection with the distribution of
Notes denominated in any foreign currency or currency unit,
they will as agent, directly or indirectly, not solicit offers
to purchase and as principal under any Purchase Agreement or
otherwise, directly or indirectly, not offer, sell or deliver,
such Notes in or to residents of the country issuing such cur-
rency, except as permitted by applicable law.
(e) Administrative Procedures. Administrative pro-
cedures respecting the sale of Notes (the "Procedures") are set
forth in Exhibit B hereto and may be amended in writing from
time to time by the Agents and the Company. Each Agent and the
Company agree to perform the respective duties and obligations
specifically provided to be performed by each of them herein
and in the Procedures.
SECTION 3. COVENANTS OF THE COMPANY
The Company covenants and agrees with each Agent:
(a) Delivery of Signed Registration Statement and
Prospectus. To furnish promptly to the Agents and to their
counsel a signed copy of the Registration Statement as origi-
nally filed and each amendment thereto, all documents incor-
porated therein by reference and all consents and exhibits
filed therewith.
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(b) Delivery of Other Documents. To deliver
promptly to the Agents, and in such number as they may reason-
ably request, each of the following documents: (i) conformed
copies of the Registration Statement (excluding exhibits other
than the computation of the ratio of earnings to fixed charges,
the Indenture and this Agreement), (ii) the Basic Prospectus,
(iii) each Prospectus and (iv) any documents incorporated by
reference in the Prospectus.
(c) Revisions to Prospectus. If, during the time
that a prospectus relating to the Notes is required to be de-
livered under the Act in connection with the offering or sale
of any of the Notes (a "Marketing Period"), any event occurs as
a result of which the Prospectus would include an untrue state-
ment of a material fact or omit to state any material fact nec-
essary to make the statements therein, in light of the circum-
stances under which they were made when the Prospectus was
delivered, not misleading, or if it is necessary at any time to
amend any Prospectus to comply with the Act, to notify the
Agents promptly (confirmed in writing) to suspend solicitation
of purchases of the Notes (and, if so notified, you shall
forthwith suspend such solicitations and cease using the Pro-
spectus); and the Company shall promptly prepare and file with
the Commission an amendment or supplement, whether by filing
documents pursuant to the Exchange Act, the Act or otherwise,
as may be necessary to correct such statement or omission or
which will effect such compliance whereupon the Agents will,
upon the filing of such amendment or supplement with the Com-
mission or effectiveness of an amendment to the Registration
Statement and upon counsel for the Agents being reasonably sat-
isfied as to such correction or compliance in all material
respects (with the Company agreeing to furnish to such counsel
all documents and information that they may reasonably request
to enable them to pass upon such matters), resume their respec-
tive obligations to solicit offers to purchase the Notes; pro-
vided, however, the Company shall not be required to comply
with the provisions of this paragraph (c) during any period
from the time (i)(A) an Agent shall have suspended solicitation
of purchases of the Notes in its capacity as agent pursuant to
a request from the Company and any Notes sold as a result of
solicitations by such Agent, as Agent, shall have been deliv-
ered and (B) such Agent shall not then hold any Notes as prin-
cipal purchased pursuant to a Purchase Agreement, to the time
(ii) the Company shall determine that solicitation of purchases
of the Notes should be resumed or shall subsequently enter into
a new Purchase Agreement with such Agent.
(d) Commission Filings. To timely file with the
Commission during any Marketing Period, all documents (and any
amendments to previously filed documents) required to be filed
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<PAGE>
by the Company pursuant to Sections 13(a), 13(c), 14 or 15(d)
of the Exchange Act.
(e) Copies of Filings with Commission. Prior to
filing with the Commission during any Marketing Period, any
amendment or supplement to the Registration Statement, or any
Prospectus (except for a Pricing Supplement or a supplement
relating to an offering of securities other than the Notes and
except for documents required to be filed by the Company pursu-
ant to Sections 13(a), 13(c), 14 or 15(d) of the Exchange Act)
to furnish a copy thereof to the Agents and, prior to filing
any Pricing Supplement relating to any Notes, to furnish a copy
thereof to the Agent soliciting the purchase of or purchasing
such Notes.
(f) Notice to Agent of Certain Events. To advise
the Agents promptly (i) when any post-effective amendment to
the Registration Statement relating to or covering the Notes
becomes effective, (ii) of any request by the Commission for an
amendment or supplement to the Registration Statement or to any
Prospectus, or for any additional information and will afford
the Agents a reasonable opportunity to comment on any such pro-
posed amendment or supplement, (iii) of the issuance by the
Commission of any stop order suspending the effectiveness of
the Registration Statement or any part thereof or any order
preventing or suspending the use of any Prospectus or any docu-
ment incorporated therein by reference, (iv) of the suspension
of the qualification of the Notes for sale in any jurisdiction
and (v) when there shall have occurred any downgrading or any
public notice shall have been given of any intended or poten-
tial downgrading or other negative review in the rating
accorded any of the Company's senior unsecured debt securities
by any of Standard & Poor's Corporation, Moody's Investors Ser-
vice, Inc., Duff & Phelps, Inc. or Fitch Investors Service,
Inc. (the "Rating Agencies").
(g) Stop Orders. If, during any Marketing Period,
the Commission shall issue a stop order suspending the effec-
tiveness of the Registration Statement, to make every reason-
able effort to obtain the lifting of that order at the earliest
possible time.
(h) Earnings Statements. As soon as practicable
after the date of each acceptance by the Company of an offer to
purchase Notes hereunder, to make generally available to its
security holders an earnings statement covering a period of at
least 12 months beginning with the first fiscal quarter of the
Company after the later of (i) the effective date of the Regis-
tration Statement and (ii) the effective date of the most
recent post-effective amendment to the Registration Statement
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<PAGE>
to become effective prior to the date of such acceptance which
will satisfy the provisions of Section 11(a) of the Act (or, at
the option of the Company, Rule 158 of the Rules and Regula-
tions under the Act);
(i) Reports. So long as the Notes are outstanding,
to furnish to the Agents copies of all reports, press releases
or other communications (financial or other) furnished to hold-
ers of the Company's publicly traded securities and copies of
any reports and financial statements publicly filed with the
Commission contemporaneously with furnishing such materials to
such holders or with the Commission.
(j) Blue Sky Qualifications. To take such action as
the Agents may reasonably request to qualify the Notes for
offering and sale under the securities laws of such jurisdic-
tions as the Agents may reasonably request, and to maintain
such qualifications in effect for as long as may reasonably be
required for the distribution of the Notes; provided that the
Company shall not be obligated to subject itself to any mate-
rial additional tax liabilities, to qualify as a foreign cor-
poration or as a dealer in securities in any jurisdiction in
which it is not so qualified or required to file a general con-
sent to service of process in any jurisdiction.
(k) Condition to Agency Transactions. With respect
to any person who has agreed to purchase Notes as a result of
an offer to purchase solicited by an Agent, if, during the
period beginning on the date such person agreed to purchase the
Notes (the "Trade Date") and ending on the date such Notes are
required to be delivered (the "Settlement Date") or, in the
case of clause (i) below, since the respective dates as of
which information is given in the Prospectus as amended or sup-
plemented through the Trade Date, (i) there has been any mate-
rial adverse change in the business, business prospects, finan-
cial position, stockholders' equity or results of operations of
the Company and its subsidiaries taken as a whole, except as
set forth or contemplated in the Prospectus as amended or sup-
plemented through the Trade Date, the effect of which is such,
in the judgment of the Agent which presented the offer to pur-
chase such Note, as materially to impair the investment quality
of the Notes to be purchased by such person, (ii) there shall
have occurred any outbreak or escalation of hostilities or
other calamity or crisis (including a crisis in the financial
markets) the effect of which, in the judgment of the Agent
which presented the offer to purchase such Notes, makes it
impracticable to proceed with the sale of such Notes, (iii)
trading generally shall have been suspended or materially lim-
ited on the New York Stock Exchange or trading of any of the
Company's securities shall have been suspended on any exchange
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<PAGE>
or in any over-the-counter market the effect of which, in the
judgment of the Agent which presented the offer to purchase
such Notes, makes it impracticable to proceed with the sale of
such Notes, (iv) a general moratorium on commercial banking
activities in New York shall have been declared by either Fed-
eral or New York State authorities or, in the case of Notes
denominated in other than United States dollars, by the author-
ities or the country of the currency in which such Notes are
denominated, or (v) there shall have occurred any downgrading
or any public notice shall have been given of any intended or
potential downgrading or other negative review accorded any of
the Company's senior unsecured debt securities by any of the
Rating Agencies, then the Company agrees that it shall promptly
advise the relevant Agent of such event described in clause (i)
through (v) above and the person who had agreed to purchase the
Notes shall have the right to refuse to purchase such Notes.
SECTION 4. PAYMENT OF EXPENSES
The Company will pay or cause to be paid all expenses
incident to the performance of its obligations under this
Agreement, including (i) the preparation, issuance, execution,
authentication and delivery of the Notes, (ii) the preparation,
printing and filing under the Act of the Registration State-
ment, the Prospectus and any amendments, supplements and exhib-
its thereto, (iii) the printing and delivery to the Agents of
the Registration Statement, as originally filed, and each
amendment and post-effective amendment thereof (including
exhibits), the Basic Prospectus, each Prospectus, any supple-
ment or amendment to any Prospectus and any documents incorpo-
rated by reference in any of the foregoing documents, (iv) the
fees and disbursements of the Trustee and its counsel and any
Paying Agent, Authenticating Agent or Calculation Agent for the
Notes, (v) the cost and fees in connection with any filings
with the National Association of Securities Dealers, Inc., (vi)
the reasonable fees and disbursements of counsel to the Company
and counsel to the Agents incurred in connection with the
offering and sale of the Notes, (vii) the fees paid to rating
agencies in connection with the rating of the Notes, (viii) the
fees and expenses of qualifying the Notes under the securities
laws of the several jurisdictions as provided in Section 3(j)
hereof and of preparing and printing a Blue Sky Memorandum and
a memorandum concerning the legality of the Notes as an invest-
ment (including reasonable fees and disbursements of counsel
for the Agents in connection therewith not to exceed $15,000),
and (ix) all advertising expenses in connection with the offer-
ing of the Notes incurred with the consent of the Company.
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SECTION 5. CONDITIONS OF OBLIGATIONS OF AGENT
The obligation of the Agents to solicit offers to
purchase the Notes, as agents of the Company, the obligations
of any purchasers of the Notes sold through an Agent as agent,
and the obligation of any Agent to purchase Notes as principal,
is subject to the accuracy of the representations and warran-
ties of the Company contained herein and to the accuracy of the
statements made in any certificate furnished by the Company
pursuant to the provisions hereof, to the performance by the
Company of its obligations hereunder, and to each of the fol-
lowing additional conditions:
(a) Registration Statement. No stop order suspend-
ing the effectiveness of the Registration Statement shall have
been issued and no stop order proceeding shall have been initi-
ated or, to the Company's knowledge, threatened by the Commis-
sion; any request of the Commission for inclusion of additional
information in the Registration Statement or any Prospectus or
otherwise shall have been complied with to the reasonable sat-
isfaction of the Agents.
(b) Legal Matters Satisfactory to Counsel. On the
date hereof and (if required by the Purchase Agreement) on each
date Notes are delivered with respect to any applicable Pur-
chase Agreement, all corporate proceedings and other legal mat-
ters incident to the authorization, form and validity of this
Agreement, the Notes, the Indenture, the form of the Registra-
tion Statement, each Prospectus (other than financial state-
ments and other financial data) and all other legal matters
relating to this Agreement and the transactions contemplated
hereby shall be reasonably satisfactory in all respects to
counsel for the Agents and the Company shall have furnished to
such counsel all documents and information that they may rea-
sonably request to enable them to pass upon such matters.
(c) Opinion of Outside Counsel. On the date hereof,
Wachtell, Lipton, Rosen & Katz, special counsel for the Com-
pany, shall have furnished to the Agents their written opinion,
dated the date of delivery, in form and substance reasonably
satisfactory to the Agents, to the effect that:
(i) this Agreement has been duly authorized, exe-
cuted and delivered by the Company;
(ii) the Notes are in a form contemplated by the
Indenture and have been duly authorized by all necessary
corporate action and, when the terms of the Notes and of
their issue and sale have been duly established in accor-
dance with the Indenture and this Agreement so as not to
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violate any applicable law or agreement or instrument then
binding on the Company, and when the Notes have been duly
executed and authenticated as specified in the Indenture
and delivered against payment therefor in accordance with
this Agreement, the Notes will constitute valid and bind-
ing obligations of the Company entitled to the benefits
provided by the Indenture, subject to the effect of (A)
bankruptcy, insolvency, reorganization, moratorium or
other similar laws relating to or affecting the rights of
creditors generally and (B) the application of general
principles of equity (regardless of whether enforcement is
considered in proceedings at law or in equity);
(iii) the Indenture has been duly authorized, executed
and delivered by the Company and constitutes a valid and
binding instrument of the Company, subject to the effect
of (A) bankruptcy, insolvency, reorganization, moratorium
or other similar laws relating to or affecting the rights
of creditors generally or (B) the application of general
principles of equity (regardless of whether enforcement is
considered in proceedings at law or in equity); and the
Indenture has been duly qualified under the Trust Inden-
ture Act;
(iv) the issue and sale of the Notes and the perfor-
mance by the Company of its obligations under the Notes,
the Indenture and this Agreement and the consummation of
the transactions herein and therein contemplated will not
(A) conflict with or result in a breach of any of the
terms or provisions of, or constitute a default under, any
indenture, mortgage, deed of trust or loan agreement set
forth on a Schedule previously furnished to the Agents
(such counsel may assume compliance with the financial
covenants contained therein), (B) result in any violation
of the provisions of the Restated Certificate of Incorpo-
ration or the By-Laws of the Company or (C) violate the
federal securities laws or regulations, the Delaware Gen-
eral Corporation Law or any law, statute, order, rule or
regulation known to such counsel (without independent
investigation) of any court or governmental agency or body
of the State of New York having jurisdiction over the Com-
pany, any Significant Subsidiary or any of their respec-
tive properties, except, in the case of clauses (A) and
(C), for conflicts, breaches, defaults or violations which
would not have a material effect on the financial condi-
tion, results of operations, assets or business of the
Company and its subsidiaries taken as a whole;
(v) except as required by the Act, the Trust Inden-
ture Act, the Exchange Act and the applicable securities
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and Blue Sky laws of the various states and other juris-
dictions, no consent, approval, authorization, order, reg-
istration or qualification of or with any court or govern-
mental agency or body is required for the issue and sale
of the Notes;
(vi) the Notes and the Indenture conform in all ma-
terial respects to the descriptions thereof in the Pro-
spectus; and the opinion contained in the Prospectus under
"Certain Federal Tax Consequences" is confirmed in all
material respects;
(vii) (A) each document incorporated by reference in
the Registration Statement and the Prospectus (except for
the financial statements and related schedules and notes
or other financial or statistical data included or incor-
porated by reference therein as to which such counsel need
express no opinion) complied as to form, in all material
respects, as amended as of the time the Registration
Statement became effective, with the Exchange Act; and (B)
the Registration Statement and the Prospectus as amended
or supplemented (except for the financial statements and
related schedules and notes or other financial or statis-
tical data included or incorporated by reference therein
as to which such counsel need express no opinion) comply
as to form in all material respects with the requirements
of the Act.
In rendering such opinions, such counsel may rely (A)
upon the opinion furnished to the Agents pursuant to Section
5(d); (B) upon oral advice of the staff of the Commission; and
(C) as to matters of fact, to the extent such counsel deems
proper, on certificates of officers of the Company and certifi-
cates or other written statements of officials of jurisdictions
having custody of documents respecting the corporate existence
or good standing of the Company. In rendering the opinion
referred to in subparagraph (ii) above, such counsel need not
express an opinion as to whether, with respect to any Notes
denominated in a currency other than United States dollars, a
court located in the United States of America would grant a
judgment relating to the Notes in other than United States dol-
lars, nor an opinion as to the date which any such court would
utilize for determining the rate of conversion into United
States dollars in granting such judgment. With respect to the
matters to be covered in subparagraph (vii) above counsel may
state their opinion is based upon their participation in the
preparation of the Registration Statement and the Prospectus
and any amendment or supplement thereto (excluding any docu-
ments incorporated by reference thereto, in which case such
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opinion is based upon their review of such documents) and dis-
cussions with representatives of the Company and its auditors
(including discussions in which the Agents and their counsel
participated) but is without independent check or verification
except as specified. Such counsel shall state that in the
course of such participation, review and discussions no facts
have come to such counsel's attention which lead such counsel
to believe that (except for the financial statements and
related schedules and notes or other financial or statistical
data included or incorporated by reference therein as to which
such counsel need express no belief and except for that part of
the Registration Statement which constitutes the Form T-1 of
the Trustee under the Trust Indenture Act) the Registration
Statement and the Prospectus included therein at the time the
Registration Statement became effective contained any untrue
statement of a material fact or omitted to state a material
fact required to be stated therein or necessary to make the
statements therein not misleading, and that the Prospectus as
amended or supplemented, if applicable, contains any untrue
statement of a material fact or omits to state a material fact
necessary in order to make the statements therein, in the light
of the circumstances under which they were made, not mislead-
ing. Such counsel may further state that such counsel have not
verified, and are not passing upon and do not assume any
responsibility for, the accuracy, completeness or fairness of
the statements contained in the Registration Statement or the
Prospectus (other than as set forth in subparagraph (vi)).
(d) Opinion of Company Counsel. On the date hereof,
the Company's General Counsel or Chief Legal Officer shall have
furnished to the Agents her written opinion, dated the date
hereof, in form and substance reasonably satisfactory to the
Agents, to the effect that:
(i) the Company has been duly incorporated and is
validly existing as a corporation in good standing under
the laws of the State of Delaware, with power and author-
ity (corporate and other) to own its properties and con-
duct its business as described in the Prospectus;
(ii) the Company has been duly qualified as a foreign
corporation for the transaction of business and is in good
standing under the laws of each other jurisdiction in
which it owns or leases properties, or conducts any busi-
ness, so as to require such qualification, other than
where the failure to be so qualified or in good standing
would not have a material adverse effect on the Company
and its subsidiaries taken as a whole;
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(iii) each Significant Subsidiary has been duly in-
corporated and is validly existing as a corporation under
the laws of its jurisdiction of incorporation, with power
and authority (corporate and other) to own its properties
and conduct its business as described in the Prospectus,
and has been duly qualified as a foreign corporation for
the transaction of business and is in good standing under
the laws of each other jurisdiction in which it owns or
leases properties, or conducts any business, so as to
require such qualification, other than where the failure
to be so qualified or in good standing would not have a
material adverse effect on the Company and its subsidiar-
ies taken as a whole; and all of the outstanding shares of
capital stock of each Significant Subsidiary have been
duly authorized and validly issued, are fully paid and
non-assessable, and are owned directly or indirectly by
the Company, free and clear of all material liens, encum-
brances, equities or claims;
(iv) other than as set forth or contemplated in the
Prospectus, such counsel does not know of any legal or
governmental proceedings pending to which the Company or
any Significant Subsidiary is a party or to which any
property of the Company or any Significant Subsidiary is
the subject which are required to be described in the Pro-
spectus as amended or supplemented which are not described
as required; and such counsel does not know of any con-
tracts or other documents of a character required to be
filed as an exhibit to the Registration Statement or
required to be described in the Registration Statement or
the Prospectus which are not filed or described as re-
quired; and
(v) the statements in the Prospectus incorporated by
reference from Item 3 of Part I of the Company's Annual
Report on Form 10-K for the year ended January 29, 1994,
as modified or amended by any subsequent documents incor-
porated by reference in the Registration Statement or Pro-
spectus, 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 or proceedings.
(e) Officers' Certificate. On the date hereof, the
Company shall have furnished to the Agents a certificate, dated
the date of delivery, of the Company (signed by an executive
officer) stating that the representations and warranties of the
Company in Section 1 hereof are true and correct in all mate-
rial respects as of such date; the Company has complied in all
material respects with all its agreements contained herein to
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be performed on or prior to such date; the conditions set forth
in Section 5(a) hereof have been fulfilled; and that since the
respective dates as of which information is given in the Pro-
spectus as amended or supplemented through the date of such
certificate, there has not been any material adverse change in
the business, business prospects, financial position, stock-
holders' equity or results of operations of the Company and its
subsidiaries taken as a whole, except as set forth or contem-
plated in the Prospectus as so amended or supplemented.
(f) Accountant's Letter. On the date hereof, the
Company shall have furnished to the Agents a letter of Ernst &
Young LLP, addressed to the Agents and dated the date of such
delivery, in form and substance reasonably satisfactory to the
Agents, containing statements and information of the type cus-
tomarily included in accountants "comfort letters" to under-
writers with respect to the financial statements and certain
financial information contained or incorporated by reference in
the Registration Statement and the Prospectus.
(g) Condition to Principal Transactions. An Agent
may terminate any Purchase Agreement, immediately upon notice
to the Company, at any time prior to the related Settlement
Date, if, during the period beginning on the Trade Date and
ending on the Settlement Date or, in the case of clause (i)
below, since the respective dates as of which information is
given in the Prospectus as amended or supplemented through the
Trade Date, (i) there has been any material adverse change in
the business, business prospects, financial position, stock-
holders' equity or results of operations of the Company and its
subsidiaries taken as a whole, except as set forth or contem-
plated in the Prospectus as amended or supplemented through the
Trade Date, the effect of which is such, in the judgment of
such Agent, as materially to impair the investment quality of
the Notes, (ii) there shall have occurred any outbreak or esca-
lation of hostilities or other calamity or crisis (including a
crisis in the financial markets) the effect of which is such as
to make it, in the judgment of such Agent, impracticable to
market the Notes or enforce contracts for the sale of the
Notes, (iii) trading generally shall have been suspended or
materially limited on the New York Stock Exchange or trading of
any of the Company's securities shall have been suspended on
any exchange or in any over-the-counter market the effect of
which is such as to make it, in the judgment of such Agent,
impracticable to market the Notes or enforce contracts for the
sale of the Notes, (iv) a general moratorium on commercial
banking activities in New York shall have been declared by
either Federal or New York State authorities or, in the case of
Notes denominated in other than United States dollars, by the
authorities or the country of the currency in which such Notes
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are denominated, or (v) there shall have occurred any downgrad-
ing or any public notice shall have been given of any intended
or potential downgrading or other negative review accorded any
of the Company's senior unsecured debt securities by any of the
Rating Agencies. The Company shall promptly advise such Agent
of the occurrence of any event described in clause (i) above
prior to the Settlement Date.
SECTION 6. ADDITIONAL COVENANTS OF THE COMPANY.
The Company covenants and agrees that:
(a) Affirmation of Representations and Warranties.
Each acceptance by the Company of an offer for the purchase of
Notes and each delivery of the Notes in any sale made to, or
pursuant to an offer solicited by you, shall be deemed to be an
affirmation to any Agent that solicited such offer or purchased
such Notes that the representations and warranties of the Com-
pany contained in this Agreement are true and correct in all
material respects at the time of such acceptance or delivery,
as though made at and as of each such time (and such represen-
tations and warranties shall relate to the Registration State-
ment and the Prospectus as amended or supplemented to each such
time).
(b) Subsequent Delivery of Officers' Certificates.
The Company agrees that during each Marketing Period, each time
that (A) the Registration Statement or any Prospectus shall be
amended or supplemented (but excluding amendments or supple-
ments (i) relating solely to an offering of securities other
than the Notes, (ii) constituting a Pricing Supplement relating
solely to the interest rates, maturities or other pricing terms
of the Notes or the principal amount of Notes remaining to be
sold, or (iii) relating solely to the incorporation by refer-
ence of the Company's proxy statement for its annual meeting of
shareholders or of a filing by the Company of any periodic or
current reports (other than a quarterly report on Form 10-Q or
an annual report on Form 10-K) unless, in the reasonable judg-
ment of the Agents, such periodic or current reports are of
such a character that the provisions of this paragraph (b)
should apply), or (B) (if required pursuant to a Purchase
Agreement) the Company sells Notes to an Agent pursuant to a
Purchase Agreement, the Company shall, absent the submission of
a certificate as provided below, be deemed to have represented
to the Agents (or, in the case of a Purchase Agreement, the
relevant Agent), as of the date of such supplement or filing or
the effectiveness of such amendment or at the time of delivery
of the Notes pursuant to such Purchase Agreement, that the
statements contained in the certificate referred to in Section
5(e) hereof which was last furnished to the Agents are true and
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correct at the time of such amendment, supplement or filing, as
the case may be, as though made at and as of such time (except
that such statements shall be deemed to relate to the Registra-
tion Statement and each Prospectus as amended and supplemented
to such time) or, in lieu of such representation, the Company
may (or, if required pursuant to a Purchase Agreement, shall)
submit to the Agents (or, in the case of a Purchase Agreement,
the relevant Agent) a certificate of the same tenor as the cer-
tificate referred to in said Section 5(e), modified as neces-
sary to relate to the Registration Statement and each Prospec-
tus as amended and supplemented to the time of delivery of such
certificate.
(c) Subsequent Delivery of Legal Opinions. The Com-
pany agrees that during each Marketing Period, each time that
(A) the Registration Statement or any Prospectus shall be
amended or supplemented (but excluding amendments or supple-
ments (i) relating solely to an offering of securities other
than the Notes, (ii) constituting a Pricing Supplement relating
solely to the interest rates, maturities or other pricing terms
of the Notes or the principal amount of Notes remaining to be
sold, or (iii) relating solely to the incorporation by refer-
ence of the Company's proxy statement for its annual meeting of
shareholders or of a filing by the Company of any periodic or
current reports (other than an annual report on Form 10-K)
unless, in the reasonable judgment of the Agents, such periodic
or current reports are of such a character that the provisions
of this paragraph (c) should apply) or (B) (if required pursu-
ant to a Purchase Agreement) the Company sells Notes to an
Agent pursuant to a Purchase Agreement, the Company shall, con-
currently with such amendment, supplement or filing or at the
time of delivery of the Notes pursuant to such Purchase Agree-
ment, furnish the Agents (or, in the case of a Purchase Agree-
ment, the relevant Agent) and their counsel with the written
opinions of the Company's General Counsel or Chief Legal
Officer and special counsel, each addressed to the Agents and
dated the date of delivery of such opinion, in form reasonably
satisfactory to the Agents, of the same effect as the opinions
referred to in Sections 5(c) and 5(d) hereof, but modified, as
necessary, to relate to the Registration Statement and each
Prospectus as amended or supplemented to the time of delivery
of such opinion; provided, however, that in lieu of such opin-
ion, each such counsel may furnish the Agents (or, in the case
of a Purchase Agreement, the relevant Agent) with a letter to
the effect that the Agents may rely on such prior opinion to
the same extent as though it was dated the date of such letter
authorizing reliance (except that statements in such prior
opinion shall be deemed to relate to the Notes being delivered
and to the Registration Statement and each Prospectus as
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amended or supplemented to the time of delivery of such letter
authorizing reliance).
(d) Subsequent Delivery of Accountant's Letters.
The Company agrees that during each Marketing Period, each time
that (A) the Company files an Annual Report on Form 10-K, (B)
the Registration Statement or any Prospectus shall be amended
or supplemented to include additional financial information or
the Company files with the Commission any document incorporated
by reference into any Prospectus which contains additional
financial information that, in the reasonable judgment of the
Agents, should be covered by a letter of the same effect as the
letter referred to in Section 5(f) hereof, or (C) (if required
pursuant to a Purchase Agreement), the Company sells Notes to
an Agent pursuant to a Purchase Agreement, the Company shall
cause Ernst & Young LLP (or other independent accountants of
the Company acceptable to the Agents) to furnish the Agents
(or, in the case of a Purchase Agreement, the relevant Agent),
concurrently with such amendment, supplement, or filing or at
the time of delivery of the Notes pursuant to such Purchase
Agreement, a letter, addressed jointly to the Company and the
Agents and dated the date of delivery of such letter, in form
and substance reasonably satisfactory to the Agents, of the
same effect as the letter referred to in Section 5(f) hereof
but modified to relate to the Registration Statement and each
Prospectus, as amended and supplemented to the date of such
letter, with such changes as may be necessary to reflect
changes in the financial statements and other information de-
rived from the accounting records of the Company available
within five days of the date of such letter.
SECTION 7. INDEMNIFICATION AND CONTRIBUTION
The Company agrees to indemnify and hold harmless
each Agent and each person, if any, who controls any Agent
within the meaning of either Section 15 of the Securities Act
or Section 20 of the Exchange Act, from and against any and all
losses, claims, damages and liabilities (including without lim-
itation the reasonable legal fees and other expenses incurred
in connection with investigating, preparing to defend or
defending any suit, action or proceeding or any claim asserted
which shall be reimbursed as such legal fees and other expenses
are incurred) arising out of or based upon any untrue statement
or alleged untrue statement of a material fact contained in the
Registration Statement or the Prospectus (as amended or supple-
mented if the Company shall have furnished any amendments or
supplements thereto), or arising out of or based upon any omis-
sion or alleged omission to state therein a material fact
required to be stated therein or, in the case of the Registra-
tion Statement or the Prospectus (as amended or supplemented),
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necessary to make the statements therein not misleading, except
insofar as such losses, claims, damages or liabilities arise
out of or are based upon any untrue statement or omission or
alleged untrue statement or omission made in the Form T-1 or
made in the Registration Statement or Prospectus in reliance
upon and in conformity with information furnished to the Com-
pany in a letter from the Agents expressly for use therein.
Each Agent agrees, severally and not jointly, to
indemnify and hold harmless the Company, its directors, its
officers and each person who controls the Company within the
meaning of either Section 15 of the Securities Act or Section
20 of the Exchange Act to the same extent as the foregoing
indemnity from the Company to each Agent, but only with ref-
erence to any untrue statement or omission or alleged untrue
statement or omission made in reliance upon and in conformity
with information furnished to the Company in a letter from the
Agents expressly for use in the Registration Statement, the
Prospectus or any amendment or supplement thereto.
If any suit, action, proceeding (including any gov-
ernmental or regulatory investigation), claim or demand shall
be brought or asserted against any person in respect of which
indemnity may be sought pursuant to either of the two preceding
paragraphs, such person (the "Indemnified Person") shall
promptly notify the person against whom such indemnity may be
sought (the "Indemnifying Person") in writing, and the Indem-
nifying Person shall be entitled to participate in and, to the
extent that it shall desire, to assume the defense thereof,
with counsel reasonably satisfactory to the Indemnified Person
to represent the Indemnified Person and any others the Indemni-
fying Person may designate in such proceeding and shall pay the
fees and expenses of such counsel related to such proceeding.
In any such proceeding, any Indemnified Person 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 Person
unless (i) the Indemnifying Person and the Indemnified Person
shall have mutually agreed to the contrary, (ii) the Indemnify-
ing Person has failed within a reasonable time to retain coun-
sel reasonably satisfactory to the Indemnified Person or (iii)
the named parties in any such proceeding (including any im-
pleaded parties) include both the Indemnifying Person and the
Indemnified Person and representation of both parties by the
same counsel would be inappropriate due to actual or potential
conflicts of interest between them. It is understood that the
Indemnifying Person shall not, in connection with any proceed-
ing or related proceeding in the same jurisdiction, be liable
for the fees and expenses of more than one separate firm (in
addition to any local counsel) for all Indemnified Persons, and
that all such fees and expenses shall be reimbursed as they are
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incurred. The Indemnifying Person shall not be liable for any
settlement of any proceeding effected without its written con-
sent, but if settled with such consent or if there be a final
judgment for the plaintiff, the Indemnifying Person agrees to
indemnify any Indemnified Person from and against any loss or
liability by reason of such settlement or judgment to the ex-
tent set forth in this Section 7. No Indemnifying Person
shall, without the prior written consent of the Indemnified
Person, effect any settlement of any pending proceeding in
respect of which any Indemnified Person is a party and with
respect to which such Indemnified Person could reasonably have
been entitled to indemnity hereunder by such Indemnifying Per-
son, unless such settlement includes an unconditional release
of such Indemnified Person from all liability on claims that
are the subject matter of such proceeding.
If the indemnification provided for in the first and
second paragraphs of this Section 7 is unavailable to an Indem-
nified Person in respect of any losses, claims, damages or
liabilities referred to therein, then each Indemnifying Person
under such paragraph, in lieu of indemnifying such Indemnified
Person thereunder, shall contribute to the amount paid or pay-
able by such Indemnified Person as a result of such losses,
claims, damages or liabilities (i) in such proportion as is
appropriate to reflect the relative benefits received by the
Company on the one hand and the Agents on the other hand 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 Agents on the
other in connection with the statements or omissions that
resulted in such losses, claims, damages or liabilities, as
well as any other relevant equitable considerations. The rela-
tive benefits received by the Company on the one hand and the
Agents on the other shall be deemed to be in the same respec-
tive proportions as the net proceeds from the offering (before
deducting expenses) received by the Company and the total com-
missions received by the Agents, in each case as set forth in
the table in Annex A of this Agreement, bear to the aggregate
public offering price of the Notes. The relative fault of the
Company on the one hand and the Agents 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 or alleged omission to state a material fact relates
to information supplied by the Company or by the Agents and the
parties' relative intent, knowledge, access to information and
opportunity to correct or prevent such statement or omission.
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The Company and the Agents agree that it would not be
just and equitable if contribution pursuant to this Section 7
were determined by pro rata allocation (even if the Agents were
treated as one entity for such purpose) or by any other method
of allocation that does not take account of the equitable con-
siderations referred to in the immediately preceding paragraph.
The amount paid or payable by an Indemnified Person as a result
of the losses, claims, damages and liabilities referred to in
the immediately preceding paragraph shall be deemed to include,
subject to the limitations set forth above, any legal or other
expenses incurred by such Indemnified Person in connection with
investigating or defending any such action or claim. Notwith-
standing the provisions of this Section 7, in no event shall an
Agent be required to contribute any amount in excess of the
amount by which the total price at which the Notes sold through
such Agent and distributed to the public were offered to the
public exceeds the amount of any damages that such Agent 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 mean-
ing of Section 11(f) of the Securities Act) shall be entitled
to contribution from any person who was not guilty of such
fraudulent misrepresentation.
The indemnity and contribution agreements contained
in this Section 7 are in addition to any liability which the
Indemnifying Persons may otherwise have to the Indemnified Per-
sons referred to above.
SECTION 8. STATUS OF EACH AGENT
In soliciting offers to purchase the Notes from the
Company pursuant to this Agreement (other than offers to pur-
chase pursuant to Section 11), each Agent is acting solely as
agent for the Company and not as principal. Each Agent will
make reasonable efforts to assist the Company in obtaining per-
formance by each purchaser whose offer to purchase Notes from
the Company has been solicited by such Agent and accepted by
the Company but such Agent shall have no liability to the Com-
pany in the event any such purchase is not consummated for any
reason. If the Company shall default in its obligations to
deliver Notes to a purchaser whose offer it has accepted, the
Company shall hold the Agents harmless against any loss, claim
or damage arising from or as a result of such default by the
Company and, in particular, pay to the Agents any commission to
which they would be entitled in connection with the sale.
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SECTION 9. INDEMNITIES, REPRESENTATIONS AND WARRAN-
TIES TO SURVIVE DELIVERY
All indemnities, representations and warranties of
the Company contained in this Agreement, or contained in cer-
tificates of officers of the Company submitted pursuant hereto,
shall remain operative and in full force and effect, regardless
of the termination or cancellation of this Agreement or any in-
vestigation made by or on behalf of any Agent or any person
controlling such Agent or by or on behalf of the Company, its
officers, directors or any other person controlling the Company
and shall survive each delivery of and payment for any of the
Notes.
SECTION 10. TERMINATION
This Agreement may be terminated at any time (i) by
the Company with respect to any Agent by giving one day's writ-
ten notice of such termination to each Agent or (ii) by any
Agent, as to the rights and obligations of such Agent only, by
giving written notice to the Company and the other Agents. If,
at the time of a termination, an offer to purchase any of the
Notes has been accepted by the Company but the related Settle-
ment Date has not occurred or if the Agent is still holding
Notes which it acquired as principal, the covenants set forth
in Sections 3 and 6 and the conditions set forth in Section 5
of this Agreement shall remain in effect until such Notes are
delivered. The provisions of Sections 2(c), 3(i), 4, 7, 8, 9,
12, 13 and 14 hereof shall survive any termination of this
Agreement.
SECTION 11. PURCHASES AS PRINCIPAL
In any case in which an Agent purchases Notes as
principal, it shall (i) advise the Company at the time it makes
its offer to purchase such Notes that it is acting as princi-
pal, and (ii) advise the Company from time to time promptly
upon request whether it continues to hold any Notes as princi-
pal. Each sale of Notes to an Agent as principal shall be made
in accordance with the terms contained herein and (unless the
Company and such Agent shall otherwise agree) pursuant to a
separate agreement to be entered into between such Agent and
the Company. Each such separate agreement, which may be in the
form attached hereto as Exhibit C or may be an oral agreement,
confirmed in writing, is herein referred to as a "Purchase
Agreement". Each such Purchase Agreement shall also specify,
to the extent applicable, the requirements for an officer's
certificate, opinions of counsel and comfort letters pursuant
to Sections 5(b), 6(b), 6(c) and 6(d) hereof. The Agent's com-
mitment to purchase Notes as principal shall be deemed to have
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been made on the basis of the representations and warranties of
the Company herein contained and shall be subject to the terms
and conditions herein set forth. An agent may utilize a sell-
ing or dealer group in connection with the resale of the Notes
purchased.
SECTION 12. NOTICES
Except as otherwise provided herein, all notices and
other communications hereunder shall be in writing and shall be
deemed to have been duly given if mailed or transmitted by any
standard form of telecommunication. Notices to the Agents
shall be directed to it as follows: [to follow]; notices to
the Company shall be directed to it as follows: American
Stores Company, 709 East South Temple, Salt Lake City, Utah
84102 (telecopy: (801) 537-7808), Attention: Treasurer (with
a copy to the General Counsel).
SECTION 13. BINDING EFFECT; BENEFITS
This Agreement and any Purchase Agreement shall inure
to the benefit of and be binding upon the Agent, the Company,
and their respective successors. Nothing in this Agreement or
any Purchase Agreement is intended or shall be construed to
give any other person, firm or corporation, other than the par-
ties hereto and their respective successors and the controlling
persons referred to in Section 7 and their heirs and legal rep-
resentatives, any legal or equitable right, remedy or claim
under or in respect of this Agreement or any provision con-
tained herein. This Agreement and all conditions and provi-
sions 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
through or from any Agent shall be deemed a successor by reason
merely of such purchase.
SECTION 14. GOVERNING LAW; COUNTERPARTS
This Agreement shall be governed by and construed in
accordance with the laws of New York, without giving effect to
the conflicts of laws provisions thereof. This Agreement may
be executed in counterparts and the executed counterparts shall
together constitute a single instrument.
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SECTION 15. PARAGRAPH HEADINGS
The paragraph headings used in this Agency Agreement
are for convenience of reference only, and are not to affect
the construction hereof or be taken into consideration in the
interpretation hereof.
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If the foregoing correctly sets forth our agreement,
please sign and return to us a counterpart hereof, whereupon
this instrument along with all counterparts will become a bind-
ing agreement between the Company and you in accordance with
its terms.
Very truly yours,
AMERICAN STORES COMPANY
By:
Title:
CONFIRMED AND ACCEPTED,
as of the date first above writ-
ten:
[Names of Agents]
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WLRK DRAFT
11/1/94
EXHIBIT A
AMERICAN STORES COMPANY
MEDIUM-TERM NOTES, SERIES B
SCHEDULE OF PAYMENTS
The Company agrees to pay each Agent a commission
equal to the following percentage of the aggregate U.S. dollar
equivalent of the principal amount of Notes:
TERM COMMISSION RATE
9 months to less than 1 year .125%
1 year to less than 18 months .150%
18 months to less than 2 years .200%
2 years to less than 3 years .250%
3 years to less than 4 years .350%
4 years to less than 5 years .450%
5 years to less than 6 years .500%
6 years to less than 7 years .550%
7 years to less than 10 years .600%
10 years to less than 15 years .625%
15 years to less than 20 years .650%
20 years to 30 years .750%
PAGE
<PAGE>
EXHIBIT B
AMERICAN STORES COMPANY
MEDIUM-TERM NOTES, SERIES B
ADMINISTRATIVE PROCEDURES
Medium-Term Notes, Series B, due from nine months to
30 years from date of issue (the "Notes") are to be offered on
a continuing basis by American Stores Company (the "Company").
[Names of Agents], as agents (each an "Agent" and collectively,
the "Agents"), have each agreed to use their reasonable best
efforts to solicit offers to purchase the Notes. The Notes are
being sold pursuant to an Agency Agreement between the Company
and the Agents dated , 199_ (as it may be supple-
mented or amended from time to time, the "Agency Agreement") to
which these administrative procedures are attached as an
exhibit. The Notes will be issued under the Indenture, dated
as of November __, 1994 between the Company and The First
National Bank of Chicago, as trustee (the "Trustee"), as
heretofore supplemented. The First National Bank of Chicago
has been appointed as paying agent, registrar and authenti-
cating agent with respect to the Notes (the "Paying Agent").
The Notes will rank equally with all other unsecured and un-
subordinated indebtedness of the Company and have been regis-
tered with the Securities and Exchange Commission (the "Commis-
sion"). Terms defined in the Prospectus relating to the Notes
(the "Prospectus") and in the Agency Agreement shall have the
same meaning when used in this exhibit. Special administrative
procedures for Multi-Currency Notes and for Global Securities
relating to Book-Entry Notes follow these administrative
procedures.
Administrative responsibilities, document control and
record-keeping functions to be performed by the Company will be
performed by its Treasurer, Vice President and Assistant
Treasurer or Vice President-Cash Management and Assistant
Treasurer. Administrative procedures for the offering are
explained below.
PRICE TO PUBLIC
Each Note will be issued at 100% of principal amount,
unless otherwise determined by the Company.
DATE OF ISSUANCE
Each Note will be dated and issued as of the date of
its authentication by the Paying Agent, as authenticating
agent.
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MATURITIES
Each Note will mature on a Business Day (as defined
below) selected by the purchaser and agreed upon by the Com-
pany, such date being at least nine months but not more than 30
years from the date of issuance. Each Floating Rate Note will
mature on an Interest Payment Date (as defined below).
"Business Day" shall mean any day which is not a
Saturday or Sunday and which is not a day on which banking
institutions are generally authorized or obligated by law to
close in The City of New York or Chicago.
REGISTRATION
Notes will be issued only in fully registered form as
either a Book-Entry Note or a Certificated Note. Certificated
Notes may be presented for registration of transfer or exchange
at the Paying Agent's New York office.
DENOMINATIONS
The Notes (other than Notes represented by Global
Securities) will be issued and payable in U.S. dollars in the
denomination of $100,000 and any larger denomination which is
an integral multiple of $1,000.
INTEREST PAYMENTS
Each Note bearing interest at a fixed rate (a "Fixed
Rate Note") will bear interest from its issue date at the
annual rate stated on the face thereof, payable on
and of each year (each an "Interest Payment Date"
with respect to such Fixed Rate Note) and at Stated Maturity or
upon redemption or repayment, if applicable.
Special provisions are set forth in the Prospectus
relating to Notes bearing interest at a rate or rates deter-
mined by reference to an interest rate formula ("Floating Rate
Notes") at a rate determined pursuant to the formula stated on
the face thereof, payable in arrears on such dates as are
specified therein (each an "Interest Payment Date" with respect
to such Floating Rate Note).
Interest on Fixed Rate Notes will be calculated and
paid on the basis of a 360-day year of twelve 30-day months.
Interest on Floating Rate Notes will be calculated on the basis
of actual days elapsed and a 360-day year of twelve 30-day
months except that in the case of Treasury Rate Notes, interest
will be calculated on the basis of the actual number of days in
the year. Interest will be payable to the person in whose name
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such Note is registered at the close of business on the March
15 or September 15 (whether or not a Business Day) with respect
to Fixed Rate Notes or the fifteenth day (whether or not a
Business Day) next preceding an Interest Payment Date with re-
spect to Floating Rate Notes (the "Record Dates"); provided,
however, that interest payable at Stated Maturity or upon
redemption or repayment will be payable to the person to whom
principal shall be payable. Any payment of principal and
interest on such Note required to be paid on an Interest Pay-
ment Date or at Stated Maturity or upon redemption or repay-
ment, if applicable, which is not a Business Day shall be
postponed to the next day which is a Business Day with the same
force and effect as if made on such Interest Payment Date, at
Stated Maturity or upon redemption or repayment, and no addi-
tional interest shall accrue as a result of such delayed pay-
ment. The first payment of interest on any Note originally
issued between a Record Date and an Interest Payment Date will
be made on the Interest Payment Date following the next suc-
ceeding Record Date. All interest payments, excluding interest
payments made at Stated Maturity or upon redemption or repay-
ment, if applicable, will be made by check mailed to the person
entitled thereto as provided above, or, at the option of the
Company, by wire transfer to an account maintained by such
person with a bank located in the United States. Notwith-
standing the foregoing, the holder of $10 million or more in
aggregate principal amount of Notes with the same Interest
Payment Date may request payment by wire transfers.
On the fifth Business Day immediately preceding each
Interest Payment Date, the Paying Agent will furnish the Com-
pany with the total amount of the interest payments to be made
on such Interest Payment Date. The Paying Agent will provide
monthly to the Company's Treasury Department a list of the
principal and interest to be paid on Notes maturing in the next
succeeding month. The Company will provide to the Paying Agent
not later than the payment date sufficient moneys to pay in
full all principal and interest payments due on such payment
date. The Paying Agent will assume responsibility for with-
holding taxes on interest paid as required by law.
ACCEPTANCE AND REJECTION OF OFFERS
The Company shall have the sole right to accept of-
fers to purchase Notes and may reject any such offer in whole
or in part. Each Agent shall promptly communicate to the
Company, orally or in writing, each reasonable offer to pur-
chase Notes from the Company received by it other than those
rejected by such Agent. Each Agent shall have the right, in
its discretion reasonably exercised without advising the Com-
pany, to reject any offers in whole or in part.
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SETTLEMENT
The receipt of immediately available funds in U.S.
dollars by the Company in payment for a Note (less the appli-
cable commission) and the authentication and issuance of such
Note shall, with respect to such Note, constitute "Settlement."
All offers accepted by the Company will be settled from one to
five Business Days from the date of acceptance by the Company
pursuant to the timetable for Settlement set forth below unless
the Company and the purchaser agree to Settlement on a later
date; provided, however, that the Company will so notify the
Paying Agent of any such later date on or before the Business
Day immediately prior to the Settlement date.
SETTLEMENT PROCEDURES
In the event of a purchase of Notes by an Agent, as
principal, additional Settlement details may be set forth in
the applicable Purchase Agreement to be entered into between
such Agent and the Company pursuant to the Agency Agreement,
which details will be furnished to the Paying Agent. In the
event of the sale of a Multi-Currency Note, additional or
different Settlement details may be set forth in an Amendment
to be entered into between the Agent and the Company.
Settlement procedures with regard to each Certifi-
cated Note sold through each Agent shall be as follows:
A. Such Agent (the "Presenting Agent") will advise
the Company by telephone (confirmed in writing), telex, fac-
simile or other acceptable means of the following Settlement
information:
1. Exact name in which the Note is to be registered
("Registered Owner").
2. Exact address of the Registered Owner and ad-
dress for payment of principal and interest, if
any.
3. Taxpayer identification number of the Registered
Owner.
4. Principal amount of the Note (and, if multiple
Notes are to be issued, denominations thereof).
5. Settlement date.
6. Stated Maturity and, if the Company has the
option to extend the Stated Maturity Date, the
Extension Periods and the Final Maturity Date.
7. Issue Price and any OID information.
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8. Trade Date.
9. Interest rate (including, if appropriate, such
interest rate information applicable to any
Extension Period):
(a) Fixed Rate Notes:
(i) interest rate
(ii) date or dates, if any, on which the
interest rate may be reset and the
basis or formula, if any, for such
resetting
(b) Floating Rate Notes:
(i) interest rate basis
(ii) initial interest rate
(iii) spread or spread multiplier, if any
(iv) date or dates, if any, on which the
spread or spread multiplier may be
reset and the basis or formula, if
any, for such resetting
(v) interest reset period
(vi) maximum and minimum interest rates, if
any
(vii) interest payment period
(viii) index maturity
10. The date on or after which the Notes are re-
deemable at the option of the Company or the
holder, and additional redemption or repurchase
provisions, if any.
11. Wire transfer information.
12. Presenting Agent's commission (to be paid in the
form of a discount from the proceeds remitted to
the Company upon Settlement).
13. That the Note will be a Certificated Note.
B. The Company will confirm the above Settlement
information to the Paying Agent by telex, facsimile or other
acceptable means, and the Paying Agent will assign a Note
number to the transaction. If the Company disputes the Set-
tlement information, the Company will promptly notify the
Presenting Agent by telephone.
C. The Paying Agent will prepare the Certificated
Note and appropriate receipts that will serve as documentary
control of the transaction [Note: if the Company is utilizing
the book-entry system, see procedures below].
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D. The Paying Agent will deliver the Note to the
Presenting Agent against delivery of a receipt therefor by the
Presenting Agent.
E. The Presenting Agent will cause to be wire
transferred to a bank account designated by the Company im-
mediately available funds in U.S. dollars in the amount of the
principal amount of the Note, less the applicable commission or
discount, if any.
F. The Presenting Agent will deliver the Note to the
purchaser against payment in immediately available funds in the
amount of the principal amount of the Note. The Presenting
Agent will deliver to the purchaser a copy of the most recent
Prospectus applicable to the Note with or prior to any written
offer of Notes, delivery of the Note and the confirmation and
payment by the purchaser for the Note.
G. The Presenting Agent will obtain the acknowl-
edgement of receipt for the Note and Prospectus by the pur-
chaser.
H. The Paying Agent will mail appropriate confir-
mations of the issuance of each Note to the Company's Treasurer
and to the Trustee.
SETTLEMENT PROCEDURES TIMETABLE
For offers accepted by the Company, Settlement pro-
cedures "A" through "H" set forth above shall be completed on
or before the respective times set forth below:
SETTLEMENT
PROCEDURE TIME (NEW YORK)
A 5 PM on date of order
B 3 PM on the Business Day prior to
Settlement Date
C-D 12 Noon on the Settlement Date
E 2:15 PM on the Settlement Date
F-G 3 PM on the Settlement Date
H 5 PM on Business Day after the
Settlement Date
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FAILS
In the event that a purchaser of a Note shall either
fail to accept delivery of or make payment for such Note on the
date fixed by the Company for Settlement, the Presenting Agent
will immediately notify the Paying Agent and the Company's
Treasurer, Vice President and Assistant Treasurer or Vice
President-Cash Management and Assistant Treasurer by telephone,
confirmed in writing, of such failure and return the Note to
the Paying Agent. Upon the Paying Agent's receipt of the Note
from the Presenting Agent, the Company will promptly return to
the Presenting Agent an amount of immediately available funds
in U.S. dollars equal to any amount previously transferred to
the Company in respect of the Note pursuant to advances made by
the Presenting Agent. Such returns will be made on the Set-
tlement date, if possible, and in any event not later than 12
noon (New York City time) on the Business Day following the
Settlement date. If such failure shall have occurred for any
reason other than default by the Presenting Agent in the per-
formance of its duties under the Agency Agreement, the Company
will reimburse the Presenting Agent on an equitable basis for
its loss of the use of the funds during the period when the
funds were credited to the account of the Company. Upon
receipt of the Note in respect of which the failure occurred,
the Paying Agent will mark the Note "cancelled," make appro-
priate entries in its records, dispose of such Note and deliver
a certificate of disposition to the Company and the Trustee.
The Presenting Agent will not be entitled to any commission
with respect to any Note which the purchaser does not accept or
make payment for.
REDEMPTION AND REPAYMENT
Except as otherwise specified in the applicable
Pricing Supplement and on the Notes, the Notes will not be
redeemable or subject to repayment prior to their Stated
Maturity. If so specified in a Pricing Supplement and on the
Note, such Note will be subject to redemption by the Company or
repayment at the option of a holder, at any time on or after
the date set forth on such supplement and the Note, in whole or
from time to time in part, at the option of the Company or the
holder, as the case may be, at the redemption price or repay-
ment price set forth therein, together with interest accrued
thereon on the date of redemption or repayment.
Notice of redemption shall be given by first-class
mail postage prepaid, mailed not less than 30 days nor more
than 60 days prior to the date of redemption, to each holder of
Notes to be redeemed, in the manner and in accordance with the
Indenture. In the event of redemption in part of any Note, a
new Note for the amount of the unredeemed portion shall be
issued in the name of the Holder upon cancellation of the
redeemed Note.
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In order for a Note that is redeemable at the option
of the holder to be repaid, the Paying Agent must receive at
least 30 days but not more than 45 days prior to the repayment
date (a) appropriate wire instructions and (b) either (i) the
Note with the form entitled "Option to Elect Repayment"
attached to the Note duly completed or (ii) a telegram, telex,
facsimile transmission or letter from a member of a national
securities exchange or the National Association of Securities
Dealers, Inc. or a commercial bank or trust company in the
United States setting forth the name of the holder of the Note,
the principal amount of the Note, the portion of the principal
amount of the Note to be repaid, the certificate number or a
description of the tenor and terms of the Note, a statement
that the option to elect repayment is being exercised thereby
and a guarantee that the Note to be repaid with the form
entitled "Option to Elect Repayment" attached to the Note duly
completed will be received by the Paying Agent not later than
five Business Days after the date of such telegram, telex,
facsimile transmission or letter and such Note and form duly
completed must be received by the Paying Agent by such fifth
Business Day. Exercise of the repayment option by the holder
of a Note shall be irrevocable, except as otherwise provided
under "Interest Rate Reset" and "Extension of Maturity" in the
Prospectus Supplement. The repayment option may be exercised
by the holder of a Note for less than the entire principal
amount of the Note provided that the principal amount of the
Note remaining outstanding after repayment is an authorized
denomination. No transfer or exchange of any Note (or, in the
event that any Note is to be repaid in part, the portion of the
Note to be repaid) will be permitted after exercise of a
repayment option. All questions as to the validity, eligi-
bility (including time of receipt) and acceptance of any Note
for repayment will be determined by the Company, whose determi-
nation will be final, binding and non-appealable.
If a Note is represented by a Global Security, DTC's
nominee will be the holder of such Note and therefore will be
the only entity that can exercise a right to repayment. In
order to ensure that the DTC's nominee will timely exercise a
right to repayment with respect to a particular Note, the
beneficial owner of such Note must instruct the broker or other
direct or indirect participant through which it holds an
interest in such Note to notify the Depositary of its desire to
exercise a right to repayment. Different firms have different
cut-off times for accepting instructions from their customers
and, accordingly, each beneficial owner should consult the
broker or other direct or indirect participant through which it
holds an interest in a Note in order to ascertain the cut-off
time by which such an instruction must be given in order for
timely notice to be delivered to the DTC.
If a Note is an Original Issue Discount Note, the
amount payable on such Note in the event of redemption or
repayment prior to its Stated Maturity Date shall be the
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Amortized Face Amount of such Note, as specified on the face of
the Note, on the date of redemption or repayment.
MATURITY
Upon presentation of each Note at Maturity, the
Paying Agent will pay the principal amount thereof, together
with accrued interest. Such payment shall be made in immedi-
ately available funds in U.S. dollars, provided that the Note
is presented to the Paying Agent in time for such Paying Agent
to make payments in such funds in accordance with its normal
procedures. The Company will provide the Paying Agent with
funds available for immediate use for such purpose. Notes
presented at Maturity will be delivered to the Paying Agent for
cancellation as provided in the Indenture. The Paying Agent
shall dispose of the cancelled notes and deliver a certificate
of disposition to the Company and the Trustee.
PROCEDURES FOR ESTABLISHING
THE TERMS OF THE NOTES
The Company and the Agents will discuss from time to
time the rates to be borne by the Notes that may be sold as a
result of the solicitation of offers by the Agents. Once any
Agent has recorded any indication of interest in Notes upon
certain terms, and communicated with the Company, if the Com-
pany accepts an offer to purchase Notes upon such terms, the
Company will prepare a Pricing Supplement in the form previ-
ously approved by the Agents, reflecting the terms of such
Notes and will arrange to have 10 copies of such Pricing Sup-
plement (together with the Prospectus, if amended or supple-
mented) filed with the Commission in accordance with the
applicable paragraph of Rule 424(b) and will supply an ap-
propriate number of copies of the Prospectus, as then amended
or supplemented, together with such Pricing Supplement, to the
Presenting Agent. The Presenting Agent will cause such Pricing
Supplement to be delivered to the purchaser of a Note. See
"Delivery of Prospectus."
If the Company decides to post rates and a decision
has been reached to change interest rates, the Company will
promptly notify each Agent. Each Agent will forthwith suspend
solicitation of purchases until the new posted rates have been
established with the Agents. Following establishment of posted
rates and prior to the filing described in the following sen-
tence, the Agents may only record indications of interest in
purchasing Notes at the posted rates. Once any Agent has
recorded any indication of interest in Notes at the posted
rates and communicated with the Company, if the Company accepts
an offer at the posted rate, the Company will prepare a Pricing
Supplement reflecting such posted rates and will arrange to
have 10 copies of such Pricing Supplement (together with the
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Prospectus if amended or supplemented) filed with the Commis-
sion in accordance with the applicable paragraph of Rule 424(b)
and will supply an appropriate number of copies of the Pro-
spectus, as then amended or supplemented, to the Presenting
Agent. The Presenting Agent will cause such Pricing Supplement
to be delivered to the purchaser of a Note. See "Delivery of
Prospectus."
In each instance that a Pricing Supplement is pre-
pared, the Presenting Agent will affix the Pricing Supplement
to the Prospectuses prior to their use. Outdated Pricing
Supplements and the Prospectuses to which they are attached
(other than those retained for files) will be destroyed.
SUSPENSION OF SOLICITATION;
AMENDMENT OR SUPPLEMENT
In the event that at the time the Agents, at the
direction of the Company, suspend solicitation of offers to
purchase from the Company there shall be any orders outstanding
which have not been settled, the Company will promptly advise
the Agents, the Trustee and the Paying Agent whether such
orders may be settled and whether copies of the Prospectus as
theretofore amended and/or supplemented as in effect at the
time of the suspension may be delivered in connection with the
settlement of such orders. The Company will have the sole
responsibility for such decision and for any arrangements which
may be made in the event that the Company determines that such
orders may not be settled or that copies of such Prospectus may
not be so delivered.
DELIVERY OF PROSPECTUS
A copy of the Prospectus as most recently amended or
supplemented on the date of delivery thereof, together with the
applicable Pricing Supplement, must be delivered by the Pre-
senting Agent to a purchaser or his agent prior to or together
with the earlier of the delivery of (i) the written confirma-
tion of a sale sent to a purchaser or his agent and (ii) any
Note purchased by such purchaser. The Company shall provide
copies of the Prospectus and each amendment or supplement
thereto (including the applicable Pricing Supplement) in such
quantities by 11:00 a.m. on the day after the Sale Date so that
the Presenting Agent will be able to deliver such confirmation
or Note to a purchaser as contemplated by these procedures and
in compliance with the preceding sentence. Copies of Pricing
Supplements should be delivered to [names, addresses and fax
numbers of Agents]. If, since the date of acceptance of a
purchaser's offer, the Prospectus shall have been supplemented
solely to reflect any sale of Notes on terms different from
those agreed to between the Company and such purchaser or a
change in posted rates not applicable to such purchaser, such
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purchaser shall not receive the Prospectus as supplemented by
such new supplement, but shall receive the Prospectus as sup-
plemented to reflect the terms of the Notes being purchased by
such purchaser and otherwise as most recently amended or sup-
plemented on the date of delivery of the Prospectus. The
Paying Agent will make all such deliveries with respect to all
Notes sold directly by the Company.
AUTHENTICITY OF SIGNATURES
The Company will cause the Paying Agent, as authen-
ticating agent, to furnish the Agents from time to time with
the specimen signatures of each of the Paying Agent's officers,
employees and agents who have been authorized by the Paying
Agent to authenticate Notes, but the Agents will have no
obligation or liability to the Company or the Paying Agent in
respect of the authenticity of the signature of any officer,
employee or agent of the Company or the Paying Agent on any
Note.
ADVERTISING COSTS
The Company will determine with the Agents the amount
and nature of advertising that may be appropriate in offering
the Notes. Advertising expenses incurred with the consent of
the Company will be paid by the Company.
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SPECIAL ADMINISTRATIVE PROCEDURES
FOR MULTI-CURRENCY NOTES
Unless otherwise set forth in an applicable Foreign
Currency Amendment, the following procedures and terms shall
apply to Multi-Currency Notes in addition to, and to the extent
inconsistent therewith in replacement of, the procedures and
terms set forth above.
DENOMINATIONS
The authorized denominations for Multi-Currency Notes
will be set forth in the applicable Pricing Supplement.
CURRENCIES
Unless otherwise specified in the applicable Pricing
Supplement, purchasers of Multi-Currency Notes are required to
pay for such Multi-Currency Notes in the Specified Currency in
immediately available funds. If requested by the purchaser of
the Multi-Currency Note on or prior to the fifth Business Day
preceding the date of delivery of the Multi-Currency Notes (or
by such other day as the Presenting Agent shall determine), the
Presenting Agent will arrange the conversion of U.S. dollars
into such Specified Currency to enable the purchaser to pay for
the Multi-Currency Notes. Each such conversion will be made by
the Presenting Agent on such terms and subject to such condi-
tions, limitations and charges as such Presenting Agent may
from time to time establish in accordance with its regular
foreign exchange practices. All costs of exchange will be
borne by the purchasers of the Multi-Currency Notes.
PAYMENT OF PRINCIPAL AND INTEREST
The principal of, premium, if any, and interest on
Multi-Currency Notes will be payable in the Specified Currency.
Unless otherwise indicated in the applicable Pricing Supple-
ment, the agent appointed by the Company (the "Exchange Rate
Agent") will convert all such payments of principal, premium,
if any, and interest to U.S. dollars. However, unless other-
wise indicated in the applicable Pricing Supplement, the holder
of a Multi-Currency Note may elect to receive such payments in
the Specified Currency as described below.
Any U.S. dollar amount to be received by a holder of
a Multi-Currency Note will be based on the highest bid quota-
tion in The City of New York received by the Exchange Rate
Agent at approximately 11:00 A.M., New York City time, on the
second Business Day preceding the applicable payment date from
three recognized foreign exchange dealers (one of which may be
the Exchange Rate Agent) for the purchase by the quoting dealer
of the Specified Currency for U.S. dollars for settlement on
such payment date in the aggregate amount of the Specified
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Currency payable to all holders of Notes scheduled to receive
U.S. dollar payments and at which the applicable dealer commits
to execute a contract. If such bid quotations are not avail-
able, payments will be made in the Specified Currency. All
currency exchange costs will be borne by the holder of the
Multi-Currency Note by deductions from such payments.
A holder of a Multi-Currency Note may, unless oth-
erwise specified in the applicable Pricing Supplement, elect to
receive payment of the principal of, premium, if any, and
interest on such Multi-Currency Notes in the Specified Cur-
rency, by transmitting a written request for such payment by
mail, hand delivered, or by cable, telex or other form of
facsimile transmission to the principal office of the Paying
Agent on or prior to the Record Date or at least fifteen days
prior to Maturity (or redemption or repayment), as the case may
be, such election to remain in effect until revoked by written
notice to the Paying Agent received by the Paying Agent on or
prior to the Record Date or at least fifteen days prior to
Maturity (or redemption or repayment), as the case may be. A
holder of a Multi-Currency Note may elect to receive payment in
the Specified Currency for all principal, premium, if any, and
interest payments and need not file a separate election for
each payment.
Interest on Multi-Currency Notes paid in U.S. dollars
will be paid in the manner specified in the applicable Pricing
Supplement. Unless otherwise specified in the applicable
Pricing Supplement, interest on Multi-Currency Notes paid in
the Specified Currency will be paid by wire transfer to a bank
account maintained by the holder in the country of the Speci-
fied Currency. The principal of Multi-Currency Notes, together
with interest accrued and unpaid therein, due at Maturity (or
upon redemption or repayment) will be paid in immediately
available funds against presentation of such Multi-Currency
Notes at the principal office of the Paying Agent, provided
that principal, premium, if any, and interest payable at
Maturity (or upon redemption or repayment) in a Specified
Currency will be paid by wire transfer to such bank account.
Any payment of principal or interest required to be made on an
Interest Payment Date or at Maturity (or upon redemption or
repayment) of a Multi-Currency Note which is not a Business Day
need not be made on such day, but may be made on the next
succeeding Business Day with the same force and effect as if
made on the Interest Payment Date or Maturity (or upon re-
demption or repayment), as the case may be, and no interest
shall accrue from the period from and after such Interest
Payment Date or Maturity (or redemption or repayment date).
PAYMENT CURRENCY
If a Specified Currency is not available for payment
on a Multi-Currency Note due to the imposition of exchange
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controls or other circumstances beyond the control of the Com-
pany, or is no longer used by the government of the country
issuing such Specified Currency or for the settlement of
transactions by public institutions of or within the inter-
national banking community, then the Company will be entitled
to satisfy its obligations to holders of Multi-Currency Notes
by making such payment in U.S. dollars on the basis of the noon
buying rate in The City of New York for cable transfers of the
Specified Currency in The City of New York, as determined by
the Federal Reserve Bank of New York (the "Market Exchange
Rate"), on the latest date for which such rate was established
on or before the date on which such payment is due. Any pay-
ment made under such circumstances in U.S. dollars where
required payment is in a Specified Currency other than U.S.
dollars will not constitute a default under the Indenture. All
determinations by the Company or its agent shall be at its sole
discretion and, in the absence of manifest error, shall be
conclusive for all purposes and binding on holders of the Notes
and the Company.
OUTSTANDING MULTI-CURRENCY NOTES
For purposes of calculating the principal amount of
any Multi-Currency Note for any purpose under the Indenture,
the principal amount of such Multi-Currency Note at any time
Outstanding shall be deemed to be the U.S. dollar equivalent at
the Market Exchange Rate, determined as of the date of the
original issuance of such Multi-Currency Note, of the principal
amount of such Multi-Currency Note.
DETAILS FOR SETTLEMENT OF MULTI-CURRENCY NOTES
In addition to the Settlement information specified
in "Settlement Procedures" above, the Presenting Agent shall
communicate to the Company in the manner set forth in "Set-
tlement Procedures" the following information:
1. Specified Currency
2. Denominations
3. Wire transfer and overseas bank account infor-
mation (if holder has elected payment in a
Specified Currency).
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SPECIAL ADMINISTRATIVE PROCEDURES FOR BOOK-ENTRY NOTES
Each Note will be represented by either a Global
Security delivered to the Paying Agent, as agent for the
Depository Trust Company ("DTC"), and recorded in the book-
entry system maintained by DTC or a certificate delivered to
the Holder thereof or a Person designated by such Holder. An
owner of a Book-Entry Note will not be entitled to receive a
certificate representing such Note. Certain matters described
below relating to DTC's Participant Terminal System which are
designated as the responsibility of the Paying Agent which is a
participant in DTC's Same-Day Funds Settlement System ("SDFS").
In connection with the qualification of the Book-Entry Notes
for eligibility in the book-entry system maintained by DTC, the
Paying Agent will perform or cause to be performed the custo-
dial, document control and administrative functions described
below, in accordance with the obligations of the Paying Agent
under a Letter of Representations from the Company and the
Paying Agent to DTC and a Medium-Term Note Certificate Agree-
ment previously entered into between the Paying Agent and DTC,
and as a participant in DTC, including SDFS. Except as other-
wise set forth in this Exhibit B, Book-Entry Notes will be
issued in accordance with the administrative procedures set
forth below.
ISSUANCE
On any date of settlement (as defined under "Set-
tlement" below) for one or more Fixed Rate Book-Entry Notes,
the Company will issue a single Global Security in fully regis-
tered form without coupons representing up to $150,000,000
principal amount of all of such Notes that have the same
original issuance date, interest rate, redemption or repayment
provisions and Stated Maturity. Similarly, on any settlement
date for one or more Floating Rate Book-Entry Notes, the Com-
pany will issue a single Global Security representing up to
$150,000,000 principal amount of all of such Notes that have
the same interest rate formula, original issuance date, Initial
Interest Rate, Interest Payment Dates, Spread, Spread Multi-
plier, minimum interest rate (if any), maximum interest rate
(if any), redemption or repayment provisions and Stated Matu-
rity. Each Global Security will be dated and issued as of the
date of its authentication by the Paying Agent, as authenti-
cating agent. Each Global Security will have an interest
accrual date (the "Interest Accrual Date"), which will be (i)
with respect to an original Global Security (or any portion
thereof), its original issuance date and (ii) with respect to
any Global Security (or portion thereof) issued subsequently
upon exchange of a Global Security or in lieu of a destroyed,
lost or stolen Global Security, the most recent Interest Pay-
ment Date to which interest has been paid or duly provided for
on the predecessor Global Security or Securities (or if no such
payment or provision has been made, the original issuance date
of the predecessor Global Security), regardless of the date of
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authentication of such subsequently issued Global Security. No
Global Security will represent (i) both Fixed Rate and Floating
Rate Book-Entry Notes or (ii) any Certificated Note or (iii)
any Multi-Currency Note.
IDENTIFICATION NUMBERS
The Company will arrange, on or prior to commencement
of a program for the offering of Book-Entry Notes, with the
CUSIP Service Bureau of Standard & Poor's Corporation (the
"CUSIP Service Bureau") for the reservation of a series of
CUSIP numbers (including tranche numbers), consisting of
approximately 900 CUSIP numbers and relating to Global Secu-
rities representing the Book-Entry Notes. The Company has or
will obtain from the CUSIP Service Bureau a written list of
such series of reserved CUSIP numbers and will deliver to the
Paying Agent and DTC such written list of 900 CUSIP numbers of
such series. The Paying Agent will assign CUSIP numbers to
Global Securities as described below under Settlement Procedure
"B." DTC will notify the CUSIP Service Bureau periodically of
the CUSIP numbers that the Company has assigned to Global
Securities. The Paying Agent will notify the Company at any
time when fewer than 100 of the reserved CUSIP numbers remain
unassigned to Global Securities, and if it deems necessary, the
Company will reserve additional CUSIP numbers for assignment to
Global Securities representing Book-Entry Notes. Upon ob-
taining such additional CUSIP numbers the Paying Agent shall
deliver such additional CUSIP numbers to the Company and DTC.
REGISTRATION
Each Global Security will be registered in the name
of Cede & Co., as nominee for DTC, on the Securities Register
maintained under the Indenture, governing such Global Security.
The beneficial owner of a Book-Entry Note (or one or more
indirect participants in DTC designated by such owner) will
designate one or more participants in DTC with respect to such
Note (the "Participants") to act as agent or agents for such
owner in connection with the book-entry system maintained by
DTC, and DTC will record in book-entry form, in accordance with
instructions provided by such Participants, a credit balance
with respect to such beneficial owner in such Note in the
account of such Participants. The ownership interest of such
beneficial owner in such Note will be recorded through the
records of such Participants or through the separate records of
such Participants and one or more indirect participants in DTC.
TRANSFERS
Transfers of a Book-Entry Note will be accomplished
by book entries made by DTC and, in turn, by Participants (and
in certain cases, one or more indirect participants in DTC)
acting on behalf of beneficial transferors and transferees of
such Note.
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CONSOLIDATION AND EXCHANGE
The Paying Agent may deliver to DTC and the CUSIP
Service Bureau at any time a written notice of consolidation
specifying (i) the CUSIP numbers of two or more Outstanding
Global Securities that represent (A) Fixed Rate Book-Entry
Notes having the same original issuance date, interest rate,
redemption and repayment provisions and Stated Maturity and
with respect to which interest has been paid to the same date
or (B) Floating Rate Book-Entry Notes having the same interest
rate formula, original issuance date, Initial Interest Rate,
Interest Payment Dates, Spread or Spread Multiplier, minimum
interest rate (if any), maximum interest rate (if any),
redemption and repayment provisions and with respect to which
interest has been paid to the same date, (ii) a date, occurring
at least thirty days after such written notice is delivered and
at least thirty days before the next Interest Payment Date for
such Book-Entry Notes, on which such Global Securities shall be
exchanged for a single replacement Global Security and (iii) a
new CUSIP number, obtained from the Company, to be assigned to
such replacement Global Security. Upon receipt of such a
notice, DTC will send to its participants (including the Paying
Agent) a written reorganization notice to the effect that such
exchange will occur on such date. Prior to the specified
exchange date, the Paying Agent will deliver to the CUSIP
Service Bureau a written notice setting forth such exchange
date and the new CUSIP number and stating that, as of such
exchange date, the CUSIP numbers of the Global Securities to be
exchanged will no longer be valid. On the specified exchange
date, the Paying Agent will exchange such Global Securities for
a single Global Security bearing the new CUSIP number and a new
Interest Accrual Date, and the CUSIP numbers of the exchanged
Global Securities will, in accordance with CUSIP Service Bureau
procedures, be cancelled and not immediately reassigned.
Notwithstanding the foregoing, if the Global Securities to be
exchanged exceed $150,000,000 in aggregate principal amount,
one Global Security will be authenticated and issued to rep-
resent each $150,000,000 of principal amount of the exchanged
Global Securities and an additional Global Security will be
authenticated and issued to represent any remaining principal
amount of such Global Securities (see "Denominations" below).
MATURITIES
Each Book-Entry Note will mature on a date not less
than nine months or more than 30 years after the settlement
date for such Note. A Floating Rate Book-Entry Note will
mature only on an Interest Payment Date for such Note.
NOTICE OF REDEMPTION OR REPAYMENT DATE
The Paying Agent will give notice to DTC prior to each
redemption date or repayment date (as specified in the Note),
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if any, at the time and in the manner set forth in the Letter
of Redemption.
DENOMINATIONS
Book-Entry Notes will be issued in principal amounts
of $100,000 or any amount in excess thereof that is an integral
multiple of $1,000. Global Securities representing one or more
Book-Entry Notes will be denominated in principal amounts not
in excess of $150,000,000. If one or more Book-Entry Notes
having an aggregate principal amount in excess of $150,000,000
would, but for the preceding sentence, be represented by a
single Global Security, then one Global Security will be issued
to represent each $150,000,000 principal amount of such Book-
Entry Note or Notes and an additional Global Security will be
issued to represent any remaining principal amount of such
Book-Entry Note or Notes. In such a case, each of the Global
Securities representing such Book-Entry Note or Notes shall be
assigned the same CUSIP number.
INTEREST
General. Interest on each Book-Entry Note will ac-
crue from the Interest Accrual Date of the Global Security
representing such Note. Each payment of interest on a Book-
Entry Note will include interest accrued through the day pre-
ceding, as the case may be, the Interest Payment Date or Ma-
turity, redemption or repayment; provided, however, that if the
Interest Reset Dates with respect to any such Note are daily or
weekly, interest payable on any Interest Payment Date, other
than interest payable on any date on which principal for such
Note is payable, will include interest accrued from but
excluding the second preceding Regular Record Date to and in-
cluding the next preceding Regular Record Date. Interest
payable at the Maturity or upon earlier redemption or repayment
of a Book-Entry Note will be payable to the person to whom the
principal of such Note is payable. Standard & Poor's Corpo-
ration will use the information received in the pending deposit
message described under Settlement Procedure "C" below in order
to include the amount of any interest payable and certain other
information regarding the related Global Security in the
appropriate weekly bond report published by Standard & Poor's
Corporation.
Notice of Regular Record Dates and Interest Payment
Dates. On the first Business Day of January, April, July and
October of each year, the Paying Agent will deliver to the
Company and DTC a written list of Regular Record Dates and
Interest Payment Dates that will occur with respect to Floating
Rate Book-Entry Notes during the six-month period beginning on
such first Business Day. Promptly after each Interest Deter-
mination Date (as defined in Appendix A hereto) for Floating
Rate Notes, the Company will notify the Paying Agent, and the
Paying Agent in turn will notify Standard & Poor's Corporation,
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of the interest rates determined on such Interest Determination
Date.
PAYMENTS OF PRINCIPAL AND INTEREST
Payments of Interest Only. Promptly after each
Regular Record Date, the Paying Agent will deliver to the
Company and DTC a written notice specifying by CUSIP number the
amount of interest to be paid on each Global Security on the
following Interest Payment Date (other than an Interest Payment
Date coinciding with Maturity or any earlier redemption or
repayment date) and the total of such amounts. DTC will con-
firm the amount payable on each Global Security on such
Interest Payment Date by reference to the daily bond reports
published by Standard & Poor's Corporation. The Company will
pay to the Paying Agent the total amount of interest due on
such Interest Payment Date (other than at Maturity), and the
Paying Agent will pay such amount to DTC at the times and in
the manner set forth below under "Manner of Payment."
Payments at Maturity or Upon Redemption or Repayment.
On or about the first Business Day of each month, the Paying
Agent will deliver to the Company and DTC a written list of
principal and interest to be paid on each Global Security
maturing either at maturity or any redemption or repayment date
in the following month. The Company, the Paying Agent and DTC
will confirm the amounts of such principal and interest pay-
ments with respect to each such Global Security on or about the
fifth Business Day preceding the Maturity or redemption or
repayment date of such Global Security. The Company will pay
to the Paying Agent the principal amount of such Global Secu-
rity, together with interest due at such Maturity or redemption
or repayment date, as the case may be. The Paying Agent will
pay such amount to DTC at the times and in the manner set forth
below under "Manner of Payment."
Promptly after payment to DTC of the principal and
interest due at the Maturity of such Global Security, the
Paying Agent will cancel such Global Security and deliver it or
a certificate to the Company with an appropriate debit advice,
with a copy of such certificate to the Trustee. On the first
Business Date of each month, the Paying Agent will prepare a
written statement indicating the total principal amount of Out-
standing Global Securities for which it serves as paying agent
as of the immediately preceding Business Day.
Manner of Payment. The total amount of any principal
and interest due on Global Securities on any Interest Payment
Date or at Maturity or upon redemption or repayment shall be
paid by the Company to the Paying Agent in funds available for
use by the Paying Agent as of 9:30 A.M. (New York City time) on
such date. For maturity, redemption or any other principal
payments: prior to 10 A.M. (New York City time) on such date
or as soon as possible thereafter, the Paying Agent will make
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such payments to DTC in same day funds in accordance with DTC's
Same Day Funds Settlement Paying Agent Operating Procedures.
For interest payments: the Paying Agent will make such pay-
ments to DTC in accordance with existing arrangements between
DTC and the Paying Agent. DTC will allocate such payments to
its participants in accordance with its existing operating
procedures. Neither the Company, the Paying Agent nor the
Trustee shall have any direct responsibility or liability for
the payment by DTC to such Participants of the principal of and
interest on the Book-Entry Notes.
Withholding Taxes. The amount of any taxes required
under applicable law to be withheld from any interest payment
on a Book-Entry Note will be determined and withheld by the
Participant, indirect participant in DTC or other person
responsible for forwarding payments and materials directly to
the beneficial owner of such Note.
SETTLEMENT PROCEDURES
Settlement Procedures with regard to each Book-Entry
Note sold by the Company through an Agent, as agent, shall be
as follows:
A. The Presenting Agent will advise the Company by telephone
(confirmed in writing), telex or facsimile, of the fol-
lowing settlement information:
1. Exact name in which Note is to be registered ("Reg-
istered Owner").
2. Exact address of the Registered Owner and address for
payments of principal and interest, if any.
3. Taxpayer identification number of the Registered
Owner.
4. Principal amount of the Note (and, if multiple Notes
are to be issued, denominations thereof).
5. Settlement date.
6. Stated Maturity and, if the Company has the option to
extend the Stated Maturity Date, the Extension
Periods and the Final Maturity Date.
7. Issue Price and any OID information.
8. Trade date.
9. The DTC Participant account number of such Agent.
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10. Interest rate (including, if appropriate, such
interest rate information applicable to any Extension
Period):
(a) Fixed Rate Notes:
(i) interest rate
(ii) date or dates, if any, on which the
interest rate may be reset and the basis or
formula, if any, for such resetting
(b) Floating Rate Notes:
(i) interest rate basis
(ii) initial interest rate
(iii) spread or spread multiplier, if any
(iv) date or dates, if any, on which the spread
or spread multiplier may be reset and the
basis or formula, if any, for such reset-
ting
(v) interest reset period
(vi) maximum and minimum interest rates, if any
(vii) interest payment period
(viii) index maturity
11. The date on or after which the Notes are redeemable
at the option of the Company, and additional re-
demption or repurchase provisions, if any.
12. Wire transfer information.
13. Presenting Agent's commission (to be paid in the form
of a discount from the proceeds remitted to the
Company upon settlement).
14. That the Note will be a Book-Entry Note.
B. The Company will assign a CUSIP number to the Global Se-
curity representing such Note and then advise the Paying
Agent by telephone (confirmed in writing at any time on
the same date) or electronic transmission of the infor-
mation set forth in Settlement Procedure "A" above, such
CUSIP number and the name of such Agent.
C. The Paying Agent will enter a pending deposit message
through DTC's Participant Terminal System, providing the
following settlement information to DTC, the Presenting
Agent, Standard & Poor's Corporation and, upon request,
the Trustee under the Indenture pursuant to which such
Note is to be issued:
1. The information set forth in Settlement Procedure
"A."
2. Identification as a Fixed Rate Book-Entry Note or a
Floating Rate Book-Entry Note.
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3. Initial Interest Payment Date for such Note, number
of days by which such date succeeds the related "DTC
Record Date" (which term means the Regular Record
Date except in the case of floating rate notes which
reset daily or weekly in which case it means the date
5 calendar days immediately preceding the Interest
Payment Date) and, if known, amount of interest
payable on such Interest Payment Date.
4. Frequency of interest payments (monthly, semiannu-
ally, quarterly, etc.).
5. CUSIP number of the Global Security representing such
Note.
6. Whether such Global Security will represent any other
Book-Entry Note (to the extent known at such time).
7. The number of Participant accounts to be maintained
by DTC on behalf of the Agents or the Paying Agent.
D. The Paying Agent, as the authenticating agent, will com-
plete and authenticate the note certificate evidencing the
Global Security representing such Book-Entry Note.
E. DTC will credit such Note to the Paying Agent's partici-
pant account at DTC.
F. The Paying Agent will enter an SDFS deliver order through
DTC's Participant Terminal System instructing DTC to (i)
debit such Note to the Paying Agent's participant account
and credit such Note to the Presenting Agent's participant
account and (ii) debit the Presenting Agent's settlement
account and credit the Paying Agent's settlement account
for an amount equal to the price of such Note less the
Presenting Agent's commission.
G. The Presenting Agent will enter an SDFS deliver order
through DTC's Participant Terminal System instructing DTC
(i) to debit such Note to the Presenting Agent's partic-
ipant account and credit such Note to the participant
accounts of the Participants with respect to such Note and
(ii) to debit the settlement accounts of such Participants
and credit the settlement account of the Presenting Agent
for an amount equal to the price of such Note.
H. Transfers of funds in accordance with SDFS deliver orders
described in Settlement Procedures "F" and "G" will be
settled in accordance with SDFS operating procedures in
effect on the settlement date.
I. The Paying Agent will credit to an account of the Company
maintained at the Paying Agent funds available for
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<PAGE>
immediate use in the amount transferred to the Paying
Agent in accordance with Settlement Procedure "F."
J. The Presenting Agent will deliver to the purchaser a copy
of the most recent Prospectus applicable to the Note with
or prior to any written offer of Notes and the confirma-
tion and payment by the purchaser of the Note.
The Presenting Agent will confirm the purchase of such
Note to the purchaser either by transmitting to the Par-
ticipants with respect to such Note a confirmation order
or orders through DTC's institutional delivery system or
by mailing a written confirmation to such purchaser.
SETTLEMENT PROCEDURES TIMETABLE
For orders of Book-Entry Notes solicited by an Agent,
as agent, and accepted by the Company for settlement, Settle-
ment Procedures "A" through "J" set forth above shall be com-
pleted as soon as possible but not later than the respective
times (New York City time) set forth below:
SETTLEMENT
PROCEDURES TIME
A 11:00 A.M. on the Sale date
B 12:00 Noon on the Sale date
C 2:00 P.M. on the Sale date
D 9:00 A.M. on Settlement date
E 10:00 A.M. on Settlement date
F-G 2:00 P.M. on Settlement date
H 4:45 P.M. on Settlement date
I-J 5:00 P.M. on Settlement date
If a sale is to be settled more than one Business Day
after the sale date, Settlement Procedures "A," "B" and "C"
shall be completed as soon as practicable but no later than
11:00 A.M., 12:00 Noon and 2:00 P.M., as the case may be, on
the first Business Day after the sale date. If the initial in-
terest rate for a Floating Rate Book-Entry Note has not been
determined at the time that Settlement Procedure "A" is com-
pleted, Settlement Procedures "B" and "C" shall be completed as
soon as such rate has been determined but no later than 12:00
Noon and 2:00 P.M. , respectively, on the second Business Day
before the settlement date. Settlement Procedure "I" is sub-
ject to extension in accordance with any extension of Fedwire
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closing deadlines and in the other events specified in the SDFS
operating procedures in effect on the settlement date.
If settlement of a Book-Entry Note is rescheduled or
canceled, the Paying Agent will deliver to DTC, through DTC's
Participant Terminal System, a cancellation message to such
effect by no later than 2:00 P.M. on the Business Day immedi-
ately preceding the scheduled settlement date.
FAILURE TO SETTLE
If the Paying Agent fails to enter an SDFS deliver
order with respect to a Book-Entry Note pursuant to Settlement
Procedure "F," the Paying Agent may deliver to DTC, through
DTC's Participant Terminal System, as soon as practicable a
withdrawal message instructing DTC to debit such Note to the
Paying Agent's participant account. DTC will process the with-
drawal message, provided that the Paying Agent's participant
account contains a principal amount of the Global Security rep-
resenting such Note that is at least equal to the principal
amount to be debited. If a withdrawal message is processed
with respect to all the Book-Entry Notes represented by a
Global Security, the Paying Agent will mark such Global Secu-
rity "canceled," make appropriate entries in the Paying Agent's
records and send such canceled Global Security to the Company.
The CUSIP number assigned to such Global Security shall, in ac-
cordance with CUSIP Service Bureau procedures, be canceled and
not immediately reassigned. If a withdrawal message is
processed with respect to one or more, but not all, of the
Book-Entry Notes represented by a Global Security, the Paying
Agent will exchange such Global Security for two Global Securi-
ties, one of which shall represent such Book-Entry Note or
Notes and shall be canceled immediately after issuance and the
other of which shall represent the other Book-Entry Notes
previously represented by the surrendered Global Security and
shall bear the CUSIP number of the surrendered Global Security.
If the purchase price for any Book-Entry Note is not
timely paid to the Participants with respect to such Note by
the beneficial purchaser thereof (or a Person, including an
indirect participant in DTC, acting on behalf of such pur-
chaser), such Participants and, in turn, the Agent for such
Note may enter SDFS deliver orders through DTC's Participant
Terminal System reversing the orders entered pursuant to Set-
tlement Procedures "F" and "G," respectively. Thereafter, the
Paying Agent will deliver the withdrawal message and take the
related actions described in the preceding paragraph.
Notwithstanding the foregoing, upon any failure to
settle with respect to a Book-Entry Note, DTC may take any
actions in accordance with its SDFS operating procedures then
in effect. In the event of a failure to settle with respect to
one or more, but not all, of the Book-Entry Notes to have been
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represented by a Global Security, the Paying Agent will pro-
vide, in accordance with Settlement Procedure "D," for the
authentication and issuance of a Global Security representing
the other Book-Entry Notes to have been represented by such
Global Security and will make appropriate entries in its
records.
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EXHIBIT C
PURCHASE AGREEMENT
[DATE]
American Stores Company
709 East South Temple
Salt Lake City, Utah 84102
Attention: Treasurer
The undersigned agrees to purchase the following princi-
pal amount of the Notes described in the Agency Agreement
dated ________ __, 199_ (as it may be supplemented or amended
from time to time, the "Agency Agreement"):
All Notes: Fixed Rate Notes: Floating Rate Notes:
Issue Price: Interest Rate Per Base Rate:
Agent's Discount: Annum: Spread:
Original Issue Date: Spread Multiplier:
Settlement Date Initial Interest Rate:
and Time: Maximum Interest Rate:
Stated Maturity Date: Minimum Interest Rate:
Specified Currency: Index Maturity:
Redeemable at Option of Interest Reset Period:
Company ( ) yes ( ) no Interest Payment Period:
Initial Redemption Date:
Initial Redemption Price:
Annual Redemption Price Reduction:
Original Issue Discount Note: ( ) yes ( ) no
Total OID:
Yield to Maturity:
Initial Accrual Period OID:
Repayment Option of Holder: ( ) yes ( ) no
Repayment Date(s):
Repayment Price(s):
Other Provisions:
[In the case of Notes issued in a foreign currency or
currency unit, unless otherwise specified below, settlement and
payments of principal and interest will be in U.S. dollars
based on the highest bid quotation in The City of New York
received by the Exchange Rate Agent at approximately 11:00
A.M., New York City time, on the second Business Day preceding
the applicable payment date from three recognized foreign
exchange dealers (one of which may be the Exchange Rate Agent)
PAGE
<PAGE>
for the purchase by the quoting dealer of the Specified Cur-
rency for U.S. dollars for settlement on such payment date in
the aggregate amount of the Specified Currency payable to all
holders of Notes denominated in such Specified Currency
electing to receive U.S. dollar payments and at which the
applicable dealer commits to execute a contract. If such bid
quotations are not available, payments will be made in the
Specified Currency.]
All capitalized terms not otherwise defined in this
Agreement shall have the meanings set forth in the Agency
Agreement. Our obligation to purchase Notes hereunder is sub-
ject to the continued accuracy of your representations and
warranties contained in the Agency Agreement and to your per-
formance and observance of all applicable covenants and
agreements contained therein, including, without limitation,
your obligations pursuant to Section 7 thereof. [Our obliga-
tion hereunder is subject to the further condition that certain
legal matters shall be satisfactory to our counsel pursuant to
Section 5(b) and we shall receive (a) the opinions required to
be delivered pursuant to Sections 5(c) and 5(d) of the Agency
Agreement, (b) the certificate required to be delivered pur-
suant to Section 5(e) of the Agency Agreement and (c) the
letter referred to in Section 5(f) in each case dated as of the
above Settlement Date.]
In further consideration of our agreement hereunder,
you agree that between the date hereof and the above Settlement
Date, you will not offer or sell, or enter into any agreement
to sell, any debt securities of the Company, having a maturity
within six months of the maturity of such Notes, other than
borrowings under your revolving credit agreements and lines of
credit, the private placement of securities and issuances of
your commercial paper, without our prior written consent which
consent shall not be unreasonably withheld, except pursuant to
arrangements of which you have been advised by the Company
prior to the time of execution of this Agreement.
We may terminate this Agreement, immediately upon
notice to you, at any time prior to the Settlement Date, if
prior thereto: (i) there shall have occurred any material
adverse change in the business, business prospects, financial
position, stockholders' equity or results of operations of the
Company and its subsidiaries taken as a whole, except as set
forth or contemplated in the Prospectus as amended or supple-
mented through the date of this Agreement, the effect of which
is such, in our judgment, as materially to impair the invest-
ment quality of the Notes, (ii) there shall have occurred any
outbreak or escalation of hostilities or other calamity or
crisis (including a crisis in the financial markets) the effect
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of which is such as to make it, in our judgment, impracticable
to market the Notes or enforce contracts for the sale of the
Notes, (iii) trading generally shall have been suspended or
materially limited on the New York Stock Exchange or trading of
any of the Company's securities shall have been suspended on
any exchange or in any over-the-counter market the effect of
which is such as to make it, in our judgment, impracticable to
market the Notes or enforce contracts for the sale of the
Notes, (iv) a general moratorium on commercial banking
activities in New York shall have been declared by either
Federal or New York State authorities or, in the case of Notes
denominated in other than United States dollars, by the
authorities or the country of the currency in which such Notes
are denominated, or (v) there shall have occurred any down-
grading or any public notice shall have been given of any
intended or potential downgrading or other negative review
accorded any of the Company's senior unsecured debt securities
by any of the Rating Agencies. In the event of such termina-
tion, no party shall have any liability to the other party
hereto, except as provided in Sections 4, 7 and 14 of the
Agency Agreement.
This Agreement shall be governed by and construed in
accordance with the laws of New York.
INSERT NAME[S] OF AGENT[S]
By:
[Title]
ACCEPTED: , 19
AMERICAN STORES COMPANY
By:
[Title]
C-3
<PAGE>
WLR&K Draft
10/20/94
Exhibit 4.1
AMERICAN STORES COMPANY
AND
THE FIRST NATIONAL BANK OF CHICAGO
Senior Indenture
Dated as of November __, 1994
PAGE
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TABLE OF CONTENTS
Page
PARTIES.............................................. 1
RECITALS
Authorization of Indenture...................... 1
Compliance with Legal Requirements.............. 1
Purpose of and Consideration for Indenture...... 1
ARTICLE ONE
DEFINITIONS
SECTION 1.1. Certain Terms Defined................ 1
Affiliate............................ 2
Attributable Debt.................... 2
Authenticating Agent................. 2
Authorized Newspaper................. 2
Board of Directors................... 3
Board Resolution..................... 3
Business Day......................... 3
Capital Lease........................ 3
Commission........................... 3
Common Stock......................... 3
Consolidated......................... 3
Corporate Trust Office............... 4
Coupon............................... 4
Depositary........................... 4
Dollar............................... 4
ECU.................................. 4
Event of Default..................... 4
Foreign Currency..................... 4
Funded Indebtedness.................. 4
Holder, Holder of Securities,
Securityholder..................... 4
Indebtedness......................... 5
Indenture............................ 5
Interest............................. 5
Issuer............................... 5
Issuer Order......................... 5
Judgment Currency.................... 5
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Page
Market Exchange Rate................. 5
Net Tangible Assets.................. 5
Non-Restricted Subsidiary............ 6
Officer's Certificate................ 6
Operating Assets..................... 6
Operating Property................... 6
Opinion of Counsel................... 6
original issue date.................. 6
Original Issue Discount Security..... 7
Outstanding.......................... 7
Periodic Offering.................... 8
Person............................... 8
principal............................ 8
record date.......................... 8
Registered Global Security........... 8
Registered Security.................. 8
Required Currency.................... 8
Responsible Officer.................. 8
Restricted Subsidiaries.............. 9
Security or Securities............... 9
Significant Subsidiary............... 9
Subsidiary........................... 9
Trust Indenture Act of 1939.......... 9
Trustee.............................. 9
Unregistered Security................ 9
U.S. Government Obligations.......... 9
Yield to Maturity.................... 9
ARTICLE TWO
SECURITIES
SECTION 2.1. Forms Generally...................... 10
SECTION 2.2. Form of Trustee's Certificate
of Authentication.................. 10
SECTION 2.3. Amount Unlimited; Issuable in
Series............................. 11
SECTION 2.4. Authentication and Delivery of
Securities......................... 14
SECTION 2.5. Execution of Securities.............. 18
SECTION 2.6. Certificate of Authentication........ 18
SECTION 2.7. Denomination and Date of
Securities; Payments of Interest... 19
SECTION 2.8. Registration, Transfer and Exchange.. 20
SECTION 2.9. Mutilated, Defaced, Destroyed, Lost
and Stolen Securities.............. 24
SECTION 2.10. Cancellation of Securities;
Disposition Thereof................ 25
SECTION 2.11. Temporary Securities................. 27
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Page
SECTION 2.12. Availability of Currency of Payment
in Respect of Securities........... 27
ARTICLE THREE
COVENANTS OF THE ISSUER
SECTION 3.1. Payment of Principal and Interest.... 28
SECTION 3.2. Offices for Payments, etc............ 29
SECTION 3.3. Appointment to Fill a Vacancy in
Office of Trustee.................. 30
SECTION 3.4. Paying Agents........................ 30
SECTION 3.5. Certificate of the Issuer............ 31
SECTION 3.6. Luxembourg Publications.............. 32
SECTION 3.7. Limitations on Liens................. 32
SECTION 3.8. Limitations on Sale and Lease-Back... 35
SECTION 3.9. Reports by the Issuer................ 36
ARTICLE FOUR
SECURITYHOLDERS LISTS AND REPORTS BY THE TRUSTEE
SECTION 4.1. Securityholders Lists................ 37
SECTION 4.2. Reports by the Trustee............... 37
ARTICLE FIVE
REMEDIES OF THE TRUSTEE AND SECURITYHOLDERS
ON EVENT OF DEFAULT
SECTION 5.1. Event of Default Defined; Acceleration
of Maturity; Waiver of Default..... 37
SECTION 5.2. Collection of Indebtedness by Trustee;
Trustee May Prove Debt............. 41
SECTION 5.3. Application of Proceeds.............. 44
SECTION 5.4. Suits for Enforcement................ 45
SECTION 5.5. Restoration of Rights on Abandonment
of Proceedings..................... 45
SECTION 5.6. Limitations on Suits by
Securityholders.................... 46
SECTION 5.7. Unconditional Right of
Securityholders to Institute
Certain Suits...................... 47
SECTION 5.8. Powers and Remedies Cumulative;
Delay or Omission Not Waiver of
Default............................ 47
SECTION 5.9. Control by Holders of Securities..... 47
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Page
SECTION 5.10. Waiver of Past Defaults.............. 48
SECTION 5.11. Trustee to Give Notice of Default,
But May Withhold in Certain
Circumstances...................... 48
SECTION 5.12. Right of Court to Require Filing of
Undertaking to Pay Costs........... 49
ARTICLE SIX
CONCERNING THE TRUSTEE
SECTION 6.1. Duties and Responsibilities of the
Trustee; During Default; Prior to
Default............................ 50
SECTION 6.2. Certain Rights of the Trustee........ 51
SECTION 6.3. Trustee Not Responsible for Recitals,
Disposition of Securities or
Application of Proceeds Thereof.... 53
SECTION 6.4. Trustee and Agents May Hold
Securities or Coupons;
Collections, etc................... 53
SECTION 6.5. Moneys Held by Trustee............... 53
SECTION 6.6. Compensation and Indemnification of
Trustee and Its Prior Claim........ 54
SECTION 6.7. Right of Trustee to Rely on
Officer's Certificate, etc......... 54
SECTION 6.8. Persons Eligible for Appointment
as Trustee......................... 55
SECTION 6.9. Resignation and Removal; Appointment
of Successor Trustee............... 55
SECTION 6.10. Acceptance of Appointment by
Successor Trustee.................. 57
SECTION 6.11. Merger, Conversion, Consolidation
or Succession to Business of
Trustee............................ 59
SECTION 6.12. Appointment of Authenticating Agent.. 59
ARTICLE SEVEN
CONCERNING THE SECURITYHOLDERS
SECTION 7.1. Evidence of Action Taken by
Securityholders.................... 61
SECTION 7.2. Proof of Execution of Instruments
and of Holding of Securities....... 61
SECTION 7.3. Holders to be Treated as Owners...... 62
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SECTION 7.4. Securities Owned by Issuer Deemed
Not Outstanding.................... 63
SECTION 7.5. Right of Revocation of Action
Taken.............................. 64
SECTION 7.6. Record Date for Consents and
Waivers............................ 64
ARTICLE EIGHT
SUPPLEMENTAL INDENTURES
SECTION 8.1. Supplemental Indentures Without
Consent of Securityholders......... 65
SECTION 8.2. Supplemental Indentures With Consent
of Securityholders................. 66
SECTION 8.3. Effect of Supplemental Indenture..... 69
SECTION 8.4. Documents to Be Given to Trustee..... 69
SECTION 8.5. Notation on Securities in Respect of
Supplemental Indentures............ 69
ARTICLE NINE
CONSOLIDATION, MERGER, SALE OR CONVEYANCE
SECTION 9.1. Covenant Not to Merge, Consolidate,
Sell or Convey Property Except
Under Certain Conditions........... 69
SECTION 9.2. Successor Corporation Substituted.... 70
SECTION 9.3. Opinion of Counsel Delivered to
Trustee............................ 71
ARTICLE TEN
SATISFACTION AND DISCHARGE OF INDENTURE;
UNCLAIMED MONEYS
SECTION 10.1. Satisfaction and Discharge of
Indenture.......................... 71
SECTION 10.2. Application by Trustee of Funds
Deposited for Payment of
Securities......................... 75
SECTION 10.3. Repayment of Moneys Held by Paying
Agent.............................. 75
SECTION 10.4. Return of Moneys Held By Trustee
and Paying Agent Unclaimed for
One Year........................... 75
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SECTION 10.5. Indemnity For U.S. Government
Obligations........................ 76
ARTICLE ELEVEN
MISCELLANEOUS PROVISIONS
SECTION 11.1. Partners, Incorporators, Stock-
holders, Employees, Officers
and Directors of Issuer Exempt
from Individual Liability.......... 76
SECTION 11.2. Provisions of Indenture for the Sole
Benefit of Parties and Holders of
Securities and Coupons............. 76
SECTION 11.3. Successors and Assigns of Issuer
Bound by Indenture................. 77
SECTION 11.4. Notices and Demands on Issuer,
Trustee and Holders of Securities
and Coupons........................ 77
SECTION 11.5. Officer's Certificates and Opinions
of Counsel; Statements to Be
Contained Therein.................. 78
SECTION 11.6. Payments Due on Saturdays, Sundays
and Holidays....................... 79
SECTION 11.7. Conflict of Any Provision of
Indenture with Trust Indenture Act
of 1939............................ 80
SECTION 11.8. New York Law to Govern............... 80
SECTION 11.9. Counterparts......................... 80
SECTION 11.10. Effect of Headings................... 80
SECTION 11.11. Securities in a Foreign Currency
or in ECUs......................... 80
SECTION 11.12. Judgment Currency.................... 80
SECTION 11.13. Calculation of Original Issue
Discount; Calculation of Foreign
Currency Equivalents; Certain
Information Concerning Tax
Reporting.......................... 81
ARTICLE TWELVE
REDEMPTION OF SECURITIES AND SINKING FUNDS
SECTION 12.1. Applicability of Article............. 82
SECTION 12.2. Notice of Redemption; Partial
Redemptions........................ 83
SECTION 12.3. Payment of Securities Called for
Redemption......................... 85
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SECTION 12.4. Exclusion of Certain Securities
from Eligibility for Selection for
Redemption......................... 86
SECTION 12.5. Mandatory and Optional Sinking
Funds.............................. 86
TESTIMONIUM.......................................... 90
SIGNATURES........................................... 90
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THIS INDENTURE, dated as of November __, 1994
between AMERICAN STORES COMPANY, a Delaware corporation (the
"Issuer"), and THE FIRST NATIONAL BANK OF CHICAGO, a national
banking association, as trustee (the "Trustee"),
W I T N E S S E T H:
WHEREAS, the Issuer has duly authorized the issue
from time to time of its unsecured debentures, notes or other
evidences of indebtedness to be issued in one or more series
(the "Securities") up to such principal amount or amounts as
may from time to time be authorized in accordance with the
terms of this Indenture;
WHEREAS, the Issuer has duly authorized the
execution and delivery of this Indenture to provide, among
other things, for the authentication, delivery and
administration of the Securities; and
WHEREAS, all things necessary to make this Inden-
ture a valid indenture and agreement according to its terms
have been done;
NOW, THEREFORE:
In consideration of the premises and the purchases
of the Securities by the holders thereof, the Issuer and the
Trustee mutually covenant and agree for the equal and
proportionate benefit of the respective holders from time to
time of the Securities and of the coupons, if any,
appertaining thereto as follows:
ARTICLE ONE
DEFINITIONS
SECTION 1.1 Certain Terms Defined. The following
terms (except as otherwise expressly provided or unless the
context otherwise clearly requires) for all purposes of this
Indenture and of any indenture supplemental hereto shall have
the respective meanings specified in this Section. All other
terms used in this Indenture that are defined in the Trust
Indenture Act of 1939 or the definitions of which in the
Securities Act of 1933 are referred to in the Trust Indenture
Act of 1939, including terms defined therein by reference to
the Securities Act of 1933 (except as herein otherwise
expressly provided or unless the context otherwise clearly
requires), shall have the meanings assigned to such terms in
said Trust Indenture Act and in said Securities Act as in
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force at the date of this Indenture. All accounting terms
used herein and not expressly defined shall have the meanings
assigned to such terms in accordance with generally accepted
accounting principles, and the term "generally accepted
accounting principles" means such accounting principles as
are generally accepted at the time of any computation. The
words "herein", "hereof" and "hereunder" and other words of
similar import refer to this Indenture as a whole and not to
any particular Article, Section or other subdivision. The
terms defined in this Article have the meanings assigned to
them in this Article and include the plural as well as the
singular.
"Affiliate" means any Person which directly or
indirectly controls, or is controlled by, or under common
control with, the Issuer.
"Attributable Debt" when used in connection with a
Sale and Lease-Back Transaction shall mean, as of any
particular time, the aggregate of present values (discounted
at a rate per annum equal to the average interest borne by
all Outstanding Securities determined on a weighted average
basis and compounded semi-annually) of the obligations of the
Issuer or any Subsidiary for net rental payments during the
remaining term of the applicable lease (including any period
for which such lease has been extended or may, at the option
of the lessor, be extended). The term "net rental payments"
under any lease of any period shall mean the sum of the
rental and other payments required to be paid in such period
by the lessee thereunder, not including, however, any amounts
required to be paid by such lessee (whether or not designated
as rental or additional rental) on account of maintenance and
repairs, reconstruction, insurance, taxes, assessments, water
rates or similar charges required to be paid by such lessee
thereunder or any amounts required to be paid by such lessee
thereunder contingent upon the amount of sales, maintenance
and repairs, reconstruction, insurance, taxes, assessments,
water rates or similar charges.
"Authenticating Agent" shall have the meaning set
forth in Section 6.12.
"Authorized Newspaper" means a newspaper (which, in
the case of The City of New York, will, if practicable, be
The Wall Street Journal (Eastern Edition), in the case of the
United Kingdom, will, if practicable, be the Financial Times
(London Edition) and, in the case of Luxembourg, will, if
practicable, be the Luxemburger Wort) published in an
official language of the country of publication customarily
published at least once a day for at least five days in each
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calendar week and of general circulation in The City of New
York, the United Kingdom or in Luxembourg, as applicable. If
it shall be impractical in the opinion of the Trustee to make
any publication of any notice required hereby in an
Authorized Newspaper, any publication or other notice in lieu
thereof which is made or given with the approval of the
Trustee shall constitute a sufficient publication of such
notice.
"Board of Directors" means either the Board of
Directors of the Issuer or any committee of such Board duly
authorized to act hereunder on its behalf.
"Board Resolution" means a copy of one or more
resolutions, certified by the secretary or an assistant
secretary of the Issuer to have been duly adopted or
consented to by the Board of Directors and to be in full
force and effect, and delivered to the Trustee.
"Business Day" means, with respect to any Security,
a day that in the city (or in any of the cities, if more than
one) in which amounts are payable, as specified in the form
of such Security, is neither a Saturday, Sunday or legal
holiday nor a day on which banking institutions are
authorized or required by law or regulation to close.
"Capital Lease" means any lease of property which,
in accordance with generally accepted accounting principles,
should be capitalized on the lessee's balance sheet or for
which the amount of the asset and liability thereunder as if
so capitalized should be disclosed in a note to such balance
sheet; and "Capitalized Lease Obligation" means the amount of
the liability which should be so capitalized or disclosed.
"Commission" means the Securities and Exchange
Commission, as from time to time constituted, created under
the Securities Exchange Act of 1934, or if at any time after
the execution and delivery of this Indenture such Commission
is not existing and performing the duties now assigned to it
under the Trust Indenture Act, then the body performing such
duties on such date.
"Common Stock" means the common stock, par value
$1.00, of the Issuer as the same exists at the date of
execution and delivery of this Indenture or as such stock may
be reconstituted from time to time.
"Consolidated" when used with respect to any of the
terms defined in the Indenture, refers to such terms as
reflected in a consolidation of the accounts of the Issuer
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and its Restricted Subsidiaries in accordance with generally
accepted accounting principles.
"Corporate Trust Office" means the office of the
Trustee at which the corporate trust business of the Trustee
shall, at any particular time, be principally administered,
which office is, at the date as of which this Indenture is
dated, located in Chicago, Illinois.
"Coupon" means interest coupon, if any,
appertaining to a Security.
"Depositary" means, with respect to the Securities
of any series issuable or issued in the form of one or more
Registered Global Securities, the Person designated as
Depositary by the Issuer pursuant to Section 2.3 until a
successor Depositary shall have become such pursuant to the
applicable provisions of this Indenture, and thereafter
"Depositary" shall mean or include each Person who is then a
Depositary hereunder, and if at any time there is more than
one such Person, "Depositary" as used with respect to the
Securities of any such series shall mean the Depositary with
respect to the Registered Global Securities of that series.
"Dollar" means the 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.
"ECU" means the European Currency Unit as defined
and revised from time to time by the Council of European
Communities.
"Event of Default" means any event or condition
specified as such in Section 5.1.
"Foreign Currency" means a currency issued by the
government of a country other than the United States.
"Funded Indebtedness" means any Indebtedness
maturing by its terms more than one year from the date of the
determination thereof, including any Indebtedness renewable
or extendible at the option of the obligor to a date later
than one year from the date of the determination thereof.
"Holder", "Holder of Securities", Securityholder"
or other similar terms mean (a) in the case of any Registered
Security, the Person in whose name such Security is
registered in the security register kept by the Issuer for
that purpose in accordance with the terms hereof, and (b) in
the case of any Unregistered Security, the bearer of such
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Security, or any Coupon appertaining thereto, as the case may
be.
"Indebtedness" of any Person means all obligations
(other than the Securities of such series) of, or guaranteed
or assumed by, such Person or any of such Person's Restricted
Subsidiaries for borrowed money or evidenced by bonds,
debentures, notes or other similar instruments.
"Indenture" means this instrument as originally
executed and delivered or, if amended or supplemented as
herein provided, as so amended or supplemented or both, and
shall include the forms and terms of particular series of
Securities established as contemplated hereunder.
"Interest" means, when used with respect to
noninterest bearing Securities, interest payable after
maturity.
"Issuer" means (except as otherwise provided in
Article Six) American Stores Company, a Delaware corporation,
and, subject to Article Nine, its successors and assigns.
"Issuer Order" means a written statement, request
or order of the Issuer which is signed in its name by the
chairman of the Board of Directors, the president, any
executive vice president or any senior vice president of the
Issuer.
"Judgment Currency" shall have the meaning set
forth in Section 11.12.
"Market Exchange Rate" shall mean the noon Dollar
buying rate in New York City for cable transfers of that
currency as published by the Federal Reserve Bank of New
York; provided that in the case of ECUs, Market Exchange Rate
shall mean the rate of exchange determined by the Commission
of the European Communities (or any successor thereto) as
published in the Official Journal of the European Communities
or any successor publication (such publication or any
successor publication, the "Journal").
"Net Tangible Assets" means the total amounts of
assets (less depreciation and valuation reserves and other
reserves and items deductible from gross book value of
specific asset accounts under generally accepted accounting
principles) which under generally accepted accounting
principles would be included on a balance sheet after
deducting therefrom (a) all liability items except Funded
Indebtedness, Capitalized Lease Obligations, stockholders'
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equity and reserves for deferred income taxes and (b) all
goodwill, trade names, trademarks, patents, unamortized debt
discount and expense and other like intangibles, which in
each case would be so included on such balance sheet.
"Non-Restricted Subsidiary" means any Subsidiary
that the Issuer's Board of Directors has in good faith
declared pursuant to a written resolution not to be of
material importance, either singly or together with all other
Non-Restricted Subsidiaries, to the business of the Issuer
and its consolidated Subsidiaries taken as a whole.
"Officer's Certificate" means a certificate signed
by the chairman of the Board of Directors, the president, any
executive vice president, any senior vice president or the
treasurer of the Issuer and delivered to the Trustee. Each
such certificate shall comply with Section 314 of the Trust
Indenture Act of 1939 and include the statements provided for
in Section 11.5.
"Operating Assets" means all merchandise
inventories, furniture, fixtures and equipment (including all
transportation and warehousing equipment but excluding office
equipment and data processing equipment) owned or leased
pursuant to Capital Leases by the Issuer or a Restricted
Subsidiary.
"Operating Property" means all real property and
improvements thereon owned or leased pursuant to Capital
Leases by the Issuer or a Restricted Subsidiary and
constituting, without limitation, any store, warehouse,
service center or distribution center wherever located,
provided that such term shall not include any store,
warehouse, service center or distribution center which the
Issuer's Board of Directors declares by written resolution
not to be of material importance to the business of the
Issuer and its Restricted Subsidiaries.
"Opinion of Counsel" means an opinion in writing
signed by legal counsel, who may be the General Counsel of
the Issuer, or such other legal counsel who may be an
employee of or counsel to the Issuer, and who shall be
satisfactory to the Trustee. Each such opinion shall comply
with Section 314 of the Trust Indenture Act of 1939 and
include the statements provided for in Section 11.5.
"original issue date" of any Security (or portion
thereof) means the earlier of (a) the date of such Security
or (b) the date of any Security (or portion thereof) for
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which such Security was issued (directly or indirectly) on
registration of transfer, exchange or substitution.
"Original Issue Discount Security" means any
Security that provides for an amount less than the principal
amount thereof to be due and payable upon a declaration of
acceleration of the maturity thereof pursuant to Section 5.1.
Accrual of original issue discount on any Original
Issue Discount Security shall, unless otherwise specified in
the Board Resolution or Officer's Certificate establishing
the terms of such Security, be calculated using the "constant
yield method", computed in accordance with the rules of the
Internal Revenue Code of 1986, as amended, and the
regulations thereunder, as then in effect.
"Outstanding" when used with reference to
Securities, shall, subject to the provisions of Section 7.4,
mean, as of any particular time, all Securities authenticated
and delivered by the Trustee under this Indenture, except
(a) Securities theretofore cancelled by the
Trustee or delivered to the Trustee for cancellation;
(b) Securities or portions thereof, for the
payment or redemption of which moneys or U.S. Government
Obligations (as provided for in Section 10.1) in the
necessary amount shall have been deposited in trust with
the Trustee or with any paying agent (other than the
Issuer) or shall have been set aside, segregated and
held in trust by the Issuer for the Holders of such
Securities (if the Issuer shall act as its own paying
agent); provided that if such Securities, or portions
thereof, are to be redeemed prior to the maturity
thereof, notice of such redemption shall have been given
as herein provided, or provision satisfactory to the
Trustee shall have been made for giving such notice;
provided further that such payment is effective under
Article 10 with respect to such Securities to discharge
the Indenture with respect to such Securities under
Section 10.1(A) or to defease such Securities under
Section 10.1(B), as the case may be; and
(c) Securities which shall have been paid or in
substitution for which other Securities shall have been
authenticated and delivered pursuant to the terms of
Section 2.9 (except with respect to any such Security as
to which proof satisfactory to the Trustee is presented
that such Security is held by a Person in whose hands
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such Security is a legal, valid and binding obligation
of the Issuer).
In determining whether the Holders of the requisite
principal amount of Outstanding Securities of any or all
series have given any request, demand, authorization,
direction, notice, consent or waiver hereunder, (i) there
shall be excluded Outstanding Securities held by the Issuer
and or any Affiliate and (ii) the principal amount of an
Original Issue Discount Security that shall be deemed to be
Outstanding for such purposes shall be the amount of the
principal thereof that would be due and payable as of the
date of such determination upon a declaration of acceleration
of the maturity thereof pursuant to Section 5.1.
"Periodic Offering" means an offering of Securities
of a series from time to time, the specific terms of which
Securities, including, without limitation, the rate or rates
of interest, if any, thereon, the stated maturity or
maturities thereof and the redemption provisions, if any,
with respect thereto, are to be determined by the Issuer or
its agents upon the issuance of such Securities.
"Person" means any individual, corporation,
partnership, joint venture, association, joint stock company,
trust, unincorporated organization or government or any
agency or political subdivision thereof.
"principal" whenever used with reference to the
Securities or any Security or any portion thereof, shall be
deemed to include "and premium, if any".
"record date" shall have the meaning set forth in
Section 2.7.
"Registered Global Security", means a Security
evidencing all or a part of a series of Registered
Securities, issued to the Depositary for such series in
accordance with Section 2.4, and bearing the legend
prescribed in Section 2.4.
"Registered Security" means any Security registered
on the Security register of the Issuer.
"Required Currency" shall have the meaning set
forth in Section 11.12.
"Responsible Officer" when used with respect to the
Trustee, means any officer within the Corporate Trust Office
(or any successor group of the Trustee) including any Vice
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President, Assistant Vice President, Assistant Secretary or
any other officer of the Trustee customarily performing
functions similar to those performed by any of the above
designated officers and also means, with respect to a
particular corporate trust matter, any other officer to whom
such matter is referred because of his knowledge of and
familiarity with the particular subject.
"Restricted Subsidiaries" means all subsidiaries
other than Non-Restricted Subsidiaries.
"Security" or "Securities" has the meaning stated
in the first recital of this Indenture, or, as the case may
be, Securities that have been authenticated and delivered
under this Indenture.
"Significant Subsidiary" means, with respect to the
Issuer, any Subsidiary that is a significant subsidiary
within the meaning of Rule 1-02 of Regulation S-X promulgated
by the Commission.
"Subsidiary" means (i) any corporation or other
entity of which securities or other ownership interests
having ordinary voting power to elect a majority of the board
of directors or other persons performing similar functions
are at the time directly or indirectly owned by the Issuer or
(ii) any partnership of which more than 50% of the
partnership interests are owned by the Issuer or any
Subsidiary.
"Trust Indenture Act of 1939" (except as otherwise
provided in Sections 8.1, 8.2 and 13.5) means the Trust
Indenture Act of 1939, as amended as in force at the date as
of which this Indenture was originally executed.
"Trustee" means the Person identified as "Trustee"
in the first paragraph hereof and, subject to the provisions
of Article Six, shall also include any successor trustee.
"Trustee" shall also mean or include each Person who is then
a trustee hereunder and if at any time there is more than one
such Person, "Trustee" as used with respect to the Securities
of any series shall mean the trustee with respect to the
Securities of such series.
"Unregistered Security" means any Security other
than a Registered Security.
"U.S. Government Obligations" shall have the
meaning set forth in Section 10.1(A).
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"Yield to Maturity" means the yield to maturity on
a series of Securities, calculated at the time of issuance of
such series, or, if applicable, at the most recent
redetermination of interest on such series, and calculated in
accordance with generally accepted financial practice.
ARTICLE TWO
SECURITIES
SECTION 2.1 Forms Generally. The Securities of each
series and the Coupons, if any, to be attached thereto shall be
substantially in such form (not inconsistent with this
Indenture) as shall be established by or pursuant to one or
more Board Resolutions (as set forth in Board Resolutions or,
to the extent established pursuant to rather than set forth in
Board Resolutions, an Officer's Certificate detailing such
establishment) or in one or more indentures supplemental
hereto, in each case with such appropriate insertions,
omissions, substitutions and other variations as are required
or permitted by this Indenture and may have imprinted or
otherwise reproduced thereon such legend or legends or
endorsements, not inconsistent with the provisions of this
Indenture, as may be required to comply with any law or with
any rules or regulations pursuant thereto, or with any rules of
any securities exchange or to conform to general usage, all as
may be determined by the officers executing such Securities and
Coupons, if any, as evidenced by their execution of such
Securities and Coupons.
The definitive Securities and Coupons, if any, shall
be printed, lithographed or engraved on steel engraved borders
or may be produced in any other manner, all as determined by
the officers executing such Securities and Coupons, if any, as
evidenced by their execution of such Securities and Coupons, if
any.
SECTION 2.2 Form of Trustee's Certificate of
Authentication. The Trustee's certificate of authentication on
all Securities shall be in substantially the following form:
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"This is one of the Securities of the series
designated herein referred to in the within-mentioned Senior
Indenture.
THE FIRST NATIONAL BANK OF CHICAGO,
Trustee
By
Authorized Officer"
If at any time there shall be an Authenticating
Agent appointed with respect to any series of Securities,
then the Securities of such series shall bear, in addition to
the Trustee's Certificate of Authentication ("Certificate of
Authentication") an alternate Certificate of Authentication
which shall be substantially as follows:
"This is one of the Securities of the series
designated herein referred to in the within-mentioned Senior
Indenture.
THE FIRST NATIONAL BANK OF CHICAGO,
Trustee
By ,
As Authenticating Agent
By
Authorized Officer"
SECTION 2.3 Amount Unlimited; Issuable in Series.
The aggregate principal amount of Securities which may be
authenticated and delivered under this Indenture is
unlimited.
The Securities may be issued in one or more series
and the Securities of each such series shall rank equally and
pari passu with all other unsecured and unsubordinated debt
of the Issuer. There shall be established in or pursuant to
one or more Board Resolutions (as set forth in Board
Resolutions or, to the extent established pursuant to rather
than set forth in Board Resolutions, in an Officer's
Certificate detailing such establishment) or established in
one or more indentures supplemental hereto, prior to the
initial issuance of Securities of any series,
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(1) the title of the Securities of the series,
which shall distinguish the Securities of the series
from all other Securities;
(2) any limit upon the aggregate principal amount
of the Securities of the series that may be
authenticated and delivered under this Indenture (except
for Securities authenticated and delivered upon
registration of transfer of, or in exchange for, or in
lieu of, other Securities of the series pursuant to
Section 2.8, 2.9, 2.11, 8.5 or 12.3;
(3) if other than Dollars, the coin or currency in
which the Securities of that series are denominated
(including, but not limited to, any Foreign Currency or
ECU);
(4) the date or dates on which the principal of
the Securities of the series is payable;
(5) the rate or rates at which the Securities of
the series shall bear interest, if any, the date or
dates from which such interest shall accrue, on which
such interest shall be payable and (in the case of
Registered Securities) on which a record shall be taken
for the determination of Holders to whom interest is
payable and/or the method by which such rate or rates or
date or dates shall be determined;
(6) the place or places where the principal of and
any interest on Securities of the series shall be
payable (if other than as provided in Section 3.2);
(7) the right, if any, of the Issuer or any Holder
to redeem or cause to be redeemed Securities, in whole
or in part, at its option and the period or periods
within which, the price or prices at which and any terms
and conditions upon which, and the manner in which (if
different from the provision of Article 12 hereof),
Securities of the series may be so redeemed, pursuant to
any sinking fund or otherwise and/or the method by which
such price or prices shall be determined and the
applicability of Section 12.4 and the second paragraph
of Section 12.5;
(8) the obligation, if any, of the Issuer to
redeem, purchase or repay Securities of the series
pursuant to any mandatory redemption, sinking fund or
analogous provisions or at the option of a Holder
thereof and the price or prices (and/or the method by
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which such price or prices shall be determined) at which
and the period or periods within which and any terms and
conditions upon which Securities of the series shall be
redeemed, purchased or repaid, in whole or in part,
pursuant to such obligation;
(9) if other than denominations of $1,000 and any
integral multiple thereof in the case of Registered
Securities, or $1,000 and $5,000 in the case of
Unregistered Securities, the denominations in which
Securities of the series shall be issuable;
(10) if other than the principal amount thereof,
the portion of the principal amount of Securities of the
series which shall be payable upon declaration of
acceleration of the maturity thereof;
(11) if other than the coin or currency in which
the Securities of that series are denominated, the coin
or currency in which payment of the principal of or
interest on the Securities of such series shall be
payable;
(12) if the principal of or interest on the
Securities of such series are to be payable, at the
election of the Issuer or a Holder thereof, in a coin or
currency other than that in which the Securities are
denominated, the period or periods within which, and the
terms and conditions upon which, such election may be
made;
(13) if the amount of payments of principal of
and/or interest on the Securities of the series may be
determined with reference to the value or price of any
one or more currencies or indices, the manner in which
such amounts will be determined;
(14) whether the Securities of the series will be
issuable as Registered Securities (and if so, whether
such Securities will be issuable as Registered Global
Securities) or Unregistered Securities (with or without
Coupons), or any combination of the foregoing, any
restrictions applicable to the offer, sale or delivery
of Unregistered Securities or the payment of interest
thereon and, if other than as provided in Section 2.8,
the terms upon which Unregistered Securities of any
series may be exchanged for Registered Securities of
such series and vice versa;
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(15) whether and under what circumstances the
Issuer will pay additional amounts on the Securities of
the series held by a Person who is not a U.S. Person in
respect of any tax, assessment or governmental charge
withheld or deducted and, if so, whether the Issuer will
have the option to redeem such Securities rather than
pay such additional amounts;
(16) if the Securities of such series are to be
issuable in definitive form (whether upon original issue
or upon exchange of a temporary Security of such series)
only upon receipt of certain certificates or other
documents or satisfaction of other conditions, the form
and terms of such certificates, documents or conditions;
(17) any trustees, depositaries, authenticating or
paying agents, transfer agents or registrars or any
other agents with respect to the Securities of such
series;
(18) any events of default or covenants not set
forth herein with respect to the Securities of such
series;
(19) whether the provisions of Section
10.1(A)(c)(i)(y) or 10.1(B) or 12.4 hereof will not be
applicable to Securities of such series; and
(20) any other terms of the series (which terms
shall not be inconsistent with the provisions of this
Indenture but which may modify or delete any such
provision of this Indenture insofar as it applies to
such series; provided that no term thereof shall be
modified or deleted if imposed by operation of Section
318(c) of the Trust Indenture Act of 1939; provided
further that any modification or deletion of the rights,
duties or immunities of the Trustee shall have been
consented to in writing by the Trustee).
If any of the foregoing terms are not available at
the time such resolutions are adopted, or such Officer's
Certificate or any supplemental indenture is executed, such
resolutions, Officer's Certificate or supplemental indenture
may reference the document or documents to be created in
which such terms will be set forth prior to the issuance of
such Securities.
All Securities of any one series and Coupons, if
any, appertaining thereto, shall be substantially identical,
except in the case of Registered Securities as to
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denomination and except as may otherwise be provided by or
pursuant to the Board Resolutions or Officer's Certificate
referred to above or as set forth in any such indenture
supplemental hereto. All Securities of any one series need
not be issued at the same time and may be issued from time to
time, consistent with the terms of this Indenture, if so
provided by or pursuant to such Board Resolutions, such
Officer's Certificate or in any such indenture supplemental
hereto.
SECTION 2.4 Authentication and Delivery of
Securities. The Issuer may deliver Securities of any series
having attached thereto appropriate Coupons, if any, executed
by the Issuer to the Trustee for authentication together with
the applicable documents referred to below in this Section,
and the Trustee shall thereupon authenticate and deliver such
Securities to or upon the order of the Issuer (contained in
the Issuer Order referred to below in this Section) or
pursuant to such procedures acceptable to the Trustee and to
such recipients as may be specified from time to time by an
Issuer Order. The maturity date, original issue date,
interest rate and any other terms of the Securities of such
series and Coupons, if any, appertaining thereto shall be
determined by or pursuant to such Issuer Order and
procedures. If provided for in such procedures, such Issuer
Order may authorize authentication and delivery pursuant to
oral instructions from the Issuer or its duly authorized
agent, which instructions shall be promptly confirmed in
writing. In authenticating such Securities and accepting the
additional responsibilities under this Indenture in relation
to such Securities, the Trustee shall be entitled to receive
(in the case of subparagraphs 2, 3 and 4 below only at or
before the time of the first request of the Issuer to the
Trustee to authenticate Securities of such series) and
(subject to Section 6.1) shall be fully protected in relying
upon, unless and until such documents have been superseded or
revoked:
(1) an Issuer Order requesting such authentication
and setting forth delivery instructions if the
Securities and Coupons, if any, are not to be delivered
to the Issuer; provided that, with respect to Securities
of a series subject to a Periodic Offering, (a) such
Issuer Order may be delivered by the Issuer to the
Trustee prior to the delivery to the Trustee of such
Securities for authentication and delivery, (b) the
Trustee shall authenticate and deliver Securities of
such series for original issue from time to time, in an
aggregate principal amount not exceeding the aggregate
principal amount established for such series, pursuant
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to an Issuer Order or pursuant to procedures acceptable
to the Trustee as may be specified from time to time by
an Issuer Order, (c) the maturity date or dates,
original issue date or dates, interest rate or rates and
any other terms of Securities of such series shall be
determined by an Issuer Order or pursuant to such
procedures and (d) if provided for in such procedures,
such Issuer Order may authorize authentication and
delivery pursuant to oral or electronic instructions
from the Issuer or its duly authorized agent or agents,
which oral instructions shall be promptly confirmed in
writing;
(2) any Board Resolution, Officer's Certificate
and/or executed supplemental indenture referred to in
Sections 2.1 and 2.3 by or pursuant to which the forms
and terms of the Securities and Coupons, if any, were
established;
(3) an Officer's Certificate setting forth the
form or forms and terms of the Securities and Coupons,
if any, stating that the form or forms and terms of the
Securities and Coupons, if any, have been established
pursuant to Sections 2.1 and 2.3 and comply with this
Indenture, and covering such other matters as the
Trustee may reasonably request; and
(4) at the option of the Issuer, either an Opinion
of Counsel, or a letter addressed to the Trustee
permitting it to rely on an Opinion of Counsel,
substantially to the effect that:
(a) the form or forms of the Securities and
Coupons, if any, have been duly authorized and
established in conformity with the provisions of
this Indenture;
(b) in the case of an underwritten offering,
the terms of the Securities have been duly
authorized and established in conformity with the
provisions of this Indenture, and, in the case of
an offering that is not underwritten, certain terms
of the Securities have been established pursuant to
a Board Resolution, an Officer's Certificate or a
supplemental indenture in accordance with this
Indenture, and when such other terms as are to be
established pursuant to procedures set forth in an
Issuer Order shall have been established, all such
terms will have been duly authorized by the Issuer
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and will have been established in conformity with
the provisions of this Indenture; and
(c) when the Securities and Coupons, if any,
have been executed by the Issuer and authenticated
by the Trustee in accordance with the provisions of
this Indenture and delivered to and duly paid for
by the purchasers thereof, they will be valid and
binding obligations of the Issuer, enforceable in
accordance with their respective terms and entitled
to the benefits of this Indenture, subject to the
effect of (i) bankruptcy, insolvency,
reorganization, moratorium or other similar laws
relating to or affecting the rights of creditors
generally or (ii) the application of general
principles of equity (regardless of whether
enforcement is considered in a proceeding in equity
or at law).
In rendering such opinions, such counsel may rely,
as to all matters governed by the laws of jurisdictions other
than the State of New York and the federal law of the United
States, upon opinions of other counsel (copies of which shall
be delivered to the Trustee), who shall be counsel reasonably
satisfactory to the Trustee, in which case the opinion shall
state that such counsel believes he and the Trustee are
entitled so to rely. Such counsel may also state that,
insofar as such opinion involves factual matters, he has
relied, to the extent he deems proper, upon certificates of
officers of the Issuer and its Subsidiaries and certificates
of public officials.
The Trustee shall have the right to decline to
authenticate and deliver any Securities under this Section if
the Trustee, being advised by counsel, determines that such
action may not lawfully be taken by the Issuer or if the
Trustee in good faith by a trust committee or Responsible
Officers shall determine that such action would expose the
Trustee to personal liability to existing Holders or would
affect the Trustee's own rights, duties or immunities under
the Securities, this Indenture or otherwise.
If the Issuer shall establish pursuant to Section
2.3 that the Securities of a series are to be issued in the
form of one or more Registered Global Securities, then the
Issuer shall execute and the Trustee shall, in accordance
with this Section and the Issuer Order with respect to such
series, authenticate and deliver one or more Registered
Global Securities that (i) shall represent and shall be
denominated in an amount equal to the aggregate principal
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amount of all of the Securities of such series issued and not
yet cancelled, (ii) shall be registered in the name of the
Depositary for such Registered Global Security or Securities
or the nominee of such Depositary, (iii) shall be delivered
by the Trustee to such Depositary or pursuant to such
Depositary's instructions and (iv) shall bear a legend
substantially to the following effect: "Unless and until it
is exchanged in whole or in part for Securities in definitive
registered form, this Security may not be transferred except
as a whole by the Depositary to the nominee of the Depositary
or by a nominee of the Depositary to the Depositary or
another nominee of the Depositary or by the Depositary or any
such nominee to a successor Depositary or a nominee of such
successor Depositary."
Each Depositary designated pursuant to Section 2.3
must, at the time of its designation and at all times while
it serves as Depositary, be a clearing agency registered
under the Securities Exchange Act of 1934 and any other
applicable statute or regulation.
SECTION 2.5 Execution of Securities. The
Securities and, if applicable, each Coupon appertaining
thereto shall be signed on behalf of the Issuer by the
chairman of the board of directors, the president, any
executive vice president, any senior vice president or the
treasurer of the Issuer, and by any of the foregoing officers
or the secretary, any assistant secretary or assistant
treasurer of the Issuer, under its corporate seal (except in
the case of Coupons) which may, but need not, be attested.
Such signatures may be the manual or facsimile signatures of
the present or any future such chairman or officers. The
seal of the Issuer may be in the form of a facsimile thereof
and may be impressed, affixed, imprinted or otherwise
reproduced on the Securities. Typographical and other minor
errors or defects in any such reproduction of the seal or any
such signature shall not affect the validity or
enforceability of any Security that has been duly
authenticated and delivered by the Trustee.
In case any officer of the Issuer who shall have
signed any of the Securities or Coupons, if any, shall cease
to be such officer before the Security or Coupon so signed
(or the Security to which the Coupon so signed appertains)
shall be authenticated and delivered by the Trustee or
disposed of by the Issuer, such Security or Coupon
nevertheless may be authenticated and delivered or disposed
of as though the Person who signed such Security or Coupon
had not ceased to be such officer of the Issuer; and any
Security or Coupon may be signed on behalf of the Issuer by
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such Persons as, at the actual date of the execution of such
Security or Coupon, shall be the proper officers of the
Issuer, although at the date of the execution and delivery of
this Indenture any such Person was not such an officer.
SECTION 2.6 Certificate of Authentication. Only
such Securities as shall bear thereon a certificate of
authentication substantially in the form hereinbefore
recited, executed by the Trustee by the manual signature of
one of its authorized officers, shall be entitled to the
benefits of this Indenture or be valid or obligatory for any
purpose. No Coupon shall be entitled to the benefits of this
Indenture or shall be valid and obligatory for any purpose
until the certificate of authentication on the Security to
which such Coupon appertains shall have been duly executed by
the Trustee. The execution of such certificate by the
Trustee upon any Security executed by the Issuer shall be
conclusive evidence that the Security so authenticated has
been duly authenticated and delivered hereunder and that the
Holder is entitled to the benefits of this Indenture.
SECTION 2.7 Denomination and Date of Securities;
Payments of Interest. The Securities of each series shall be
issuable as Registered Securities or Unregistered Securities
in denominations as shall be specified as contemplated by
Section 2.3 or, with respect to the Registered Securities of
any series, if not so established, in denominations of $1,000
and any integral multiple thereof. If denominations of
Unregistered Securities of any series are not so established,
such Securities shall be issuable in denominations of $1,000
and $5,000. The Securities of each series shall be numbered,
lettered or otherwise distinguished in such manner or in
accordance with such plan as the chairman or the officers of
the Issuer executing the same may determine with the approval
of the Trustee, as evidenced by the execution and
authentication thereof.
Each Registered Security shall be dated the date of
its authentication. Each Unregistered Security shall be
dated as provided in or pursuant to the resolution or
resolutions of the Board of Directors referred to in Section
2.3. The Securities of each series shall bear interest, if
any, from the date, and such interest shall be payable on the
dates, which shall be specified as contemplated by Section
2.3.
The Person in whose name any Registered Security of
any series is registered at the close of business on any
record date applicable to a particular series with respect to
any interest payment date for such series shall be entitled
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to receive the interest, if any, payable on such interest
payment date notwithstanding any transfer or exchange of such
Registered Security subsequent to the record date and prior
to such interest payment date, except in the case of any such
transfer or exchange if and to the extent the Issuer shall
default in the payment of the interest due on such interest
payment date for such series, in which case such defaulted
interest shall then cease to be payable to the Holder on such
record date by virtue of having been such Holder and shall be
paid to the Persons in whose names Outstanding Registered
Securities for such series are registered at the close of
business on a subsequent record date (which shall be not less
than five Business Days prior to the date of payment of such
defaulted interest) established by notice given by mail by or
on behalf of the Issuer to the Holders of Registered
Securities not less than 15 days preceding such subsequent
record date. The term "record date" as used with respect to
any interest payment date (except a date for payment of
defaulted interest) for the Securities of any series shall
mean the date specified as such in the terms of the
Registered Securities of such series, or, if no such date is
so specified, if such interest payment date is the first day
of a calendar month, the fifteenth day of the next preceding
calendar month or, if such interest payment date is the
fifteenth day of a calendar month, the first day of such
calendar month, whether or not such record date is a Business
Day.
SECTION 2.8 Registration, Transfer and Exchange.
The Issuer will keep at each office or agency to be
maintained for the purpose as provided in Section 3.2 for
each series of Securities a register or registers in which,
subject to such reasonable regulations as it may prescribe,
it will provide for the registration of Registered Securities
of such series and the registration of transfer of Registered
Securities of such series. Such register shall be in written
form in the English language or in any other form capable of
being converted into such form within a reasonable time. At
all reasonable times such register or registers shall be open
for inspection by the Trustee.
Upon due presentation for registration of transfer
of any Registered Security of any series at any such office
or agency to be maintained for the purpose as provided in
Section 3.2, the Issuer shall execute and the Trustee shall
authenticate and deliver in the name of the transferee or
transferees a new Registered Security or Registered
Securities of the same series, of like tenor in an equal
aggregate principal amount.
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Unregistered Securities (except for any temporary
global Unregistered Securities) and Coupons (except for
Coupons attached to any temporary global Unregistered
Securities) shall be transferable by delivery.
At the option of the Holder thereof, Registered
Securities of any series (other than a Registered Global
Security, except as set forth below) may be exchanged for a
Registered Security or Registered Securities of such series
having other authorized denominations, of like tenor and an
equal aggregate principal amount, upon surrender of such
Registered Securities to be exchanged at the agency of the
Issuer that shall be maintained for such purpose in
accordance with Section 3.2 and upon payment, if the Issuer
shall so require, of the charges hereinafter provided. If
the Securities of any series are issued in both registered
and unregistered form, except as otherwise specified pursuant
to Section 2.3, at the option of the Holder thereof,
Unregistered Securities of any series may be exchanged for
Registered Securities of such series having authorized
denominations, of like tenor and an equal aggregate principal
amount, upon surrender of such Unregistered Securities to be
exchanged at the agency of the Issuer that shall be
maintained for such purpose in accordance with Section 3.2,
with, in the case of Unregistered Securities that have
Coupons attached, all unmatured Coupons and all matured
Coupons in default thereto appertaining, and upon payment, if
the Issuer shall so require, of the charges hereinafter
provided. At the option of the Holder thereof, if
Unregistered Securities of any series, maturity date,
interest rate and original issue date are issued in more than
one authorized denomination, except as otherwise specified
pursuant to Section 2.3, such Unregistered Securities may be
exchanged for Unregistered Securities of such series having
authorized denominations, of like tenor and an equal
aggregate principal amount, upon surrender of such
Unregistered Securities to be exchanged at the agency of the
Issuer that shall be maintained for such purpose in
accordance with Section 3.2 or as specified pursuant to
Section 2.3, with, in the case of Unregistered Securities
that have Coupons attached, all unmatured Coupons and all
matured Coupons in default thereto appertaining, and upon
payment, if the Issuer shall so require, of the charges
hereinafter provided. Unless otherwise specified pursuant to
Section 2.3, Registered Securities of any series may not be
exchanged for Unregistered Securities of such series.
Whenever any Securities are so surrendered for exchange, the
Issuer shall execute, and the Trustee shall authenticate and
deliver, the Securities which the Holder making the exchange
is entitled to receive. All Securities and Coupons
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surrendered upon any exchange or transfer provided for in
this Indenture shall be promptly cancelled and disposed of by
the Trustee and the Trustee will deliver a certificate of
disposition thereof to the Issuer.
All Registered Securities presented for
registration of transfer, exchange, redemption, repurchase or
payment shall (if so required by the Issuer or the Trustee)
be duly endorsed by, or be accompanied by a written
instrument or instruments of transfer in form satisfactory to
the Issuer and the Trustee duly executed by the Holder or his
attorney duly authorized in writing.
The Issuer may require payment of a sum sufficient
to cover any tax or other governmental charge that may be
imposed in connection with any exchange or registration of
transfer of Securities. No service charge shall be made for
any such transaction.
The Issuer shall not be required to exchange or
register a transfer of (a) any Securities of any series for a
period of 15 days next preceding the first mailing or
publication of notice of redemption of Securities of such
series to be redeemed, (b) any Securities selected, called or
being called for redemption, in whole or in part, except, in
the case of any Security to be redeemed in part, the portion
thereof not so to be redeemed, or (c) any Security if the
Holder thereof has exercised his right, if any, to require
the Issuer to repurchase such Security in whole or in part,
except the portion of such Security not required to be
repurchased.
Notwithstanding any other provision of this Section
2.8, unless and until it is exchanged in whole or in part for
Securities in definitive registered form, a Registered Global
Security representing all or a portion of the Securities of a
series may not be transferred except as a whole by the
Depositary for such series to a nominee of such Depositary or
by a nominee of such Depositary to such Depositary or another
nominee of such Depositary or by such Depositary or any such
nominee to a successor Depositary for such series or a
nominee of such successor Depositary.
If at any time the Depositary for any Registered
Securities of a series represented by one or more Registered
Global Securities notifies the Issuer that it is unwilling or
unable to continue as Depositary for such Registered
Securities or if at any time the Depositary for such
Registered Securities shall no longer be eligible under
Section 2.4, the Issuer shall appoint a successor Depositary
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with respect to such Registered Securities. If a successor
Depositary for such Registered Securities is not appointed by
the Issuer within 90 days after the Issuer receives such
notice or becomes aware of such ineligibility, the Issuer's
election pursuant to Section 2.3 that such Registered
Securities be represented by one or more Registered Global
Securities shall no longer be effective and the Issuer will
execute, and the Trustee, upon receipt of an Officer's
Certificate for the authentication and delivery of definitive
Securities of such series, will authenticate and deliver,
Securities of such series in definitive registered form
without Coupons, in any authorized denominations, in an
aggregate principal amount equal to the principal amount of
the Registered Global Security or Securities representing
such Registered Securities in exchange for such Registered
Global Security or Securities.
The Issuer may at any time and in its sole
discretion determine that the Registered Securities of any
series issued in the form of one or more Registered Global
Securities shall no longer be represented by a Registered
Global Security or Securities. In such event the Issuer will
execute, and the Trustee, upon receipt of an Officer's
Certificate for the authentication and delivery of definitive
Securities of such series, will authenticate and deliver,
Securities of such series in definitive registered form
without Coupons, in any authorized denominations, in an
aggregate principal amount equal to the principal amount of
the Registered Global Security or Securities representing
such Registered Securities, in exchange for such Registered
Global Security or Securities.
If specified by the Issuer pursuant to Section 2.3
with respect to Securities represented by a Registered Global
Security, the Depositary for such Registered Global Security
may surrender such Registered Global Security in exchange in
whole or in part for Securities of the same series in
definitive registered form on such terms as are acceptable to
the Issuer and such Depositary. Thereupon, the Issuer shall
execute, and the Trustee shall authenticate and deliver,
without service charge,
(i) to the Person specified by such Depositary a
new Registered Security or Securities of the same
series, of any authorized denominations as requested by
such Person, in an aggregate principal amount equal to
and in exchange for such Person's beneficial interest in
the Registered Global Security; and
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(ii) to such Depositary a new Registered Global
Security in a denomination equal to the difference, if
any, between the principal amount of the surrendered
Registered Global Security and the aggregate principal
amount of Registered Securities authenticated and
delivered pursuant to clause (i) above.
Upon the exchange of a Registered Global Security
for Securities in definitive registered form without Coupons,
in authorized denominations, such Registered Global Security
shall be cancelled by the Trustee or an agent of the Issuer
or the Trustee. Securities in definitive registered form
without coupons issued in exchange for a Registered Global
Security pursuant to this Section 2.8 shall be registered in
such names and in such authorized denominations as the
Depositary for such Registered Global Security, pursuant to
instructions from its direct or indirect participants or
otherwise, shall instruct the Trustee or an agent of the
Issuer or the Trustee. The Trustee or such agent shall
deliver at its office such Securities to or as directed by
the Persons in whose names such Securities are so registered.
All Securities issued upon any transfer or exchange
of Securities shall be valid and legally binding obligations
of the Issuer, evidencing the same debt, and entitled to the
same benefits under this Indenture, as the Securities
surrendered upon such transfer or exchange.
Notwithstanding anything herein or in the terms of
any series of Securities to the contrary, none of the Issuer,
the Trustee or any agent of the Issuer or the Trustee (any of
which, other than the Issuer, shall rely on an Officer's
Certificate and an Opinion of Counsel) shall be required to
exchange any Unregistered Security for a Registered Security
if such exchange would result in adverse Federal income tax
consequences to the Issuer (such as, for example, the
inability of the Issuer to deduct from its income, as
computed for Federal income tax purposes, the interest
payable on the Unregistered Securities) under then applicable
United States Federal income tax laws.
SECTION 2.9 Mutilated, Defaced, Destroyed, Lost
and Stolen Securities. In case any temporary or definitive
Security or any Coupon appertaining to any Security shall
become mutilated, defaced or be apparently destroyed, lost or
stolen, the Issuer in its discretion may execute, and upon
the written request of any officer of the Issuer, the Trustee
shall authenticate and deliver a new Security of the same
series, maturity date, interest rate and original issue date,
bearing a number or other distinguishing symbol not
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contemporaneously outstanding, in exchange and substitution
for the mutilated or defaced Security, or in lieu of and in
substitution for the Security so destroyed, lost or stolen
and, if applicable, with Coupons corresponding to the Coupons
appertaining to the Securities so mutilated, defaced,
destroyed, lost or stolen, or in exchange or substitution for
the Security to which such mutilated, defaced, destroyed,
lost or stolen Coupon appertained, with Coupons appertaining
thereto corresponding to the Coupons so mutilated, defaced,
destroyed, lost or stolen. In every case the applicant for a
substitute Security or Coupon shall furnish to the Issuer and
to the Trustee and any agent of the Issuer or the Trustee
such security or indemnity as may be required by them to
indemnify and defend and to save each of them harmless and,
in every case of apparent destruction, loss or theft,
evidence to their satisfaction of the destruction, loss or
theft, of such Security or Coupon and of the ownership
thereof and in the case of mutilation or defacement shall
surrender the Security and related Coupons to the Trustee or
such agent.
Upon the issuance of any substitute Security or
Coupon, the Issuer may require the payment of a sum
sufficient to cover any tax or other governmental charge that
may be imposed in relation thereto and any other expenses
(including the fees and expenses of the Trustee or its agent)
connected therewith. In case any Security or Coupon which
has matured or is about to mature or has been called for
redemption in full shall become mutilated or defaced or be
apparently destroyed, lost or stolen, the Issuer may instead
of issuing a substitute Security, with the Holder's consent
pay or authorize the payment of the same or the relevant
Coupon (without surrender thereof except in the case of a
mutilated or defaced Security or Coupon), if the applicant
for such payment shall furnish to the Issuer and to the
Trustee and any agent of the Issuer or the Trustee such
security or indemnity as any of them may require to save each
of them harmless, and, in every case of destruction, loss or
theft, the applicant shall also furnish to the Issuer and the
Trustee and any agent of the Issuer or the Trustee evidence
to their satisfaction of the apparent destruction, loss or
theft of such Security or Coupon and of the ownership
thereof.
Every substitute Security or Coupon of any series
issued pursuant to the provisions of this Section by virtue
of the fact that any such Security or Coupon is apparently
destroyed, lost or stolen shall constitute an additional
contractual obligation of the Issuer, whether or not the
apparently destroyed, lost or stolen Security or Coupon shall
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be at any time enforceable by anyone and shall be entitled to
all the benefits of (but shall be subject to all the
limitations of rights set forth in) this Indenture equally
and proportionately with any and all other Securities or
Coupons of such series duly authenticated and delivered
hereunder. All Securities and Coupons shall be held and
owned upon the express condition that, to the extent
permitted by law, the foregoing provisions are exclusive with
respect to the replacement or payment of mutilated, defaced
or apparently destroyed, lost or stolen Securities and
Coupons and shall preclude any and all other rights or
remedies notwithstanding any law or statute existing or
hereafter enacted to the contrary with respect to the
replacement or payment of negotiable instruments or other
securities without their surrender.
SECTION 2.10 Cancellation of Securities;
Disposition Thereof. All Securities and Coupons surrendered
for payment, repurchase, redemption, registration of transfer
or exchange, or for credit against any payment in respect of
a sinking or analogous fund, if surrendered to the Issuer or
any agent of the Issuer or the Trustee or any agent of the
Trustee, shall be delivered to the Trustee or its agent for
cancellation or, if surrendered to the Trustee, shall be
cancelled by it; and no Securities or Coupons shall be issued
in lieu thereof except as expressly permitted by any of the
provisions of this Indenture. The Trustee or its agent shall
dispose of cancelled Securities and Coupons held by it and
deliver a certificate of disposition to the Issuer. If the
Issuer or its agent shall acquire any of the Securities or
Coupons, such acquisition shall not operate as a redemption
or satisfaction of the indebtedness represented by such
Securities or Coupons unless and until the same are delivered
to the Trustee or its agent for cancellation.
SECTION 2.11 Temporary Securities. Pending the
preparation of definitive Securities for any series, the
Issuer may execute and the Trustee shall authenticate and
deliver temporary Securities for such series (printed,
lithographed, typewritten or otherwise reproduced, in each
case in form satisfactory to the Trustee). Temporary
Securities of any series shall be issuable as Registered
Securities without coupons, or as Unregistered Securities
with or without coupons attached thereto, of any authorized
denomination, and substantially in the form of the definitive
Securities of such series but with such omissions, insertions
and variations as may be appropriate for temporary
Securities, all as may be determined by the Issuer with the
concurrence of the Trustee as evidenced by the execution and
authentication thereof. Temporary Securities may contain
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such references to any provisions of this Indenture as may be
appropriate. Every temporary Security shall be executed by
the Issuer and be authenticated by the Trustee upon the same
conditions and in substantially the same manner, and with
like effect, as the definitive Securities. Without
unreasonable delay the Issuer shall execute and shall furnish
definitive Securities of such series and thereupon temporary
Securities of such series may be surrendered in exchange
therefor without charge, in the case of Registered
Securities, at each office or agency to be maintained by the
Issuer for that purpose pursuant to Section 3.2 and, in the
case of Unregistered Securities, at any agency maintained by
the Issuer for such purpose as specified pursuant to Section
2.3, and the Trustee shall authenticate and deliver in
exchange for such temporary Securities of such series an
equal aggregate principal amount of definitive Securities of
the same series having authorized denominations and, in the
case of Unregistered Securities, having attached thereto any
appropriate Coupons. Until so exchanged, the temporary
Securities of any series shall be entitled to the same
benefits under this Indenture as definitive Securities of
such series, unless otherwise established pursuant to Section
2.3. The provisions of this Section are subject to any
restrictions or limitations on the issue and delivery of
temporary Unregistered Securities of any series that may be
established pursuant to Section 2.3 (including any provision
that Unregistered Securities of such series initially be
issued in the form of a single global Unregistered Security
to be delivered to a depositary or agency located outside the
United States and the procedures pursuant to which definitive
or global Unregistered Securities of such series would be
issued in exchange for such temporary global Unregistered
Security).
Section 2.12 Availability of Currency of Payment
in Respect of Securities. If the principal, premium, if any,
and interest on any Securities is payable in a Foreign
Currency and such Foreign Currency is unavailable due to the
imposition of exchange controls or other circumstances beyond
the Issuer's control, or is no longer used by the government
of the country issuing such currency or currency unit or for
the settlement of transactions by public institutions of or
within the international banking community, then the Issuer
shall be entitled to satisfy its obligations to Holders under
this Indenture by making such payment in Dollars on the basis
of the Market Exchange Rate for such Foreign Currency on the
latest date for which such rate was established on or before
the date on which such payment is due.
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If payment on a Security is required to be made in
ECU and on a payment date with respect to such Security ECU
are unavailable due to the imposition of exchange controls or
other circumstances beyond the Issuer's control, or are no
longer used in the European Monetary System, then all such
payments due on such payment date shall be made in Dollars.
The amount so payable on any payment date in ECU shall be
converted into Dollars at a rate determined by the Issuer or
its agent as of the second Business Day prior to the date on
which such payment is due in the manner described below. The
component currencies of the ECU for this purpose (the
"Components") shall be the currency amounts that were
components of the ECU as of the last date on which ECU were
used in the European Monetary System. The equivalent of ECU
in Dollars shall be calculated by aggregating the Dollar
equivalents of the Components. The Dollar equivalent of each
of the Components shall be determined by the Issuer or its
agent on the basis of the most recently available Market
Exchange Rate for the Components.
If the official unit of any component currency is
altered by way of combination or subdivision, the number of
units of that currency as a Component shall be divided or
multiplied in the same proportion. If two or more component
currencies are consolidated into a single currency, the
amounts of those currencies as Components shall be replaced
by an amount in such single currency equal to the sum of the
amounts of the consolidated component currencies expressed in
such single currency. If any component currency is divided
into two or more currencies, the amount of that currency as a
Component shall be replaced by amounts of such two or more
currencies, each of which shall have a value on the date of
division equal to the amount of the former component currency
divided by the number of currencies into which that currency
was divided.
Any payment made pursuant to this Section 2.12 in
Dollars where the required payment is in a Foreign Currency
shall not constitute a default under this Indenture. All
determinations referred to above made by the Issuer or its
agent shall be at its sole discretion and, in the absence of
manifest error, shall be conclusive for all purposes and
binding on Holders of the Securities and the Issuer to the
extent permitted by applicable law.
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ARTICLE THREE
COVENANTS OF THE ISSUER
SECTION 3.1 Payment of Principal and Interest.
The Issuer covenants and agrees for the benefit of each
series of Securities that it will duly and punctually pay or
cause to be paid the principal of, and interest on, each of
the Securities of such series (together with any additional
amounts payable pursuant to the terms of such Securities) at
the place or places, at the respective times and in the
manner provided in such Securities and in the Coupons, if
any, appertaining thereto and in this Indenture. The
interest on Securities with Coupons attached (together with
any additional amounts payable pursuant to the terms of such
Securities) shall be payable only upon presentation and
surrender of the several Coupons for such interest
installments as are evidenced thereby as they severally
mature. If any temporary Unregistered Security provides that
interest thereon may be paid while such Security is in
temporary form, the interest on any such temporary
Unregistered Security (together with any additional amounts
payable pursuant to the terms of such Security) shall be
paid, as to the installments of interest evidenced by Coupons
attached thereto, if any, only upon presentation and
surrender thereof, and, as to the other installments of
interest, if any, only upon presentation of such Securities
for notation thereon of the payment of such interest, in each
case subject to any restrictions that may be established
pursuant to Section 2.3. The interest on Registered
Securities (together with any additional amounts payable
pursuant to the terms of such Securities) shall be payable
only to or upon the written order of the Holders thereof and,
at the option of the Issuer, may be paid by wire transfer or
by mailing checks for such interest payable to or upon the
written order of such Holders at their last addresses as they
appear on the registry books of the Issuer.
SECTION 3.2 Offices for Payments, etc. So long as
any Registered Securities are authorized for issuance
pursuant to this Indenture or are Outstanding hereunder, the
Issuer will maintain in The City of New York, an office or
agency where the Registered Securities of each series may be
presented for payment and where the Securities of each series
may be presented for registration of transfer or exchange as
is provided in this Indenture.
The Issuer will maintain one or more offices or
agencies in a city or cities located outside the United
States (including any city in which such an agency is
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required to be maintained under the rules of any stock
exchange on which the Securities of such series are listed)
where the Unregistered Securities, if any, of each series and
Coupons, if any, appertaining thereto may be presented for
payment. No payment on any Unregistered Security or Coupon
will be made upon presentation of such Unregistered Security
or Coupon at an agency of the Issuer within the United States
nor will any payment be made by transfer to an account in, or
by mail to an address in, the United States unless pursuant
to applicable United States laws and regulations then in
effect such payment can be made without adverse tax
consequences to the Issuer. Notwithstanding the foregoing,
payments in Dollars of Unregistered Securities of any series
and Coupons appertaining thereto which are payable in Dollars
may be made at an agency of the Issuer maintained in The City
of New York if such payment in Dollars at each agency
maintained by the Issuer outside the United States for
payment on such Unregistered Securities is illegal or
effectively precluded by exchange controls or other similar
restrictions.
The Issuer will maintain in The City of New York,
an office or agency where notices and demands to or upon the
Issuer in respect of the Securities of any series, the
Coupons appertaining thereto or this Indenture may be served.
The Issuer will give to the Trustee written notice
of the location of each such office or agency and of any
change of location thereof. In case the Issuer shall fail to
maintain any agency required by this Section to be located in
The City of New York, or shall fail to give such notice of
the location or of any change in the location of any of the
above agencies, presentations and demands may be made and
notices may be served at the Corporate Trust Office of the
Trustee.
The Issuer may from time to time designate one or
more additional offices or agencies where the Securities of a
series and any Coupons appertaining thereto may be presented
for payment, where the securities of that series may be
presented for exchange as provided in this Indenture and
pursuant to Section 2.3 and where the Registered Securities
of that series may be presented for registration of transfer
as in this Indenture provided, and the Issuer may from time
to time rescind any such designation, as the Issuer may deem
desirable or expedient; provided that no such designation or
rescission shall in any manner relieve the Issuer of its
obligation to maintain the agencies provided for in the first
three paragraphs of this Section. The Issuer will give to
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the Trustee prompt written notice of any such designation or
rescission thereof.
SECTION 3.3 Appointment to Fill a Vacancy in
Office of Trustee. The Issuer, whenever necessary to avoid
or fill a vacancy in the office of Trustee, will appoint, in
the manner provided in Section 6.10, a Trustee, so that there
shall at all times be a Trustee with respect to each series
of Securities hereunder.
SECTION 3.4 Paying Agents. Whenever the Issuer
shall appoint a paying agent other than the Trustee with
respect to the Securities of any series, it will cause such
paying agent to execute and deliver to the Trustee an
instrument in which such agent shall agree with the Trustee,
subject to the provisions of this Section,
(a) that it will hold all sums received by it as
such agent for the payment of the principal of or
interest on the Securities of such series (whether such
sums have been paid to it by the Issuer or by any other
obligor on the Securities of such series) in trust for
the benefit of the Holders of the Securities of such
series, or Coupons appertaining thereto, if any, or of
the Trustee,
(b) that it will give the Trustee prompt notice of
any failure by the Issuer (or by any other obligor on
the Securities of such series) to make any payment of
the principal of or interest on the Securities of such
series when the same shall be due and payable, and
(c) that any time during the continuance of any
such failure upon the written request of the Trustee, it
will forthwith pay to the Trustee all sums so held in
trust by such agent.
The Issuer will, not later than each due date of
the principal of or interest on the Securities of such
series, deposit with the paying agent a sum sufficient to pay
such principal or interest so becoming due, and (unless such
paying agent is the Trustee) the Issuer will promptly notify
the Trustee of any failure to take such action.
If the Issuer shall act as its own paying agent
with respect to the Securities of any series, it will, on or
before each due date of the principal of or interest on the
Securities of such series, set aside, segregate and hold in
trust for the benefit of the Holders of the Securities of
such series or the Coupons appertaining thereto a sum
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sufficient to pay such principal or interest so becoming due
until such sums shall be paid to such Persons as herein
provided. The Issuer will promptly notify the Trustee of any
failure to take such action.
Anything in this Section to the contrary
notwithstanding, but subject to Section 10.1, the Issuer may
at any time, for the purpose of obtaining a satisfaction and
discharge with respect to one or more or all series of
Securities hereunder, or for any other reason, pay or cause
to be paid to the Trustee all sums held in trust for any such
series by the Issuer or any paying agent hereunder, as
required by this Section, such sums to be held by the Trustee
upon the trusts herein contained.
Anything in this Section to the contrary
notwithstanding, the agreement to hold sums in trust as
provided in this Section is subject to the provisions of
Sections 10.3 and 10.4.
SECTION 3.5 Certificate of the Issuer. The Issuer
will furnish to the Trustee within 120 days of the close of
each fiscal year of the Issuer ending after the date hereof a
brief certificate (which need not comply with Section 11.5)
from the principal executive, financial or accounting officer
of the Issuer as to his or her knowledge of the Issuer's
compliance with all conditions and covenants under the
Indenture (such compliance to be determined without regard to
any period of grace or requirement of notice provided under
the Indenture).
SECTION 3.6 Luxembourg Publications. In the event
of the publication of any notice pursuant to Section 5.11,
6.9, 6.10, 6.12, 8.2, 10.4, 12.2 or 12.5, the party making
such publication in the Borough of Manhattan, The City of New
York and London shall also, to the extent that notice is
required to be given to Holders of Securities of any series
by applicable Luxembourg law or stock exchange regulation, as
evidenced by an Officer's Certificate delivered to such
party, make a similar publication in Luxembourg.
SECTION 3.7 Limitations on Liens. After the date
hereof and so long as any Securities are Outstanding, the
Issuer will not issue, assume or guarantee, and will not
permit any Restricted Subsidiary to issue, assume or
guarantee, any Indebtedness which is secured by a mortgage,
pledge, security interest, lien or encumbrance (any mortgage,
pledge, security interest, lien or encumbrance being
hereinafter in this Article referred as a "lien," or "liens")
of or upon any Operating Property or Operating Assets,
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whether now owned or hereafter acquired, of the Issuer or any
such Restricted Subsidiary without effectively providing that
the Securities (together with, if the Issuer shall so
determine, any other Indebtedness of the Issuer ranking
equally with the Securities) shall be equally and ratably
secured by a lien on such assets ranking ratably with and
equal to (or at the Issuer's option prior to) such secured
Indebtedness; provided that the foregoing restriction shall
not apply to:
(a) liens on any property or assets of any
corporation existing at the time such corporation
becomes a Restricted Subsidiary provided that such lien
does not extend to any other property of the Issuer or
any of its Restricted Subsidiaries;
(b) liens on any property or assets (including
stock) existing at the time of acquisition of such
property or assets by the Issuer or a Restricted
Subsidiary, or liens to secure the payment of all or any
part of the purchase price of such property or assets
(including stock) upon the acquisition of such property
or assets by the Issuer or a Restricted Subsidiary or to
secure any indebtedness incurred, assumed or guaranteed
by the Issuer or a Restricted Subsidiary prior to, at
the time of, or within 18 months after such acquisition
(or in the case of real property, the completion of
construction (including any improvements on an existing
asset) or commencement of full operation at such
property, whichever is later (which in the case of a
retail store is the opening of the store for business to
the public)) which indebtedness is incurred, assumed or
guaranteed for the purpose of financing all or any part
of the purchase price thereof or, in the case of real
property, construction or improvements thereon; provided
that in the case of any such acquisition, construction
or improvement, the lien shall not apply to any property
or assets theretofore owned by the Issuer or a
Restricted Subsidiary, other than, in the case of any
such construction or improvement, any real property on
which the property so constructed, or the improvement,
is located;
(c) liens on any property or assets to secure
Indebtedness of a Restricted Subsidiary to the Issuer or
to another Restricted Subsidiary;
(d) liens on any property or assets of a
corporation existing at the time such corporation is
merged into or consolidated with the Issuer or a
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Restricted Subsidiary or at the time of a purchase,
lease or other acquisition of the assets of a
corporation or firm as an entirety or substantially as
an entirety by the Issuer or a Restricted Subsidiary
provided that such lien does not extend to any other
property of the Issuer or any of its Restricted
Subsidiaries;
(e) liens on any property or assets of the Issuer
or a Restricted Subsidiary in favor of the United States
of America or any State thereof, or any department,
agency or instrumentality or political subdivision of
the United States of America or any State thereof, or in
favor of any other country, or any political subdivision
thereof, to secure partial, progress, advance or other
payments pursuant to any contract or statute or to
secure any Indebtedness incurred or guaranteed for the
purpose of financing all or any part of the purchase
price (or, in the case of real property, the cost of
construction) of the property or assets subject to such
liens (including, but not limited to, liens incurred in
connection with pollution control, industrial revenue or
similar financings);
(f) any extension, renewal or replacement (or
successive extensions, renewals or replacements) in
whole or in part, of any lien referred to in the
foregoing clauses (a) through (e), inclusive; provided
that the principal amount of indebtedness secured
thereby shall not exceed the principal amount of
indebtedness so secured at the time of such extension,
renewal or replacement, and that such extension, renewal
or replacement shall be limited to all or a part of the
property or assets which secured the lien so extended,
renewed or replaced (plus improvements and construction
on real property);
(g) liens imposed by law, such as mechanics',
workmen's, repairmen's, materialmen's, carriers,
warehouseman's, vendors, or other similar liens arising
in the ordinary course of business, or governmental
(federal, state or municipal) liens arising out of
contracts for the sale of products or services by the
Issuer or any Restricted Subsidiary, or deposits or
pledges to obtain the release of any of the foregoing
liens;
(h) pledges, liens or deposits under worker's
compensation laws or similar legislation and liens or
judgments thereunder which are not currently
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dischargeable, or in connection with bids, tenders,
contracts (other than for the payment of money) or
leases to which the Issuer or any Restricted Subsidiary
is a party, or to secure the public or statutory
obligations of the Issuer or any Restricted Subsidiary,
or in connection with obtaining or maintaining self-
insurance or to obtain the benefits of any law,
regulation or arrangement pertaining to unemployment
insurance, old age pensions, social security or similar
matters, or to secure surety, appeal or customs bonds to
which the Issuer or any Restricted Subsidiary is a
party, or in litigation or other proceedings such as,
but not limited to, interpleader proceedings, and other
similar pledges, liens or deposits made or incurred in
the ordinary course of business;
(i) liens created by or resulting from any
litigation or other proceeding which is being contested
in good faith by appropriate proceedings, including
liens arising out of judgments or awards against the
Issuer or any Restricted Subsidiary with respect to
which the Issuer or such Restricted Subsidiary is in
good faith prosecuting an appeal or proceedings for
review or for which the time to make an appeal has not
yet expired; or final unappealable judgment liens which
are satisfied within 15 days of the date of judgment; or
liens incurred by the Issuer or any Restricted
Subsidiary for the purpose of obtaining a stay or
discharge in the course of any litigation or other
proceeding to which the Issuer or such Restricted
Subsidiary is a party;
(j) liens for taxes or assessments or governmental
charges or levies not yet due or delinquent, or which
can thereafter be paid without penalty, or which are
being contested in good faith by appropriate
proceedings; landlord's liens on property held under
lease; and any other liens or charges incidental to the
conduct of the business of the Issuer or any Restricted
Subsidiary or the ownership of the property or assets of
any of them which were not incurred in connection with
the borrowing of money or the obtaining of advances or
credit and which do not, in the opinion of the Issuer,
materially impair the use of such property or assets in
the operation of the business of the Issuer or such
Restricted Subsidiary or the value of such property or
assets for the purposes of such business; or
(k) liens not permitted by clauses (a) through (j)
above if at the time of, and after giving effect to, the
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creation or assumption of any such lien, the aggregate
amount of all Indebtedness of the Issuer and its
Restricted Subsidiaries secured by all such liens not so
permitted by clauses (a) through (j) above together with
the Attributable Debt in respect of Sale and Lease-Back
Transactions permitted by paragraph (a) of Section 3.8
does not exceed the greater of (i) $250 million or (ii)
15% of Consolidated Net Tangible Assets.
SECTION 3.8 Limitations on Sale and Lease-Back.
After the date hereof and so long as any Securities are
Outstanding, the Issuer agrees that it will not, and will not
permit any Restricted Subsidiary to, enter into any
arrangement with any Person providing for the leasing by the
Issuer or a Restricted Subsidiary of any Operating Property
or Operating Asset (other than any such arrangement involving
a lease for a term, including renewal rights, for not more
than 3 years and leases between the Issuer and a Subsidiary
or between Subsidiaries), whereby such Operating Property or
Operating Asset has been or is to be sold or transferred by
the Issuer or any Restricted Subsidiary to such Person
(herein referred to as a "Sale and Lease-Back Transaction"),
unless:
(a) the Issuer or such Restricted Subsidiary
would, at the time of entering into a Sale and Lease-
Back Transaction, be entitled to incur Indebtedness
secured by a lien on the Operating Property or Operating
Asset to be leased in an amount at least equal to the
Attributable Debt in respect of such Sale and Lease-Back
Transaction without equally and ratably securing the
Securities pursuant to Section 3.7; or
(b) the proceeds of the sale of the Operating
Property or Operating Asset to be leased are at least
equal to the fair market value of such Operating
Property or Operating Asset (as determined by the chief
financial officer or chief accounting officer of the
Issuer) and an amount in cash equal to the net proceeds
from the sale of the Operating Property or Operating
Asset so leased is applied, within 180 days of the
effective date of any such Sale and Lease-Back
Transaction, to the purchase or acquisition (or, in the
case of Operating Property, the construction) of
Operating Property or Operating Assets or to the
retirement (other than at maturity or pursuant to a
mandatory sinking fund or redemption provision and other
than Indebtedness owned by the Issuer or any Restricted
Subsidiary) of Securities or of Funded Indebtedness of
the Issuer ranking on a parity with or senior to the
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Securities, or in the case of a Sale and Lease-Back
Transaction by a Restricted Subsidiary, of Funded
Indebtedness of such Restricted Subsidiary; provided
that in connection with any such retirement, any related
loan commitment or the like shall be reduced in an
amount equal to the principal amount so retired.
The foregoing restriction shall not apply to, in the case of
any Operating Property or Operating Asset acquired or
constructed subsequent to the date eighteen months prior to
the date of this Indenture, any Sale and Lease-Back
Transaction with respect to such Operating Asset or Operating
Property (including presently owned real property upon which
such Operating Property is to be constructed) if a binding
commitment is entered into with respect to such Sale and
Lease-Back Transaction within 18 months after the later of
the acquisition of the Operating Property or Operating Asset
or the completion of improvements or construction thereon or
commencement of full operations at such Operating Property
(which in the case of a retail store is the opening of the
store for business to the public).
SECTION 3.9 Reports by the Issuer. The Issuer
covenants to file with the Trustee, within 15 days after the
Issuer is required to file the same with the Commission,
copies of the annual reports and of the information,
documents, and other reports which the Issuer may be required
to file with the Commission pursuant to Section 13 or Section
15(d) of the Securities Exchange Act of 1934.
ARTICLE FOUR
SECURITYHOLDERS LISTS AND REPORTS BY THE
ISSUER AND THE TRUSTEE
SECTION 4.1 Securityholders Lists. If and so long
as the Trustee shall not be the Security registrar for the
Securities or any series, the Issuer will furnish or cause to
be furnished to the Trustee a list in such form as the
Trustee may reasonably require of the names and addresses of
the holders of the Securities of such series pursuant to
Section 312 of the Trust Indenture Act of 1939 (a)
semiannually and not more than 15 days after each March 1 and
September 1, commencing March 1, 1995, and (b) at such other
times as the Trustee may request in writing, within 30 days
after receipt by the Issuer of any such request as of a date
not more than 15 days prior to the time such information is
furnished.
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SECTION 4.2 Reports by the Trustee. Any Trustee's
report required under Section 313(a) of the Trust Indenture
Act of 1939 shall be transmitted on or before July 15 in each
year following the date hereof, so long as any Securities are
Outstanding hereunder, and shall be dated as of a date
convenient to the Trustee no more than 60 nor less than 45
days prior thereto.
ARTICLE FIVE
REMEDIES OF THE TRUSTEE AND SECURITYHOLDERS
ON EVENT OF DEFAULT
SECTION 5.1 Event of Default Defined; Acceleration
of Maturity; Waiver of Default. "Event of Default" with
respect to Securities of any series wherever used herein,
means each one of the following events which shall have
occurred and be continuing (whatever the reason for such
Event of Default and whether it shall be voluntary or
involuntary or be effected by operation of law or pursuant to
any judgment, decree or order of any court or any order, rule
or regulation of any administrative or governmental body):
(a) default in the payment of any installment of
interest upon any of the Securities of such series as
and when the same shall become due and payable, and
continuance of such default for a period of 30 days; or
(b) default in the payment of all or any part of
the principal of any of the Securities of such series as
and when the same shall become due and payable either at
maturity, upon a redemption or required repurchase, by
declaration or otherwise (including any sinking fund
payment); or
(c) failure on the part of the Issuer duly to
observe or perform any other of the covenants or
agreements on the part of the Issuer in the Securities
of such series (other than a covenant or agreement in
respect of the Securities of such series a default in
the performance or breach of which is elsewhere in this
Section specifically dealt with) or contained in this
Indenture (other than a covenant or agreement which is
not applicable to the Securities of such series) for a
period of 60 days after the date on which written notice
specifying such failure, stating that such notice is a
"Notice of Default" hereunder and demanding that the
Issuer remedy the same, shall have been given by
registered or certified mail, return receipt requested,
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to the Issuer by the Trustee, or to the Issuer and the
Trustee by the Holders of at least 25% in aggregate
principal amount of the Outstanding Securities of such
series; or
(d) a court having jurisdiction in the premises
shall enter a decree or order for relief in respect of
the Issuer or any Significant Subsidiary in an
involuntary case under any applicable bankruptcy,
insolvency, reorganization or other similar law now or
hereafter in effect, or a decree or order adjudging the
Issuer or any Significant Subsidiary a bankrupt or
insolvent, approving as properly filed a petition
seeking reorganization, assignment, adjustment or
composition of, or in respect of, the Issuer or any
Significant Subsidiary under any applicable federal or
state law or appointing a receiver, liquidator,
assignee, custodian, trustee, sequestrator (or similar
official) of the Issuer or any Significant Subsidiary or
for any substantial part of its property or ordering the
winding up or liquidation of its affairs, and such
decree or order shall remain unstayed and in effect for
a period of 60 consecutive days; or
(e) the Issuer or any Significant Subsidiary shall
commence a voluntary case under any applicable
bankruptcy, insolvency, reorganization or other similar
law now or hereafter in effect, or any other case or
proceeding to be adjudicated a bankrupt or insolvent, or
consent to the entry of an order for relief in an
involuntary case or proceeding under any such law or to
the commencement of any bankruptcy or insolvency
proceeding against it, or the filing by it of a petition
or answer or consent seeking reorganization or relief
under any applicable state or federal law, or consent to
the filing of such petition or, to the appointment or
taking possession by a receiver, liquidator, assignee,
custodian, trustee or sequestrator (or similar official)
of the Issuer or any Significant Subsidiary for any
substantial part of its property, or make any general
assignment for the benefit of creditors, or the
admission by the Issuer or any Significant Subsidiary in
writing of its inability to pay its debts generally as
they become due, or the taking of corporate action in
furtherance of any such action; or
(f) failure by the Issuer or any Significant
Subsidiary to make any payment at maturity, including
any applicable grace period, in respect of Indebtedness
of the Issuer or any Significant Subsidiary (other than
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the Securities of such series or non-recourse
obligations) in an amount in excess of $25,000,000 or
the equivalent thereof in any other currency or
composite currency and such failure shall have continued
without having been cured, waived, rescinded or annulled
for a period of thirty days after written notice thereof
shall have been given by registered or certified mail,
return receipt requested, to the Issuer by the Trustee,
or to the Issuer and the Trustee by the Holders of not
less than 25% in aggregate principal amount of the
Outstanding Securities of such series; or
(g) a default with respect to any Indebtedness of
the Issuer or any Significant Subsidiary, which default
results in the acceleration of Indebtedness of the
Issuer or any Significant Subsidiary (other than the
Debt Securities of such series or non-recourse
obligations) in an amount in excess of $25,000,000 or
the equivalent thereof in any other currency or
composite currency without such Indebtedness having been
discharged or such acceleration having been cured,
waived, rescinded or annulled for a period of thirty
days after written notice thereof shall have been given
by registered or certified mail, return receipt
requested, to the Issuer by the Trustee, or to the
Issuer and the Trustee by the Holders of not less than
25% in aggregate principal amount of the Outstanding
Securities of such series; or
(h) any other Event of Default provided in the
supplemental indenture or Board Resolutions under which
such series of Securities is issued or in the form of
Security for such series.
If an Event of Default occurs and is continuing
with respect to the Securities of any series, then, and in
each and every such case (other than an Event of Default
specified in clause (d) or (e) of this section relating to
the Issuer), except for any series of Securities the
principal of which shall have already become due and payable,
either the Trustee or the Holders of not less than 25% in
aggregate principal amount of the Securities of such series
then Outstanding hereunder (each such series voting as a
separate class) by notice in writing to the Issuer (and to
the Trustee if given by Securityholders), may declare the
entire principal (or, if the Securities of such series are
Original Issue Discount Securities, such portion of the
principal amount as may be specified in the terms of such
series) of all Securities of such series, and the interest
accrued thereon, if any, to be due and payable immediately,
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and upon any such declaration, the same shall become
immediately due and payable. If an Event of Default
specified in clause (d) or (e) of this section relating to
the Issuer occurs, such principal amount shall ipso facto
become and be immediately due and payable without any
declaration or other act on the part of the Trustee or any
Holder.
The foregoing provisions, however, are subject to
the condition that if, at any time after the principal (or,
if the Securities of such series are Original Issue Discount
Securities, such portion of the principal as may be specified
in the terms thereof) of the Securities of any series shall
have been so declared due and payable, and before any
judgment or decree for the payment of the moneys due shall
have been obtained or entered as hereinafter provided, the
Issuer shall pay or shall deposit with the Trustee a sum
sufficient to pay all matured installments of interest upon
all the Securities of each such series and the principal of
any and all Securities of such series which shall have become
due otherwise than by acceleration (with interest upon such
principal and, to the extent that payment of such interest is
enforceable under applicable law, on overdue installments of
interest, at the same rate as the rate of interest or Yield
to Maturity (in the case of Original Issue Discount
Securities) specified in the Securities of such series to the
date of such payment or deposit) and such amount as shall be
sufficient to cover reasonable compensation to the Trustee
and each predecessor Trustee, their respective agents,
attorneys and counsel, and all other expenses and liabilities
incurred, and all advances made, by the Trustee and each
predecessor Trustee except as a result of negligence or bad
faith, and if any and all Events of Default under the
Indenture, other than the non-payment of the principal of
Securities which shall have become due by acceleration, shall
have been cured, waived or otherwise remedied as provided
herein -- then and in every such case the Holders of a
majority in aggregate principal amount of all the Securities
of such series then Outstanding (each series voting as a
separate class), by written notice to the Issuer and to the
Trustee, may waive all defaults with respect to each such
series and rescind and annul such declaration and its
consequences, but no such waiver or rescission and annulment
shall extend to or shall affect any subsequent default or
shall impair any right consequent thereon.
For all purposes under this Indenture, if a portion
of the principal of any Original Issue Discount Securities
shall have been accelerated and declared due and payable
pursuant to the provisions hereof, then, from and after such
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declaration, unless such declaration has been rescinded and
annulled, the principal amount of such Original Issue
Discount Securities shall be deemed, for all purposes
hereunder, to be such portion of the principal thereof as
shall be due and payable as a result of such acceleration,
and payment of such portion of the principal thereof as shall
be due and payable as a result of such acceleration, together
with accrued interest, if any, thereon and all other amounts
owing thereunder, shall constitute payment in full of such
Original Issue Discount Securities.
SECTION 5.2 Collection of Indebtedness by Trustee;
Trustee May Prove Debt. The Issuer covenants that (a) in
case default shall be made in the payment of any installment
of interest on any of the Securities of any series when such
interest shall have become due and payable, and such default
shall have continued for a period of 30 days or (b) in case
default shall be made in the payment of all or any part of
the principal of any of the Securities of any series when the
same shall have become due and payable, whether upon maturity
of the Securities of such series or upon any redemption or by
declaration or otherwise -- then upon demand of the Trustee,
the Issuer will pay to the Trustee for the benefit of the
Holders of the Securities of such series the whole amount
that then shall have become due and payable on all Securities
of such series, and such Coupons, for principal or interest,
as the case may be (with interest to the date of such payment
upon the overdue principal and, to the extent that payment of
such interest is enforceable under applicable law, on overdue
installments of interest at the same rate as the rate of
interest or Yield to Maturity (in the case of Original Issue
Discount Securities) specified in the Securities of such
series); and in addition thereto, such further amount as
shall be sufficient to cover the costs and expenses of
collection, including reasonable compensation to the Trustee
and each predecessor Trustee, their respective agents,
attorneys and counsel, and any expenses and liabilities
incurred, and all advances made, by the Trustee and each
predecessor Trustee except as a result of its negligence or
bad faith.
Until such demand is made by the Trustee, the
Issuer may pay the principal of and interest on the
Securities of any series to the Holders, whether or not the
principal of and interest on the Securities of such series be
overdue.
In case the Issuer shall fail forthwith to pay such
amounts upon such demand, the Trustee, in its own name and as
trustee of an express trust, shall be entitled and empowered
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to institute any action or proceedings at law or in equity
for the collection of the sums so due and unpaid, and may
prosecute any such action or proceedings to judgment or final
decree, and may enforce any such judgment or final decree
against the Issuer or other obligor upon the Securities and
collect in the manner provided by law out of the property of
the Issuer or other obligor upon the Securities, wherever
situated the moneys adjudged or decreed to be payable.
In case there shall be pending proceedings relative
to the Issuer or any other obligor upon the Securities under
Title 11 of the United States Code or any other applicable
Federal or state bankruptcy, insolvency, reorganization or
other similar law, or in case a receiver, assignee or trustee
in bankruptcy or reorganization, liquidator, sequestrator or
similar official shall have been appointed for or taken
possession of the Issuer or its property or such other
obligor, or in case of any other comparable judicial
proceedings relative to the Issuer or other obligor upon the
Securities of any series, or to the creditors or property of
the Issuer or such other obligor, the Trustee, irrespective
of whether the principal of the Securities shall then be due
and payable as therein expressed or by declaration or
otherwise and irrespective of whether the Trustee shall have
made any demand pursuant to the provisions of this Section,
shall be entitled and empowered, by intervention in such
proceedings or otherwise:
(a) to file and prove a claim or claims for the
whole amount of principal and interest (or, if the
Securities of any series are Original Issue Discount
Securities, such portion of the principal amount as may
be specified in the terms of such series) owing and
unpaid in respect of the Securities of any series, and
to file such other papers or documents as may be
necessary or advisable in order to have the claims of
the Trustee (including any claim for reasonable
compensation to the Trustee and each predecessor
Trustee, and their respective agents, attorneys and
counsel, and for reimbursement of all expenses and
liabilities incurred, and all advances made, by the
Trustee and each predecessor Trustee, except as a result
of negligence or bad faith) and of the Securityholders
allowed in any judicial proceedings relative to the
Issuer or other obligor upon the Securities of any
series, or to the creditors or property of the Issuer or
such other obligor,
(b) unless prohibited by applicable law and
regulations, to vote on behalf of the Holders of the
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Securities of any series in any election of a trustee or
a standby trustee in any arrangement, reorganization,
liquidation or other bankruptcy or insolvency
proceedings or Person performing similar functions in
comparable proceedings, and
(c) to collect and receive any moneys or other
property payable or deliverable on any such claims, and
to distribute all amounts received with respect to the
claims of the Securityholders and of the Trustee on
their behalf; and any trustee, receiver, or liquidator,
custodian or other similar official is hereby authorized
by each of the Securityholders to make payments to the
Trustee, and, in the event that the Trustee shall
consent to the making of payments directly to the
Securityholders, to pay to the Trustee such amounts as
shall be sufficient to cover reasonable compensation to
the Trustee, each predecessor Trustee and their
respective agents, attorneys and counsel, and all other
expenses and liabilities incurred, and all advances
made, by the Trustee and each predecessor Trustee except
as a result of negligence or bad faith.
Nothing herein contained shall be deemed to
authorize the Trustee to authorize or consent to or vote for
or accept or adopt on behalf of any Securityholder any plan
of reorganization, arrangement, adjustment or composition
affecting the Securities of any series or the rights of any
Holder thereof, or to authorize the Trustee to vote in
respect of the claim of any Securityholder in any such
proceeding except, as aforesaid, to vote for the election of
a trustee in bankruptcy or similar Person.
All rights of action and of asserting claims under
this Indenture, or under any of the Securities of any series
or Coupons appertaining to such Securities, may be prosecuted
and enforced by the Trustee without the possession of any of
the Securities of such series or Coupons appertaining to such
Securities or the production thereof on any trial or other
proceedings relative thereto, and any such action or
proceedings instituted by the Trustee shall be brought in its
own name as trustee of an express trust, and any recovery of
judgment, subject to the payment of the expenses,
disbursements, advances and compensation of the Trustee, each
predecessor Trustee and their respective agents and
attorneys, shall be for the ratable benefit of the Holders of
the Securities or Coupons appertaining to such Securities in
respect of which such judgment has been recovered.
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In any proceedings brought by the Trustee (and also
any proceedings involving the interpretation of any provision
of this Indenture to which the Trustee shall be a party) the
Trustee shall be held to represent all the Holders of the
Securities or Coupons appertaining to such Securities in
respect to which such action was taken, and it shall not be
necessary to make any Holders of such Securities or Coupons
appertaining to such Securities parties to any such
proceedings.
SECTION 5.3 Application of Proceeds. Any moneys
collected by the Trustee pursuant to this Article in respect
of any series shall be applied in the following order at the
date or dates fixed by the Trustee and, in case of the
distribution of such moneys on account of principal or
interest, upon presentation of the several Securities and
Coupons appertaining to such Securities in respect of which
moneys have been collected and stamping (or otherwise noting)
thereon the payment, or issuing Securities of such series in
reduced principal amounts in exchange for the presented
Securities of like series if only partially paid, or upon
surrender thereof if fully paid:
FIRST: To the payment of costs and expenses
applicable to such series in respect of which moneys
have been collected, including any and all amounts due
the Trustee under Section 6.6;
SECOND: In case the principal of the Securities of
such series in respect of which moneys have been
collected shall not have become and be then due and
payable, to the payment of interest on the Securities of
such series in default in the order of the maturity of
the installments of such interest, with interest (to the
extent that such interest has been collected by the
Trustee) upon the overdue installments of interest at
the same rate as the rate of interest or Yield to
Maturity (in the case of Original Issue Discount
Securities) specified in such Securities, such payments
to be made ratably to the Persons entitled thereto,
without discrimination or preference;
THIRD: In case the principal of the Securities of
such series in respect of which moneys have been
collected shall have become and shall be then due and
payable, to the payment of the whole amount then owing
and unpaid upon all the Securities of such series for
principal and interest, with interest upon the overdue
principal, and (to the extent that such interest has
been collected by the Trustee) upon overdue installments
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of interest at the same rate as the rate of interest or
Yield to Maturity (in the case of Original Issue
Discount Securities) specified in the Securities of such
series; and in case such moneys shall be insufficient to
pay in full the whole amount so due and unpaid upon the
Securities of such series, then to the payment of such
principal and interest or Yield to Maturity, without
preference or priority of principal over interest or
Yield to Maturity, or of interest or Yield to Maturity
over principal, or of any installment of interest over
any other installment of interest, or of any Security of
such series over any other Security of such series,
ratably to the aggregate of such principal and accrued
and unpaid interest or Yield to Maturity; and
FOURTH: To the payment of the remainder, if any,
to the Issuer or any other Person lawfully entitled
thereto.
SECTION 5.4 Suits for Enforcement. In case an
Event of Default has occurred, has not been waived and is
continuing, the Trustee may in its discretion proceed to
protect and enforce the rights vested in it by this Indenture
by such appropriate judicial proceedings as the Trustee shall
deem most effectual to protect and enforce any of such
rights, either at law or in equity or in bankruptcy or
otherwise, whether for the specific enforcement of any
covenant or agreement contained in this Indenture or in aid
of the exercise of any power granted in this Indenture or to
enforce any other legal or equitable right vested in the
Trustee by this Indenture or by law.
SECTION 5.5 Restoration of Rights on Abandonment
of Proceedings. In case the Trustee or any Securityholder
shall have proceeded to enforce any right under this
Indenture and such proceedings shall have been discontinued
or abandoned for any reason, or shall have been determined
adversely to the Trustee or such Securityholder, then and in
every such case, subject to any determination in such
proceeding the Issuer, the Trustee and the Securityholder
shall be restored severally and respectively to their former
positions and rights hereunder, and all rights, remedies and
powers of the Issuer, the Trustee and the Securityholders
shall continue as though no such proceedings had been taken.
SECTION 5.6 Limitations on Suits by
Securityholders. No Holder of any Security of any series or
of any Coupon appertaining thereto shall have any right by
virtue or by availing of any provision of this Indenture to
institute any action or proceeding at law or in equity or in
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bankruptcy or otherwise upon or under or with respect to this
Indenture, or for the appointment of a trustee, receiver,
liquidator, custodian or other similar official or for any
other remedy hereunder, unless such Holder previously shall
have given to the Trustee written notice of default and of
the continuance thereof, as hereinbefore provided, and unless
also the Holders of not less than 25% in aggregate principal
amount of the Securities of such affected series then
Outstanding shall have made written request upon the Trustee,
and the Trustee shall not have received direction
inconsistent with such written request by the Holders of a
majority in principal amount of the Securities of such
affected series then outstanding, to institute such action or
proceedings in its own name as trustee hereunder and shall
have offered to the Trustee such reasonable indemnity as it
may require against the costs, expenses and liabilities
(including the fees and expenses of Trustee's Counsel) to be
incurred therein or thereby and the Trustee for 60 days after
its receipt of such notice, request and offer of indemnity
shall have failed to institute any such action or proceeding
and no direction inconsistent with such written request shall
have been given to the Trustee pursuant to Section 5.9; it
being understood and intended, and being expressly covenanted
by the Holder of every Security or Coupon with every other
Holder and the Trustee, that no one or more Holders of
Securities of any series or Coupons appertaining to such
Securities shall have any right in any manner whatever by
virtue or by availing of any provision of this Indenture to
affect, disturb or prejudice the rights of any other such
Holder of Securities or Coupons appertaining to such
Securities, or to obtain or seek to obtain priority over or
preference to any other such Holder or to enforce any right
under this Indenture, except in the manner herein provided
and for the equal, ratable and common benefit of all Holders
of Securities of the applicable series and Coupons
appertaining to such Securities. For the protection and
enforcement of the provisions of this Section, each and every
Securityholder and the Trustee shall be entitled to such
relief as can be given either at law or in equity.
SECTION 5.7 Unconditional Right of Securityholders
to Institute Certain Suits. Notwithstanding any other
provision in this Indenture and any provision of any
Security, the right of any Holder of any Security or Coupon
to receive payment of the principal of (or premium, if any)
and interest on such Security or Coupon on or after the
respective due dates expressed in such Security or Coupon, or
to institute suit for the enforcement of any such payment on
or after such respective dates, shall not be impaired or
affected without the consent of such Holder.
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SECTION 5.8 Powers and Remedies Cumulative; Delay
or Omission Not Waiver of Default. Except as provided in
Sections 2.9 and 5.6 no right or remedy herein conferred upon
or reserved to the Trustee or to the Holders of Securities or
Coupons is intended to be exclusive of any other right or
remedy, and every right and remedy shall, to the extent
permitted by law, be cumulative and in addition to every
other right and remedy given hereunder or now or hereafter
existing at law or in equity or otherwise. The assertion or
employment of any right or remedy hereunder, or otherwise,
shall not prevent the concurrent assertion or employment of
any other appropriate right or remedy.
No delay or omission of the Trustee or of any
Holder of Securities or Coupons to exercise any right or
power accruing upon any Event of Default occurring and
continuing as aforesaid shall impair any such right or power
or shall be construed to be a waiver of any such Event of
Default or an acquiescence therein; and, subject to Section
5.6, every power and remedy given by this Indenture or by law
to the Trustee or to the Holders of Securities or Coupons may
be exercised from time to time, and as often as shall be
deemed expedient, by the Trustee or by the Holders of
Securities or Coupons.
SECTION 5.9 Control by Holders of Securities. The
Holders of a majority in aggregate principal amount of the
Securities of any series affected (with each series voting as
a separate class) at the time Outstanding shall have the
right to direct the time, method, and place of conducting any
proceeding for any remedy available to the Trustee, or
exercising any trust or power conferred on the Trustee with
respect to the Securities of such series pursuant to this
Indenture; provided that such direction shall not be
otherwise than in accordance with law and the provisions of
this Indenture; and provided further that (subject to the
provisions of Section 6.1) the Trustee shall have the right
to decline to follow any such direction if the Trustee, being
advised by counsel, shall determine that the action or
proceeding so directed may not lawfully be taken or would
involve the Trustee in personal liability or if the Trustee
in good faith by its trust committee thereof or any
Responsible Officer shall so determine that the actions or
forbearances specified in or pursuant to such direction would
be unduly prejudicial to the interests of Holders of the
Securities of all series so affected not joining in the
giving of said direction, it being understood that (subject
to Section 6.1) the Trustee shall have no duty to ascertain
whether or not such actions or forbearances are unduly
prejudicial to such Holders.
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Nothing in this Indenture shall impair the right of
the Trustee in its discretion to take any action deemed
proper by the Trustee and which is not inconsistent with such
direction or directions by Securityholders.
SECTION 5.10 Waiver of Past Defaults. Prior to
the declaration of the acceleration of the maturity of the
Securities of any series as provided in Section 5.1, the
Holders of a majority in aggregate principal amount of the
Securities of such series at the time Outstanding may on
behalf of the Holders of all Securities of such series waive
any past default or Event of Default with respect to such
series described in Section 5.1 and its consequences, except
a default in respect of a covenant or provision hereof which
cannot be modified or amended without the consent of the
Holder of each Security affected (including, without
limitation, the provisions with respect to payment of
principal of (or premium, if any) and interest on such
Security).
Upon any such waiver, such default shall cease to
exist and be deemed to have been cured and not to have
occurred, and any Event of Default arising therefrom shall be
deemed to have been cured, and not to have occurred for every
purpose of this Indenture; but no such waiver shall extend to
any subsequent or other default or Event of Default or impair
any right consequent thereon.
SECTION 5.11 Trustee to Give Notice of Default,
But May Withhold in Certain Circumstances. The Trustee shall
at Issuer's expense, within ninety days after the occurrence
of a default with respect to the Securities of any series,
give notice of all defaults with respect to that series known
to the Trustee (i) if any Unregistered Securities of that
series are then Outstanding, to the Holders thereof, by
publication at least once in an Authorized Newspaper in the
Borough of Manhattan, The City of New York and at least once
in an Authorized Newspaper in London (and, if required by
Section 3.6, at least once in an Authorized Newspaper in
Luxembourg) and (ii) to all Holders of Securities of such
series, unless in each case such defaults shall have been
cured before the mailing or publication of such notice (the
terms "default" and "defaults" for the purpose of this
Section being hereby defined to mean any event or condition
which is, or with notice or lapse of time or both would
become, an Event of Default); provided that, except in the
case of default in the payment of the principal of or
interest on any of the Securities of such series, or in the
payment of any sinking fund installment on such series, the
Trustee shall be protected in withholding such notice if and
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so long as a trust committee or Responsible Officers of the
Trustee in good faith determines that the withholding of such
notice is in the interests of the Securityholders of such
series.
SECTION 5.12 Right of Court to Require Filing of
Undertaking to Pay Costs. All parties to this Indenture
agree, and each Holder of any Security or Coupon by his
acceptance thereof shall be deemed to have agreed, that any
court may in its discretion require, in any suit for the
enforcement of any right or remedy under this Indenture or in
any suit against the Trustee for any action taken, suffered
or omitted by it as Trustee, the filing by any party litigant
in such suit of an undertaking to pay the costs of such suit,
and that such court may in its discretion assess reasonable
costs, including reasonable attorneys' fees and
disbursements, against any party litigant in such suit,
having due regard for the merits and good faith of the claims
or defenses made by such party litigant; but the provisions
of this Section shall not apply to any suit instituted by the
Trustee, to any suit instituted by any Securityholder or
group of Securityholders of any series holding in the
aggregate more than 10% in aggregate principal amount of the
Securities of such series then Outstanding, or to any suit
instituted by any Securityholder for the enforcement of the
payment of the principal of or interest on any Security on or
after the due date expressed in such Security or any date
fixed for redemption.
ARTICLE SIX
CONCERNING THE TRUSTEE
SECTION 6.1 Duties and Responsibilities of the
Trustee; During Default; Prior to Default. With respect to
the Holders of any series of Securities issued hereunder, the
Trustee, prior to the occurrence of an Event of Default with
respect to the Securities of a particular series and after
the curing or waiving of all Events of Default which may have
occurred with respect to such series, undertakes to perform
such duties and only such duties as are specifically set
forth in this Indenture. In case an Event of Default with
respect to the Securities of a series has occurred (which has
not been cured or waived) the Trustee shall exercise with
respect to such series of Securities such of the rights and
powers vested in it by this Indenture, and use the same
degree of care and skill in their exercise, as a prudent man
would exercise or use under the circumstances in the conduct
of his own affairs.
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No provision of this Indenture shall be construed
to relieve the Trustee from liability for its own negligent
action, its own negligent failure to act or its own wilful
misconduct, except that
(a) prior to the occurrence of an Event of Default
with respect to the Securities of a series and after the
curing or waiving of all such Events of Default with
respect to such series which may have occurred:
(i) the duties and obligations of the Trustee
with respect to the Securities of such series shall
be determined solely by the express provisions of
this Indenture, and the Trustee shall not be liable
except for the performance of such duties and
obligations as are specifically set forth in this
Indenture, and no implied covenants or obligations
shall be read into this Indenture against the
Trustee; and
(ii) in the absence of bad faith on the part
of the Trustee, the Trustee may conclusively rely,
as to the truth of the statements and the
correctness of the opinions expressed therein, upon
any statements, certificates or opinions furnished
to the Trustee and conforming to the requirements
of this Indenture; but in the case of any such
statements, certificates or opinions which by any
provision hereof are specifically required to be
furnished to the Trustee, the Trustee shall be
under a duty to examine the same to determine
whether or not they conform to the requirements of
this Indenture;
(b) the Trustee shall not be liable for any error
of judgment made in good faith by a Responsible Officer
or Responsible Officers of the Trustee, unless it shall
be proved that the Trustee was negligent in ascertaining
the pertinent facts; and
(c) the Trustee shall not be liable with respect
to any action taken or omitted to be taken by it in good
faith in accordance with the direction of the Holders
pursuant to Section 5.9 relating to the time, method and
place of conducting any proceeding for any remedy
available to the Trustee, or exercising any trust or
power conferred upon the Trustee, under this Indenture.
None of the provisions contained in this Indenture
shall require the Trustee to expend or risk its own funds or
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otherwise incur personal financial liability in the
performance of any of its duties or in the exercise of any of
its rights or powers, if there shall be reasonable ground for
believing that the repayment of such funds or adequate
indemnity against such liability is not reasonably assured to
it.
The provisions of this Section 6.1 are in
furtherance of and subject to Sections 315 and 316 of the
Trust Indenture Act of 1939.
SECTION 6.2 Certain Rights of the Trustee. In
furtherance of and subject to the Trust Indenture Act of
1939, and subject to Section 6.1:
(a) the Trustee may rely and shall be protected in
acting or refraining from acting upon any resolution,
Officer's Certificate, Opinion of Counsel, or any other
certificate, statement, instrument, opinion, report,
notice, request, consent, order, bond, debenture, note,
coupon, security or other paper or document believed by
it to be genuine and to have been signed or presented by
the proper party or parties;
(b) any request, direction, order or demand of the
Issuer mentioned herein shall be sufficiently evidenced
by an Officer's Certificate or Issuer Order (unless
other evidence in respect thereof be herein specifically
prescribed); and any resolution of the Board of
Directors may be evidenced to the Trustee by a copy
thereof certified by the secretary or an assistant
secretary of the Issuer;
(c) the Trustee may consult with counsel and any
advice or any Opinion of Counsel shall be full and
complete authorization and protection in respect of any
action taken, suffered or omitted to be taken by it
hereunder in good faith and in reliance thereon in
accordance with such advice or Opinion of Counsel;
(d) the Trustee shall be under no obligation to
exercise any of the trusts or powers vested in it by
this Indenture at the request, order or direction of any
of the Securityholders pursuant to the provisions of
this Indenture, unless such Securityholders shall have
offered to the Trustee reasonable security or indemnity
against the costs, expenses and liabilities which might
be incurred therein or thereby;
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(e) the Trustee shall not be liable for any action
taken or omitted by it in good faith and believed by it
to be authorized or within the discretion, rights or
powers conferred upon it by this Indenture;
(f) prior to the occurrence of an Event of Default
hereunder and after the curing or waiving of all Events
of Default, the Trustee shall not be bound to make any
investigation into the facts or matters stated in any
resolution, certificate, statement, instrument, opinion,
report, notice, request, consent, order, approval,
appraisal, bond, debenture, note, coupon, security, or
other paper or document unless requested in writing so
to do by the Holders of not less than a majority in
aggregate principal amount of the Securities of each
series affected then Outstanding, but during an Event of
Default or upon reasonable grounds prior to such Event
of Default the Trustee, in the furtherance of its duties
may make such further inquiries or investigation into
such related facts or matters, and, if the Trustee shall
determine to make such inquiry or investigation, it
shall be entitled to reasonable examination of the
books, records and premises of the Issuer, personally or
by agent or attorney upon reasonable notice to the
Issuer; provided that, if the payment within a
reasonable time to the Trustee of the costs, expenses or
liabilities likely to be incurred by it in the making of
such investigation is, in the opinion of the Trustee,
not reasonably assured to the Trustee by the security
afforded to it by the terms of this Indenture, the
Trustee may require reasonable indemnity against such
expenses or liabilities as a condition to proceeding;
the reasonable expenses of every such investigation
shall be paid by the Issuer or, if paid by the Trustee
or any predecessor Trustee, shall be repaid by the
Issuer upon demand;
(g) the Trustee may execute any of the trusts or
powers hereunder or perform any duties hereunder either
directly or by or through agents or attorneys not
regularly in its employ and the Trustee shall not be
responsible for any misconduct or negligence on the part
of any such agent or attorney appointed with due care by
it hereunder; and
(h) the Trustee shall not be deemed to have
knowledge of an Event of Default (other than a payment
default) until a Responsible Officer of the Trustee
shall have received written notice thereof stating that
an Event of Default has occurred.
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SECTION 6.3 Trustee Not Responsible for Recitals,
Disposition of Securities or Application of Proceeds Thereof.
The recitals contained herein and in the Securities, except
the Trustee's certificates of authentication, shall be taken
as the statements of the Issuer, and the Trustee assumes no
responsibility for the correctness of the same. The Trustee
makes no representation as to the validity or sufficiency of
this Indenture or of the Securities or Coupons. The Trustee
shall not be accountable for the use or application by the
Issuer of any of the Securities or of the proceeds thereof.
SECTION 6.4 Trustee and Agents May Hold Securities
or Coupons; Collections, etc. The Trustee or any agent of
the Issuer or the Trustee, in its individual or any other
capacity, may become the owner or pledgee of Securities or
Coupons with the same rights it would have if it were not the
Trustee or such agent and, may otherwise deal with the Issuer
and receive, collect, hold and retain collections from the
Issuer with the same rights it would have if it were not the
Trustee or such agent.
SECTION 6.5 Moneys Held by Trustee. Subject to
the provisions of Section 10.4 hereof, all moneys received by
the Trustee shall, until used or applied as herein provided,
be held in trust for the purposes for which they were
received, but need not be segregated from other funds except
to the extent required by mandatory provisions of law.
Neither the Trustee nor any agent of the Issuer or the
Trustee shall be under any liability for interest on any
moneys received by it hereunder.
SECTION 6.6 Compensation and Indemnification of
Trustee and Its Prior Claim. The Issuer covenants and agrees
to pay to the Trustee from time to time, and the Trustee
shall be entitled to, reasonable compensation (which shall
not be limited by any provision of law in regard to the
compensation of a trustee of an express trust) and the Issuer
covenants and agrees to pay or reimburse the Trustee and each
predecessor Trustee upon its request for all reasonable
expenses, disbursements and advances incurred or made by or
on behalf of it in accordance with any of the provisions of
this Indenture (including the reasonable compensation and the
expenses and disbursements of its counsel and of all agents
and other Persons not regularly in its employ) except any
such expense, disbursement or advance as may arise from its
negligence or bad faith. The Issuer also covenants to
indemnify the Trustee and each predecessor Trustee for, and
to hold it harmless against, any loss, liability or expense
incurred without negligence or bad faith on its part, arising
out of or in connection with the acceptance or administration
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of this Indenture or the trusts hereunder and its duties
hereunder, including the costs and expenses of defending
itself against or investigating any claim or liability in the
premises, except to the extent such loss, liability or
expense is due to the negligence or bad faith of the Trustee
or such predecessor Trustee. The obligations of the Issuer
under this Section to compensate and indemnify the Trustee
and each predecessor Trustee and to pay or reimburse the
Trustee and each predecessor Trustee for expenses,
disbursements and advances shall constitute additional
indebtedness hereunder and shall survive the removal or
resignation of the Trustee and the satisfaction and discharge
of this Indenture. Such additional indebtedness shall be a
senior claim to that of the Securities upon all property and
funds held or collected by the Trustee as such, except funds
held in trust for the benefit of the Holders of particular
Securities or Coupons, and the Securities are hereby
subordinated to such senior claim. When the Trustee incurs
expenses or renders services in connection with an Event of
Default specified in Section 5.1 or in connection with
Article Five hereof, the expenses (including the reasonable
fees and expenses of its counsel) and the compensation for
the service in connection therewith are intended to
constitute expenses of administration under any bankruptcy
law.
SECTION 6.7 Right of Trustee to Rely on Officer's
Certificate, etc. Subject to Sections 6.1 and 6.2, whenever
in the administration of the trusts of this Indenture the
Trustee shall deem it necessary or desirable that a matter be
proved or established prior to taking or suffering or
omitting any action hereunder, such matter (unless other
evidence in respect thereof be herein specifically
prescribed) may, in the absence of negligence or bad faith on
the part of the Trustee, be deemed to be conclusively proved
and established by an Officer's Certificate delivered to the
Trustee, and such certificate, in the absence of negligence
or bad faith on the part of the Trustee, shall be full
warrant to the Trustee for any action taken, suffered or
omitted by it under the provisions of this Indenture upon the
faith thereof.
SECTION 6.8 Persons Eligible for Appointment as
Trustee. The Trustee for each series of Securities hereunder
shall at all times be a corporation having a combined capital
and surplus of at least $10,000,000, and which is eligible in
accordance with the provisions of Section 310(a) of the Trust
Indenture Act of 1939. If such corporation publishes reports
of condition at least annually, pursuant to law or to the
requirements of a Federal, State or District of Columbia
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supervising or examining authority, then for the purposes of
this Section, the combined capital and surplus of such
corporation shall be deemed to be its combined capital and
surplus as set forth in its most recent report of condition
so published.
SECTION 6.9 Resignation and Removal; Appointment
of Successor Trustee. (a) The Trustee, or any trustee or
trustees hereafter appointed, may at any time resign with
respect to one or more or all series of Securities by giving
written notice of resignation to the Issuer and (i) if any
Unregistered Securities of a series affected are then
Outstanding, by giving notice of such resignation to the
Holders thereof, by publication at least once in an
Authorized Newspaper in the Borough of Manhattan, The City of
New York, and at least once in an Authorized Newspaper in
London (and, if required by Section 3.6, at least once in an
Authorized Newspaper in Luxembourg), (ii) if any Unregistered
Securities of a series affected are then Outstanding, by
mailing notice of such resignation to the Holders thereof who
have filed their names and addresses with the Trustee at such
addresses as were so furnished to the Trustee and (iii) by
mailing notice of such resignation to the Holders of then
Outstanding Registered Securities of each series affected at
their addresses as they shall appear on the registry books.
Upon receiving such notice of resignation, the Issuer shall
promptly appoint a successor trustee or trustees with respect
to the applicable series by written instrument in duplicate,
executed by authority of the Board of Directors, one copy of
which instrument shall be delivered to the resigning Trustee
and one copy to the successor trustee or trustees. If no
successor trustee shall have been so appointed and have
accepted appointment within 30 days after the mailing of such
notice of resignation, the resigning trustee may petition any
court of competent jurisdiction for the appointment of a
successor trustee, or any Securityholder who has been a bona
fide Holder of a Security or Securities of the applicable
series for at least six months may, subject to the provisions
of Section 5.12, on behalf of himself and all others
similarly situated, petition any such court for the
appointment of a successor trustee. Such court may
thereupon, after such notice, if any, as it may deem proper
and prescribe, appoint a successor trustee.
(b) In case at any time any of the following shall
occur:
(i) the Trustee shall fail to comply with the
provisions of Section 310(b) of the Trust Indenture Act
of 1939 with respect to any series of Securities after
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written request therefor by the Issuer or by any
Securityholder who has been a bona fide Holder of a
Security or Securities of such series for at least six
months; or
(ii) the Trustee shall cease to be eligible in
accordance with the provisions of Section 310(a) of the
Trust Indenture Act of 1939 and shall fail to resign
after written request therefor by the Issuer or by any
such Securityholder; or
(iii) the Trustee shall become incapable of acting
with respect to any series of Securities, or shall be
adjudged a bankrupt or insolvent, or a receiver or
liquidator of the Trustee or of its property shall be
appointed, or any public officer shall take charge or
control of the Trustee or of its property or affairs for
the purpose of rehabilitation, conservation or
liquidation;
then, in any such case, the Issuer may remove the Trustee
with respect to the applicable series of Securities and
appoint a successor trustee for such series by written
instrument, in duplicate, executed by order of the Board of
Directors, one copy of which instrument shall be delivered to
the Trustee so removed and one copy to the successor trustee,
or, subject to Section 315(e) of the Trust Indenture Act of
1939, any Securityholder who has been a bona fide Holder of a
Security or Securities of such series for at least six months
may on behalf of himself and all others similarly situated,
petition any court of competent jurisdiction for the removal
of the Trustee and the appointment of a successor trustee
with respect to such series. Such court may thereupon, after
such notice, if any, as it may deem proper and prescribe,
remove the Trustee and appoint a successor trustee.
(c) The Holders of a majority in aggregate
principal amount of the Securities of each series at the time
Outstanding may at any time remove the Trustee with respect
to Securities of such series and appoint a successor trustee
with respect to the Securities of such series by delivering
to the Trustee so removed, to the successor trustee so
appointed and to the Issuer the evidence provided for in
Section 7.1 of the action in that regard taken by the
Securityholders.
(d) Any resignation or removal of the Trustee with
respect to any series and any appointment of a successor
trustee with respect to such series pursuant to any of the
provisions of this Section 6.9 shall become effective upon
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acceptance of appointment by the successor trustee as
provided in Section 6.10.
(e) The Issuer shall give notice of each removal
of the Trustee (i) if any Unregistered Securities of a series
affected are then Outstanding, to the Holders thereof, by
publication of such notice at least once in an Authorized
Newspaper in the Borough of Manhattan, The City of New York
and at least once in an Authorized Newspaper in London (and,
if required by Section 3.6, at least once in an Authorized
Newspaper in Luxembourg), (ii) if any Unregistered Securities
of a series affected are then Outstanding, to the Holders
thereof who have filed their names and addresses with the
Trustee pursuant to Section 4.4(c)(ii), by mailing such
notice to such Holders at such addresses as were so furnished
to the Trustee (and the Trustee shall make such information
available to the Issuer for such purpose) and (iii) to the
Holders of Registered Securities of each series affected, by
mailing such notice to such Holders at their addresses as
they shall appear on the registry books.
SECTION 6.10 Acceptance of Appointment by
Successor Trustee. Any successor Trustee appointed as
provided in Section 6.9 shall execute and deliver to the
Issuer and to its predecessor trustee an instrument accepting
such appointment hereunder, and thereupon the resignation or
removal of the predecessor trustee with respect to all or any
applicable series shall become effective and such successor
Trustee, without any further act, deed or conveyance, shall
become vested with all rights, powers, duties and obligations
with respect to such series of its predecessor hereunder,
with like effect as if originally named as Trustee for such
series hereunder; but, nevertheless, on the written request
of the Issuer or of the successor Trustee, upon payment of
its charges then unpaid, the Trustee ceasing to act shall,
subject to Section 10.4, pay over to the successor Trustee
all moneys at the time held by it hereunder and shall execute
and deliver an instrument transferring to such successor
Trustee all such rights, powers, duties and obligations.
Upon request of any such successor Trustee, the Issuer shall
execute any and all instruments in writing for more fully and
certainly vesting in and confirming to such successor Trustee
all such rights and powers. Any Trustee ceasing to act
shall, nevertheless, retain a prior claim upon all property
or funds held or collected by such Trustee to secure any
amounts then due it pursuant to the provisions of Section
6.6.
If a successor Trustee is appointed with respect to
the Securities of one or more (but not all) series, the
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Issuer, the predecessor trustee and each successor Trustee
with respect to the Securities of any applicable series shall
execute and deliver an indenture supplemental hereto which
shall contain such provisions as shall be deemed necessary or
desirable to confirm that all the rights, powers, trusts and
duties of the predecessor trustee with respect to the
Securities of any series as to which the predecessor trustee
is not retiring shall continue to be vested in the
predecessor trustee, and shall add to or change any of the
provisions of this Indenture as shall be necessary to provide
for or facilitate the administration of the trusts hereunder
by more than one Trustee, it being understood that nothing
herein or in such supplemental indenture shall constitute
such Trustees co-trustees of the same trust and that each
such Trustee shall be Trustee of a trust or trusts under
separate indentures.
Upon acceptance of appointment by any successor
Trustee as provided in this Section 6.10, the Issuer shall
give notice thereof (a) if any Unregistered Securities of a
series affected are then Outstanding, to the Holders thereof,
by publication of such notice at least once in an Authorized
Newspaper in the Borough of Manhattan, The City of New York
and at least once in an Authorized Newspaper in London (and,
if required by Section 3.6, at least once in an Authorized
Newspaper in Luxembourg), (b) if any Unregistered Securities
of a series affected are then Outstanding, to the Holders
thereof who have filed their names and addresses with the
Trustee, by mailing such notice to such Holders at such
addresses as were so furnished to the Trustee (and the
Trustee shall make such information available to the Issuer
for such purpose) and (c) to the Holders of Registered
Securities of each series affected, by mailing such notice to
such Holders at their addresses as they shall appear on the
registry books. Each such notice shall include the name of
the successor trustee and the address of its principal
corporate trust office. If the acceptance of appointment is
substantially contemporaneous with the resignation, then the
notice called for by the preceding sentence may be combined
with the notice called for by Section 6.9. If the Issuer
fails to give such notice within ten days after acceptance of
appointment by the successor trustee, the successor trustee
shall cause such notice to be given at the expense of the
Issuer.
SECTION 6.11 Merger, Conversion, Consolidation or
Succession to Business of Trustee. Any corporation into
which the Trustee may be merged or converted or with which it
may be consolidated, or any corporation resulting from any
merger, conversion or consolidation to which the Trustee
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shall be a party, or any corporation succeeding to the
corporate trust business of the Trustee, shall be the
successor of the Trustee hereunder; provided that such
corporation shall be eligible to so serve, without the
execution or filing of any paper or any further act on the
part of any of the parties hereto, anything herein to the
contrary notwithstanding.
In case at the time such successor to the Trustee
shall succeed to the trusts created by this Indenture any of
the Securities of any series shall have been authenticated
but not delivered, any such successor to the Trustee may
adopt the certificate of authentication of any predecessor
Trustee and deliver such Securities so authenticated; and, in
case at that time any of the Securities of any series shall
not have been authenticated, any successor to the Trustee may
authenticate such Securities either in the name of any
predecessor hereunder or in the name of the successor
Trustee; and in all such cases such certificate shall have
the full force which it is anywhere in the Securities of such
series or in this Indenture provided that the certificate of
the Trustee shall have; provided that the right to adopt the
certificate of authentication of any predecessor Trustee or
to authenticate Securities of any series in the name of any
predecessor Trustee shall apply only to its successor or
successors by merger, conversion or consolidation.
SECTION 6.12 Appointment of Authenticating Agent.
As long as any Securities of a series remain Outstanding, the
Trustee may, by an instrument in writing, appoint with the
approval of the Issuer an authenticating agent (the
"Authenticating Agent") which shall be authorized to act on
behalf of the Trustee to authenticate Securities, including
Securities issued upon exchange, registration of transfer,
partial redemption or pursuant to Section 2.9. Securities of
each such series authenticated by such Authenticating Agent
shall be entitled to the benefits of this Indenture and shall
be valid and obligatory for all purposes as if authenticated
by the Trustee. Whenever reference is made in this Indenture
to the authentication and delivery of Securities of any
series by the Trustee or to the Trustee's Certificate of
Authentication, such reference shall be deemed to include
authentication and delivery on behalf of the Trustee by an
Authenticating Agent for such series and a Certificate of
Authentication executed on behalf of the Trustee by such
Authenticating Agent. Such Authenticating Agent shall at all
times be a corporation organized and doing business under the
laws of the United States of America or of any State,
authorized under such laws to exercise corporate trust
powers, having a combined capital and surplus of at least
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$10,000,000 (determined as provided in Section 6.8 with
respect to the Trustee) and subject to supervision or
examination by Federal or State authority.
Any corporation into which any Authenticating Agent
may be merged or converted, or with which it may be
consolidated, or any corporation resulting from any merger,
conversion or consolidation to which any Authenticating Agent
shall be a party, or any corporation succeeding to the
corporate agency business of any Authenticating Agent, shall
continue to be the Authenticating Agent with respect to all
series of Securities for which it served as Authenticating
Agent without the execution or filing of any paper or any
further act on the part of the Trustee or such Authenticating
Agent. Any Authenticating Agent may at any time, and if it
shall cease to be eligible shall, resign by giving written
notice of resignation to the Trustee and to the Issuer. The
Trustee may at any time terminate the agency of an
Authenticating Agent by giving written notice thereof to such
Authenticating Agent and to the Issuer.
Upon receiving such a notice of resignation or upon
such a termination, or in case at any time any Authenticating
Agent shall cease to be eligible in accordance with the
provisions of this Section 6.12 with respect to one or more
series of Securities, the Trustee may appoint a successor
Authenticating Agent which shall be acceptable to the Issuer
and the Issuer shall provide notice of such appointment to
all Holders of Securities of such series in the manner and to
the extent provided in Section 11.4. Any successor
Authenticating Agent upon acceptance of its appointment
hereunder shall become vested with all rights, powers, duties
and responsibilities of its predecessor hereunder, with like
effect as if originally named as Authenticating Agent. The
Issuer agrees to pay to the Authenticating Agent for such
series from time to time reasonable compensation. The
Authenticating Agent for the Securities of any series shall
have no responsibility or liability for any action taken by
it as such at the direction of the Trustee.
Sections 6.2, 6.3, 6.4 and, as agent of the
Trustee, 7.3 shall be applicable to any Authenticating Agent.
ARTICLE SEVEN
CONCERNING THE SECURITYHOLDERS
SECTION 7.1 Evidence of Action Taken by
Securityholders. Any request, demand, authorization,
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direction, notice, consent, waiver or other action provided
by this Indenture to be given or taken by a specified
percentage in principal amount of the Securityholders of any
or all series may be embodied in and evidenced by one or more
instruments of substantially similar tenor signed by such
specified percentage of Securityholders in person or by agent
duly appointed in writing; and, except as herein otherwise
expressly provided, such action shall become effective when
such instrument or instruments are delivered to the Trustee.
Proof of execution of any instrument or of a writing
appointing any such agent shall be sufficient for any purpose
of this Indenture and (subject to Sections 6.1 and 6.2)
conclusive in favor of the Trustee and the Issuer, if made in
the manner provided in this Article.
SECTION 7.2 Proof of Execution of Instruments and
of Holding of Securities. Subject to Sections 6.1 and 6.2,
the execution of any instrument by a Securityholder or his
agent or proxy may be proved in the following manner:
(a) The fact and date of the execution by any
Holder or his agent or proxy of any instrument, or the
authority of such an agent or proxy to execute such an
instrument, may be proved by the certificate of any
notary public or other officer of any jurisdiction
authorized to take acknowledgments of deeds or
administer oaths that the person executing such
instruments acknowledged to him the execution thereof,
or by an affidavit of a witness to such execution sworn
to before any such notary or other such officer. Where
such execution is by or on behalf of any legal entity
other than an individual, such certificate or affidavit
shall also constitute sufficient proof of the authority
of the person executing the same. The fact of the
holding by any Holder of an Unregistered Security of any
series, and the identifying number of such Security and
the date of his holding the same, may be proved by the
production of such Security or by a certificate executed
by any trust company, bank, or recognized securities
dealer wherever situated satisfactory to the Trustee, if
such certificate shall be deemed by the Trustee to be
satisfactory. Each such certificate shall be dated and
shall state that on the date thereof a Security of such
series bearing a specified identifying number was
deposited with or exhibited to such trust company, bank,
or recognized securities dealer by the person named in
such certificate. Any such certificate may be issued in
respect of one or more Unregistered Securities of one or
more series specified therein. The holding by the
Person named in any such certificate of any Unregistered
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Securities of any series specified therein shall be
presumed to continue for a period of one year from the
date of such certificate unless at the time of any
determination of such holding (1) another certificate
bearing a later date issued in respect of the same
Securities shall be produced, or (2) the Security of
such series specified in such certificate shall be
produced by some other Person, or (3) the Security of
such series specified in such certificate shall have
ceased to be Outstanding. Subject to Sections 6.1 and
6.2, the fact and date of the execution of any such
instrument and the amount and numbers of Securities of
any series held by the Person so executing such
instrument and the amount and numbers of any Security or
Securities for such series may also be proven in
accordance with such reasonable rules and regulations as
may be prescribed by the Trustee for such series or in
any other manner which the Trustee for such series may
deem sufficient.
(b) In the case of Registered Securities, the
ownership of such Securities shall be proved by the
Security register or by a certificate of the Security
registrar.
SECTION 7.3 Holders to be Treated as Owners.
Prior to due presentment of a Security for registration of
transfer, the Issuer, the Trustee and any agent of the Issuer
or the Trustee may deem and treat the Person in whose name
any Security shall be registered upon the Security register
for such series as the absolute owner of such Security
(whether or not such Security shall be overdue and
notwithstanding any notation of ownership or other writing
thereon) for the purpose of receiving payment of or on
account of the principal of and, subject to the provisions of
this Indenture, interest on such Security and for all other
purposes; and neither the Issuer nor the Trustee nor any
agent of the Issuer or the Trustee shall be affected by any
notice to the contrary. The Issuer, the Trustee and any
agent of the Issuer or the Trustee may treat the Holder of
any Unregistered Security and the Holder of any Coupon as the
absolute owner of such Unregistered Security or Coupon
(whether or not such Unregistered Security or Coupon shall be
overdue) for the purpose of receiving payment thereof or on
account thereof and for all other purposes and neither the
Issuer, the Trustee, nor any agent of the Issuer or the
Trustee shall be affected by any notice to the contrary. All
such payments so made to any such Person, or upon his order,
shall be valid, and, to the extent of the sum or sums so
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paid, effectual to satisfy and discharge the liability for
moneys payable upon any such Unregistered Security or Coupon.
SECTION 7.4 Securities Owned by Issuer Deemed Not
Outstanding. In determining whether the Holders of the
requisite aggregate principal amount of Outstanding
Securities of any or all series have concurred in any
direction, consent or waiver under this Indenture, Securities
which are owned by the Issuer or any other obligor on the
Securities with respect to which such determination is being
made or by any Person directly or indirectly controlling or
controlled by or under direct or indirect common control with
the Issuer or any other obligor on the Securities with
respect to which such determination is being made shall be
disregarded and deemed not to be Outstanding for the purpose
of any such determination, except that for the purpose of
determining whether the Trustee shall be protected in relying
on any such direction, consent or waiver only Securities
which the Trustee knows are so owned shall be so disregarded.
Securities so owned which have been pledged in good faith may
be regarded as Outstanding if the pledgee establishes to the
satisfaction of the Trustee the pledgee's right so to act
with respect to such Securities and that the pledgee is not
the Issuer or any other obligor upon the Securities or any
Person directly or indirectly controlling or controlled by or
under direct or indirect common control with the Issuer or
any other obligor on the Securities. In case of a dispute as
to such right, the advice of counsel shall be full protection
in respect of any decision made by the Trustee in accordance
with such advice. Upon request of the Trustee, the Issuer
shall furnish to the Trustee promptly an Officer's
Certificate listing and identifying all Securities, if any,
known by the Issuer to be owned or held by or for the account
of any of the above-described Persons; and, subject to
Sections 6.1 and 6.2, the Trustee shall be entitled to accept
such Officer's Certificate as conclusive evidence of the
facts therein set forth and of the fact that all Securities
not listed therein are Outstanding for the purpose of any
such determination.
SECTION 7.5 Right of Revocation of Action Taken.
At any time prior to (but not after) the evidencing to the
Trustee, as provided in Section 7.1, of the taking of any
action by the Holders of the percentage in aggregate
principal amount of the Securities of any or all series, as
the case may be, specified in this Indenture in connection
with such action, any Holder of a Security the serial number
of which is shown by the evidence to be included among the
serial numbers of the Securities the Holders of which have
consented to such action may, by filing written notice at the
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Corporate Trust Office and upon proof of holding as provided
in this Article, revoke such action so far as concerns such
Security. Except as aforesaid any such action taken by the
Holder of any Security shall be conclusive and binding upon
such Holder and upon all future Holders and owners of such
Security and of any Securities issued in exchange or
substitution therefor or on registration of transfer thereof,
irrespective of whether or not any notation in regard thereto
is made upon any such Security. Any action taken by the
Holders of the percentage in aggregate principal amount of
the Securities of any or all series, as the case may be,
specified in this Indenture in connection with such action
shall be conclusively binding upon the Issuer, the Trustee
and the Holders of all the Securities affected by such
action.
SECTION 7.6 Record Date for Consents and Waivers.
The Issuer may, but shall not be obligated to, direct the
Trustee to establish a record date for the purpose of
determining the Persons entitled to (i) waive any past
default with respect to the Securities of such series in
accordance with Section 5.10 of the Indenture, (ii) consent
to any supplemental indenture in accordance with Section 8.2
or (iii) waive compliance with any term, condition or
provision of any covenant hereunder (if the Indenture should
expressly provide for such waiver). If a record date is
fixed, the Holders on such record date, or their duly
designated proxies, and any such Persons, shall be entitled
to waive any such past default, consent to any such
supplemental indenture or waive compliance with any such
term, condition or provision, whether or not such Holder
remains a Holder after such record date; provided that unless
such waiver or consent is obtained from the Holders, or duly
designated proxies, of the requisite principal amount of
Outstanding Securities of such series prior to the date which
is the 90th day after such record date, any such waiver or
consent previously given shall automatically and without
further action by any Holder be cancelled and of no further
effect.
ARTICLE EIGHT
SUPPLEMENTAL INDENTURES
SECTION 8.1 Supplemental Indentures Without
Consent of Securityholders. The Issuer, when authorized by a
resolution of its Board of Directors (which resolution may
provide general terms or parameters for such action and may
provide that the specific terms of such action may be
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determined in accordance with or pursuant to an Issuer
Order), and the Trustee may from time to time and at any time
enter into an indenture or indentures supplemental hereto for
one or more of the following purposes:
(a) to convey, transfer, assign, mortgage or
pledge to the Trustee as security for the Securities of
one or more series any property or assets;
(b) to evidence the succession of another
corporation to the Issuer, or successive successions,
and the assumption by the successor corporation of the
covenants, agreements and obligations of the Issuer
pursuant to Article Nine;
(c) to add to the covenants of the Issuer such
further covenants, restrictions, conditions or
provisions as the Issuer and the Trustee shall consider
to be for the protection of the Holders of Securities or
Coupons, and to make the occurrence, or the occurrence
and continuance, of a default in any such additional
covenants, restrictions, conditions or provisions an
Event of Default permitting the enforcement of all or
any of the several remedies provided in this Indenture
as herein set forth; provided that in respect of any
such additional covenant, restriction, condition or
provision such supplemental indenture may provide for a
particular period of grace after default (which period
may be shorter or longer than that allowed in the case
of other defaults) or may provide for an immediate
enforcement upon such an Event of Default or may limit
the remedies available to the Trustee upon such an Event
of Default or may limit the right of the Holders of a
majority in aggregate principal amount of the Securities
of such series to waive such an Event of Default;
(d) to cure any ambiguity or to correct or
supplement any provision contained herein or in any
supplemental indenture which may be defective or
inconsistent with any other provision contained herein
or in any supplemental indenture, or to make any other
provisions in regard to matters or questions arising
under this Indenture or any supplemental indenture as
the Issuer may deem necessary or desirable; provided
that no such action shall adversely affect the interests
of the Holders of the Securities or Coupons;
(e) to establish the form or terms of Securities
of any series or of the Coupons appertaining to such
Securities as permitted by Sections 2.1 and 2.3; and
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(f) to evidence and provide for the acceptance of
appointment hereunder by a successor trustee with
respect to the Securities of one or more series and to
add to or change any of the provisions of this Indenture
as shall be necessary to provide for or facilitate the
administration of the trusts hereunder by more than one
trustee, pursuant to the requirements of Section 6.10.
The Trustee is hereby authorized to join with the
Issuer in the execution of any such supplemental indenture,
to make any further appropriate agreements and stipulations
which may be therein contained and to accept the conveyance,
transfer, assignment, mortgage or pledge of any property
thereunder, but the Trustee shall not be obligated to enter
into any such supplemental indenture which affects the
Trustee's own rights, duties or immunities under this
Indenture or otherwise.
Any supplemental indenture authorized by the
provisions of this Section may be executed without the
consent of the Holders of any of the Securities at the time
Outstanding, notwithstanding any of the provisions of Section
8.2.
SECTION 8.2 Supplemental Indentures With Consent
of Securityholders. With the consent (evidenced as provided
in Article Seven) of the Holders of not less than a majority
in aggregate principal amount of the Securities at the time
Outstanding of any series affected by such supplemental
indenture, the Issuer, when authorized by a resolution of its
Board of Directors (which resolution may provide general
terms or parameters for such action and may provide that the
specific terms of such action may be determined in accordance
with or pursuant to an Issuer Order), and the Trustee may,
from time to time and at any time, enter into an indenture or
indentures supplemental hereto (which shall conform to the
provisions of the Trust Indenture Act of 1939 as in force at
the date of execution thereof) for the purpose of adding any
provisions to or changing in any manner or eliminating any of
the provisions of this Indenture or of any supplemental
indenture or of modifying in any manner the rights of the
Holders of the Securities of such series or of the Coupons
appertaining to such Securities; provided that no such
supplemental indenture shall (a) change the final maturity of
any Security, or reduce the principal amount thereof, or
reduce the rate or extend the time of payment of interest
thereon, or reduce any amount payable on redemption or
repayment thereof (or the time at which any such redemption
may be made), or make the principal thereof (including any
amount in respect of original issue discount), or interest
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thereon payable in any coin or currency other than that
provided in the Securities and Coupons or in accordance with
the terms thereof, or reduce the amount of the principal of
an Original Issue Discount Security that would be due and
payable upon an acceleration of the maturity thereof pursuant
to Section 5.1 or the amount thereof provable in bankruptcy
pursuant to Section 5.2, or alter the provisions of Section
11.11 or impair or affect the right of any Securityholder to
institute suit for the payment thereof, in each case without
the consent of the Holder of each Security so affected;
provided that no consent of any Holder of any Security shall
be necessary under this Section 8.2 to permit the Trustee and
the Issuer to execute supplemental indentures pursuant to
Section 8.1(e) of this Indenture, or (b) reduce the aforesaid
percentage of Securities of any series, the consent of the
Holders of which is required for any such supplemental
indenture, without the consent of the Holders of each
Security so affected, or (c) reduce the percentage of
Securities of any series necessary to consent to waive any
past default under this Indenture to less than a majority,
without the consent of the Holders of each Security so
affected, or (d) modify any of the provisions of this Section
8.2, except to increase any such percentage or to provide
that certain other provisions of this Indenture cannot be
modified or waived without the consent of the Holder of each
Security affected thereby; provided that this clause shall
not be deemed to require the consent of any Holder with
respect to changes in the references to "the Trustee" and
concomitant changes in this Section, or the deletion of this
proviso, in accordance with the requirements of Sections 6.9,
6.10 and 6.11.
A supplemental indenture which changes or
eliminates any covenant or other provision of this Indenture
which has expressly been included solely for the benefit of
one or more particular series of Securities, or which
modifies the rights of Holders of Securities of such series,
or of Coupons appertaining to such Securities, with respect
to such covenant or provision, shall be deemed not to affect
the rights under this Indenture of the Holders of Securities
of any other series or of the Coupons appertaining to such
Securities.
Upon the request of the Issuer, accompanied by a
copy of a resolution of the Board of Directors (which
resolution may provide general terms or parameters for such
action and may provide that the specific terms of such action
may be determined in accordance with or pursuant to an Issuer
Order) certified by the secretary or an assistant secretary
of the Issuer authorizing the execution of any such
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supplemental indenture, and upon the filing with the Trustee
of evidence of the consent of the Holders of the Securities
as aforesaid and other documents, if any, required by Section
7.1, the Trustee shall join with the Issuer in the execution
of such supplemental indenture unless such supplemental
indenture affects the Trustee's own rights, duties or
immunities under this Indenture or otherwise, in which case
the Trustee may in its discretion, but shall not be obligated
to, enter into such supplemental indenture.
It shall not be necessary for the consent of the
Securityholders under this Section to approve the particular
form of any proposed supplemental indenture, but it shall be
sufficient if such consent shall approve the substance
thereof.
Promptly after the execution by the Issuer and the
Trustee of any supplemental indenture pursuant to the
provisions of this Section, the Trustee shall give notice
thereof (i) to the Holders of then Outstanding Registered
Securities of each series affected thereby, by mailing a
notice thereof by first-class mail to such Holders at their
addresses as they shall appear on the Security register, (ii)
if any Unregistered Securities of a series affected thereby
are then Outstanding, to the Holders thereof who have filed
their names and addresses with the Trustee, by mailing a
notice thereof by first-class mail to such Holders at such
addresses as were so furnished to the Trustee and (iii) if
any Unregistered Securities of a series affected thereby are
then Outstanding, to all Holders thereof, by publication of a
notice thereof at least once in an Authorized Newspaper in
the Borough of Manhattan, The City of New York and at least
once in an Authorized Newspaper in London (and, if required
by Section 3.6, at least once in an Authorized Newspaper in
Luxembourg), and in each case such notice shall set forth in
general terms the substance of such supplemental indenture.
Any failure of the Issuer to give such notice, or any defect
therein, shall not, however, in any way impair or affect the
validity of any such supplemental indenture.
SECTION 8.3 Effect of Supplemental Indenture.
Upon the execution of any supplemental indenture pursuant to
the provisions hereof, this Indenture shall be and be deemed
to be modified and amended in accordance therewith and the
respective rights, limitations of rights, obligations, duties
and immunities under this Indenture of the Trustee, the
Issuer and the Holders of Securities of each series affected
thereby shall thereafter be determined, exercised and
enforced hereunder subject in all respects to such
modifications and amendments, and all the terms and
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conditions of any such supplemental indenture shall be and be
deemed to be part of the terms and conditions of this
Indenture for any and all purposes.
SECTION 8.4 Documents to Be Given to Trustee. The
Trustee, subject to the provisions of Sections 6.1 and 6.2,
shall be entitled to receive an Officer's Certificate and an
Opinion of Counsel as conclusive evidence that any
supplemental indenture executed pursuant to this Article
Eight complies with the applicable provisions of this
Indenture.
SECTION 8.5 Notation on Securities in Respect of
Supplemental Indentures. Securities of any series
authenticated and delivered after the execution of any
supplemental indenture pursuant to the provisions of this
Article may bear a notation in form approved by the Trustee
for such series as to any matter provided for by such
supplemental indenture or as to any action taken by
Securityholders. If the Issuer or the Trustee shall so
determine, new Securities of any series so modified as to
conform, in the opinion of the Trustee and the Issuer, to any
modification of this Indenture contained in any such
supplemental indenture may be prepared by the Issuer,
authenticated by the Trustee and delivered in exchange for
the Securities of such series then Outstanding.
ARTICLE NINE
CONSOLIDATION, MERGER, SALE OR CONVEYANCE
SECTION 9.1 Covenant Not to Merge, Consolidate,
Sell or Convey Property Except Under Certain Conditions. The
Issuer covenants that it will not merge with or into or
consolidate with any corporation, partnership, or other
entity or sell, lease or convey all or substantially all of
its assets to any other Person, unless (i) either the Issuer
shall be the continuing corporation, or the successor entity
or the Person which acquires by sale, lease or conveyance
substantially all the assets of the Issuer (if other than the
Issuer) shall be a corporation or partnership organized under
the laws of the United States of America or any State thereof
or the District of Columbia and shall expressly assume all
obligations of the Issuer under this Indenture and the
Securities, including the due and punctual payment of the
principal of and interest on all the Securities and Coupons,
if any, according to their tenor, and the due and punctual
performance and observance of all of the covenants and
conditions of this Indenture to be performed or observed by
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the Issuer, by supplemental indenture in form satisfactory to
the Trustee, executed and delivered to the Trustee by such
entity, and (ii) the Issuer, such person or such successor
entity, as the case may be, shall not, immediately after such
merger or consolidation, or such sale, lease or conveyance,
be in default in the performance of any such covenant or
condition and, immediately after giving effect to such
transaction, no Event of Default, and no event which, after
notice or lapse of time or both, would become an Event of
Default, shall have happened and be continuing.
SECTION 9.2 Successor Corporation Substituted. In
case of any such consolidation, merger, sale, lease or
conveyance, and following such an assumption by the successor
corporation such successor corporation shall succeed to and
be substituted for the Issuer, with the same effect as if it
had been named herein. Such successor corporation may cause
to be signed, and may issue either in its own name or in the
name of the Issuer prior to such succession any or all of the
Securities issuable hereunder which together with any Coupons
appertaining thereto theretofore shall not have been signed
by the Issuer and delivered to the Trustee; and, upon the
order of such successor corporation, instead of the Issuer,
and subject to all the terms, conditions and limitations in
this Indenture prescribed, the Trustee shall authenticate and
shall deliver any Securities together with any Coupons
appertaining thereto which previously shall have been signed
and delivered by the officers of the Issuer to the Trustee
for authentication, and any Securities which such successor
entity thereafter shall cause to be signed and delivered to
the Trustee for that purpose. All of the Securities so
issued together with any Coupons appertaining thereto shall
in all respects have the same legal rank and benefit under
this Indenture as the Securities theretofore or thereafter
issued in accordance with the terms of this Indenture as
though all of such Securities had been issued at the date of
the execution hereof.
In case of any such consolidation, merger, sale,
lease or conveyance such changes in phrasing and form (but
not in substance) may be made in the Securities and Coupons
thereafter to be issued as may be appropriate.
In the event of any such sale or conveyance (other
than a conveyance by way of lease) and the assumption of the
obligations and covenants under the Securities and this
Indenture in accordance with Section 9.1 the Issuer shall be
discharged from all obligations and covenants under this
Indenture and the Securities and may be liquidated and
dissolved.
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SECTION 9.3 Opinion of Counsel Delivered to
Trustee. The Trustee, subject to the provisions of Sections
6.1 and 6.2, may receive an Opinion of Counsel as conclusive
evidence that any such consolidation, merger, sale, lease or
conveyance, and any such assumption, and any such liquidation
or dissolution, complies with the applicable provisions of
this Indenture.
ARTICLE TEN
SATISFACTION AND DISCHARGE OF INDENTURE;
UNCLAIMED MONEYS
SECTION 10.1 Satisfaction and Discharge of
Indenture. (A) The following provisions shall apply to the
Securities of each series unless specifically otherwise
provided in a Board Resolution, Officer's Certificate or
indenture supplemental hereto pursuant to Section 2.3. If at
any time (a) the Issuer shall have paid or caused to be paid
the principal of and interest on all the Securities of any
series Outstanding hereunder and all unmatured Coupons
appertaining thereto (other than Securities of such series
and Coupons appertaining thereto which have been destroyed,
lost or stolen and which have been replaced or paid as
provided in Section 2.9) as and when the same shall have
become due and payable, or (b) the Issuer shall have
delivered to the Trustee for cancellation all Securities of
any series theretofore authenticated and all unmatured
Coupons appertaining thereto (other than any Securities of
such series and Coupons appertaining thereto which shall have
been destroyed, lost or stolen and which shall have been
replaced or paid as provided in Section 2.9) or (c) in the
case of any series of Securities where the exact amount
(including the currency of payment) of principal of and
interest due on which can be determined at the time of making
the deposit referred to in clause (ii) below, (i) (x) all the
Securities of such series and all unmatured Coupons
appertaining thereto not theretofore delivered to the Trustee
for cancellation shall have become due and payable, or (y)
are by their terms to become due and payable within one year
or are to be called for redemption within one year under
arrangements satisfactory to the Trustee for the giving of
notice of redemption, and (ii) the Issuer shall have
irrevocably deposited or caused to be deposited with the
Trustee as trust funds the entire amount in cash (other than
moneys repaid by the Trustee or any paying agent to the
Issuer in accordance with Section 10.4) or, in the case of
any series of Securities the payments on which may only be
made in Dollars, direct obligations of the United States of
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America, backed by its full faith and credit ("U.S.
Government Obligations"), maturing as to principal and
interest at such times and in such amounts as will insure the
availability of cash, or a combination thereof, sufficient in
the opinion of a nationally recognized firm of independent
public accountants expressed in a written certification
thereof delivered to the Trustee, to pay (aa) the principal
and interest on all Securities of such series and Coupons
appertaining thereto on each date that such principal or
interest is due and payable and (bb) any mandatory sinking
fund payments on the dates on which such payments are due and
payable in accordance with the terms of the Indenture and the
Securities of such series; and if, in any such case, the
Issuer shall also pay or cause to be paid all other sums
payable hereunder by the Issuer, then this Indenture with
respect to the Securities of such series and Coupons
appertaining thereto shall cease to be of further effect
(except as to (i) rights of registration or transfer and the
Issuer's right of optional redemption, if any, (ii)
substitution of mutilated, defaced, destroyed, lost or stolen
Securities or Coupons, (iii) rights of Holders of Securities
and Coupons appertaining thereto to receive payments of
principal thereof and interest thereon, upon the original
stated due dates therefor (but not upon acceleration), and
remaining rights of the Holders to receive mandatory sinking
fund payments, if any, (iv) the rights, obligations, duties
and immunities of the Trustee hereunder including any right
to compensation and indemnification under Section 6.6, (v)
the rights of the Holders of Securities of such series and
Coupons appertaining thereto as beneficiaries hereof with
respect to the property so deposited with the Trustee payable
to all or any of them, and (vi) the obligations of the Issuer
under Section 3.2) and the Trustee, on demand of the Issuer
accompanied by an Officer's Certificate and an Opinion of
Counsel, each stating that all conditions precedent provided
for relating to the satisfaction and discharge contemplated
by this provision have been complied with, and at the cost
and expense of the Issuer, shall execute proper instruments
acknowledging such satisfaction of and discharging this
Indenture with respect to the Securities of such series and
Coupons appertaining thereto; provided that the rights of
Holders of the Securities and Coupons to receive amounts in
respect of principal of and interest on the Securities and
Coupons held by them shall not be delayed longer than
required by then-applicable mandatory rules or policies of
any securities exchange upon which the Securities are listed.
The Issuer agrees to reimburse the Trustee for any costs or
expenses (including the reasonable fees and expenses of
counsel) thereafter reasonably and properly incurred and to
compensate the Trustee for any services thereafter reasonably
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and properly rendered by the Trustee in connection with this
Indenture or the Securities of such series.
(B) The following provisions shall apply to the
Securities of each series unless specifically otherwise
provided in a Board Resolution, Officer's Certificate or
indenture supplemental hereto provided pursuant to Section
2.3. In addition to discharge of the Indenture pursuant to
the next preceding paragraph, in the case of any series of
Securities the exact amounts (including the currency of
payment) of principal of and interest due on which can be
determined at the time of making the deposit referred to in
clause (a) below, the Issuer shall be deemed to have paid and
discharged the entire indebtedness on all the Securities of
such a series and the Coupons appertaining thereto on the
91st day after the date of the deposit referred to in
subparagraph (a) below, and the provisions of this Indenture
with respect to the Securities of such series and Coupons
appertaining thereto shall no longer be in effect (except as
to (i) rights of registration of transfer and exchange of
Securities of such series and of Coupons appertaining thereto
and the Issuer's right of optional redemption, if any, (ii)
substitution of mutilated, defaced, destroyed, lost or stolen
Securities or Coupons, (iii) rights of Holders of Securities
and Coupons appertaining thereto to receive payments of
principal thereof and interest thereon, upon the original
stated due dates therefor (but not upon acceleration), and
remaining rights of the Holders to receive mandatory sinking
fund payments, if any, (iv) the rights, obligations, duties
and immunities of the Trustee hereunder, (v) the rights of
the Holders of Securities of such series and Coupons
appertaining thereto as beneficiaries hereof with respect to
the property so deposited with the Trustee payable to all or
any of them and (vi) the obligations of the Issuer under
Section 3.2) and the Trustee, at the expense of the Issuer,
shall at the Issuer's request, execute proper instruments
acknowledging the same, if
(a) with reference to this provision the Issuer
has irrevocably deposited or caused to be irrevocably
deposited with the Trustee as trust funds in trust,
specifically pledged as security for, and dedicated
solely to, the benefit of the Holders of the Securities
of such series and Coupons appertaining thereto (i) cash
in an amount, or (ii) in the case of any series of
Securities the payments on which may only be made in
Dollars, U.S. Government Obligations, maturing as to
principal and interest at such times and in such amounts
as will insure the availability of cash or (iii) a
combination thereof, sufficient, in the opinion of a
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nationally recognized firm of independent public
accountants expressed in a written certification thereof
delivered to the Trustee, to pay (A) the principal and
interest on all Securities of such series and Coupons
appertaining thereto on each date that such principal or
interest is due and payable and (B) any mandatory
sinking fund payments on the dates on which such
payments are due and payable in accordance with the
terms of the Indenture and the Securities of such
series;
(b) such deposit will not result in a breach or
violation of, or constitute a default under, any
agreement or instrument to which the Issuer is a party
or by which it is bound;
(c) the Issuer has delivered to the Trustee an
Opinion of Counsel based on the fact that (x) the Issuer
has received from, or there has been published by, the
Internal Revenue Service a ruling or (y) since the date
hereof, there has been a change in the applicable
Federal income tax law, in either case to the effect
that, and such opinion shall confirm that, the Holders
of the Securities of such series and Coupons
appertaining thereto will not recognize income, gain or
loss for Federal income tax purposes as a result of such
deposit, defeasance and discharge and will be subject to
Federal income tax on the same amount and in the same
manner and at the same times, as would have been the
case if such deposit, defeasance and discharge had not
occurred; and
(d) the Issuer has delivered to the Trustee an
Officer's Certificate and an Opinion of Counsel, each
stating that all conditions precedent provided for
relating to the defeasance contemplated by this
provision have been complied with.
SECTION 10.2 Application by Trustee of Funds
Deposited for Payment of Securities. Subject to Section
10.4, all moneys and securities deposited with the Trustee
pursuant to Section 10.1 shall be held in trust and applied
by it to the payment, either directly or through any paying
agent (including the Issuer acting as its own paying agent),
to the Holders of the particular Securities of such series
and of Coupons appertaining thereto for the payment or
redemption of which such moneys or securities have been
deposited with the Trustee, of all sums due and to become due
thereon for principal and interest; but such moneys or
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securities need not be segregated from other funds except to
the extent required by law.
SECTION 10.3 Repayment of Moneys Held by Paying
Agent. In connection with the satisfaction and discharge of
this Indenture with respect to Securities of any series, all
moneys then held by any paying agent under the provisions of
this Indenture with respect to such series of Securities
shall, upon demand of the Issuer, be repaid to it or paid to
the Trustee and thereupon such paying agent shall be released
from all further liability with respect to such moneys.
SECTION 10.4 Return of Moneys Held by Trustee and
Paying Agent Unclaimed for One Year. Any moneys or U.S.
Government Obligations deposited with or paid to the Trustee
or any paying agent for the payment of the principal of or
interest on any Security of any series or Coupons attached
thereto and not applied but remaining unclaimed for one year
after the date upon which such principal or interest shall
have become due and payable, shall, upon the written request
of the Issuer and unless otherwise required by mandatory
provisions of applicable escheat or abandoned or unclaimed
property law, be repaid to the Issuer by the Trustee for such
series or such paying agent, and the Holder of the Securities
of such series and of any Coupons appertaining thereto shall,
unless otherwise required by mandatory provisions of
applicable escheat or abandoned or unclaimed property laws,
thereafter look only to the Issuer for any payment which such
Holder may be entitled to collect, and all liability of the
Trustee or any paying agent with respect to such moneys shall
thereupon cease; provided that the Trustee or such paying
agent, before being required to make any such repayment with
respect to moneys deposited with it for any payment (a) in
respect of Registered Securities of any series, shall at the
expense of the Issuer, mail by first-class mail to Holders of
such Securities at their addresses as they shall appear on
the Security register, (b) in respect of Unregistered
Securities of any series the Holders of which have filed
their names and addresses with the Trustee, shall at the
expense of the Issuer, mail by first-class mail to such
Holders at such addresses, and (c) in respect of Unregistered
Securities of any series, shall at the expense of the Issuer
cause to be published once, in an Authorized Newspaper in the
Borough of Manhattan, The City of New York and once in an
Authorized Newspaper in London (and if required by Section
3.6, once in an Authorized Newspaper in Luxembourg), notice,
that such moneys remain and that, after a date specified
therein, which shall not be less than thirty days from the
date of such mailing or publication, any unclaimed balance of
such money then remaining will be repaid to the Issuer.
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SECTION 10.5 Indemnity for U.S. Government
Obligations. The Issuer shall pay and indemnify the Trustee
against any tax, fee or other charge imposed on or assessed
against the U.S. Government Obligations deposited pursuant to
Section 10.1 or the principal or interest received in respect
of such obligations.
ARTICLE ELEVEN
MISCELLANEOUS PROVISIONS
SECTION 11.1 Partners, Incorporators,
Stockholders, Employees, Officers and Directors of Issuer
Exempt from Individual Liability. No recourse under or upon
any obligation, covenant or agreement contained in this
Indenture, or in any Security, or because of any indebtedness
evidenced thereby, shall be had against any incorporator, as
such or against any past, present or future stockholder,
employee, officer or director, as such, of the Issuer, of any
partner of the Issuer or of any successor, either directly or
through the Issuer or any successor, under any rule of law,
statute or constitutional provision or by the enforcement of
any assessment or by any legal or equitable proceeding or
otherwise, all such liability being expressly waived and
released by the acceptance of the Securities and the Coupons
appertaining thereto by the Holders thereof and as part of
the consideration for the issue of the Securities and the
Coupons appertaining thereto.
SECTION 11.2 Provisions of Indenture for the Sole
Benefit of Parties and Holders of Securities and Coupons.
Nothing in this Indenture, in the Securities or in the
Coupons appertaining thereto, expressed or implied, shall
give or be construed to give to any Person, firm or
corporation, other than the parties hereto and their
successors and the Holders of the Securities or Coupons, if
any, any legal or equitable right, remedy or claim under this
Indenture or under any covenant or provision herein
contained, all such covenants and provisions being for the
sole benefit of the parties hereto and their successors and
the Holders of the Securities or Coupons, if any.
SECTION 11.3 Successors and Assigns of Issuer
Bound by Indenture. All the covenants, stipulations,
promises and agreements in this Indenture made by or on
behalf of the Issuer shall bind its successors and assigns,
whether so expressed or not.
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SECTION 11.4 Notices and Demands on Issuer,
Trustee and Holders of Securities and Coupons. Any notice or
demand which by any provision of this Indenture is required
or permitted to be given or served by the Trustee or by the
Holders of Securities or Coupons to or on the Issuer may be
given or served by being deposited postage prepaid, first-
class mail (except as otherwise specifically provided herein)
addressed (until another address of the Issuer is filed by
the Issuer with the Trustee) to American Stores Company, 709
East South Temple, Salt Lake City, Utah 84102, Attention:
Treasurer. Any notice, direction, request or demand by the
Issuer or any Holder of Securities or Coupons to or upon the
Trustee shall be deemed to have been sufficiently given or
served by being deposited postage prepaid, first-class mail
(except as otherwise specifically provided herein) addressed
(until another address of the Trustee is filed by the Trustee
with the Issuer) to The First National Bank of Chicago, One
First National Bank Plaza, Suite 0126, Chicago, Illinois
60670-0126, Attention: Corporate Trust Administration.
Where this Indenture provides for notice to Holders
of Registered Securities, such notice shall be sufficiently
given (unless otherwise herein expressly provided) if in
writing and mailed, first-class postage prepaid, to each
Holder entitled thereto, at his last address as it appears in
the Security register. Where this Indenture provides for
notice to Holders of Unregistered Securities, (i) in respect
of such Holders who have filed their names and addresses with
the Trustee, such notice shall be sufficiently given (unless
otherwise herein expressly provided) if in writing and
mailed, first-class postage prepaid, to each Holder entitled
thereto, at his last address as it appears in such filing and
(ii) in respect of all other Holders of Unregistered
Securities, such notice shall be sufficiently given (unless
otherwise herein expressly provided) if published at least
once in an Authorized Newspaper in the Borough of Manhattan,
the City of New York and at least once in an Authorized
Newspaper in London (and, if required by Section 3.6, at
least once in an Authorized Newspaper in Luxembourg). In any
case where notice to such Holders is given by mail, neither
the failure to mail such notice, nor any defect in any notice
so mailed, to any particular Holder shall affect the
sufficiency of such notice with respect to other Holders.
Where this Indenture provides for notice in any manner, such
notice may be waived in writing by the Person entitled to
receive such notice, either before or after the event, and
such waiver shall be the equivalent of such notice. Waivers
of notice by Holders shall be filed with the Trustee, but
such filing shall not be a condition precedent to the
validity of any action taken in reliance upon such waiver.
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In case, by reason of the suspension of or
irregularities in regular mail service, it shall be
impracticable to mail notice to the Issuer when such notice
is required to be given pursuant to any provision of this
Indenture, then any manner of giving such notice as shall be
reasonably satisfactory to the Trustee shall be deemed to be
a sufficient giving of such notice.
SECTION 11.5 Officer's Certificates and Opinions
of Counsel; Statements to Be Contained Therein. Upon any
application or demand by the Issuer to the Trustee to take
any action under any of the provisions of this Indenture, the
Issuer shall furnish to the Trustee an Officer's Certificate
stating that all conditions precedent provided for in this
Indenture relating to the proposed action have been complied
with and an Opinion of Counsel stating that in the opinion of
such counsel all such conditions precedent have been complied
with, except that in the case of any such application or
demand as to which the furnishing of such documents is
specifically required by any provision of this Indenture
relating to such particular application or demand, no
additional certificate or opinion need be furnished.
Each certificate or opinion provided for in this
Indenture and delivered to the Trustee with respect to
compliance with a condition or covenant provided for in this
Indenture (other than certificates provided pursuant to
Section 3.5) shall include (a) a statement that the person
making such certificate or opinion has read such covenant or
condition, (b) a brief statement as to the nature and scope
of the examination or investigation upon which the statements
or opinions contained in such certificate or opinion are
based, (c) a statement that, in the opinion of such person,
he has made such examination or investigation as is necessary
to enable him to express an informed opinion as to whether or
not such covenant or condition has been complied with and (d)
a statement as to whether or not, in the opinion of such
person, such condition or covenant has been complied with.
Any certificate, statement or opinion of an officer
of the Issuer may be based, insofar as it relates to legal
matters, upon a certificate or opinion of or representations
by counsel, unless such officer knows that the certificate or
opinion or representations with respect to the matters upon
which his certificate, statement or opinion may be based as
aforesaid are erroneous, or in the exercise of reasonable
care should know that the same are erroneous. Any
certificate, statement or opinion of counsel may be based,
insofar as it relates to factual matters, information with
respect to which is in the possession of the Issuer, upon the
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certificate, statement or opinion of or representations by an
officer or officers of the Issuer, unless such counsel knows
that the certificate, statement or opinion or representations
with respect to the matters upon which his certificate,
statement or opinion may be based as aforesaid are erroneous,
or in the exercise of reasonable care should know that the
same are erroneous.
Any certificate, statement or opinion of an officer
of the Issuer or of counsel may be based, insofar as it
relates to accounting matters, upon a certificate or opinion
of or representations by an accountant or firm of accountants
in the employ of the Issuer, unless such officer or counsel,
as the case may be, knows that the certificate or opinion or
representations with respect to the accounting matters upon
which his certificate, statement or opinion may be based as
aforesaid are erroneous, or in the exercise of reasonable
care should know that the same are erroneous.
Any certificate or opinion of any independent firm
of public accountants filed with and directed to the Trustee
shall contain a statement that such firm is independent.
SECTION 11.6 Payments Due on Saturdays, Sundays
and Holidays. If the date of maturity of interest on or
principal of the Securities of any series or any coupons
appertaining thereto or the date fixed for redemption or
repayment of any such Security or Coupon shall not be a
Business Day, then payment of interest or principal need not
be made on such date, but may be made on the next succeeding
Business Day with the same force and effect as if made on the
date of maturity or the date fixed for redemption or
repayment, and, in the case of payment, no interest shall
accrue for the period after such date.
SECTION 11.7 Conflict of Any Provision of
Indenture with Trust Indenture Act of 1939. If and to the
extent that any provision of this Indenture limits, qualifies
or conflicts with another provision included in this
Indenture by operation of Sections 310 to 317, inclusive, of
the Trust Indenture Act of 1939 (an "incorporated
provision"), such incorporated provision shall control.
SECTION 11.8 New York Law to Govern. This
Indenture and each Security and Coupon shall be deemed to be
a contract under the laws of the State of New York, and for
all purposes shall be construed in accordance with the laws
of such State, except as may otherwise be required by
mandatory provisions of law.
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SECTION 11.9 Counterparts. This Indenture may be
executed in any number of counterparts, each of which shall
be an original; but such counterparts shall together
constitute but one and the same instrument.
SECTION 11.10 Effect of Headings. The Article and
Section headings herein and the Table of Contents are for
convenience only and shall not affect the construction
hereof.
SECTION 11.11 Securities in a Foreign Currency or
in ECUs. Unless otherwise specified in an Officer's
Certificate delivered pursuant to Section 2.3 of this
Indenture with respect to a particular series of Securities,
whenever for purposes of this Indenture any action may be
taken by the Holders of a specified percentage in aggregate
principal amount of Securities of all series or all series
affected by a particular action at the time Outstanding and,
at such time, there are Outstanding Securities of any series
which are denominated in a coin or currency other than
Dollars (including ECUs), then the principal amount of
Securities of such series which shall be deemed to be
Outstanding for the purpose of taking such action shall be
that amount of Dollars that could be obtained for such amount
at the Market Exchange Rate as of the date of original
issuance of such Securities. The provisions of this
paragraph shall apply in determining the equivalent principal
amount in respect of Securities of a series denominated in a
currency other than Dollars in connection with any action
taken by Holders of Securities pursuant to the terms of this
Indenture.
SECTION 11.12 Judgment Currency. The Issuer
agrees, except as provided in Section 2.12 or by applicable
law, that (a) if for the purpose of obtaining judgment in any
court it is necessary to convert the sum due in respect of
the principal of or interest on the Securities of any series
(the "Required Currency") into a currency in which a judgment
will be rendered (the "Judgment Currency"), the rate of
exchange used shall be the rate at which in accordance with
normal banking procedures the Trustee could purchase in The
City of New York the Required Currency with the Judgment
Currency on the day on which final unappealable judgment is
entered, unless such day is not a New York Banking Day, then,
to the extent permitted by applicable law, the rate of
exchange used shall be the rate at which in accordance with
normal banking procedures the Trustee could purchase in The
City of New York the Required Currency with the Judgment
Currency on the New York Banking Day preceding the day on
which final unappealable judgment is entered and (b) its
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obligations under this Indenture to make payments in the
Required Currency (i) shall not be discharged or satisfied by
any tender, or any recovery pursuant to any judgment (whether
or not entered in accordance with subsection (a)), in any
currency other than the Required Currency, except to the
extent that such tender or recovery shall result in the
actual receipt, by the payee, of the full amount of the
Required Currency expressed to be payable in respect of such
payments, (ii) shall be enforceable as an alternative or
additional cause of action for the purpose of recovering in
the Required Currency the amount, if any, by which such
actual receipt shall fall short of the full amount of the
Required Currency so expressed to be payable and (iii) shall
not be affected by judgment being obtained for any other sum
due under this Indenture. For purposes of the foregoing,
"New York Banking Day" means any day except a Saturday,
Sunday or a legal holiday in The City of New York or a day on
which banking institutions in The City of New York are
authorized or required by law or executive order to close.
SECTION 11.13 Calculation of Original Issue
Discount; Calculation of Foreign Currency Equivalents;
Certain Information Concerning Tax Reporting. As soon as
practicable after the issuance of any Original Issue Discount
Security, the Issuer shall furnish to the Trustee and the
paying agent (if any) appointed pursuant to Section 3.4 an
Officer's Certificate setting forth (i) the amount of the
original issue discount on such Security expressed as a U.S.
dollar amount per $1,000 of principal amount of such
Security, (ii) the yield to maturity for such Security and
(iii) a table of the amounts that would be due and payable
upon a declaration of acceleration of the Maturity of such
Security for each day from the date of original issuance of
such Security to the Stated Maturity of such Security.
As soon as practicable after the issuance of any
Security denominated in any currency or currencies, including
composite currencies, other than U.S. dollars, the Issuer
shall furnish to the Trustee and the paying agent (if any)
appointed pursuant to Section 3.4 an Officer's Certificate
specifying the Market Exchange Rate as of the date of such
issuance and the U.S. dollar equivalent of the principal
amount of such Security as of the date of original issuance
of such Security (or, in the case of an Original Issue
Discount Security, the U.S. dollar equivalent on the date of
original issuance of such Security of the principal amount
thereof that would be due and payable as of the date of
original issuance of such Security upon a declaration of
acceleration of the Maturity thereof as of such date) based
upon such Market Exchange Rate. All decisions and
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determinations of the Issuer or its agent regarding the
Market Exchange Rate shall be in its sole discretion and
shall, in the absence of manifest error, be conclusive to the
extent permitted by law for all purposes and irrevocably
binding upon the Issuer and all Holders.
The Issuer covenants to indemnify the Trustee for,
and to hold it harmless against, any loss, liability or
expense reasonably incurred without negligence or bad faith
on its part arising out of or in connection with actions
taken or omitted to be taken by the Trustee in reliance upon
any Officer's Certificate furnished pursuant to this Section.
On or before December 15 of each year during which
any Securities are outstanding, the Issuer shall furnish to
the paying agent (if any) appointed pursuant to Section 3.4
and Trustee such information as may be reasonably requested
by such paying agent or the Trustee in order that such paying
agent (or, if there is no paying agent, the Trustee) may
prepare the information which it is required to report for
such year on Internal Revenue Service Forms 1096 and 1099
pursuant to Section 6049 for the Internal Revenue Code of
1986, as amended. Such information shall include the amount
of original issue discount includible in income for each
$1,000 of principal amount of Original Issue Discount
Securities outstanding during such year.
ARTICLE TWELVE
REDEMPTION OF SECURITIES AND SINKING FUNDS
SECTION 12.1 Applicability of Article. The
provisions of this Article shall be applicable to the
Securities of any series which are redeemable before their
maturity or to any sinking fund for the retirement of
Securities of a series except as otherwise specified, as
contemplated by Section 2.3 for Securities of such series.
SECTION 12.2 Notice of Redemption; Partial
Redemptions. Notice of redemption to the Holders of
Registered Securities of any series to be redeemed as a whole
or in part at the option of the Issuer shall be given by
mailing notice of such redemption by first-class mail,
postage prepaid, at least 30 days and not more than 60 days
prior to the date fixed for redemption to such Holders of
Securities of such series at their last addresses as they
shall appear upon the registry books. Notice of redemption
to Holders of Unregistered Securities shall be published in
an Authorized Newspaper in the Borough of Manhattan, The City
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of New York and in an Authorized Newspaper in London (and, if
required by Section 3.6, in an Authorized Newspaper in
Luxembourg), in each case, once in each of three successive
calendar weeks, the first publication to be not less than 30
nor more than 60 days prior to the date fixed for redemption.
Any notice which is mailed in the manner herein provided
shall be conclusively presumed to have been duly given,
whether or not the Holder receives the notice. Failure to
give notice by mail, or any defect in the notice to the
Holder of any Security of a series designated for redemption
as a whole or in part shall not affect the validity of the
proceedings for the redemption of any other Security of such
series.
The notice of redemption to each such Holder shall
specify, the principal amount of each Security of such series
held by such Holder to be redeemed, the date fixed for
redemption, the redemption price, the place or places of
payment, that payment will be made upon presentation and
surrender of such Securities and, in the case of Securities
with Coupons attached thereto, of all Coupons appertaining
thereto maturing after the date fixed for redemption, that
such redemption is pursuant to the mandatory or optional
sinking fund, or both, if such be the case, that interest
accrued to the date fixed for redemption will be paid as
specified in such notice and that on and after said date
interest thereon or on the portions thereof to be redeemed
will cease to accrue. In case any Security of a series is to
be redeemed in part only the notice of redemption shall state
the portion of the principal amount thereof to be redeemed
and shall state that on and after the date fixed for
redemption, upon surrender of such Security, a new Security
or Securities of such series in principal amount equal to the
unredeemed portion thereof will be issued.
The notice of redemption of Securities of any
series to be redeemed at the option of the Issuer shall be
given by the Issuer or, at the Issuer's request, by the
paying agent appointed pursuant to Section 3.4 (or if there
is no such paying agent, the Trustee) in the name and at the
expense of the Issuer.
At least one Business Day prior to the redemption
date specified in the notice of redemption given as provided
in this Section, the Issuer will deposit with the Trustee or
with one or more paying agents (or, if the Issuer is acting
as its own paying agent, set aside, segregate and hold in
trust as provided in Section 3.4) an amount of money
sufficient to redeem on the redemption date all the
Securities of such series so called for redemption at the
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appropriate redemption price, together with accrued interest
to the date fixed for redemption. The Issuer will deliver to
the Trustee not less than 30 nor more than 60 days prior to
the date fixed for redemption an Officer's Certificate
stating the aggregate principal amount of Securities to be
redeemed. In case of a redemption at the election of the
Issuer prior to the expiration of any restriction on such
redemption, the Issuer shall deliver to the Trustee, prior to
the giving of any notice of redemption to Holders pursuant to
this Section, an Officer's Certificate stating that such
restriction has been complied with.
If less than all the Securities of a series are to
be redeemed, the paying agent appointed pursuant to Section
3.4 (or, if there is no such paying agent, the Trustee) shall
select, in the manner specified in such Securities or
specified pursuant to Section 2.3, or, if no manner is
specified in the Securities or pursuant to Section 2.3, then
by lot, pro rata or by such other manner as it shall deem
appropriate and fair, Securities of such Series to be
redeemed in whole or in part. Securities may be redeemed in
part in multiples equal to the minimum authorized
denomination for Securities of such series or any multiple
thereof. The paying agent (or the Trustee, as the case may
be) shall promptly notify the Issuer in writing of the
Securities of such series selected for redemption and, in the
case of any Securities of such series selected for partial
redemption, the principal amount thereof to be redeemed. For
all purposes of this Indenture, unless the context otherwise
requires, all provisions relating to the redemption of
Securities of any series shall relate, in the case of any
Security redeemed or to be redeemed only in part, to the
portion of the principal amount of such Security which has
been or is to be redeemed.
SECTION 12.3 Payment of Securities Called for
Redemption. If notice of redemption has been given as above
provided, the Securities or portions of Securities specified
in such notice shall become due and payable on the date and
at the place stated in such notice at the applicable
redemption price, together with interest accrued to the date
fixed for redemption, and on and after said date (unless the
Issuer shall default in the payment of such Securities at the
redemption price, together with interest accrued to said
date) interest on the Securities or portions of Securities so
called for redemption shall cease to accrue, and the
unmatured Coupons, if any, appertaining thereto shall be
void, and, except as provided in Sections 6.5 and 10.4, such
Securities shall cease from and after the date fixed for
redemption to be entitled to any benefit or security under
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this Indenture, and the Holders thereof shall have no right
in respect of such Securities except the right to receive the
redemption price thereof and unpaid interest to the date
fixed for redemption. On presentation and surrender of such
Securities at a place of payment specified in said notice,
together with all Coupons, if any, appertaining thereto
maturing after the date fixed for redemption, said Securities
or the specified portions thereof shall be paid and redeemed
by the Issuer at the applicable redemption price, together
with interest accrued thereon to the date fixed for
redemption; provided that payment of interest becoming due on
or prior to the date fixed for redemption shall be payable in
the case of Securities with Coupons attached thereto, to the
Holders of the Coupons for such interest upon surrender
thereof, and in the case of Registered Securities, to the
Holders of such Registered Securities registered as such on
the relevant record date subject to the terms and provisions
of Sections 2.3 and 2.7 hereof.
If any Security called for redemption shall not be
so paid upon surrender thereof for redemption, the principal
shall, until paid or duly provided for, bear interest from
the date fixed for redemption at the rate of interest or
Yield to Maturity (in the case of an Original Issue Discount
Security) borne by such Security.
If any Security with Coupons attached thereto is
surrendered for redemption and is not accompanied by all
appurtenant Coupons maturing after the date fixed for
redemption, the surrender of such missing Coupon or Coupons
may be waived by the Issuer, the Trustee and any paying
agent, if there be furnished to each of them such security or
indemnity as they may require to save each of them harmless.
Upon presentation of any Security redeemed in part
only, the Issuer shall execute and the Trustee or
Authenticating Agent shall authenticate and deliver to or on
the order of the Holder thereof, at the expense of the
Issuer, a new Security or Securities of such series, of
authorized denominations, in principal amount equal to the
unredeemed portion of the Security so presented.
SECTION 12.4 Exclusion of Certain Securities from
Eligibility for Selection for Redemption. If this section
has been specified in accordance with Section 2.3 to be
applicable to the Securities of any series, then Securities
shall be excluded from eligibility for selection for
redemption if they are identified by registration and
certificate number in an Officer's Certificate delivered to
the Trustee (and the paying agent, if any, appointed pursuant
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to Section 3.4) at least 45 days prior to the last date on
which notice of redemption may be given as being owned of
record and beneficially by, and not pledged or hypothecated
by either (a) the Issuer or (b) an entity specifically
identified in such written statement as directly or
indirectly controlling or controlled by or under direct or
indirect common control with the Issuer.
SECTION 12.5 Mandatory and Optional Sinking Funds.
The minimum amount of any sinking fund payment provided for
by the terms of the Securities of any series is herein
referred to as a "mandatory sinking fund payment", and any
payment in excess of such minimum amount provided for by the
terms of the Securities of any series is herein referred to
as an "optional sinking fund payment". The date on which a
sinking fund payment is to be made is herein referred to as
the "sinking fund payment date".
If this section has been specified in accordance
with Section 2.3 to be applicable to the Securities of any
series, then in lieu of making all or any part of any
mandatory sinking fund payment with respect to any series of
Securities in cash, the Issuer may at its option (a) deliver
to the Trustee or paying agent Securities of such series
theretofore purchased or otherwise acquired (except upon
redemption pursuant to the mandatory sinking fund) by the
Issuer or receive credit for Securities of such series (not
previously so credited) theretofore purchased or otherwise
acquired (except as aforesaid) by the Issuer and delivered to
the Trustee or paying agent for cancellation pursuant to
Section 2.10, (b) receive credit for optional sinking fund
payments (not previously so credited) made pursuant to this
Section, or (c) receive credit for Securities of such series
(not previously so credited) redeemed by the Issuer through
any optional redemption provision contained in the terms of
such series. Securities so delivered or credited shall be
received or credited by the Trustee at the sinking fund
redemption price specified in such Securities.
On or before the 60th day next preceding each
sinking fund payment date for any series, the Issuer will
deliver to the Trustee an Officer's Certificate (which need
not contain the statements required by Section 11.5) (a)
specifying the portion of the mandatory sinking fund payment
to be satisfied by payment of cash and the portion to be
satisfied by credit of Securities of such series and the
basis for such credit, (b) stating that none of the
Securities of such series to be so credited has theretofore
been so credited, (c) stating that no defaults in the payment
of interest or Events of Default with respect to such series
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have occurred (which have not been waived or cured) and are
continuing and (d) stating whether or not the Issuer intends
to exercise its right to make an optional sinking fund
payment with respect to such series and, if so, specifying
the amount of such optional sinking fund payment which the
Issuer intends to pay on or before the next succeeding
sinking fund payment date. Any Securities of such series to
be credited and required to be delivered to the Trustee in
order for the Issuer to be entitled to credit therefor as
aforesaid which have not theretofore been delivered to the
Trustee shall be delivered for cancellation pursuant to
Section 2.10 to the Trustee with such Officer's Certificate
(or reasonably promptly thereafter if acceptable to the
Trustee). Such Officer's Certificate shall be irrevocable
and upon its receipt by the Trustee the Issuer shall become
unconditionally obligated to make all the cash payments or
payments therein referred to, if any, on or before the next
succeeding sinking fund payment date. Failure of the Issuer,
on or before any such 60th day, to deliver such Officer's
Certificate and Securities (subject to the parenthetical
clause in the second preceding sentence) specified in this
paragraph, if any, shall not constitute a default but shall
constitute, on and as of such date, the irrevocable election
of the Issuer (i) that the mandatory sinking fund payment for
such series due on the next succeeding sinking fund payment
date shall be paid entirely in cash without the option to
deliver or credit Securities of such series in respect
thereof and (ii) that the Issuer will make no optional
sinking fund payment with respect to such series as provided
in this Section.
If the sinking fund payment or payments (mandatory
or optional or both) to be made in cash on the next
succeeding sinking fund payment date plus any unused balance
of any preceding sinking fund payments made in cash shall
exceed $50,000 (or the equivalent thereof in any Foreign
Currency or ECU) or a lesser sum in Dollars (or the
equivalent thereof in any Foreign Currency or ECU) if the
Issuer shall so request with respect to the Securities of any
particular series, such cash shall be applied on the next
succeeding sinking fund payment date to the redemption of
Securities of such series at the sinking fund redemption
price together with accrued interest to the date fixed for
redemption. If such amount shall be $50,000 (or the
equivalent thereof in any Foreign Currency or ECU) or less
and the Issuer makes no such request then it shall be carried
over until a sum in excess of $50,000 (or the equivalent
thereof in any Foreign Currency or ECU) is available. The
Trustee or paying agent shall select, in the manner provided
in Section 12.2, for redemption on such sinking fund payment
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date a sufficient principal amount of Securities of such
series to absorb said cash, as nearly as may be, and shall
(if requested in writing by the Issuer) inform the Issuer of
the serial numbers of the Securities of such series (or
portions thereof) so selected. The Trustee or paying agent,
in the name and at the expense of the Issuer (or the Issuer,
if it shall so request the Trustee in writing) shall cause
notice of redemption of the Securities of such series to be
given in substantially the manner provided in Section 12.2
(and with the effect provided in Section 12.3) for the
redemption of Securities of such series in part at the option
of the Issuer. The amount of any sinking fund payments not
so applied or allocated to the redemption of Securities of
such series shall be added to the next cash sinking fund
payment for such series and, together with such payment,
shall be applied in accordance with the provisions of this
Section. Any and all sinking fund moneys held on the stated
maturity date of the Securities of any particular series (or
earlier, if such maturity is accelerated), which are not held
for the payment or redemption of particular Securities of
such series shall be applied, together with other moneys, if
necessary, sufficient for the purpose, to the payment of the
principal of, and interest on, the Securities of such series
at maturity.
The Issuer's obligation to make a mandatory or
optional sinking fund payment shall automatically be reduced
by an amount equal to the sinking fund redemption price
allocable to any Securities or portions thereof called for
redemption pursuant to the preceding paragraph on any sinking
fund payment date.
On or before each sinking fund payment date, the
Issuer shall pay to the Trustee or paying agent, as the case
may be, in cash or shall otherwise provide for the payment of
all interest accrued to the date fixed for redemption on
Securities to be redeemed on the next following sinking fund
payment date.
The Trustee or paying agent, as the case may be,
shall not redeem or cause to be redeemed any Securities of a
series with sinking fund moneys or give any notice of
redemption of Securities for such series by operation of the
sinking fund during the continuance of a default in payment
of interest on such Securities or of any Event of Default
except that, where the giving of notice of redemption of any
Securities shall theretofore have been made, the Trustee or
paying agent, as the case may be, shall redeem or cause to be
redeemed such Securities; provided that it shall have
received from the Issuer a sum sufficient for such
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redemption. Except as aforesaid, any moneys in the sinking
fund for such series at the time when any such default or
Event of Default shall occur, and any moneys thereafter paid
into the sinking fund, shall, during the continuance of such
default or Event of Default, be deemed to have been collected
under Article Five and held for the payment of all such
Securities. In case such Event of Default shall have been
waived as provided in Section 5.10 or the default cured on or
before the sixtieth day preceding the sinking fund payment
date in any year, such moneys shall thereafter be applied on
the next succeeding sinking fund payment date in accordance
with this Section to the redemption of such Securities.
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IN WITNESS WHEREOF, the parties hereto have caused
this Indenture to be duly executed, and the appropriate
corporate seals to be hereunto affixed and attested, all as
of November __, 1994.
AMERICAN STORES COMPANY
By
Title:
[CORPORATE SEAL]
Attest:
By
Title:
THE FIRST NATIONAL BANK
OF CHICAGO,
Trustee
By
Title:
[CORPORATE SEAL]
Attest:
By
Title:
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STATE OF )
) ss.:
COUNTY OF )
On the day of _______________, 1994, before me
personally came , to me known, who
being by me duly sworn did depose and say that he resides at
; that he is of
American Stores Company, one of the corporations described in
and which executed the above instrument; that he knows the
corporate seal of said corporation; that the seal affixed to
said instrument is such corporate seal; that it was so
affixed by the authority of the Board of Directors of said
corporation; and that he signed his name thereto by like
authority.
Notary Public
My Commission Expires
[NOTARIAL SEAL]
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STATE OF )
) ss.:
COUNTY OF )
On the day of ____________, 1994, before me
personally came , to me known, who being by me
duly sworn did depose and say that he resides at
; that he is a of The
First National Bank of Chicago, one of the corporations
described in and which executed the above instrument; that he
knows the corporate seal of said corporation; that the seal
affixed to said instrument is such corporate seal; that it
was so affixed by the authority of the Board of Directors of
said corporation; and that he signed his name thereto by like
authority.
Notary Public
My Commission Expires
[NOTARIAL SEAL]
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CONFORMED COPY
$1,000,000,000
CREDIT AGREEMENT
dated as of
June 28, 1994
among
American Stores Company,
The Banks Listed Herein,
Wachovia Bank of Georgia, N.A.,
NationsBank of Texas, N.A.,
Credit Suisse and
Bank of America National Trust and Savings Association
as Co-Agents,
and
Morgan Guaranty Trust Company of New York,
as Agent
TABLE OF CONTENTS(*)
ARTICLE I
DEFINITIONS
Page
----
SECTION 1.01 Definitions....................................... 1
1.02 Accounting Terms and Determinations............... 13
1.03 Types of Borrowings............................... 14
ARTICLE II
THE CREDITS
SECTION 2.01 Commitments to Lend............................... 14
2.02 Notice of Committed Borrowing..................... 15
2.03 Money Market Borrowings........................... 15
2.04 Notice to Banks; Funding of Loans................. 19
2.05 Notes............................................. 20
2.06 Maturity of Loans................................. 21
2.07 Interest Rates.................................... 21
2.08 Fees.............................................. 25
2.09 Optional Termination or
Reduction of Commitments......................... 26
2.10 Scheduled Termination
of Commitments................................... 26
2.11 Optional Prepayments.............................. 26
2.12 General Provisions as to Payments................. 27
2.13 Funding Losses.................................... 28
2.14 Computation of Interest and Fees.................. 28
ARTICLE III
CONDITIONS
SECTION 3.01 Effectiveness..................................... 28
3.02 Borrowings........................................ 30
3.03 Outstanding "Money Market Loans".................. 31
ARTICLE IV
REPRESENTATIONS AND WARRANTIES
SECTION 4.01 Corporate Existence and Power..................... 31
4.02 Corporate and Governmental
Authorization; No Contravention.................. 31
4.03 Binding Effect.................................... 31
4.04 Financial Information............................. 32
4.05 Litigation........................................ 32
4.06 Compliance with ERISA............................. 33
4.07 Environmental Matters............................. 33
4.08 Taxes............................................. 33
4.09 Subsidiaries...................................... 34
4.10 Not an Investment Company......................... 34
4.11 Full Disclosure................................... 34
ARTICLE V
COVENANTS
SECTION 5.01 Information....................................... 34
5.02 Payment of Obligations............................ 36
5.03 Maintenance of Property; Insurance................ 37
5.04 Conduct of Business and
Maintenance of Existence......................... 37
5.05 Compliance with Laws.............................. 37
5.06 Inspection of Property,
Books and Records................................ 38
5.07 Cash Flow/Total Debt Ratio........................ 38
5.08 Subsidiary Debt Restriction....................... 38
5.09 Negative Pledge................................... 38
5.10 Consolidations, Mergers and
Sales of Assets.................................. 40
5.11 Use of Proceeds................................... 40
ARTICLE VI
DEFAULTS
SECTION 6.01 Events of Default................................. 40
6.02 Notice of Default................................. 43
ARTICLE VII
THE AGENT AND THE CO-AGENTS
SECTION 7.01 Appointment and Authorization..................... 43
7.02 Agent and Affiliates.............................. 43
7.03 Action by Agent................................... 43
7.04 Consultation with Experts......................... 44
7.05 Liability of Agent................................ 44
7.06 Indemnification................................... 44
7.07 Credit Decision................................... 45
7.08 Successor Agent................................... 45
7.09 Agent's Fee....................................... 45
7.10 Co-Agents......................................... 45
ARTICLE VIII
CHANGE IN CIRCUMSTANCES
SECTION 8.01 Basis for Determining Interest
Rate Inadequate or Unfair......................... 46
8.02 Illegality......................................... 46
8.03 Increased Cost and Reduced Return.................. 47
8.04 Taxes.............................................. 49
8.05 Base Rate Loans Substituted for
Affected Fixed Rate Loans......................... 51
8.06 Substitution of a Bank............................. 51
ARTICLE IX
MISCELLANEOUS
SECTION 9.01 Notices........................................... 52
9.02 No Waivers........................................ 52
9.03 Expenses; Indemnification......................... 52
9.04 Sharing of Set-Offs............................... 53
9.05 Amendments and Waivers............................ 53
9.06 Successors and Assigns............................ 54
9.07 Collateral........................................ 56
9.08 Governing Law; Submission to Jurisdiction......... 56
9.09 Counterparts; Integration......................... 56
9.10 WAIVER OF JURY TRIAL.............................. 56
9.11 Confidentiality................................... 56
Pricing Schedule
Exhibit A - Note
Exhibit B - Money Market Quote Request
Exhibit C - Invitation for Money Market Quotes
Exhibit D - Money Market Quote
Exhibit E - Opinion of General Counsel for the Borrower
Exhibit F - Opinion of Special Counsel for the Borrower
Exhibit G - Opinion of Special Counsel for the Agent
Exhibit H - Assignment and Assumption Agreement
CREDIT AGREEMENT
AGREEMENT dated as of June 28, 1994 among AMERICAN STORES
COMPANY, the BANKS listed on the signature pages hereof, the CO-AGENTS listed
on the signature pages hereof and MORGAN GUARANTY TRUST COMPANY OF NEW YORK,
as Agent.
The parties hereto agree as follows:
ARTICLE I
DEFINITIONS
SECTION 1.01. Definitions. The following terms, as used
herein, have the following meanings:
"Absolute Rate Auction" means a solicitation of Money Market
Quotes setting forth Money Market Absolute Rates pursuant to Section 2.03.
"Adjusted CD Rate" has the meaning set forth in Section 2.07(b).
"Adjusted London Interbank Offered Rate" has the meaning set
forth in Section 2.07(c).
"Administrative Questionnaire" means, with respect to each
Bank, an administrative questionnaire in the form prepared by the Agent and
submitted to the Agent (with a copy to the Borrower) duly completed by such
Bank.
"Agent" means Morgan Guaranty Trust Company of New York in its
capacity as agent for the Banks hereunder, and its successors in such capacity.
"Applicable Lending Office" means, with respect to any Bank,
(i) in the case of its Domestic Loans, its Domestic Lending Office, (ii) in
the case of its Euro-Dollar Loans, its Euro-Dollar Lending Office and (iii) in
the case of its Money Market Loans, its Money Market Lending Office.
"Assessment Rate" has the meaning set forth in Section 2.07(b).
"Assignee" has the meaning set forth in Section 9.06(c).
"Bank" means each bank listed on the signature pages hereof,
each Assignee which becomes a Bank pursuant to Section 9.06(c), and their
respective successors.
"Base Rate" means, for any day, a rate per annum equal to the
higher of (i) the Prime Rate for such day or (ii) the sum of 1/2 of 1% plus
the Federal Funds Rate for such day.
"Base Rate Loan" means a Committed Loan to be made by a Bank as
a Base Rate Loan in accordance with the applicable Notice of Committed
Borrowing or pursuant to Article VIII.
"Borrower" means American Stores Company, a Delaware
corporation, and its successors.
"Borrower's 1993 Form 10-K" means the Borrower's annual report
on Form 10-K for 1993, as filed with the Securities and Exchange Commission
pursuant to the Securities Exchange Act of 1934.
"Borrower's Latest Form 10-Q" means the Borrower's quarterly
report on Form 10-Q for the quarter ended April 30, 1994, as filed with the
Securities and Exchange Commission pursuant to the Securities Exchange Act of
1934.
"Borrowing" has the meaning set forth in Section 1.03.
"Capital Lease" means any lease of property which, in
accordance with United States generally accepted accounting principles, should
be capitalized on the lessee's balance sheet or for which the amount of the
asset and liability thereunder as if so capitalized should be disclosed in a
note to such balance sheet; and "Capitalized Lease Obligation" means the
amount of the liability which should be so capitalized or disclosed.
"CD Base Rate" has the meaning set forth in Section 2.07(b).
"CD Loan" means a Committed Loan to be made by a Bank as a CD
Loan in accordance with the applicable Notice of Committed Borrowing.
"CD Margin" has the meaning set forth in Section 2.07(b).
"CD Reference Banks" means Wachovia Bank of Georgia, N.A.,
Credit Suisse and Morgan Guaranty Trust Company of New York.
"Co-Agent" means each of the Co-Agents listed on the signature
pages hereof, in its capacity as a Co-Agent hereunder.
"Commitment" means, with respect to each Bank, the amount set
forth opposite the name of such Bank on the signature pages hereof, as such
amount may be reduced from time to time pursuant to Sections 2.09 and 2.10.
"Committed Loan" means a loan made by a Bank pursuant to
Section 2.01.
"Consolidated Assets" means at any date the consolidated assets
of the Borrower and its Consolidated Subsidiaries determined as of such date.
"Consolidated Debt" means at any date the Debt of the Borrower
and its Consolidated Subsidiaries, determined on a consolidated basis as of
such date.
"Consolidated Net Tangible Assets" means the total amounts of
assets (less depreciation and valuation reserves and other reserves and items
deductible from gross book value of specific asset accounts under generally
accepted accounting principles) which under United States generally accepted
accounting principles would be included on a consolidated balance sheet after
deducting therefrom (a) all liability items except Funded Debt, Capitalized
Lease Obligations, stockholders' equity and reserves for deferred income
taxes and (b) all goodwill, trade names, trademarks, patents, unamortized debt
discount and expense and other like intangibles, which in each case would be
so included on such balance sheet.
"Consolidated Net Worth" means at any date the consolidated
stockholders' equity of the Borrower and its Consolidated Subsidiaries
determined as of such date.
"Consolidated Subsidiary" means at any date any Subsidiary or
other entity the accounts of which would be consolidated with those of the
Borrower in its consolidated financial statements if such statements were
prepared as of such date.
"Consolidated Tangible Assets" means at any date Consolidated
Assets less goodwill of the Borrower and its Consolidated Subsidiaries, each
determined as of such date.
"Debt" of any Person means at any date, without duplication,
(i) all obligations of such Person for borrowed money, (ii) all obligations of
such Person evidenced by bonds, debentures, notes or other similar
instruments, (iii) all obligations of such Person to pay the deferred purchase
price of property or services, except trade accounts payable arising in the
ordinary course of business, (iv) all obligations of such Person as lessee
which are capitalized in accordance with United States generally accepted
accounting principles, (v) all non-contingent obligations (and, for purposes
of Section 5.09 and the definitions of Material Debt and Material Financial
Obligations, all contingent obligations) of such Person to reimburse any bank
or other Person in respect of amounts paid under a letter of credit or similar
instrument, (vi) all Debt secured by a Lien on any asset of such Person,
whether or not such Debt is otherwise an obligation of such Person, and (vii)
all Debt of others Guaranteed by such Person.
"Default" means any condition or event which constitutes an
Event of Default or which with the giving of notice or lapse of time or both
would, unless cured or waived, become an Event of Default.
"Derivatives Obligations" of any Person means all obligations
of such Person in respect of any rate swap transaction, basis swap, forward
rate transaction, commodity swap, commodity option, equity or equity index
swap, equity or equity index option, bond option, interest rate option,
foreign exchange transaction, cap transaction, floor transaction, collar
transaction, currency swap transaction, cross-currency rate swap transaction,
currency option or any other similar transaction (including any option with
respect to any of the foregoing transactions) or any combination of the
foregoing transactions.
"Domestic Business Day" means any day except a Saturday, Sunday
or other day on which commercial banks in New York City are authorized by law
to close.
"Domestic Lending Office" means, as to each Bank, its office
located at its address set forth in its Administrative Questionnaire (or
identified in its Administrative Questionnaire as its Domestic Lending Office)
or such other office as such Bank may hereafter designate as its Domestic
Lending Office by notice to the Borrower and the Agent; provided that any Bank
may so designate separate Domestic Lending Offices for its Base Rate Loans, on
the one hand, and its CD Loans, on the other hand, in which case all
references herein to the Domestic Lending Office of such Bank shall be deemed
to refer to either or both of such offices, as the context may require.
"Domestic Loans" means CD Loans or Base Rate Loans or both.
"Domestic Reserve Percentage" has the meaning set forth in
Section 2.07(b).
"Effective Date" means the date this Agreement becomes
effective in accordance with Section 3.01.
"Environmental Laws" means any and all federal, state, local
and foreign statutes, laws, judicial decisions, regulations, ordinances,
rules, judgments, orders, decrees, plans, injunctions, permits, concessions,
grants, franchises, licenses, agreements and other governmental restrictions
relating to the environment, the effect of the environment on human health or
to emissions, discharges or releases of pollutants, contaminants, Hazardous
Substances or wastes into the environment including, without limitation,
ambient air, surface water, ground water, or land, or otherwise relating to
the manufacture, processing, distribution, use, treatment, storage, disposal,
transport or handling of pollutants, contaminants, Hazardous Substances or
wastes or the clean-up or other remediation thereof.
"ERISA" means the Employee Retirement Income Security Act of
1974, as amended, or any successor statute.
"ERISA Group" means the Borrower, any Subsidiary and all
members of a controlled group of corporations and all trades or businesses
(whether or not incorporated) under common control which, together with the
Borrower or any Subsidiary, are treated as a single employer under Section 414
of the Internal Revenue Code.
"Euro-Dollar Business Day" means any Domestic Business Day on
which commercial banks are open for international business (including dealings
in dollar deposits) in London.
"Euro-Dollar Lending Office" means, as to each Bank, its
office, branch or affiliate located at its address set forth in its
Administrative Questionnaire (or identified in its Administrative
Questionnaire as its Euro-Dollar Lending Office) or such other office,
branch or affiliate of such Bank as it may hereafter designate as its Euro-
Dollar Lending Office by notice to the Borrower and the Agent.
"Euro-Dollar Loan" means a Committed Loan to be made by a Bank
as a Euro-Dollar Loan in accordance with the applicable Notice of Committed
Borrowing.
"Euro-Dollar Margin" has the meaning set forth in Section
2.07(c).
"Euro-Dollar Reference Banks" means the principal London
offices of Wachovia Bank of Georgia, N.A., Credit Suisse and Morgan Guaranty
Trust Company of New York.
"Euro-Dollar Reserve Percentage" has the meaning set forth in
Section 2.07(c).
"Event of Default" has the meaning set forth in Section 6.01.
"Existing Credit Agreement" means the Credit Agreement dated as
of September 1, 1988 among the Borrower, the banks parties thereto and
Morgan Guaranty Trust Company of New York, as agent, as amended to the
Effective Date.
"Federal Funds Rate" means, for any day, the rate per annum
(rounded upward, if necessary, to the nearest 1/100th of 1%) equal to the
weighted average of the rates on overnight Federal funds transactions with
members of the Federal Reserve System arranged by Federal funds brokers on
such day, as published by the Federal Reserve Bank of New York on the Domestic
Business Day next succeeding such day, provided that (i) if such day is not a
Domestic Business Day, the Federal Funds Rate for such day shall be such rate
on such transactions on the next preceding Domestic Business Day as so
published on the next succeeding Domestic Business Day, and (ii) if no such
rate is so published on such next succeeding Domestic Business Day, the
Federal Funds Rate for such day shall be the average rate quoted to Morgan
Guaranty Trust Company of New York on such day on such transactions as
determined by the Agent.
"Fixed Rate Loans" means CD Loans or Euro-Dollar Loans or Money
Market Loans (excluding Money Market LIBOR Loans bearing interest at the Base
Rate pursuant to Section 8.01(a)) or any combination of the foregoing.
"Funded Debt" means any Debt maturing by its terms more than
one year from the date of the determination thereof, including any Debt
renewable or extendable at the option of the obligor to a date later than one
year from the date of the determination thereof.
"Guarantee" by any Person means any obligation, contingent or
otherwise, of such Person directly or indirectly guaranteeing any Debt of any
other Person and, without limiting the generality of the foregoing, any
obligation, direct or indirect, contingent or otherwise, of such Person (i) to
purchase or pay (or advance or supply funds for the purchase or payment of)
such Debt (whether arising by virtue of partnership arrangements, by agreement
to keep-well, to purchase assets, goods, securities or services, to
take-or-pay, or to maintain financial statement conditions or otherwise) or
(ii) entered into for the purpose of assuring in any other manner the holder
of such Debt of the payment thereof or to protect such holder against loss in
respect thereof (in whole or in part), provided that the term Guarantee shall
not include endorsements for collection or deposit in the ordinary course of
business; and provided further that the contingent liabilities of the Borrower
or any Subsidiary in respect of lease obligations of other Persons shall not
be deemed Guarantees if (x) the lease obligation was assumed by such other
Person in connection with the sale, transfer or other disposition of assets of
the Borrower or such Subsidiary to such other Person, (y) such lease
obligation, when initially incurred as a non-contingent liability of the
Borrower or such Subsidiary, was not incurred in contemplation of the sale,
transfer or other disposition referred to in clause (x) above, and (z) neither
the Borrower nor such Subsidiary shall have received notice of default by the
primary obligor under such lease obligation. The term "Guarantee" used as a
verb has a corresponding meaning.
"Hazardous Substances" means any toxic, radioactive, caustic or
otherwise hazardous substance, including petroleum, its derivatives,
by-products and other hydrocarbons, or any substance having any constituent
elements displaying any of the foregoing characteristics.
"Indemnitee" has the meaning set forth in Section 9.03(b).
"Interest Period" means: (1) with respect to each Euro-Dollar
Borrowing, the period commencing on the date of such Borrowing and ending one,
two, three or six months thereafter, as the Borrower may elect in the
applicable Notice of Borrowing; provided that:
(a) any Interest Period which would otherwise end on a day
which is not a Euro-Dollar Business Day shall, subject to clause (c)
below, be extended to the next succeeding Euro-Dollar Business Day
unless such Euro-Dollar Business Day falls in another calendar month,
in which case such Interest Period shall end on the next preceding
Euro-Dollar Business Day;
(b) any Interest Period which begins on the last Euro-Dollar
Business Day of a calendar month (or on a day for which there is no
numerically corresponding day in the calendar month at the end of
such Interest Period) shall, subject to clause (c) below, end on the
last Euro-Dollar Business Day of a calendar month; and
(c) any Interest Period which would otherwise end after the
Termination Date shall end on the Termination Date.
(2) with respect to each CD Borrowing, the period commencing on the date of
such Borrowing and ending 30, 60, 90 or 180 days thereafter, as the Borrower
may elect in the applicable Notice of Borrowing; provided that:
(a) any Interest Period which would otherwise end on a day
which is not a Euro-Dollar Business Day shall, subject to clause (b)
below, be extended to the next succeeding Euro-Dollar Business Day;
and
(b) any Interest Period which would otherwise end after the
Termination Date shall end on the Termination Date.
(3) with respect to each Base Rate Borrowing, the period commencing on the
date of such Borrowing and ending 30 days thereafter; provided that:
(a) any Interest Period which would otherwise end on a day
which is not a Euro-Dollar Business Day shall, subject to clause (b)
below, be extended to the next succeeding Euro-Dollar Business Day;
and
(b) any Interest Period which would otherwise end after the
Termination Date shall end on the Termination Date.
(4) with respect to each Money Market LIBOR Borrowing, the period commencing
on the date of such Borrowing and ending such whole number of months
thereafter as the Borrower may elect in accordance with Section 2.03; provided
that:
(a) any Interest Period which would otherwise end on a day
which is not a Euro-Dollar Business Day shall, subject to clause (c)
below, be extended to the next succeeding Euro-Dollar Business Day
unless such Euro-Dollar Business Day falls in another calendar month,
in which case such Interest Period shall end on the next preceding
Euro-Dollar Business Day;
(b) any Interest Period which begins on the last Euro-Dollar
Business Day of a calendar month (or on a day for which there is no
numerically corresponding day in the calendar month at the end of
such Interest Period) shall, subject to clause (c) below, end on the
last Euro-Dollar Business Day of a calendar month; and
(c) any Interest Period which would otherwise end after the
Termination Date shall end on the Termination Date.
(5) with respect to each Money Market Absolute Rate Borrowing, the period
commencing on the date of such Borrowing and ending such number of days
thereafter (but not less than 7 days) as the Borrower may elect in accordance
with Section 2.03; provided that:
(a) any Interest Period which would otherwise end on a day
which is not a Euro-Dollar Business Day shall, subject to clause (b)
below, be extended to the next succeeding Euro-Dollar Business Day;
and
(b) any Interest Period which would otherwise end after the
Termination Date shall end on the Termination Date.
"Internal Revenue Code" means the Internal Revenue Code of
1986, as amended, or any successor statute.
"LIBOR Auction" means a solicitation of Money Market Quotes
setting forth Money Market Margins based on the London Interbank Offered Rate
pursuant to Section 2.03.
"Lien" means, with respect to any asset, any mortgage, lien,
pledge, charge, security interest or encumbrance of any kind, or any other
type of preferential arrangement that has the practical effect of creating a
security interest, in respect of such asset. For the purposes of this
Agreement, the Borrower or any Subsidiary shall be deemed to own subject to a
Lien any asset which it has acquired or holds subject to the interest of a
vendor or lessor under any conditional sale agreement, capital lease or other
title retention agreement relating to such asset.
"Loan" means a Domestic Loan or a Euro-Dollar Loan or a Money
Market Loan and "Loans" means Domestic Loans or Euro-Dollar Loans or Money
Market Loans or any combination of the foregoing.
"London Interbank Offered Rate" has the meaning set forth in
Section 2.07(c).
"Major Subsidiary" at any time shall mean a Subsidiary of the
Borrower that either (i) has revenues in excess of $250,000,000 in the
Borrower's most recent fiscal year prior to such time or assets in excess of
$50,000,000 in the Borrower's most recent fiscal year prior to such time or
(ii) has been designated a Major Subsidiary by the Board of Directors of the
Borrower at or prior to such time. Additionally, if the Subsidiaries of the
Borrower that are not described in the preceding sentence have in the
aggregate either (1) revenues in excess of 20% of the consolidated revenues of
the Borrower and its Consolidated Subsidiaries in the Borrower's most recent
fiscal year prior to such time or (2) assets in excess of 20% of the
Consolidated Assets of the Borrower and its Consolidated Subsidiaries in the
Borrower's most recent fiscal year prior to such time, each such Subsidiary
will constitute a Major Subsidiary.
"Margin Regulations" means Regulations G, T, U and X of the
Board of Governors of The Federal Reserve System, as in effect from time to
time.
"Material Debt" means Debt (other than the Notes) of the
Borrower and/or one or more of its Subsidiaries, arising in one or more
related or unrelated transactions, in an aggregate principal or face amount
exceeding $25,000,000.
"Material Financial Obligations" means a principal or face
amount of Debt and/or payment obligations in respect of Derivatives
Obligations of the Borrower and/or one or more of its Subsidiaries, arising in
one or more related or unrelated transactions, exceeding in the aggregate
$25,000,000.
"Minimum Net Rental Expense" means, for any period, the
aggregate minimum rental expenses (net of sub-lease income) of the Borrower
and its Consolidated Subsidiaries under operating leases for such period.
"Money Market Absolute Rate" has the meaning set forth in
Section 2.03(d).
"Money Market Absolute Rate Loan" means a loan to be made by a
Bank pursuant to an Absolute Rate Auction.
"Money Market Lending Office" means, as to each Bank, its
Domestic Lending Office or such other office, branch or affiliate of such Bank
as it may hereafter designate as its Money Market Lending Office by notice to
the Borrower and the Agent; provided that any Bank may from time to time by
notice to the Borrower and the Agent designate separate Money Market Lending
Offices for its Money Market LIBOR Loans, on the one hand, and its Money
Market Absolute Rate Loans, on the other hand, in which case all references
herein to the Money Market Lending Office of such Bank shall be deemed to
refer to either or both of such offices, as the context may require.
"Money Market LIBOR Loan" means a loan to be made by a Bank
pursuant to a LIBOR Auction (including such a loan bearing interest at the
Base Rate pursuant to Section 8.01(a)).
"Money Market Loan" means a Money Market LIBOR Loan or a Money
Market Absolute Rate Loan.
"Money Market Margin" has the meaning set forth in Section
2.03(d).
"Money Market Quote" means an offer by a Bank to make a Money
Market Loan in accordance with Section 2.03.
"Multiemployer Plan" means at any time an employee pension
benefit plan within the meaning of Section 4001(a)(3) of ERISA to which any
member of the ERISA Group is then making or accruing an obligation to make
contributions or has within the preceding five plan years made contributions,
including for these purposes any Person which ceased to be a member of the
ERISA Group during such five year period.
"Notes" means promissory notes of the Borrower, substantially
in the form of Exhibit A hereto, evidencing the obligation of the Borrower to
repay the Loans, and "Note" means any one of such promissory notes issued
hereunder.
"Notice of Borrowing" means a Notice of Committed Borrowing (as
defined in Section 2.02) or a Notice of Money Market Borrowing (as defined in
Section 2.03(f)).
"Operating Cash Flow" means, for any period, the consolidated
net income of the Borrower and its Consolidated Subsidiaries (before
extraordinary items and changes in accounting principles) for such period, (a)
plus, to the extent deducted in determining such consolidated net income, the
sum of (i) interest expense, (ii) income tax expense, (iii) depreciation and
amortization expense, (iv) non-operating expenses in excess of non-operating
income and (v) any LIFO charge, and (b) minus, to the extent included in
determining such consolidated net income, non-operating income in excess of
non-operating expense. For this purpose, "non-operating income" means
interest income, gain on sale of assets outside the ordinary course of business
and any other unusual or non-recurring item of income or gain which is so
classified in the Borrower's financial statements, and "non-operating expense"
means loss on sale of assets outside the ordinary course of business and any
other unusual or non-recurring item of expense or loss which is so classified
in the Borrower's financial statements.
"Parent" means, with respect to any Bank, any Person
controlling such Bank.
"Participant" has the meaning set forth in Section 9.06(b).
"PBGC" means the Pension Benefit Guaranty Corporation or any
entity succeeding to any or all of its functions under ERISA.
"Person" means an individual, a corporation, a partnership, an
association, a trust or any other entity or organization, including a
government or political subdivision or an agency or instrumentality thereof.
"Plan" means at any time an employee pension benefit plan
(other than a Multiemployer Plan) which is covered by Title IV of ERISA or
subject to the minimum funding standards under Section 412 of the Internal
Revenue Code and either (i) is maintained, or contributed to, by any member of
the ERISA Group for employees of any member of the ERISA Group or (ii) has at
any time within the preceding five years been maintained, or contributed to,
by any Person which was at such time a member of the ERISA Group for employees
of any Person which was at such time a member of the ERISA Group.
"Pricing Schedule" means the Schedule attached hereto
identified as such.
"Prime Rate" means the rate of interest publicly announced by
Morgan Guaranty Trust Company of New York in New York City from time to time
as its Prime Rate.
"Reference Banks" means the CD Reference Banks or the
Euro-Dollar Reference Banks, as the context may require, and "Reference Bank"
means any one of such Reference Banks.
"Refunding Borrowing" means a Committed Borrowing which, after
application of the proceeds thereof, results in no net increase in the
outstanding principal amount of Committed Loans made by any Bank.
"Regulation U" means Regulation U of the Board of Governors of
the Federal Reserve System, as in effect from time to time.
"Required Banks" means at any time Banks having more than 55%
of the aggregate amount of the Commitments or, if the Commitments shall have
been terminated, holding Notes evidencing more than 55% of the aggregate
unpaid principal amount of the Loans.
"Revolving Credit Period" means the period from and including
the Effective Date to but excluding the Termination Date.
"Subsidiary" means, as to any Person, any corporation or other
entity of which securities or other ownership interests having ordinary voting
power to elect a majority of the board of directors or other persons
performing similar functions are at the time directly or indirectly owned by
such Person; unless otherwise specified, "Subsidiary" means a Subsidiary of
the Borrower.
"Termination Date" means June 28, 1999, or, if such day is
not a Euro-Dollar Business Day, the next preceding Euro-Dollar Business Day.
"Total Debt" of any Person means at any date the sum of (i)
Consolidated Debt at such date and (ii) eight times the Minimum Net Rental
Expense for the period of four consecutive fiscal quarters then most recently
ended.
"Transferee" has the meaning set forth in Section 9.06(e).
"United States" means the United States of America, including
the States and the District of Columbia, but excluding its territories and
possessions.
"Wholly Owned Consolidated Subsidiary" means any Consolidated
Subsidiary all of the shares of capital stock or other ownership interests of
which (except directors' qualifying shares) are at the time directly or
indirectly owned by the Borrower.
SECTION 1.02. Accounting Terms and Determinations. Unless
otherwise specified herein, all accounting terms used herein shall be
interpreted, all accounting determinations hereunder shall be made, and all
financial statements required to be delivered hereunder shall be prepared in
accordance with United States generally accepted accounting principles as in
effect, from time to time, applied on a basis consistent (except for changes
concurred in by the Borrower's independent public accountants) with the most
recent audited consolidated financial statements of the Borrower and its
Consolidated Subsidiaries delivered to the Banks; provided that, if the
Borrower notifies the Agent that the Borrower wishes to amend any covenant in
Article V to eliminate the effect of any change in such generally accepted
accounting principles on the operation of such covenant (or if the Agent
notifies the Borrower that the Required Banks wish to amend Article V for such
purpose), then the Borrower's compliance with such covenant shall be
determined on the basis of such generally accepted accounting principles in
effect immediately before the relevant change in such generally accepted
accounting principles became effective, until either such notice is withdrawn
or such covenant is amended in a manner satisfactory to the Borrower and the
Required Banks.
SECTION 1.03. Types of Borrowings. The term "Borrowing"
denotes the aggregation of Loans of one or more Banks to be made to the
Borrower pursuant to Article II on a single date and for a single Interest
Period. Borrowings are classified for purposes of this Agreement either by
reference to the pricing of Loans comprising such Borrowing (e.g., a
"Euro-Dollar Borrowing" is a Borrowing comprised of Euro-Dollar Loans) or by
reference to the provisions of Article II under which participation therein is
determined (i.e., a "Committed Borrowing" is a Borrowing under Section 2.01
in which all Banks participate in proportion to their Commitments, while a
"Money Market Borrowing" is a Borrowing under Section 2.03 in which the Bank
participants are determined on the basis of their bids in accordance
therewith).
ARTICLE II
THE CREDITS
SECTION 2.01. Commitments to Lend. During the Revolving
Credit Period each Bank severally agrees, on the terms and conditions set
forth in this Agreement, to make loans to the Borrower pursuant to this
Section from time to time in amounts such that the aggregate principal amount
of Committed Loans by such Bank at any one time outstanding shall not exceed
the amount of its Commitment. Each Borrowing under this Section shall be in
an aggregate principal amount of $25,000,000 or any larger multiple of
$5,000,000 (except that any such Borrowing may be in the aggregate amount
available in accordance with Section 3.02(b)) and shall be made from the
several Banks ratably in proportion to their respective Commitments. Within
the foregoing limits, the Borrower may borrow under this Section, repay, or to
the extent permitted by Section 2.11, prepay Loans and reborrow at any time
during the Revolving Credit Period under this Section.
SECTION 2.02. Notice of Committed Borrowing. The Borrower
shall give the Agent notice (a "Notice of Committed Borrowing") not later than
12:00 Noon (New York City time) on (x) the date of each Base Rate Borrowing,
(y) the second Domestic Business Day before each CD Borrowing and (z) the
third Euro-Dollar Business Day before each Euro-Dollar Borrowing, specifying:
(a) the date of such Borrowing, which shall be a Domestic
Business Day in the case of a Domestic Borrowing or a Euro-Dollar
Business Day in the case of a Euro-Dollar Borrowing,
(b) the aggregate amount of such Borrowing,
(c) whether the Loans comprising such Borrowing are to be CD
Loans, Base Rate Loans or Euro-Dollar Loans, and
(d) in the case of a Fixed Rate Borrowing, the duration of the
Interest Period applicable thereto, subject to the provisions of the
definition of Interest Period.
SECTION 2.03. Money Market Borrowings.
(a) The Money Market Option. In addition to Committed
Borrowings pursuant to Section 2.01, the Borrower may, as set forth in this
Section, request the Banks during the Revolving Credit Period to make offers
to make Money Market Loans to the Borrower. The Banks may, but shall have no
obligation to, make such offers and the Borrower may, but shall have no
obligation to, accept any such offers in the manner set forth in this Section.
(b) Money Market Quote Request. When the Borrower wishes to
request offers to make Money Market Loans under this Section, it shall
transmit to the Agent by telex or facsimile transmission a Money Market Quote
Request substantially in the form of Exhibit B hereto so as to be received no
later than 12:00 Noon (New York City time) on (x) the fifth Euro-Dollar
Business Day prior to the date of Borrowing proposed therein, in the case of a
LIBOR Auction or (y) the Domestic Business Day next preceding the date of
Borrowing proposed therein, in the case of an Absolute Rate Auction (or, in
either case, such other time or date as the Borrower and the Agent shall have
mutually agreed and shall have notified to the Banks not later than the date
of the Money Market Quote Request for the first LIBOR Auction or Absolute Rate
Auction for which such change is to be effective) specifying:
(i) the proposed date of Borrowing, which shall be a
Euro-Dollar Business Day in the case of a LIBOR Auction or a Domestic
Business Day in the case of an Absolute Rate Auction,
(ii) the aggregate amount of such Borrowing, which shall be
$25,000,000 or a larger multiple of $5,000,000,
(iii) the duration of the Interest Period applicable thereto,
subject to the provisions of the definition of Interest Period, and
(iv) whether the Money Market Quotes requested are to set forth
a Money Market Margin or a Money Market Absolute Rate.
The Borrower may request offers to make Money Market Loans for more than one
Interest Period in a single Money Market Quote Request. No Money Market Quote
Request shall be given within three Euro-Dollar Business Days (or such other
number of days as the Borrower and the Agent may agree) of any other Money
Market Quote Request.
(c) Invitation for Money Market Quotes. Promptly upon receipt
of a Money Market Quote Request, the Agent shall send to the Banks by telex or
facsimile transmission an Invitation for Money Market Quotes substantially in
the form of Exhibit C hereto, which shall constitute an invitation by the
Borrower to each Bank to submit Money Market Quotes offering to make the Money
Market Loans to which such Money Market Quote Request relates in accordance
with this Section.
(d) Submission and Contents of Money Market Quotes. (i) Each
Bank may submit a Money Market Quote containing an offer or offers to make
Money Market Loans in response to any Invitation for Money Market Quotes. Each
Money Market Quote must comply with the requirements of this subsection (d)
and must be submitted to the Agent by telex or facsimile transmission at its
offices specified in or pursuant to Section 9.01 not later than (x) 2:00 P.M.
(New York City time) on the fourth Euro-Dollar Business Day prior to the
proposed date of Borrowing, in the case of a LIBOR Auction or (y) 11:00 A.M.
(New York City time) on the proposed date of Borrowing, in the case of an
Absolute Rate Auction (or, in either case, such other time or date as the
Borrower and the Agent shall have mutually agreed and shall have notified to
the Banks not later than the date of the Money Market Quote Request for the
first LIBOR Auction or Absolute Rate Auction for which such change is to be
effective); provided that Money Market Quotes submitted by the Agent (or any
affiliate of the Agent) in the capacity of a Bank may be submitted, and may
only be submitted, if the Agent or such affiliate notifies the Borrower of the
terms of the offer or offers contained therein not later than (x) one hour
prior to the deadline for the other Banks, in the case of a LIBOR Auction or
(y) 15 minutes prior to the deadline for the other Banks, in the case of an
Absolute Rate Auction. Subject to Articles III and VI, any Money Market Quote
so made shall be irrevocable except with the written consent of the Agent
given on the instructions of the Borrower.
(ii) Each Money Market Quote shall be in substantially the
form of Exhibit D hereto and shall in any case specify:
(A) the proposed date of Borrowing,
(B) the principal amount of the Money Market Loan for which
each such offer is being made, which principal amount (w) may be
greater than or less than the Commitment of the quoting Bank, (x)
must be $3,000,000 or a larger multiple of $1,000,000, (y) may not
exceed the principal amount of Money Market Loans for which offers
were requested and (z) may be subject to an aggregate limitation as
to the principal amount of Money Market Loans for which offers being
made by such quoting Bank may be accepted,
(C) in the case of a LIBOR Auction, the margin above or below
the applicable London Interbank Offered Rate (the "Money Market
Margin") offered for each such Money Market Loan, expressed as a
percentage (specified to the nearest 1/10,000th of 1%) to be added to
or subtracted from such base rate,
(D) in the case of an Absolute Rate Auction, the rate of
interest per annum (specified to the nearest 1/10,000th of 1%) (the
"Money Market Absolute Rate") offered for each such Money Market
Loan, and
(E) the identity of the quoting Bank.
A Money Market Quote may set forth up to five separate offers by the quoting
Bank with respect to each Interest Period specified in the related Invitation
for Money Market Quotes.
(iii) Any Money Market Quote shall be disregarded if it:
(A) is not substantially in conformity with Exhibit D hereto
or does not specify all of the information required by subsection
(d)(ii);
(B) contains qualifying, conditional or similar language;
(C) proposes terms other than or in addition to those set
forth in the applicable Invitation for Money Market Quotes; or
(D) arrives after the time set forth in subsection (d)(i).
(e) Notice to Borrower. The Agent shall promptly notify the
Borrower of the terms (x) of any Money Market Quote submitted by a Bank that
is in accordance with subsection (d) and (y) of any Money Market Quote that
amends, modifies or is otherwise inconsistent with a previous Money Market
Quote submitted by such Bank with respect to the same Money Market Quote
Request. Any such subsequent Money Market Quote shall be disregarded by the
Agent unless such subsequent Money Market Quote is submitted solely to correct
a manifest error in such former Money Market Quote. The Agent's notice to the
Borrower shall specify (A) the aggregate principal amount of Money Market
Loans for which offers have been received for each Interest Period specified
in the related Money Market Quote Request, (B) the respective principal
amounts and Money Market Margins or Money Market Absolute Rates, as the case
may be, so offered and (C) if applicable, limitations on the aggregate
principal amount of Money Market Loans for which offers in any single Money
Market Quote may be accepted.
(f) Acceptance and Notice by Borrower. Not later than 12:00
Noon (New York City time) on (x) the third Euro-Dollar Business Day prior to
the proposed date of Borrowing, in the case of a LIBOR Auction or (y) the
proposed date of Borrowing, in the case of an Absolute Rate Auction (or, in
either case, such other time or date as the Borrower and the Agent shall have
mutually agreed and shall have notified to the Banks not later than the date
of the Money Market Quote Request for the first LIBOR Auction or Absolute Rate
Auction for which such change is to be effective), the Borrower shall notify
the Agent of its acceptance or non-acceptance of the offers so notified to it
pursuant to subsection (e). In the case of acceptance, such notice (a "Notice
of Money Market Borrowing") shall specify the aggregate principal amount of
offers for each Interest Period that are accepted. The Borrower may accept
any Money Market Quote in whole or in part; provided that:
(i) the aggregate principal amount of each Money Market
Borrowing may not exceed the applicable amount set forth in the
related Money Market Quote Request,
(ii) the principal amount of each Money Market Borrowing must be
$25,000,000 or a larger multiple of $5,000,000,
(iii) acceptance of offers may only be made on the basis of
ascending Money Market Margins or Money Market Absolute Rates, as the
case may be, and
(iv) the Borrower may not accept any offer that is described in
subsection (d)(iii) or that otherwise fails to comply with the
requirements of this Agreement.
(g) Allocation by Agent. If offers are made by two or more
Banks with the same Money Market Margins or Money Market Absolute Rates, as
the case may be, for a greater aggregate principal amount than the amount in
respect of which such offers are accepted for the related Interest Period, the
principal amount of Money Market Loans in respect of which such offers are
accepted shall be allocated by the Agent among such Banks as nearly as
possible (in multiples of $1,000,000, as the Agent may deem appropriate) in
proportion to the aggregate principal amounts of such offers. Determinations
by the Agent of the amounts of Money Market Loans shall be conclusive in the
absence of manifest error.
SECTION 2.04. Notice to Banks; Funding of Loans.
(a) Upon receipt of a Notice of Borrowing, the Agent shall
promptly notify each Bank of the contents thereof and of such Bank's share (if
any) of such Borrowing and such Notice of Borrowing shall not thereafter be
revocable by the Borrower.
(b) Not later than 2:00 P.M. (New York City time) on the date
of each Borrowing, each Bank participating therein shall (except as provided
in subsection (c) of this Section) make available its share of such Borrowing,
in Federal or other funds immediately available in New York City, to the Agent
at its address referred to in Section 9.01. Unless the Agent determines that
any applicable condition specified in Article III has not been satisfied, the
Agent will promptly make the funds so received from the Banks available to the
Borrower at the Agent's aforesaid address.
(c) If any Bank makes a new Loan hereunder on a day on which
the Borrower is to repay all or any part of an outstanding Loan from such
Bank, such Bank shall apply the proceeds of its new Loan to make such
repayment and only an amount equal to the difference (if any) between the
amount being borrowed and the amount being repaid shall be made available by
such Bank to the Agent as provided in subsection (b), or remitted by the
Borrower to the Agent as provided in Section 2.12, as the case may be.
(d) Unless the Agent shall have received notice from a Bank
prior to the date of any Borrowing that such Bank will not make available to
the Agent such Bank's share of such Borrowing, the Agent may assume that such
Bank has made such share available to the Agent on the date of such Borrowing
in accordance with subsections (b) and (c) of this Section 2.04 and the Agent
may, in reliance upon such assumption, make available to the Borrower on such
date a corresponding amount. If and to the extent that such Bank shall not
have so made such share available to the Agent, such Bank and the Borrower
severally agree to repay to the Agent forthwith on demand such corresponding
amount together with interest thereon, for each day from the date such amount
is made available to the Borrower until the date such amount is repaid to the
Agent, at (i) in the case of the Borrower, a rate per annum equal to the
higher of the Federal Funds Rate and the interest rate applicable thereto
pursuant to Section 2.07 and (ii) in the case of such Bank, the Federal Funds
Rate. If such Bank shall repay to the Agent such corresponding amount, such
amount so repaid shall constitute such Bank's Loan included in such Borrowing
for purposes of this Agreement.
SECTION 2.05. Notes. (a) The Loans of each Bank shall be
evidenced by a single Note payable to the order of such Bank for the account
of its Applicable Lending Office in an amount equal to the aggregate unpaid
principal amount of such Bank's Loans.
(b) Each Bank may, by notice to the Borrower and the Agent,
request that its Loans of a particular type be evidenced by a separate Note in
an amount equal to the aggregate unpaid principal amount of such Loans. Each
such Note shall be in substantially the form of Exhibit A hereto with
appropriate modifications to reflect the fact that it evidences solely Loans
of the relevant type. Each reference in this Agreement to the "Note" of such
Bank shall be deemed to refer to and include any or all of such Notes, as the
context may require.
(c) Upon receipt of each Bank's Note pursuant to Section
3.01(b), the Agent shall forward such Note to such Bank. Each Bank shall
record the date, amount, type and maturity of each Loan made by it and the
date and amount of each payment of principal made by the Borrower with respect
thereto, and may, if such Bank so elects in connection with any transfer or
enforcement of its Note, endorse on the schedule forming a part thereof
appropriate notations to evidence the foregoing information with respect to
each such Loan then outstanding; provided that the failure of any Bank to make
any such recordation or endorsement shall not affect the obligations of the
Borrower hereunder or under the Notes. Each Bank is hereby irrevocably
authorized by the Borrower so to endorse its Note and to attach to and make a
part of its Note a continuation of any such schedule as and when required.
SECTION 2.06. Maturity of Loans. Each Loan included in any
Borrowing shall mature, and the principal amount thereof shall be due and
payable, on the last day of the Interest Period applicable to such Borrowing.
SECTION 2.07. Interest Rates. (a) Each Base Rate Loan shall
bear interest on the outstanding principal amount thereof, for each day from
the date such Loan is made until it becomes due, at a rate per annum equal to
the Base Rate for such day. Such interest shall be payable for each Interest
Period on the last day thereof. Any overdue principal of or interest on any
Base Rate Loan shall bear interest, payable on demand, for each day until paid
at a rate per annum equal to the sum of 1% plus the rate otherwise applicable
to Base Rate Loans for such day.
(b) Each CD Loan shall bear interest on the outstanding
principal amount thereof, for each day during the Interest Period applicable
thereto, at a rate per annum equal to the sum of the CD Margin for such day
plus the Adjusted CD Rate applicable to such Interest Period; provided that if
any CD Loan or any portion thereof shall, as a result of clause (2)(b) of the
definition of Interest Period, have an Interest Period of less than 30 days,
such portion shall bear interest during such Interest Period at the rate
applicable to Base Rate Loans during such period. Such interest shall be
payable for each Interest Period on the last day thereof and, if such Interest
Period is longer than 90 days, at intervals of 90 days after the first day
thereof. Any overdue principal of or interest on any CD Loan shall bear
interest, payable on demand, for each day until paid at a rate per annum equal
to the sum of 1% plus the higher of (i) the sum of the CD Margin for such day
plus the Adjusted CD Rate applicable to the Interest Period for such Loan and
(ii) the rate applicable to Base Rate Loans for such day.
"CD Margin" means a rate per annum determined in accordance
with the Pricing Schedule.
The "Adjusted CD Rate" applicable to any Interest Period means
a rate per annum determined pursuant to the following formula:
[ CDBR ]*
ACDR = [ ---------- ] + AR
[ 1.00 - DRP ]
ACDR = Adjusted CD Rate
CDBR = CD Base Rate
DRP = Domestic Reserve Percentage
AR = Assessment Rate
__________
* The amount in brackets being rounded upward, if
necessary, to the next higher 1/100 of 1%
The "CD Base Rate" applicable to any Interest Period is the
rate of interest determined by the Agent to be the average (rounded upward, if
necessary, to the next higher 1/100 of 1%) of the prevailing rates per annum
bid at 10:00 A.M. (New York City time) (or as soon thereafter as practicable)
on the first day of such Interest Period by two or more New York certificate
of deposit dealers of recognized standing for the purchase at face value from
each CD Reference Bank of its certificates of deposit in an amount comparable
to the principal amount of the CD Loan of such CD Reference Bank to which such
Interest Period applies and having a maturity comparable to such Interest
Period.
"Domestic Reserve Percentage" means for any day that percentage
(expressed as a decimal) which is in effect on such day, as prescribed by the
Board of Governors of the Federal Reserve System (or any successor) for
determining the maximum reserve requirement (including without limitation any
basic, supplemental or emergency reserves) for a member bank of the Federal
Reserve System in New York City with deposits exceeding five billion dollars
in respect of new non-personal time deposits in dollars in New York City
having a maturity comparable to the related Interest Period and in an amount
of $100,000 or more. The Adjusted CD Rate shall be adjusted automatically on
and as of the effective date of any change in the Domestic Reserve Percentage.
"Assessment Rate" means for any day the annual assessment rate
in effect on such day which is payable by a member of the Bank Insurance Fund
classified as adequately capitalized and within supervisory subgroup "A" (or a
comparable successor assessment risk classification) within the meaning of 12
C.F.R. Section 327.3(e) (or any successor provision) to the Federal Deposit
Insurance Corporation (or any successor) for such Corporation's (or such
successor's) insuring time deposits at offices of such institution in the
United States. The Adjusted CD Rate shall be adjusted automatically on and as
of the effective date of any change in the Assessment Rate.
(c) Each Euro-Dollar Loan shall bear interest on the
outstanding principal amount thereof, for each day during the Interest Period
applicable thereto, at a rate per annum equal to the sum of the Euro-Dollar
Margin for such day plus the Adjusted London Interbank Offered Rate applicable
to such Interest Period. Such interest shall be payable for each Interest
Period on the last day thereof and, if such Interest Period is longer than
three months, at intervals of three months after the first day thereof.
"Euro-Dollar Margin" means a rate per annum determined in
accordance with the Pricing Schedule.
The "Adjusted London Interbank Offered Rate" applicable to any
Interest Period means a rate per annum equal to the quotient obtained (rounded
upward, if necessary, to the next higher 1/100 of 1%) by dividing (i) the
applicable London Interbank Offered Rate by (ii) 1.00 minus the Euro-Dollar
Reserve Percentage.
The "London Interbank Offered Rate" applicable to any Interest
Period means the average (rounded upward, if necessary, to the next higher
1/16 of 1%) of the respective rates per annum at which deposits in dollars are
offered to each of the Euro-Dollar Reference Banks in the London interbank
market at approximately 11:00 A.M. (London time) two Euro-Dollar Business Days
before the first day of such Interest Period in an amount approximately equal
to the principal amount of the Euro-Dollar Loan of such Euro-Dollar Reference
Bank to which such Interest Period is to apply and for a period of time
comparable to such Interest Period.
"Euro-Dollar Reserve Percentage" means for any day that
percentage (expressed as a decimal) which is in effect on such day, as
prescribed by the Board of Governors of the Federal Reserve System (or any
successor) for determining the maximum reserve requirement for a member bank
of the Federal Reserve System in New York City with deposits exceeding five
billion dollars in respect of "Eurocurrency liabilities" (or in respect of any
other category of liabilities which includes deposits by reference to which
the interest rate on Euro-Dollar Loans is determined or any category of
extensions of credit or other assets which includes loans by a non-United
States office of any Bank to United States residents). The Adjusted London
Interbank Offered Rate shall be adjusted automatically on and as of the
effective date of any change in the Euro-Dollar Reserve Percentage.
(d) Any overdue principal of or interest on any Euro-Dollar
Loan shall bear interest, payable on demand, for each day until paid at a rate
per annum equal to the higher of (i) the sum of 1% plus the Euro-Dollar Margin
for such day plus the Adjusted London Interbank Offered Rate applicable to the
Interest Period for such Loan and (ii) the sum of 1% plus the Euro-Dollar
Margin for such day plus the quotient obtained (rounded upward, if necessary,
to the next higher 1/100 of 1%) by dividing (x) the average (rounded upward,
if necessary, to the next higher 1/16 of 1%) of the respective rates per annum
at which one day (or, if such amount due remains unpaid more than three
Euro-Dollar Business Days, then for such other period of time not longer than
six months as the Agent may select) deposits in dollars in an amount
approximately equal to such overdue payment due to each of the Euro-Dollar
Reference Banks are offered to such Euro-Dollar Reference Bank in the London
interbank market for the applicable period determined as provided above by (y)
1.00 minus the Euro-Dollar Reserve Percentage (or, if the circumstances
described in clause (a) or (b) of Section 8.01 shall exist, at a rate per
annum equal to the sum of 1% plus the rate applicable to Base Rate Loans for
such day).
(e) Subject to Section 8.01(a), each Money Market LIBOR Loan
shall bear interest on the outstanding principal amount thereof, for the
Interest Period applicable thereto, at a rate per annum equal to the sum of
the London Interbank Offered Rate for such Interest Period (determined in
accordance with Section 2.07(c) as if the related Money Market LIBOR Borrowing
were a Committed Euro-Dollar Borrowing) plus (or minus) the Money Market
Margin quoted by the Bank making such Loan in accordance with Section 2.03.
Each Money Market Absolute Rate Loan shall bear interest on the outstanding
principal amount thereof, for the Interest Period applicable thereto, at a
rate per annum equal to the Money Market Absolute Rate quoted by the Bank
making such Loan in accordance with Section 2.03. Such interest shall be
payable for each Interest Period on the last day thereof and, if such Interest
Period is longer than three months, at intervals of three months after the
first day thereof. Any overdue principal of or interest on any Money Market
Loan shall bear interest, payable on demand, for each day until paid at a rate
per annum equal to the sum of 1% plus the Base Rate for such day.
(f) The Agent shall determine each interest rate applicable to
the Loans hereunder. The Agent shall give prompt notice to the Borrower and
the participating Banks of each rate of interest so determined, and its
determination thereof shall be conclusive in the absence of manifest error.
(g) Each Reference Bank agrees to use its best efforts to
furnish quotations to the Agent as contemplated by this Section. If any
Reference Bank does not furnish a timely quotation, the Agent shall determine
the relevant interest rate on the basis of the quotation or quotations
furnished by the remaining Reference Bank or Banks or, if none of such
quotations is available on a timely basis, the provisions of Section 8.01
shall apply.
SECTION 2.08. Fees.
(a) Commitment Fee. During the Revolving Credit Period, the
Borrower shall pay to the Agent for the account of the Banks ratably in
proportion to their Commitments a commitment fee at the Commitment Fee Rate
(determined daily in accordance with the Pricing Schedule) on the daily amount
by which the aggregate amount of the Commitments exceeds the aggregate
outstanding principal amount of the Loans. Such commitment fee shall accrue
from and including the Effective Date to but excluding the Termination Date
(or earlier date of termination of the Commitments in their entirety).
(b) Facility Fee. The Borrower shall pay to the Agent for the
account of the Banks ratably in proportion to their Commitments a facility fee
at the Facility Fee Rate (determined daily in accordance with the Pricing
Schedule). Such facility fee shall accrue (i) from and including the
Effective Date to but excluding the Termination Date (or earlier date of
termination of the Commitments in their entirety), on the daily aggregate
amount of the Commitments (whether used or unused) and (ii) from and including
the Termination Date or such earlier date of termination to but excluding the
date the Loans shall be repaid in their entirety, on the daily aggregate
outstanding principal amount of the Loans.
(c) Payments. Accrued fees under this Section shall be
payable quarterly on each March 31, June 30, September 30 and December 31 and
upon the date of termination of the Commitments in their entirety (and, if
later, the date the Loans shall be repaid in their entirety).
SECTION 2.09. Optional Termination or Reduction of
Commitments. During the Revolving Credit Period, the Borrower may, upon at
least three Domestic Business Days' notice to the Agent, (i) terminate the
Commitments at any time, if no Loans are outstanding at such time or (ii)
ratably reduce from time to time by an aggregate amount of $25,000,000 or any
larger multiple thereof, the aggregate amount of the Commitments in excess of
the aggregate outstanding principal amount of the Loans.
SECTION 2.10. Scheduled Termination of Commitments. The
Commitments shall terminate on the Termination Date, and any Loans then
outstanding (together with accrued interest thereon) shall be due and payable
on such date.
SECTION 2.11. Optional Prepayments. (a) Subject in the case
of any Fixed Rate Borrowing to Section 2.13, the Borrower may, upon at least
three Domestic Business Days' notice to the Agent, prepay any Domestic
Borrowing (or any Money Market Borrowing bearing interest at the Base Rate
pursuant to Section 8.01(a)) or upon at least three Euro-Dollar Business Days'
notice to the Agent, prepay any Euro-Dollar Borrowing, in each case in whole
at any time, or from time to time in part in amounts aggregating $25,000,000 or
any larger multiple of $5,000,000, by paying the principal amount to be
prepaid together with accrued interest thereon to the date of prepayment.
Each such optional prepayment shall be applied to prepay ratably the Loans of
the several Banks included in such Borrowing.
(b) Except as provided in Section 2.11(a), the Borrower may
not prepay all or any portion of the principal amount of any Money Market Loan
prior to the maturity thereof.
(c) Upon receipt of a notice of prepayment pursuant to this
Section, the Agent shall promptly notify each Bank of the contents thereof and
of such Bank's ratable share (if any) of such prepayment and such notice shall
not thereafter be revocable by the Borrower.
SECTION 2.12. General Provisions as to Payments. (a) The
Borrower shall make each payment of principal of, and interest on, the Loans
and of fees hereunder, not later than 2:00 P.M. (New York City time) on the
date when due, in Federal or other funds immediately available in New York
City, to the Agent at its address referred to in Section 9.01. The Agent will
promptly distribute to each Bank its ratable share of each such payment
received by the Agent for the account of the Banks. Whenever any payment of
principal of, or interest on, the Domestic Loans or of fees shall be due on a
day which is not a Domestic Business Day, the date for payment thereof shall
be extended to the next succeeding Domestic Business Day. Whenever any
payment of principal of, or interest on, the Euro-Dollar Loans shall be due on
a day which is not a Euro-Dollar Business Day, the date for payment thereof
shall be extended to the next succeeding Euro-Dollar Business Day unless such
Euro-Dollar Business Day falls in another calendar month, in which case the
date for payment thereof shall be the next preceding Euro-Dollar Business Day.
Whenever any payment of principal of, or interest on, the Money Market Loans
shall be due on a day which is not a Euro-Dollar Business Day, the date for
payment thereof shall be extended to the next succeeding Euro-Dollar Business
Day. If the date for any payment of principal is extended by operation of law
or otherwise, interest thereon shall be payable for such extended time.
(b) Unless the Agent shall have received notice from the
Borrower prior to the date on which any payment is due to the Banks hereunder
that the Borrower will not make such payment in full, the Agent may assume
that the Borrower has made such payment in full to the Agent on such date and
the Agent may, in reliance upon such assumption, cause to be distributed to
each Bank on such due date an amount equal to the amount then due such Bank.
If and to the extent that the Borrower shall not have so made such payment,
each Bank shall repay to the Agent forthwith on demand such amount distributed
to such Bank together with interest thereon, for each day from the date such
amount is distributed to such Bank until the date such Bank repays such amount
to the Agent, at the Federal Funds Rate.
SECTION 2.13. Funding Losses. If the Borrower makes any
payment of principal with respect to any Fixed Rate Loan (pursuant to Article
II, VI or VIII or otherwise) on any day other than the last day of the
Interest Period applicable thereto, or the last day of an applicable period
fixed pursuant to Section 2.07(d), or if the Borrower fails to borrow or
prepay any Fixed Rate Loans after notice has been given to any Bank in
accordance with Section 2.04(a) or 2.11(c), the Borrower shall reimburse each
Bank within 15 days after demand for any resulting loss or expense incurred
by it (or by an existing or prospective Participant in the related Loan),
including (without limitation) any loss incurred in obtaining, liquidating or
employing deposits from third parties, but excluding loss of margin for the
period after any such payment or failure to borrow or prepay, provided that
such Bank shall have delivered to the Borrower a certificate as to the amount
of such loss or expense, which certificate shall be conclusive in the absence
of manifest error.
SECTION 2.14. Computation of Interest and Fees. Interest
based on the Prime Rate hereunder shall be computed on the basis of a year of
365 days (or 366 days in a leap year) and paid for the actual number of days
elapsed (including the first day but excluding the last day). All other
interest and fees shall be computed on the basis of a year of 360 days and
paid for the actual number of days elapsed (including the first day but
excluding the last day).
ARTICLE III
CONDITIONS
SECTION 3.01. Effectiveness. This Agreement shall become
effective on the date that each of the following conditions shall have been
satisfied (or waived in accordance with Section 9.05):
(a) receipt by the Agent of counterparts hereof signed by each
of the parties hereto (or, in the case of any party as to which an
executed counterpart shall not have been received, receipt by the
Agent in form satisfactory to it of telegraphic, telex or other
written confirmation from such party of execution of a counterpart
hereof by such party);
(b) receipt by the Agent of a duly executed Note for the
account of each Bank dated on or before the Effective Date complying
with the provisions of Section 2.05;
(c) receipt by the Agent of an opinion of the General Counsel
of the Borrower, given upon the express instructions of the Borrower,
substantially in the form of Exhibit E hereto and covering such
additional matters relating to the transactions contemplated hereby
as the Required Banks may reasonably request;
(d) receipt by the Agent of an opinion of Wachtell, Lipton,
Rosen & Katz, Special Counsel for the Borrower, given upon the
express instructions of the Borrower, substantially in the form of
Exhibit F hereto and covering such additional matters relating to the
transactions contemplated hereby as the Required Banks may reasonably
request;
(e) receipt by the Agent of an opinion of Davis Polk &
Wardwell, special counsel for the Agent, substantially in the form of
Exhibit G hereto and covering such additional matters relating to the
transactions contemplated hereby as the Required Banks may reasonably
request;
(f) receipt by the Agent of all documents the Agent may
reasonably request relating to the existence of the Borrower, the
corporate authority for and the validity of this Agreement and the
Notes, and any other matters relevant hereto, all in form and
substance satisfactory to the Agent; and
(g) receipt by the Agent of evidence satisfactory to it of the
payment of all principal of and interest on any loans outstanding
under, and of all other amounts payable under, the Existing Credit
Agreement (subject to Section 3.03 below);
provided that this Agreement shall not become effective or be binding on any
party hereto unless all of the foregoing conditions are satisfied not later
than June 30, 1994. The Agent shall promptly notify the Borrower and the
Banks of the Effective Date, and such notice shall be conclusive and binding
on all parties hereto. The Banks that are parties to the Existing Credit
Agreement, comprising the "Required Banks" as defined therein, and the
Borrower agree (i) that the commitments under the Existing Credit Agreement
shall terminate in their entirety simultaneously with and subject to the
effectiveness of this Agreement, (ii) that the Borrower shall be obligated to
pay the accrued commitment and facility fees thereunder to but excluding the
date of such effectiveness and (iii) that the Borrower may prepay outstanding
Money Market Loans as contemplated by Section 3.03 below.
SECTION 3.02. Borrowings. The obligation of any Bank to make
a Loan on the occasion of any Borrowing is subject to the satisfaction of the
following conditions:
(a) receipt by the Agent of a Notice of Borrowing as required
by Section 2.02 or 2.03, as the case may be;
(b) the fact that, immediately after such Borrowing, the
aggregate outstanding principal amount of the Loans will not exceed
the aggregate amount of the Commitments;
(c) the fact that, immediately before and after such
Borrowing, no Default shall have occurred and be continuing;
(d) the fact that the representations and warranties of the
Borrower contained in this Agreement (except, in the case of a
Refunding Borrowing, the representations and warranties set forth in
Sections 4.04(c) and 4.05 as to any matter which has theretofore been
disclosed in writing by the Borrower to the Banks) shall be true on
and as of the date of such Borrowing; and
(e) except in the case of a Refunding Borrowing, the fact that
the Agent shall not have notified the Borrower of a determination by
the Required Banks (which determination shall be made in good faith)
that there has been a material adverse change in the business,
prospects, financial position or results of operations of the
Borrower and its Consolidated Subsidiaries, considered as a whole
since April 30, 1994.
Each Borrowing hereunder shall be deemed to be a representation and warranty
by the Borrower on the date of such Borrowing as to the facts specified in
clauses (b), (c) and (d) of this Section.
SECTION 3.03. Outstanding "Money Market Loans". Each
"Money Market Loan" outstanding under the Existing Credit Agreement made by a
Bank party to this Agreement shall be deemed prepaid in full on the Effective
Date and reloaned by such Bank as a Money Market Loan hereunder, with a
maturity and interest rate as determined under the Existing Credit Agreement.
ARTICLE IV
REPRESENTATIONS AND WARRANTIES
The Borrower represents and warrants that:
SECTION 4.01. Corporate Existence and Power. The Borrower is
a corporation duly incorporated, validly existing and in good standing under
the laws of Delaware, and has all corporate powers and all material
governmental licenses, authorizations, consents and approvals required to
carry on its business as now conducted.
SECTION 4.02. Corporate and Governmental Authorization; No
Contravention. The execution, delivery and performance by the Borrower of
this Agreement and the Notes are within the Borrower's corporate powers, have
been duly authorized by all necessary corporate action, require no action by
or in respect of, or filing with, any governmental body, agency or official
and do not contravene, or constitute a default under, any provision of
applicable law or regulation or of the certificate of incorporation or by-laws
of the Borrower or of any agreement or instrument evidencing or governing
Material Debt or of any other material agreement, judgment, injunction, order,
decree or other material instrument binding upon the Borrower or any of its
Subsidiaries or result in the creation or imposition of any Lien on any asset
of the Borrower or any of its Subsidiaries.
SECTION 4.03. Binding Effect. This Agreement constitutes a
valid and binding agreement of the Borrower and each Note, when executed and
delivered in accordance with this Agreement, will constitute a valid and
binding obligation of the Borrower, in each case enforceable in accordance
with its terms except as the same may be limited by bankruptcy, insolvency or
similar laws affecting creditors' rights generally and by general principles of
equity.
SECTION 4.04. Financial Information.
(a) The consolidated balance sheet of the Borrower and its
Consolidated Subsidiaries as of January 29, 1994 and the related consolidated
statements of earnings, common shareholders' equity and cash flows for the
fiscal year then ended, reported on by independent public accountants and set
forth in the Borrower's 1993 Form 10-K, a copy of which has been delivered to
each of the Banks, fairly present, in conformity with United States generally
accepted accounting principles, the consolidated financial position of the
Borrower and its Consolidated Subsidiaries as of such date and their
consolidated results of operations and cash flows for such fiscal year.
(b) The unaudited consolidated condensed balance sheet of the
Borrower and its Consolidated Subsidiaries as of April 30, 1994 and the
related unaudited consolidated statements of earnings and cash flows for the
three months then ended, set forth in the Borrower's Latest Form 10-Q, a copy
of which has been delivered to each of the Banks, fairly present, in
conformity with United States generally accepted accounting principles applied
on a basis consistent with the financial statements referred to in subsection
(a) of this Section, the consolidated financial position of the Borrower and
its Consolidated Subsidiaries as of such date and their consolidated results
of operations and cash flows for such three month period (subject to normal
year-end adjustments).
(c) Since April 30, 1994 there has been no material adverse
change in the business, prospects, financial position or results of operations
of the Borrower and its Consolidated Subsidiaries, considered as a whole,
which has not been disclosed in writing to the Banks or disclosed in the
Borrower's 1993 Form 10-K or Borrower's Latest Form 10-Q.
SECTION 4.05. Litigation. Except as disclosed in the
Borrower's 1993 Form 10-K or Borrower's Latest Form 10-Q or as otherwise
disclosed in writing to the Banks, there is no action, suit or proceeding
pending against, or to the knowledge of the Borrower threatened against or
affecting, the Borrower or any of its Subsidiaries before any court or
arbitrator or any governmental body, agency or official in which there is a
reasonable possibility of an adverse decision which could materially adversely
affect the business, consolidated financial position or consolidated results
of operations of the Borrower and its Consolidated Subsidiaries, considered as
a whole, or which in any manner draws into question the validity of this
Agreement or the Notes.
SECTION 4.06. Compliance with ERISA. Each member of the ERISA
Group has fulfilled its obligations under the minimum funding standards of
ERISA and the Internal Revenue Code with respect to each Plan and is in
compliance in all material respects with the presently applicable provisions
of ERISA and the Internal Revenue Code with respect to each Plan. No member
of the ERISA Group has (i) sought a waiver of the minimum funding standard
under Section 412 of the Internal Revenue Code in respect of any Plan, (ii)
failed to make any contribution or payment to any Plan or Multiemployer Plan
or made any amendment to any Plan which has resulted or could result in the
imposition of a Lien or the posting of a bond or other security under ERISA or
the Internal Revenue Code or (iii) incurred any liability under Title IV of
ERISA other than a liability to the PBGC for premiums under Section 4007 of
ERISA.
SECTION 4.07. Environmental Matters. In the ordinary course
of its business, the Borrower conducts an ongoing review of the effect of
Environmental Laws on the business, operations and properties of the Borrower
and its Subsidiaries, in the course of which it identifies and evaluates
associated liabilities and costs (including, without limitation, any capital
or operating expenditures required for clean-up or closure of properties
presently or previously owned, any capital or operating expenditures required
to achieve or maintain compliance with environmental protection standards
imposed by law or as a condition of any license, permit or contract, any
related constraints on operating activities, including any periodic or
permanent shutdown of any facility or reduction in the level of or change in
the nature of operations conducted thereat, any costs or liabilities in
connection with off-site disposal of wastes or Hazardous Substances, and any
actual or potential liabilities to third parties, including employees, and any
related costs and expenses). On the basis of this review, the Borrower has
reasonably concluded that such associated liabilities and costs, including the
costs of compliance with Environmental Laws, are unlikely to have a material
adverse effect on the business, financial condition or results of operations
of the Borrower and its Consolidated Subsidiaries, considered as a whole.
SECTION 4.08. Taxes. The Borrower and its Subsidiaries have
filed all United States Federal income tax returns and all other material tax
returns which are required to be filed by them and have paid all material
taxes due pursuant to such returns or pursuant to any assessment received by
the Borrower or any Subsidiary, except where the same may be contested in good
faith by appropriate proceedings. The charges, accruals and reserves on the
books of the Borrower and its Subsidiaries in respect of taxes or other
governmental charges are, in the opinion of the Borrower, adequate.
SECTION 4.09. Subsidiaries. Each of the Borrower's Major
Subsidiaries is a corporation duly incorporated, validly existing and in good
standing under the laws of its jurisdiction of incorporation, and has all
corporate powers and all material governmental licenses, authorizations,
consents and approvals required to carry on its business as now conducted.
SECTION 4.10. Not an Investment Company. The Borrower is not
an "investment company" within the meaning of the Investment Company Act of
1940, as amended.
SECTION 4.11. Full Disclosure. All information heretofore
furnished by the Borrower to the Agent or any Bank for purposes of or in
connection with this Agreement or any transaction contemplated hereby is, and
all such information hereafter furnished by the Borrower to the Agent or any
Bank will be, true, accurate and complete in every material respect or based
on reasonable estimates on the date as of which such information is stated or
certified. The Borrower has disclosed to the Banks in writing any and all
facts which materially and adversely affect or may materially and adversely
affect (to the extent the Borrower can now reasonably foresee), the business,
operations, prospects or condition, financial or otherwise, of the Borrower
and its Consolidated Subsidiaries, taken as a whole, or the ability of the
Borrower to perform its obligations under this Agreement.
ARTICLE V
COVENANTS
The Borrower agrees that, so long as any Bank has any
Commitment hereunder or any amount payable under any Note remains unpaid:
SECTION 5.01. Information. The Borrower will deliver to each
of the Banks:
(a) as soon as available and in any event within 120 days
after the end of each fiscal year of the Borrower, a consolidated
balance sheet of the Borrower and its Consolidated Subsidiaries as of
the end of such fiscal year and the related consolidated statements of
earnings, common shareholders' equity and cash flows for such fiscal
year, setting forth in each case in comparative form the figures for
the previous fiscal year, all reported on in a manner acceptable to
the Securities and Exchange Commission by independent public
accountants of nationally recognized standing;
(b) as soon as available and in any event within 60 days after
the end of each of the first three quarters of each fiscal year of
the Borrower, a consolidated condensed balance sheet of the Borrower
and its Consolidated Subsidiaries as of the end of such quarter and
the related consolidated condensed statements of earnings for such
quarter and for the portion of the Borrower's fiscal year ended at
the end of such quarter and the related consolidated condensed
statement of cash flows for the portion of the Borrower's fiscal year
ended at the end of such quarter, setting forth in the case of such
statements of earnings and cash flows in comparative form the figures
for the corresponding quarter and the corresponding portion of the
Borrower's previous fiscal year, all certified (subject to normal
year-end adjustments) as to fairness of presentation, United States
generally accepted accounting principles and consistency by the chief
financial officer or the chief accounting officer of the Borrower;
(c) simultaneously with the delivery of each set of financial
statements referred to in clauses (a) and (b) above, a certificate of
the chief financial officer or the chief accounting officer of the
Borrower (i) setting forth in reasonable detail the calculations
required to establish whether the Borrower was in compliance with the
requirements of Sections 5.07 to 5.09, inclusive, on the date of such
financial statements and (ii) stating whether any Default exists on
the date of such certificate and, if any Default then exists, setting
forth the details thereof and the action which the Borrower is taking
or proposes to take with respect thereto;
(d) simultaneously with the delivery of each set of financial
statements referred to in clause (a) above, a statement of the firm
of independent public accountants which reported on such statements
(i) whether anything has come to their attention to cause them to
believe that any Default existed on the date of such statements and
(ii) confirming the calculations set forth in the officer's
certificate delivered simultaneously therewith pursuant to clause (c)
above;
(e) within five days after any officer of the Borrower obtains
knowledge of any Default, if such Default is then continuing, a
certificate of the chief financial officer or the chief accounting
officer of the Borrower setting forth the details thereof and the
action which the Borrower is taking or proposes to take with respect
thereto;
(f) promptly upon the mailing thereof to the shareholders of
the Borrower generally, copies of all financial statements, reports
and proxy statements so mailed;
(g) promptly upon the filing thereof, copies of all
registration statements (other than the exhibits thereto and any
registration statements on Form S-8 or its equivalent) and reports on
Forms 10-K, 10-Q and 8-K (or their equivalents) which the Borrower
shall have filed with the Securities and Exchange Commission;
(h) if and when the Borrower or any Subsidiary or any plan
administrator gives or is required to give notice to the PBGC of any
"reportable event" (as defined in Section 4043 of ERISA) with respect
to any Plan which might constitute grounds for a termination of such
Plan under Title IV of ERISA or, with respect to any Multiemployer
Plan, receives notice as prescribed in ERISA of any material
withdrawal liability assessed against the Borrower or any Subsidiary,
a copy of such notice; and
(i) from time to time such additional information regarding
the financial position or business of the Borrower and its
Subsidiaries as the Agent, at the request of any Bank, may reasonably
request.
SECTION 5.02. Payment of Obligations. The Borrower will pay
and discharge, and will cause each Major Subsidiary to pay and discharge, at
or before maturity, all their respective material obligations and liabilities,
including, without limitation, material tax liabilities, except where the same
may be contested in good faith by appropriate proceedings, and will maintain,
and will cause each Subsidiary to maintain, in accordance with United States
generally accepted accounting principles, appropriate reserves for the accrual
of any of the same.
SECTION 5.03. Maintenance of Property; Insurance. (a) The
Borrower will keep, and will cause each Major Subsidiary to keep, all material
property useful and necessary in its business in good working order and
condition, ordinary wear and tear excepted.
(b) The Borrower will maintain, and will cause each Major
Subsidiary to maintain (either in the name of the Borrower or in such Major
Subsidiary's own name) with financially sound and reputable insurance
companies, insurance on all their property in at least such amounts and
against at least such risks as are usually insured against in the same general
area by companies of established repute engaged in the same or a similar
business, it being understood that a program of self-insurance in such amounts
and against such risks as the Borrower reasonably deems prudent and consistent
with practices of other comparable companies is not inconsistent with this
Section. The Borrower will furnish to the Banks, upon written request from
the Agent, full information as to the insurance carried.
SECTION 5.04. Conduct of Business and Maintenance of
Existence. Subject to Section 5.10, the Borrower will continue, and will
cause each Major Subsidiary to continue, to engage in business of the same
general type as now conducted by the Borrower and its Subsidiaries, and will
preserve, renew and keep in full force and effect, and will cause each Major
Subsidiary to preserve, renew and keep in full force and effect their
respective corporate existence and their respective material rights,
privileges and franchises necessary or desirable in the normal conduct of
business; provided that nothing in this Section 5.04 shall prohibit (i) the
merger of a Subsidiary into the Borrower or the merger or consolidation of a
Subsidiary with or into another Person if the corporation surviving such
consolidation or merger is a Subsidiary and if, in each case, after giving
effect thereto, no Default shall have occurred and be continuing or (ii) the
abandonment or termination of the corporate existence, rights, privileges or
franchises of any Subsidiary when deemed by the Borrower in the best interests
of its overall business.
SECTION 5.05. Compliance with Laws. The Borrower will comply,
and cause each Major Subsidiary to comply, in all material respects with all
applicable material laws, ordinances, rules, regulations, and requirements of
governmental authorities (including, without limitation, Environmental Laws
and ERISA and the rules and regulations thereunder) except where the necessity
of compliance therewith is contested in good faith by appropriate proceedings.
SECTION 5.06. Inspection of Property, Books and Records. The
Borrower will keep, and will cause each Major Subsidiary to keep, proper books
of record and account in which full, true and correct entries in conformity
with United States generally accepted accounting principles shall be made of
all dealings and transactions in relation to its business and activities; and
will permit, and will cause each Major Subsidiary to permit, representatives
of any Bank at such Bank's expense to visit and inspect any of their
respective properties, to examine and make abstracts (or, in the case of
financial information, copies) from any of their respective books and records
and to discuss their respective affairs, finances and accounts with their
respective officers, employees and independent public accountants, all as
arranged by the Borrower and the Agent at such reasonable times and as often
as may reasonably be desired. The Banks will use reasonable efforts,
consistent with their normal business practices, to maintain the
confidentiality of any information so received.
SECTION 5.07. Cash Flow/Total Debt Ratio. As of the last day
of any fiscal quarter, the ratio of (i) the sum of Operating Cash Flow plus
Minimum Net Rental Expense for the period of four consecutive fiscal quarters
then ended to (ii) Total Debt at such date will not be less than .23.
SECTION 5.08. Subsidiary Debt Restriction. The Borrower will
not permit any Subsidiary to incur, assume or suffer to exist any Debt except
for (i) Debt of a Subsidiary to the Borrower or another Subsidiary, (ii) other
Debt not included under clauses (iii) and (iv) of this Section 5.08
outstanding on the date of this Agreement in aggregate principal amount not
exceeding $75,000,000, (iii) Debt incurred by a Subsidiary to finance or
refinance real estate owned by it, or the development thereof, (iv) Debt
incurred by a Subsidiary in connection with industrial revenue and industrial
development bond financing and (v) Debt secured by a Lien permitted by Section
5.09, provided that the aggregate outstanding principal amount of Debt of
Subsidiaries of the types described in clauses (iii), (iv) and (v) (including
Debt of such nature outstanding on the date of this Agreement) shall at no
time exceed 25% of Consolidated Tangible Assets and provided further that Debt
permitted by clause (ii) does not include any extension, renewal or refunding
of any such outstanding Debt.
SECTION 5.09. Negative Pledge. Neither the Borrower nor any
Subsidiary will create, assume or suffer to exist any Lien on any asset now
owned or hereafter acquired by it, except:
(a) Liens existing on the date of this Agreement securing Debt
outstanding on the date of this Agreement in an aggregate principal
or face amount not exceeding $150,000,000;
(b) any Lien existing on any asset of any Person at the time
such Person becomes a Subsidiary and not created in contemplation of
such event;
(c) any Lien on any asset securing Debt incurred or assumed
for the purpose of financing all or any part of the cost of acquiring
or improving such asset, provided that such Lien attaches to such
asset concurrently with or within 180 days after the later of the
acquisition or completion of improvement thereof;
(d) any Lien on any asset of any Person existing at the time
such Person is merged or consolidated with or into the Borrower or a
Subsidiary and not created in contemplation of such event;
(e) any Lien existing on any asset prior to the acquisition
thereof by the Borrower or a Subsidiary and not created in
contemplation of such acquisition;
(f) any Lien securing (i) Debt of the Borrower to a Subsidiary
or (ii) Debt of a Subsidiary to the Borrower or another Subsidiary;
(g) any Lien arising out of the refinancing, extension,
renewal or refunding of any Debt secured by any Lien permitted by any
of the foregoing clauses of this Section, provided that such Debt is
not increased and is not secured by any additional assets;
(h) Liens arising in the ordinary course of its business which
(i) do not secure Debt or Derivatives Obligations, (ii) do not secure
any obligation in an amount exceeding $100,000,000 and (iii) do not
in the aggregate materially detract from the value of its assets or
materially impair the use thereof in the operation of its business;
(i) Liens on cash and cash equivalents securing Derivatives
Obligations, provided that the aggregate amount of cash and cash
equivalents subject to such Liens may at no time exceed $50,000,000;
and
(j) Liens not otherwise permitted by the foregoing clauses of
this Section securing Debt in an aggregate principal or face amount
at any time outstanding not to exceed the greater of (i) $250,000,000
or (ii) 10% of the Borrower's Consolidated Net Tangible Assets.
SECTION 5.10. Consolidations, Mergers and Sales of Assets.
The Borrower will not (i) consolidate or merge with or into any other Person
or (ii) sell, lease or otherwise transfer, directly or indirectly, all or
substantially all of the assets of the Borrower and its Subsidiaries, taken as
a whole, to any other Person, provided that the Borrower may merge with
another Person if (A) the Borrower is the corporation surviving such merger
and (B) immediately after giving effect to such merger, no Default shall have
occurred and be continuing.
SECTION 5.11. Use of Proceeds. The proceeds of the Loans made
under this Agreement will be used by the Borrower for its general corporate
purposes. None of such proceeds will be used, directly or indirectly, for the
purpose, whether immediate, incidental or ultimate, of buying or carrying any
"margin stock" within the meaning of Regulation U or in violation of any
Margin Regulations.
ARTICLE VI
DEFAULTS
SECTION 6.01. Events of Default. If one or more of the
following events ("Events of Default") shall have occurred and be continuing:
(a) the Borrower shall fail to pay when due any principal of
any Loan, or shall fail to pay within five Domestic Business Days of
the due date any interest on any Loan, any fees or any other amount
payable hereunder;
(b) the Borrower shall fail to observe or perform any covenant
contained in Sections 5.07 to 5.11, inclusive;
(c) the Borrower shall fail to observe or perform any covenant
or agreement contained in this Agreement (other than those covered by
clause (a) or (b) above) for 30 days after written notice thereof has
been given to the Borrower by the Agent at the request of any Bank;
(d) any representation, warranty, certification or statement
made by the Borrower in this Agreement or in any certificate,
financial statement or other document delivered pursuant to this
Agreement shall prove to have been incorrect in any material respect
when made (or deemed made);
(e) the Borrower or any Subsidiary shall fail to make any
payment in respect of any Material Financial Obligations when due or
within any applicable grace period), provided that such failure to
make any payment in respect of any capital lease shall not constitute
an Event of Default so long as the Borrower or such Subsidiary shall
be contesting on reasonable grounds and in good faith the obligation
to make such payment;
(f) any event or condition shall occur which results in the
acceleration of the maturity of any Material Debt or enables the
holder of such Debt or any Person acting on such holder's behalf to
accelerate the maturity thereof (in each case, any applicable grace or
cure period having elapsed);
(g) the Borrower or any Major Subsidiary (i) shall commence a
voluntary case or other proceeding seeking liquidation,
reorganization or other relief with respect to itself or its debts
under any bankruptcy, insolvency or other similar law now or
hereafter in effect or seeking the appointment of a trustee,
receiver, liquidator, custodian or other similar official of it or
any substantial part of its property, or shall consent to any such
relief or to the appointment of or taking possession by any such
official in an involuntary case or other proceeding commenced against
it, or shall make a general assignment for the benefit of creditors,
or shall fail generally to pay its debts as they become due, or (ii)
shall take any corporate action to authorize any of the foregoing;
(h) an involuntary case or other proceeding shall be commenced
against the Borrower or any Major Subsidiary seeking liquidation,
reorganization or other relief with respect to it or its debts under
any bankruptcy, insolvency or other similar law now or hereafter in
effect or seeking the appointment of a trustee, receiver, liquidator,
custodian or other similar official of it or any substantial part of
its property, and such involuntary case or other proceeding shall
remain undismissed and unstayed for a period of 60 days; or an order
for relief shall be entered against the Borrower or any Subsidiary
under the federal bankruptcy laws as now or hereafter in effect;
(i) the Borrower or any Subsidiary shall fail to pay when due
any material amount which is either uncontested or if contested is
the subject of a final non-appealable decision and which it shall
have become liable to pay to the PBGC or to a Plan under Title IV of
ERISA, or notice of intent to terminate a Plan or Plans shall be
filed under Title IV of ERISA by the Borrower, any Subsidiary, any
plan administrator or any combination of the foregoing which could
give rise to a material liability of the Borrower or any Subsidiary
under Title IV of ERISA, or the PBGC shall institute proceedings
under Title IV of ERISA to terminate or to cause a trustee to be
appointed to administer any Plan or Plans which could give rise to a
material liability of the Borrower or any Subsidiary under Title IV of
ERISA; or the Borrower or any Subsidiary shall incur any material
withdrawal liability with respect to any Multiemployer Plan which is
uncontested or, if contested, is the subject of a final non-appealable
decision and the Borrower fails to discharge, satisfy or otherwise
eliminate such liability with respect to any Multiemployer Plan
within the time required by such judgment;
(j) a judgment or order for the payment of money in excess of
$25,000,000 shall be rendered against the Borrower or any Major
Subsidiary and such judgment or order shall continue unsatisfied and
unstayed for a period of 60 days; or
(k) any person or group of persons (within the meaning of
Section 13 or 14 of the Securities Exchange Act of 1934, as amended)
shall have acquired beneficial ownership (within the meaning of Rule
13d-3 promulgated by the Securities and Exchange Commission under said
Act) of 30% or more of the outstanding shares of common stock of the
Borrower; or, during any period of 12 consecutive calendar months,
individuals who were directors of the Borrower on the first day of
such period and any successor directors the election of whom was
approved by a majority of such individuals or their successors so
approved shall cease to constitute a majority of the board of
directors of the Borrower;
then, and in every such event, the Agent shall (i) if requested by Banks
having more than 50% in aggregate amount of the Commitments, by notice to the
Borrower terminate the Commitments and they shall thereupon terminate, and
(ii) if requested by Banks holding Notes evidencing more than 50% in aggregate
principal amount of the Loans, by notice to the Borrower declare the Notes
(together with accrued interest thereon) to be, and the Notes shall thereupon
become, immediately due and payable without presentment, demand, protest or
other notice of any kind, all of which are hereby waived by the Borrower;
provided that in the case of any of the Events of Default specified in
paragraph (g)(i) or (h) above with respect to the Borrower, without any notice
to the Borrower or any other act by the Agent or the Banks, the Commitments
shall thereupon automatically terminate and the Notes (together with accrued
interest thereon) shall automatically become immediately due and payable
without presentment, demand, protest or other notice of any kind, all of which
are hereby waived by the Borrower.
SECTION 6.02. Notice of Default. The Agent shall give notice
to the Borrower under Section 6.01(c) promptly upon being requested to do so
by any Bank and shall thereupon notify all the Banks thereof.
ARTICLE VII
THE AGENT AND THE CO-AGENTS
SECTION 7.01. Appointment and Authorization. Each Bank
irrevocably appoints and authorizes the Agent to take such action as agent on
its behalf and to exercise such powers under this Agreement and the Notes as
are delegated to the Agent by the terms hereof or thereof, together with all
such powers as are reasonably incidental thereto.
SECTION 7.02. Agent and Affiliates. Morgan Guaranty Trust
Company of New York shall have the same rights and powers under this Agreement
as any other Bank and may exercise or refrain from exercising the same as
though it were not the Agent, and Morgan Guaranty Trust Company of New York
and its affiliates may accept deposits from, lend money to, and generally
engage in any kind of business with the Borrower or any Subsidiary or
affiliate of the Borrower as if it were not the Agent hereunder.
SECTION 7.03. Action by Agent. The obligations of the Agent
hereunder are only those expressly set forth herein. Without limiting the
generality of the foregoing, the Agent shall not be required to take any
action with respect to any Default, except as expressly provided in Article VI.
SECTION 7.04. Consultation with Experts. The Agent may
consult with legal counsel (who may be counsel for the Borrower), independent
public accountants and other experts selected by it and shall not be liable
for any action taken or omitted to be taken by it in good faith in accordance
with the advice of such counsel, accountants or experts.
SECTION 7.05. Liability of Agent. Neither the Agent nor any
of its affiliates nor any of their respective directors, officers, agents or
employees shall be liable for any action taken or not taken by it in
connection herewith (i) with the consent or at the request of the Required
Banks (or, if pursuant to the terms of this Agreement the consent or request
is required to be given or made by a percentage of the Banks other than that
which comprises the Required Banks, then with such consent or request) or (ii)
in the absence of its own gross negligence or willful misconduct. Neither the
Agent nor any of its affiliates nor any of their respective directors,
officers, agents or employees shall be responsible for or have any duty to
ascertain, inquire into or verify (i) any statement, warranty or
representation made in connection with this Agreement or any borrowing
hereunder; (ii) the performance or observance of any of the covenants or
agreements of the Borrower; (iii) the satisfaction of any condition specified
in Article III, except receipt of items required to be delivered to the Agent;
or (iv) the validity, effectiveness or genuineness of this Agreement, the
Notes or any other instrument or writing furnished in connection herewith.
The Agent shall not incur any liability by acting in reliance upon any notice,
consent, certificate, statement, or other writing (which may be a bank wire,
telex, facsimile transmission or similar writing) believed by it to be genuine
or to be signed by the proper party or parties.
SECTION 7.06. Indemnification. Each Bank shall, ratably in
accordance with its Commitment, indemnify the Agent, its affiliates and their
respective directors, officers, agents and employees (to the extent not
reimbursed by the Borrower) against any cost, expense (including counsel fees
and disbursements), claim, demand, action, loss or liability (except such as
result from such indemnitees' gross negligence or willful misconduct) that such
indemnitees may suffer or incur in connection with this Agreement or any
action taken or omitted by such indemnitees hereunder.
SECTION 7.07. Credit Decision. Each Bank acknowledges that it
has, independently and without reliance upon the Agent, any Co-Agent or any
other Bank, and based on such documents and information as it has deemed
appropriate, made its own credit analysis and decision to enter into this
Agreement. Each Bank also acknowledges that it will, independently and
without reliance upon the Agent, any Co-Agent or any other Bank, and based on
such documents and information as it shall deem appropriate at the time,
continue to make its own credit decisions in taking or not taking any action
under this Agreement.
SECTION 7.08. Successor Agent. The Agent may resign at any
time by giving notice thereof to the Banks and the Borrower. Upon any such
resignation, the Required Banks shall have the right to appoint a successor
Agent with the prior approval of the Borrower, which approval shall not be
unreasonably withheld; provided, however, that such successor Agent shall be a
Bank hereunder. If no successor Agent shall have been so appointed by the
Required Banks, and shall have accepted such appointment, within 30 days after
the retiring Agent gives notice of resignation, then the retiring Agent may,
on behalf of the Banks, appoint a successor Agent, which shall be a commercial
bank organized or licensed under the laws of the United States of America or
of any State thereof and having a combined capital and surplus of at least
$500,000,000. Upon the acceptance of its appointment as Agent hereunder by a
successor Agent, such successor Agent shall thereupon succeed to and become
vested with all the rights and duties of the retiring Agent, and the retiring
Agent shall be discharged from its duties and obligations hereunder. After
any retiring Agent's resignation hereunder as Agent, the provisions of this
Article shall inure to its benefit as to any actions taken or omitted to be
taken by it while it was Agent.
SECTION 7.09. Agent's Fee. The Borrower shall pay to the
Agent for its own account fees in the amounts and at the times previously
agreed upon between the Borrower and the Agent.
SECTION 7.10. Co-Agents. Nothing in this Agreement shall
impose on any Co-Agent, in its capacity as such, any duties or obligations
whatsoever.
ARTICLE VIII
CHANGE IN CIRCUMSTANCES
SECTION 8.01. Basis for Determining Interest Rate Inadequate
or Unfair. If on or prior to the first day of any Interest Period for any
Fixed Rate Borrowing:
(a) the Agent is advised by the Reference Banks that deposits
in dollars (in the applicable amounts) are not being offered to the
Reference Banks in the relevant market for such Interest Period, or
(b) in the case of a Committed Borrowing, Banks having 50% or
more of the aggregate amount of the Commitments advise the Agent that
the Adjusted CD Rate or the Adjusted London Interbank Offered Rate,
as the case may be, as determined by the Agent will not adequately
and fairly reflect the cost to such Banks of funding their CD Loans
or Euro-Dollar Loans, as the case may be, for such Interest Period,
the Agent shall forthwith give notice thereof to the Borrower and the Banks,
whereupon until the Agent notifies the Borrower that the circumstances giving
rise to such suspension no longer exist, the obligations of the Banks to make
CD Loans or Euro-Dollar Loans, as the case may be, shall be suspended. Unless
the Borrower notifies the Agent at least two Domestic Business Days before the
date of any Fixed Rate Borrowing for which a Notice of Borrowing has
previously been given that it elects not to borrow on such date, (i) if such
Fixed Rate Borrowing is a Committed Borrowing, such Borrowing shall instead be
made as a Base Rate Borrowing and (ii) if such Fixed Rate Borrowing is a Money
Market LIBOR Borrowing, the Money Market LIBOR Loans comprising such Borrowing
shall bear interest for each day from and including the first day to but
excluding the last day of the Interest Period applicable thereto at the Base
Rate for such day.
SECTION 8.02. Illegality. If, on or after the date of this
Agreement, the adoption of any applicable law, rule or regulation, or any
change in any applicable law, rule or regulation, or any change in the
interpretation or administration thereof by any governmental authority,
central bank or comparable agency charged with the interpretation or
administration thereof, or compliance by any Bank (or its Euro-Dollar Lending
Office) with any request or directive (whether or not having the force of law)
of any such authority, central bank or comparable agency shall make it
unlawful or impossible for any Bank (or its Euro-Dollar Lending Office) to
make, maintain or fund its Euro-Dollar Loans and such Bank shall so notify the
Agent, the Agent shall forthwith give notice thereof to the other Banks and
the Borrower, whereupon until such Bank notifies the Borrower and the Agent
that the circumstances giving rise to such suspension no longer exist, the
obligation of such Bank to make Euro-Dollar Loans shall be suspended. Before
giving any notice to the Agent pursuant to this Section, such Bank shall
designate a different Euro-Dollar Lending Office if such designation will avoid
the need for giving such notice and will not, in the judgment of such Bank, be
otherwise disadvantageous to such Bank or contrary to such Bank's policies.
If such Bank shall determine that it may not lawfully continue to maintain and
fund any of its outstanding Euro-Dollar Loans to maturity and shall so specify
in such notice, the Borrower shall immediately prepay in full the then
outstanding principal amount of each such Euro-Dollar Loan, together with
accrued interest thereon. Concurrently with prepaying each such Euro-Dollar
Loan, the Borrower shall borrow a Base Rate Loan in an equal principal amount
from such Bank (on which interest and principal shall be payable
contemporaneously with the related Euro-Dollar Loans of the other Banks), and
such Bank shall make such a Base Rate Loan.
SECTION 8.03. Increased Cost and Reduced Return. (a) If on
or after (x) the date hereof, in the case of any Committed Loan or any
obligation to make Committed Loans or (y) the date of the related Money Market
Quote, in the case of any Money Market Loan, the adoption of any applicable
law, rule or regulation, or any change in any applicable law, rule or
regulation, or any change in the interpretation or administration thereof by
any governmental authority, central bank or comparable agency charged with the
interpretation or administration thereof, or compliance by any Bank (or its
Applicable Lending Office) with any request or directive (whether or not
having the force of law) of any such authority, central bank or comparable
agency shall impose, modify or deem applicable any reserve (including, without
limitation, any such requirement imposed by the Board of Governors of the
Federal Reserve System, but excluding (i) with respect to any CD Loan any such
requirement included in an applicable Domestic Reserve Percentage and (ii)
with respect to any Euro-Dollar Loan any such requirement included in an
applicable Euro-Dollar Reserve Percentage), special deposit, insurance
assessment (excluding, with respect to any CD Loan, any such requirement
reflected in an applicable Assessment Rate) or similar requirement against
assets of, deposits with or for the account of, or credit extended by, any
Bank (or its Applicable Lending Office) or shall impose on any Bank (or its
Applicable Lending Office) or on the United States market for certificates of
deposit or the London interbank market any other condition affecting its Fixed
Rate Loans, its Note or its obligation to make Fixed Rate Loans and the result
of any of the foregoing is to increase the cost to such Bank (or its
Applicable Lending Office) of making or maintaining any Fixed Rate Loan, or to
reduce the amount of any sum received or receivable by such Bank (or its
Applicable Lending Office) under this Agreement or under its Note with respect
thereto, by an amount deemed by such Bank to be material, then, within 15 days
after demand by such Bank (with a copy to the Agent), the Borrower shall pay to
such Bank such additional amount or amounts as will compensate such Bank for
such increased cost or reduction.
(b) If any Bank shall have determined that, after the date
hereof, the adoption of any applicable law, rule or regulation regarding
capital adequacy, or any change in any such law, rule or regulation, or any
change in the interpretation or administration thereof by any governmental
authority, central bank or comparable agency charged with the interpretation
or administration thereof, or any request or directive regarding capital
adequacy (whether or not having the force of law) of any such authority,
central bank or comparable agency, has or would have the effect of reducing
the rate of return on capital of such Bank (or its Parent) as a consequence of
such Bank's obligations hereunder to a level below that which such Bank (or its
Parent) could have achieved but for such adoption, change, request or
directive (taking into consideration its policies with respect to capital
adequacy) by an amount deemed by such Bank to be material, then from time to
time, within 15 days after demand by such Bank (with a copy to the Agent), the
Borrower shall pay to such Bank such additional amount or amounts as will
compensate such Bank (or its Parent) for such reduction.
(c) Each Bank will promptly notify the Borrower and the Agent
of any event of which it has knowledge, occurring after the date hereof, which
will entitle such Bank to compensation pursuant to this Section and will
designate a different Applicable Lending Office if such designation will avoid
the need for, or reduce the amount of, such compensation and will not, in the
judgment of such Bank, be otherwise disadvantageous to such Bank or contrary
to such Bank's policies. A certificate of any Bank claiming compensation
under this Section shall be conclusive in the absence of manifest error. Such
certificate shall set forth the nature of the occurrence giving rise to such
compensation, the additional amount or amounts to be paid to it hereunder and
the method by which such amounts were determined. In determining such amount,
such Bank may use any reasonable averaging and attribution methods.
SECTION 8.04. Taxes. (a) For purposes of this Section
8.04, the following terms have the following meanings:
"Taxes" means any and all present or future taxes, duties,
levies, imposts, deductions, charges or withholdings with respect to any
payment by the Borrower pursuant to this Agreement or under any Note, and all
liabilities with respect thereto, excluding (i) in the case of each Bank and
the Agent, taxes imposed on its income, and franchise or similar taxes imposed
on it, by a jurisdiction under the laws of which such Bank or the Agent (as
the case may be) is organized or in which its principal executive office is
located or, in the case of each Bank, in which its Applicable Lending Office
is located and (ii) in the case of each Bank, any United States withholding
tax imposed on such payments except as a result of a change in the applicable
law from the applicable law in effect at the time such Bank first becomes a
party to this Agreement.
"Other Taxes" means any present or future stamp or documentary
taxes and any other excise or property taxes, or similar charges or levies,
which arise from any payment made pursuant to this Agreement or under any Note
or from the execution or delivery of, or otherwise with respect to, this
Agreement or any Note.
(b) Any and all payments by the Borrower to or for the
account of any Bank or the Agent hereunder or under any Note shall be made
without deduction for any Taxes or Other Taxes; provided that, if the Borrower
shall be required by law to deduct any Taxes or Other Taxes from any such
payments, (i) the sum payable shall be increased as necessary so that after
making all required deductions (including deductions applicable to additional
sums payable under this Section 8.04) such Bank or the Agent (as the case may
be) receives an amount equal to the sum it would have received had no such
deductions been made, (ii) the Borrower shall make such deductions, (iii) the
Borrower shall pay the full amount deducted to the relevant taxation authority
or other authority in accordance with applicable law and (iv) the Borrower
shall furnish to the Agent, at its address referred to in Section 9.01, the
original or a certified copy of a receipt evidencing payment thereof.
(c) The Borrower agrees to indemnify each Bank and the Agent
for the full amount of Taxes or Other Taxes (including, without limitation,
any Taxes or Other Taxes imposed or asserted by any jurisdiction on amounts
payable under this Section 8.04) paid by such Bank or the Agent (as the case
may be) and any liability (including penalties, interest and expenses) arising
therefrom or with respect thereto. This indemnification shall be paid within
15 days after such Bank or the Agent (as the case may be) makes demand
therefor.
(d) Each Bank organized under the laws of a jurisdiction
outside the United States, on or prior to the date of its execution and
delivery of this Agreement in the case of each Bank listed on the signature
pages hereof and on or prior to the date on which it becomes a Bank in the
case of each other Bank, shall provide the Borrower with Internal Revenue
Service form 1001 or 4224, as appropriate, or any successor form prescribed by
the Internal Revenue Service, certifying that such Bank is entitled to benefits
under an income tax treaty to which the United States is a party which exempts
the Bank from United States withholding tax or reduces the rate of withholding
tax on payments of interest for the account of such Bank or certifying that the
income receivable pursuant to this Agreement is effectively connected with the
conduct of a trade or business in the United States. Each Bank which is so
required to deliver a form 1001 or 4224 further undertakes to deliver to the
Borrower additional copies of the most recent form delivered by such Bank (or
a successor form) before the date that such form expires or becomes obsolete
or promptly after the occurrence of any event requiring a change in the most
recent form so delivered by it, and such amendments thereto or extensions or
renewals thereof as may be reasonably requested by the Borrower or the Agent,
unless an event (including without limitation any change in treaty, law or
regulation) has occurred prior to the date on which any such delivery would
otherwise be required which renders all such forms inapplicable or which would
prevent such Bank from duly completing and delivering any such form with
respect to it and such Bank advises the Borrower and the Agent that it is not
capable of receiving payments without any deduction or withholding of United
States federal income tax.
(e) For any period with respect to which a Bank has failed to
provide the Borrower with the appropriate form pursuant to Section 8.04(d)
(unless such failure is due to a change in treaty, law or regulation occurring
subsequent to the date on which such form originally was required to be
provided), such Bank shall not be entitled to indemnification under Section
8.04(b) or (c) with respect to Taxes imposed by the United States; provided
that if a Bank, which is otherwise exempt from or subject to a reduced rate
of withholding tax, becomes subject to Taxes because of its failure to deliver
a form required hereunder, the Borrower shall take such steps as such Bank
shall reasonably request to assist such Bank to recover such Taxes.
(f) If the Borrower is required to pay additional amounts to
or for the account of any Bank pursuant to this Section 8.04, then such Bank
will change the jurisdiction of its Applicable Lending Office if, in the
judgment of such Bank, such change (i) will eliminate or reduce any such
additional payment which may thereafter accrue and (ii) is not otherwise
disadvantageous to such Bank or contrary to its policies.
SECTION 8.05. Base Rate Loans Substituted for Affected Fixed
Rate Loans. If (i) the obligation of any Bank to make Euro-Dollar Loans has
been suspended pursuant to Section 8.02 or (ii) any Bank has demanded
compensation under Section 8.03 or 8.04 with respect to its CD Loans or
Euro-Dollar Loans and the Borrower shall, by at least five Euro-Dollar
Business Days' prior notice to such Bank through the Agent, have elected that
the provisions of this Section shall apply to such Bank, then, unless and
until such Bank notifies the Borrower that the circumstances giving rise to
such suspension or demand for compensation no longer exist:
(a) all Loans which would otherwise be made by such Bank as CD
Loans or Euro-Dollar Loans, as the case may be, shall be made instead
as Base Rate Loans (on which interest and principal shall be payable
contemporaneously with the related Fixed Rate Loans of the other
Banks), and
(b) after each of its CD Loans or Euro-Dollar Loans, as the
case may be, has been repaid, all payments of principal which would
otherwise be applied to repay such Fixed Rate Loans shall be applied
to repay its Base Rate Loans instead.
SECTION 8.06. Substitution of a Bank. If any Bank has
demanded compensation under Section 8.03 or 8.04 or has exercised any remedy
under Section 8.02, the Borrower shall have the right, with the assistance of
the Agent, to seek a mutually satisfactory substitute bank or banks (which may
be one or more of the Banks) to purchase the Note of such Bank and assume the
Commitment of such Bank. Such purchase and assumption may be made only upon
payment of any amounts due the original Bank under Sections 2.13, 8.03 and
8.04, and the Borrower's obligation to pay or reimburse the original Bank
under Sections 8.03 and 8.04 shall, as to amounts accrued or payable with
respect to any period prior to such assumption and purchase, survive any such
assumption and purchase.
ARTICLE IX
MISCELLANEOUS
SECTION 9.01. Notices. All notices, requests and other
communications to any party hereunder shall be in writing (including bank
wire, telex, facsimile transmission or similar writing) and shall be given to
such party: (x) in the case of the Borrower or the Agent, at its address,
facsimile number or telex number set forth on the signature pages hereof, (y)
in the case of any Bank, at its address, facsimile number or telex number set
forth in its Administrative Questionnaire or (z) in the case of any party,
such other address, facsimile number or telex number as such party may
hereafter specify for the purpose by notice to the Agent and the Borrower.
Each such notice, request or other communication shall be effective (i) if
given by telex, when such telex is transmitted to the telex number specified
in this Section and the appropriate answerback is received, (ii) if given by
facsimile transmission, when transmitted to the facsimile number specified in
this Section and confirmation of receipt is received, (iii) if given by mail,
72 hours after such communication is deposited in the mails with first class
postage prepaid, addressed as aforesaid or (iv) if given by any other means,
when delivered at the address specified in this Section; provided that notices
to the Agent under Article II or Article VIII shall not be effective until
received.
SECTION 9.02. No Waivers. No failure or delay by the Agent or
any Bank in exercising any right, power or privilege hereunder or under any
Note shall operate as a waiver thereof nor shall any single or partial exercise
thereof preclude any other or further exercise thereof or the exercise of any
other right, power or privilege. The rights and remedies herein provided
shall be cumulative and not exclusive of any rights or remedies provided by
law.
SECTION 9.03. Expenses; Indemnification. (a) The Borrower
shall pay (i) all out-of-pocket expenses of the Agent, including fees and
disbursements of special counsel for the Agent, in connection with the
preparation and administration of this Agreement, any waiver or consent
hereunder or any amendment hereof or any Default or alleged Default hereunder
and (ii) if an Event of Default occurs, all out-of-pocket expenses incurred by
the Agent and each Bank, including (without duplication) the fees and
disbursements of outside counsel and the allocated cost of inside counsel, in
connection with such Event of Default and collection, bankruptcy, insolvency
and other enforcement proceedings resulting therefrom.
(b) The Borrower agrees to indemnify the Agent and each Bank,
their respective affiliates and the respective directors, officers, agents and
employees of the foregoing (each an "Indemnitee") and hold each Indemnitee
harmless from and against any and all liabilities, losses, damages, costs and
expenses of any kind, including, without limitation, the reasonable fees and
disbursements of counsel and allocated cost of inside counsel, which may be
incurred by such Indemnitee in connection with any investigative,
administrative or judicial proceeding (whether or not such Indemnitee shall be
designated a party thereto) brought or threatened relating to or arising out
of this Agreement or any actual or proposed use of proceeds of Loans hereunder;
provided that no Indemnitee shall have the right to be indemnified hereunder
for such Indemnitee's own gross negligence, willful misconduct or violation of
any express provision of this Agreement as determined by a court of competent
jurisdiction.
SECTION 9.04. Sharing of Set-Offs. Each Bank agrees that if
it shall, by exercising any right of set-off or counterclaim or otherwise,
receive payment of a proportion of the aggregate amount of principal and
interest due with respect to any Note held by it which is greater than the
proportion received by any other Bank in respect of the aggregate amount of
principal and interest due with respect to any Note held by such other Bank,
the Bank receiving such proportionately greater payment shall purchase such
participations in the Notes held by the other Banks, and such other
adjustments shall be made, as may be required so that all such payments of
principal and interest with respect to the Notes held by the Banks shall be
shared by the Banks pro rata; provided that nothing in this Section shall
impair the right of any Bank to exercise any right of set-off or counterclaim
it may have and to apply the amount subject to such exercise to the payment of
indebtedness of the Borrower other than its indebtedness hereunder. The
Borrower agrees, to the fullest extent it may effectively do so under
applicable law, that any holder of a participation in a Note, whether or not
acquired pursuant to the foregoing arrangements, may exercise rights of
set-off or counterclaim and other rights with respect to such participation as
fully as if such holder of a participation were a direct creditor of the
Borrower in the amount of such participation.
SECTION 9.05. Amendments and Waivers. Any provision of this
Agreement or the Notes may be amended or waived if, but only if, such
amendment or waiver is in writing and is signed by the Borrower and the
Required Banks (and, if the rights or duties of the Agent are affected
thereby, by the Agent); provided that no such amendment or waiver shall,
unless signed by all the Banks, (i) increase or decrease the Commitment of any
Bank (except for a ratable decrease in the Commitments of all Banks) or
subject any Bank to any additional obligation, (ii) reduce the principal of or
rate of interest on any Loan or any fees hereunder, (iii) postpone the date
fixed for any payment of principal of or interest on any Loan or any fees
hereunder or for any reduction or termination of any Commitment, (iv) change
the aggregate amount by which or to which the Commitments are required to be
reduced on or prior to any Commitment Reduction Date or (v) change the
percentage of the Commitments or of the aggregate unpaid principal amount of
the Notes, or the number of Banks, which shall be required for the Banks or
any of them to take any action under this Section or any other provision of
this Agreement.
SECTION 9.06. Successors and Assigns. (a) The provisions of
this Agreement shall be binding upon and inure to the benefit of the parties
hereto and their respective successors and assigns, except that the Borrower
may not assign or otherwise transfer any of its rights or obligations under
this Agreement without the prior written consent of all Banks.
(b) Any Bank may at any time grant to one or more banks or
other institutions (each a "Participant") participating interests in its
Commitment or any or all of its Loans. In the event of any such grant by a
Bank of a participating interest to a Participant, whether or not upon notice
to the Borrower and the Agent, such Bank shall remain responsible for the
performance of its obligations hereunder, and the Borrower and the Agent shall
continue to deal solely and directly with such Bank in connection with such
Bank's rights and obligations under this Agreement. Any agreement pursuant to
which any Bank may grant such a participating interest shall provide that such
Bank shall retain the sole right and responsibility to enforce the obligations
of the Borrower hereunder including, without limitation, the right to approve
any amendment, modification or waiver of any provision of this Agreement;
provided that such participation agreement may provide that such Bank will not
agree to any modification, amendment or waiver of this Agreement described in
clause (i), (ii), (iii) or (iv) of Section 9.05 without the consent of the
Participant. The Borrower agrees that each Participant shall, to the extent
provided in its participation agreement, be entitled to the benefits of
Article VIII with respect to its participating interest. An assignment or
other transfer which is not permitted by subsection (c) or (d) below shall be
given effect for purposes of this Agreement only to the extent of a
participating interest granted in accordance with this subsection (b).
(c) Any Bank may at any time assign to one or more banks or
other institutions (each an "Assignee") all, or a proportionate part
(equivalent to an initial Commitment of not less than $10,000,000) of all, of
its rights and obligations under this Agreement and the Notes, and such
Assignee shall assume such rights and obligations, pursuant to an Assignment
and Assumption Agreement in substantially the form of Exhibit H hereto
executed by such Assignee and such transferor Bank, with (and subject to) the
subscribed consent of the Borrower, which shall not be unreasonably withheld;
provided that if an Assignee is an affiliate of such transferor Bank or was a
Bank immediately prior to such assignment, no such consent shall be required;
and provided further that such assignment may, but need not, include rights of
the transferor Bank in respect of outstanding Money Market Loans. Upon
execution and delivery of such instrument and payment by such Assignee to such
transferor Bank of an amount equal to the purchase price agreed between such
transferor Bank and such Assignee, such Assignee shall be a Bank party to this
Agreement and shall have all the rights and obligations of a Bank with a
Commitment as set forth in such instrument of assumption, and the transferor
Bank shall be released from its obligations hereunder to a corresponding
extent, and no further consent or action by any party shall be required. Upon
the consummation of any assignment pursuant to this subsection (c), the
transferor Bank, the Agent and the Borrower shall make appropriate
arrangements so that, if required, a new Note is issued to the Assignee. In
connection with any such assignment, the transferor Bank shall pay to the
Agent an administrative fee for processing such assignment in the amount of
$2,500. If the Assignee is not incorporated under the laws of the United
States of America or a state thereof, it shall deliver to the Borrower and the
Agent certification as to exemption from deduction or withholding of any
United States federal income taxes in accordance with Section 8.04.
(d) Any Bank may at any time assign all or any portion of its
rights under this Agreement and its Note to a Federal Reserve Bank, which may
enforce such assignment in any manner allowed by law. No such assignment
shall release the transferor Bank from its obligations hereunder.
(e) No Participant, Assignee or other transferee (each a
"Transferee") of any Bank's rights shall be entitled to receive any greater
payment under Section 8.03 or 8.04 than such Bank would have been entitled to
receive with respect to the rights transferred, unless such transfer is made
with the Borrower's prior written consent or by reason of the provisions of
Section 8.02, 8.03 or 8.04 requiring such Bank to designate a different
Applicable Lending Office under certain circumstances or at a time when the
circumstances giving rise to such greater payment did not exist.
SECTION 9.07. Collateral. Each of the Banks represents to the
Agent and each of the other Banks that it in good faith is not relying upon
any "margin stock" (as defined in Regulation U) as collateral in the extension
or maintenance of the credit provided for in this Agreement.
SECTION 9.08. Governing Law; Submission to Jurisdiction. This
Agreement and each Note shall be governed by and construed in accordance with
the laws of the State of New York. The Borrower hereby submits to the
nonexclusive jurisdiction of the United States District Court for the Southern
District of New York and of any New York State court sitting in New York City
for purposes of all legal proceedings arising out of or relating to this
Agreement or the transactions contemplated hereby. The Borrower irrevocably
waives, to the fullest extent permitted by law, any objection which it may now
or hereafter have to the laying of the venue of any such proceeding brought in
such a court and any claim that any such proceeding brought in such a court
has been brought in an inconvenient forum.
SECTION 9.09. Counterparts; Integration. This Agreement may
be signed in any number of counterparts, each of which shall be an original,
with the same effect as if the signatures thereto and hereto were upon the same
instrument. This Agreement constitutes the entire agreement and understanding
among the parties hereto and supersedes any and all prior agreements and
understandings, oral or written, relating to the subject matter hereof.
SECTION 9.10. WAIVER OF JURY TRIAL. EACH OF THE BORROWER, THE
AGENT AND THE BANKS HEREBY IRREVOCABLY WAIVES ANY AND ALL RIGHT TO TRIAL BY
JURY IN ANY LEGAL PROCEEDING ARISING OUT OF OR RELATING TO THIS AGREEMENT OR
THE TRANSACTIONS CONTEMPLATED HEREBY.
SECTION 9.11. Confidentiality. Each Bank agrees to keep any
information delivered or made available by the Borrower to it confidential
from anyone other than persons employed or retained by such Bank who are
expected to become engaged in evaluating, approving, structuring or
administering the Loans; provided that nothing herein shall prevent any Bank
from disclosing such information (a) to any other Bank or to the Agent, (b) to
any other person if reasonably incidental to the administration of the Loans,
(c) upon the order of any court or administrative agency, (d) upon the request
or demand of any regulatory agency or authority, (e) which had been publicly
disclosed other than as a result of a disclosure by the Agent or any Bank
prohibited by this Agreement, (f) in connection with any litigation to which
the Agent, any Bank or its subsidiaries or Parent may be a party, (g) to the
extent necessary in connection with the exercise of any remedy hereunder, (h)
to such Bank's or Agent's legal counsel and independent auditors, (i) subject
to provisions substantially similar to those contained in this Section, to any
actual or prospective Transferee and (j) otherwise with the written consent of
the Borrower.
IN WITNESS WHEREOF, the parties hereto have caused this
Agreement to be duly executed by their respective authorized officers as of
the day and year first above written.
AMERICAN STORES COMPANY
By:/s/ Neil J. Rider
-----------------------------
Title: Senior Vice President &
Treasurer
709 East South Temple
Salt Lake City, UT 84102
Telex number:
Facsimile number: (801) 531-0768
Commitments
- -----------
$74,000,000 MORGAN GUARANTY TRUST COMPANY
OF NEW YORK
By:/s/ David T. Ellis
---------------------
Title: Vice President
$65,000,000 BANK OF AMERICA NATIONAL TRUST
AND SAVINGS ASSOCIATION
By:/s/ Jim C. Deichen
----------------------------
Title: Senior Vice President
$65,000,000 CREDIT SUISSE
By:/s/ David J. Worthington
-------------------------
Title: Member of Senior
Management
By:/s/ Marilou Palenzuela
-----------------------
Title: Member of Senior
Management
$65,000,000 NATIONSBANK OF TEXAS, N.A.
By:/s/ Frank M. Johnson
---------------------
Title: Vice President
$65,000,000 WACHOVIA BANK OF GEORGIA, N.A
By:/s/ Terry L. Akins
----------------------------
Title: Senior Vice President
$50,000,000 CREDIT LYONNAIS
LOS ANGELES BRANCH
By:/s/ Thierry Vincent
---------------------
Title: Vice President
CREDIT LYONNAIS
CAYMAN ISLAND BRANCH
By:/s/ Thierry Vincent
---------------------------
Title: Authorized Signature
$50,000,000 THE FUJI BANK, LIMITED,
LOS ANGELES AGENCY
By:/s/ Yasuji Ikawa
----------------------------
Title: Joint General Manager
$50,000,000 THE INDUSTRIAL BANK OF JAPAN,
LTD., LOS ANGELES AGENCY
By:/s/ Masatake Yashiro
----------------------
Title: General Manager
$50,000,000 THE LONG TERM CREDIT BANK
OF JAPAN, LTD.
By:/s/ Y. Kamisawa
-----------------------------
Title: Deputy General Manager
$33,000,000 CHEMICAL BANK
By:/s/ Meredith L. Vanden Handel
-----------------------------
Title: Vice President
$33,000,000 CITIBANK, N.A.
By:/s/ William Stengel
---------------------
Title: Vice President
$33,000,000 COMMERZBANK AG
LOS ANGELES BRANCH
By:/s/ Steve Larsen
---------------------
Title: Vice President
By:/s/ Werner Schmidbauer
-------------------------------
Title: Assistant Vice President
$33,000,000 THE DAI-ICHI KANGYO BANK, LTD.
By:/s/ Tomohiro Nozaki
------------------------------
Title: Senior Vice President
& Joint General Manager
$33,000,000 FIRST FIDELITY BANK, N.A.
By:/s/ Wynelle Farlow
---------------------
Title: Vice President
$33,000,000 FIRST INTERSTATE BANK OF
CALIFORNIA
By:/s/ Marianne Mitosinka
----------------------
Title: Vice President
By:/s/ Michael P. Thomas
-------------------------------
Title: Assistant Vice President
$33,000,000 THE SANWA BANK, LIMITED
LOS ANGELES BRANCH
By:/s/ Gill Realon
---------------------
Title: Vice President
$33,000,000 THE SUMITOMO BANK, LIMITED
LOS ANGELES BRANCH
By:/s/ Hiroshi Amano
----------------------
Title: General Manager
$33,000,000 UNION BANK
By:/s/ Tim Streb
---------------------
Title: Vice President
$17,000,000 ABN AMRO BANK, N.V.
By:/s/ Dianne Waggoner
---------------------
Title: Vice President
By:/s/ Peter Melloni
---------------------
Title: Vice President
$17,000,000 BANK OF YOKOHAMA
By:/s/ Michiro Asaba
------------------------------
Title: General Manager & Agent
$17,000,000 THE FIRST NATIONAL BANK
OF CHICAGO
By:/s/ L. Gene Beube
----------------------------
Title: Senior Vice President
$17,000,000 NORTHERN TRUST COMPANY
By:/s/ Michelle Griffin
--------------------------
Title: Vice President
Commercial Banking
$17,000,000 SOCIETE GENERALE
By:/s/ Blaine Shaum
-----------------------
Title: Regional Manager
$17,000,000 THE TORONTO-DOMINION BANK
By:/s/ Horace J. Zona III
----------------------
Title: Director
$17,000,000 WELLS FARGO BANK, N.A.
By:/s/ Robert W. Miller
---------------------
Title: Vice President
$10,000,000 FIRST SECURITY BANK OF UTAH, N.A.
By:/s/ D. Kevin Imlay
---------------------
Title: Vice President
$10,000,000 KREDIETBANK N.V.
By:/s/ Robert Snauffer
---------------------
Title: Vice President
By:/s/ Michael V. Curran
---------------------
Title: Vice President
$10,000,000 THE MITSUI TRUST & BANKING CO.,
LTD.
By:/s/ Ken Takahashi
------------------------------
Title: General Manager & Agent
$10,000,000 THE TOYO TRUST & BANKING CO.,
LTD., LOS ANGELES AGENCY
By:/s/ Kenji Fujikawa
----------------------
Title: General Manager
$10,000,000 YASUDA TRUST & BANKING CO., LTD.
By:/s/ Kiyushi Terao
----------------------------
Title: Joint General Manager
Total Commitments
- -----------------
$1,000,000,000
=================
MORGAN GUARANTY TRUST COMPANY
OF NEW YORK, as Agent
By:/s/ David T. Ellis
---------------------
Title: Vice President
60 Wall Street
New York, New York 10260-0060
Attention: David Ellis
Telex number: 177615
Facsimile number:
BANK OF AMERICA NATIONAL TRUST
AND SAVINGS ASSOCIATION,
as Co-Agent
By:/s/ Jim C. Deichen
----------------------------
Title: Senior Vice President
CREDIT SUISSE, as Co-Agent
By:/s/ David J. Worthington
------------------------
Title: Member of Senior
Management
By:/s/ Marilou Palenzuela
------------------------
Title: Member of Senior
Management
NATIONSBANK OF TEXAS, N.A.
as Co-Agent
By:/s/ Frank M. Johnson
---------------------
Title: Vice President
WACHOVIA BANK OF GEORGIA, N.A.,
as Co-Agent
By:/s/ Terry L. Akins
----------------------------
Title: Senior Vice President
PRICING SCHEDULE
Level Level Level Level Level Level
Status* I II III IV V VI
- ----------- ----- ----- ----- ----- ----- -----
Euro-Dollar 22.50 25.00 30.00 35.00 45.00 55.00
Margin**
CD Margin** 35.00 37.50 42.50 47.50 57.50 67.50
Commitment 0 0 2.50 5.00 5.00 10.00
Fee Rate**
Facility Fee 12.50 12.50 12.50 12.50 15.00 20.00
Rate**
* In the event that the Borrower would (but for this provision) qualify for
Level I Status, Level II Status or Level IV Status on the basis of a rating
from either S&P or Moody's, but the rating from the other such rating
agency is more than one rating category lower than that required by such
Status, the applicable status shall be the next greater level to that for
which the Borrower would otherwise qualify on the basis of the higher
rating (e.g., if the Borrower were rated BBB+/Baa3, Level III Status - the
next greater level to the Level II Status for which the Borrower would
otherwise qualify on the basis of its BBB+ rating - would apply).
** Basis points per annum.
For purposes of this Schedule, the following terms have the
following meanings:
"Level I Status" exists at any date if, at such date, the
Borrower's long-term debt is rated A- or higher by S&P or A3 or higher by
Moody's.
"Level II Status" exists at any date if, at such date, (i) the
Borrower's long-term debt is rated BBB+ by S&P or Baa1 by Moody's and (ii)
Level I Status does not exist.
"Level III Status" exists at any date if, at such date, (i) the
Borrower's long-term debt is rated BBB by S&P and Baa2 by Moody's and (ii)
neither Level I Status nor Level II Status exists.
"Level IV Status" exists at any date if, at such date, (i) the
Borrower's long-term debt is rated BBB by S&P or Baa2 by Moody's and (ii) none
of Level I Status, Level II Status and Level III Status exists.
"Level V Status" exists at any date if, at such date, (i) the
Borrower's long-term debt is rated BBB- by S&P and Baa3 by Moody's and (ii)
none of Level I Status, Level II Status, Level III Status and Level IV Status
exists.
"Level VI Status" exists at any date if, at such date, no other
Status exists.
"Moody's" means Moody's Investors Service, Inc.
"S&P" means Standard & Poor's Corporation.
"Status" refers to the determination of which of Level I
Status, Level II Status, Level III Status, Level IV Status, Level V Status or
Level VI Status exists at any date.
The credit ratings to be utilized for purposes of this Schedule are those
assigned to the senior unsecured long-term debt securities of the Borrower
without third-party credit enhancement, and any rating assigned to any other
debt security of the Borrower shall be disregarded. The rating in effect at
any date is that in effect at the close of business on such date.
EXHIBIT A
NOTE
New York, New York
, 19
For value received, American Stores Company, a Delaware
corporation (the "Borrower"), promises to pay to the order of
_______________________ (the "Bank"), for the account of its Applicable
Lending Office, the unpaid principal amount of each Loan made by the Bank to
the Borrower pursuant to the Credit Agreement referred to below on the last
day of the Interest Period relating to such Loan. The Borrower promises to
pay interest on the unpaid principal amount of each such Loan on the dates and
at the rate or rates provided for in the Credit Agreement. All such payments
of principal and interest shall be made in lawful money of the United States
in Federal or other immediately available funds at the office of Morgan
Guaranty Trust Company of New York, 60 Wall Street, New York, New York.
All Loans made by the Bank, the respective types and maturities
thereof and all repayments of the principal thereof shall be recorded by the
Bank and, if the Bank so elects in connection with any transfer or enforcement
hereof, appropriate notations to evidence the foregoing information with
respect to each such Loan then outstanding may be endorsed by the Bank on the
schedule attached hereto, or on a continuation of such schedule attached to
and made a part hereof; provided that the failure of the Bank to make any such
recordation or endorsement shall not affect the obligations of the Borrower
hereunder or under the Credit Agreement.
This note is one of the Notes referred to in the Credit
Agreement dated as of June 28, 1994 among the Borrower, the banks listed on
the signature pages thereof, the Co-Agents listed on the signature pages
thereof and Morgan Guaranty Trust Company of New York, as Agent (as the same
may be amended from time to time, the "Credit Agreement"). Terms defined in
the Credit Agreement are used herein with the same meanings. Reference is
made to the Credit Agreement for provisions for the prepayment hereof and the
acceleration of the maturity hereof.
AMERICAN STORES COMPANY
By________________________
Title:
Note (cont'd)
LOANS AND PAYMENTS OF PRINCIPAL
__________________________________________________________________
Amount of
Amount of Type of Principal Maturity Notation
Date Loan Loan Repaid Date Made By
__________________________________________________________________
__________________________________________________________________
__________________________________________________________________
__________________________________________________________________
__________________________________________________________________
__________________________________________________________________
__________________________________________________________________
__________________________________________________________________
__________________________________________________________________
__________________________________________________________________
__________________________________________________________________
__________________________________________________________________
__________________________________________________________________
__________________________________________________________________
__________________________________________________________________
__________________________________________________________________
EXHIBIT B
Form of Money Market Quote Request
----------------------------------
[Date]
To: Morgan Guaranty Trust Company of New York
(the "Agent")
From: American Stores Company
Re: Credit Agreement (the "Credit Agreement") dated as of June 28,
1994 among the Borrower, the Banks listed on the signature pages
thereof, the Co-Agents listed on the signature pages thereof
and the Agent
We hereby give notice pursuant to Section 2.03 of the Credit
Agreement that we request Money Market Quotes for the following proposed Money
Market Borrowing(s):
Date of Borrowing: __________________
Principal Amount(*) Interest Period(**)
- ------------------- -------------------
$
Such Money Market Quotes should offer a Money Market [Margin]
[Absolute Rate]. [The applicable base rate is the London Interbank Offered
Rate.]
_________
(*)Amount must be $25,000,000 or a larger multiple of
$5,000,00 0.
(**)Not less than one month (LIBOR Auction) or not less than 7 days
(Absolute provisions of the definition of Interest Period. Rate
Auction), subject to
Terms used herein have the meanings assigned to them in the
Credit Agreement.
AMERICAN STORES COMPANY
By________________________
Title:
EXHIBIT C
Form of Invitation for Money Market Quotes
To: [Name of Bank]
Re: Invitation for Money Market Quotes to American Stores Company
(the "Borrower")
Pursuant to Section 2.03 of the Credit Agreement dated as of
June 28, 1994 among the Borrower, the Banks parties thereto, the Co-Agents
listed on the signature pages thereof and the undersigned, as Agent, we are
pleased on behalf of the Borrower to invite you to submit Money Market Quotes
to the Borrower for the following proposed Money Market Borrowing(s):
Date of Borrowing: __________________
Principal Amount Interest Period
- ---------------- ---------------
$
Such Money Market Quotes should offer a Money Market [Margin]
[Absolute Rate]. [The applicable base rate is the London Interbank Offered
Rate.]
Please respond to this invitation by no later than [2:00 P.M.]
[11:00 A.M.] (New York City time) on [date].
MORGAN GUARANTY TRUST COMPANY
OF NEW YORK
By______________________
Authorized Officer
EXHIBIT D
Form of Money Market Quote
--------------------------
To: Morgan Guaranty Trust Company of New York,
as Agent
Re: Money Market Quote to American Stores Company (the "Borrower")
In response to your invitation on behalf of the Borrower dated
_____________, 19__, we hereby make the following Money Market Quote on the
following terms:
1. Quoting Bank: ________________________________
2. Person to contact at Quoting Bank:
_____________________________
3. Date of Borrowing: ____________________*
4. We hereby offer to make Money Market Loan(s) in the following
principal amounts, for the following Interest Periods and at the
following rates:
Principal Interest Money Market
Amount** Period*** [Margin****] [Absolute Rate*****]
- --------- --------- --------------------------------------
$
$
[Provided, that the aggregate principal amount of Money Market Loans
for which the above offers may be accepted shall not exceed
$____________.]**
__________
* As specified in the related Invitation.
** Principal amount bid for each Interest Period may not exceed principal
amount requested. Specify aggregate limitation if the sum of the individual
offers exceeds the amount the Bank is willing to lend. Bids must be made for
$3,000,000 or a larger multiple of $1,000,000.
(notes continued on following page)
We understand and agree that the offer(s) set forth above,
subject to the satisfaction of the applicable conditions set forth in the
Credit Agreement dated as of June 28, 1994 among the Borrower, the Banks
listed on the signature pages thereof, the Co-Agents listed on the signature
pages thereof and yourselves, as Agent, irrevocably obligates us to make the
Money Market Loan(s) for which any offer(s) are accepted, in whole or in part.
Very truly yours,
[NAME OF BANK]
Dated:_______________ By:__________________________
Authorized Officer
__________
*** Not less than one month or not less than 7 days, as specified in the
related Invitation. No more than five bids are permitted for each Interest
Period.
**** Margin over or under the London Interbank Offered Rate determined for the
applicable Interest Period. Specify percentage (to the nearest 1/10,000 of
1%) and specify whether "PLUS" or "MINUS".
***** Specify rate of interest per annum (to the nearest 1/10,000th of 1%).
EXHIBIT E
OPINION OF
GENERAL COUNSEL OF THE BORROWER
To the Banks and the Agent
Referred to Below
c/o Morgan Guaranty Trust Company
of New York, as Agent
60 Wall Street
New York, New York 10260
Dear Sirs:
I have acted as counsel for American Stores Company (the
"Borrower") in connection with the Credit Agreement (the "Credit Agreement")
dated as of June 28, 1994 among the Borrower, the Banks from time to time
parties thereto, the Co-Agents listed on the signature pages thereof and
Morgan Guaranty Trust Company of New York, as Agent. Terms defined in the
Credit Agreement are used herein as therein defined. This opinion is being
rendered to you at the request of our client pursuant to Section 3.01(c) of the
Credit Agreement.
I have examined originals or copies, certified or otherwise
identified to my satisfaction, of such documents, corporate records,
certificates of public officials and other instruments and have conducted such
other investigations of fact and law as I have deemed necessary or advisable
for purposes of this opinion.
Upon the basis of the foregoing, I am of the opinion that:
1. The Borrower is a corporation duly incorporated, validly
existing and in good standing under the laws of Delaware, and has all
corporate powers and all material governmental licenses, authorizations,
consents and approvals required to carry on its business as now conducted.
2. The execution, delivery and performance by the Borrower of
the Credit Agreement and the Notes are within the Borrower's corporate powers,
have been duly authorized by all necessary corporate action, require no action
by or in respect of, or filing with, any governmental body, agency or official
and do not contravene, or constitute a default under, any provision of
applicable law or regulation or of the certificate of incorporation or by-laws
of the Borrower or of any agreement, judgment, injunction, order, decree or
other agreement or instrument evidencing or governing Material Debt or of any
other material instrument binding upon the Borrower or any of its Subsidiaries
or result in the creation or imposition of any Lien on any asset of the
Borrower or any of its Subsidiaries.
3. The Credit Agreement constitutes a valid and binding
agreement of the Borrower and each Note constitutes a valid and binding
obligation of the Borrower, in each case enforceable in accordance with its
terms, except as the same may be limited by bankruptcy, insolvency or similar
laws affecting creditors' rights generally and by general principles of equity.
4. Except as set forth in the Borrower's 1993 Form 10-K, there
is no action, suit or proceeding pending against, or to the best of my
knowledge threatened against or affecting, the Borrower or any of its
Subsidiaries before any court or arbitrator or any governmental body, agency or
official in which there is a reasonable possibility of an adverse decision
which could materially adversely affect the business, consolidated financial
position or consolidated results of operations of the Borrower and its
Consolidated Subsidiaries, considered as a whole, or which in any manner draws
into question the validity of the Credit Agreement or the Notes.
5. Each of the Borrower's Major Subsidiaries is a corporation
validly existing and in good standing under the laws of its jurisdiction of
incorporation, and has all corporate powers and all material governmental
licenses, authorizations, consents and approvals required to carry on its
business as now conducted.
Very truly yours,
EXHIBIT F
OPINION OF
SPECIAL COUNSEL FOR THE BORROWER
To the Banks and the Agent
Referred to Below
c/o Morgan Guaranty Trust Company
of New York, as Agent
60 Wall Street
New York, New York 10260
Dear Sirs:
We have acted as counsel for American Stores Company (the
"Borrower") in connection with the Credit Agreement (the "Credit Agreement")
dated as of June 28, 1994 among the Borrower, the Banks from time to time
parties thereto, the Co-Agents listed on the signature pages thereof and
Morgan Guaranty Trust Company of New York, as Agent. Terms defined in the
Credit Agreement are used herein as therein defined. This opinion is being
rendered to you at the request of our client pursuant to Section 3.01(d) of the
Credit Agreement.
We have examined originals or copies, certified or otherwise
identified to our satisfaction, of such documents, corporate records,
certificates of public officials and other instruments and have conducted such
other investigations of fact and law as we have deemed necessary or advisable
for purposes of this opinion.
Upon the basis of the foregoing, we are of the opinion that:
The Credit Agreement constitutes a valid and binding agreement
of the Borrower and each Note constitutes a valid and binding obligation of
the Borrower, in each case enforceable in accordance with its terms, except as
the same may be limited by bankruptcy, insolvency or similar laws affecting
creditors' rights generally and by general principles of equity.
We are members of the Bar of the State of New York and the
foregoing opinion is limited to the laws of the State of New York, the federal
laws of the United States of America and the General Corporation Law of the
State of Delaware. In giving the foregoing opinion, we express no opinion as
to the effect (if any) of any law of any jurisdiction (except the State of New
York) in which any Bank is located which limits the rate of interest that such
Bank may charge or collect.
This opinion is rendered solely to you in connection with the
above matter. This opinion may not be relied upon by you for any other
purpose or relied upon by any other person without our prior written consent.
Very truly yours,
EXHIBIT G
OPINION OF
DAVIS POLK & WARDWELL, SPECIAL COUNSEL
FOR THE AGENT
To the Banks and the Agent
Referred to Below
c/o Morgan Guaranty Trust Company
of New York, as Agent
60 Wall Street
New York, New York 10260
Dear Sirs:
We have participated in the preparation of the Credit Agreement
(the "Credit Agreement") dated as of June 28, 1994 among American Stores
Company, a Delaware corporation (the "Borrower"), the Banks from time to time
parties thereto (the "Banks"), the Co-Agents listed on the signature pages
thereof and Morgan Guaranty Trust Company of New York, as Agent (the "Agent"),
and have acted as special counsel for the Agent for the purpose of rendering
this opinion pursuant to Section 3.01(e) of the Credit Agreement. Terms
defined in the Credit Agreement are used herein as therein defined.
We have examined originals or copies, certified or otherwise
identified to our satisfaction, of such documents, corporate records,
certificates of public officials and other instruments and have conducted such
other investigations of fact and law as we have deemed necessary or advisable
for purposes of this opinion.
Upon the basis of the foregoing, we are of the opinion that:
1. The execution, delivery and performance by the Borrower of
the Credit Agreement and the Notes are within the Borrower's corporate powers
and have been duly authorized by all necessary corporate action.
2. The Credit Agreement constitutes a valid and binding
agreement of the Borrower and each Note constitutes a valid and binding
obligation of the Borrower, in each case enforceable in accordance with its
terms, except as the same may be limited by bankruptcy, insolvency or similar
laws affecting creditors' rights generally and by general principles of equity.
We are members of the Bar of the State of New York and the
foregoing opinion is limited to the laws of the State of New York, the federal
laws of the United States of America and the General Corporation Law of the
State of Delaware. In giving the foregoing opinion, we express no opinion as
to the effect (if any) of any law of any jurisdiction (except the State of New
York) in which any Bank is located which limits the rate of interest that such
Bank may charge or collect.
This opinion is rendered solely to you in connection with the
above matter. This opinion may not be relied upon by you for any other
purpose or relied upon by any other person without our prior written consent.
Very truly yours,
EXHIBIT H
ASSIGNMENT AND ASSUMPTION AGREEMENT
AGREEMENT dated as of _________, 19__ among [ASSIGNOR] (the
"Assignor"), [ASSIGNEE] (the "Assignee"), [BORROWER] (the "Borrower") and
MORGAN GUARANTY TRUST COMPANY OF NEW YORK, as Agent (the "Agent").
W I T N E S S E T H
WHEREAS, this Assignment and Assumption Agreement (the
"Agreement") relates to the Credit Agreement dated as of June 28, 1994 among
the Borrower, the Assignor and the other Banks party thereto, as Banks, the
Co-Agents listed on the signature pages thereof and the Agent (the "Credit
Agreement");
WHEREAS, as provided under the Credit Agreement, the Assignor
has a Commitment to make Loans to the Borrower in an aggregate principal
amount at any time outstanding not to exceed $__________;
WHEREAS, Committed Loans made to the Borrower by the Assignor
under the Credit Agreement in the aggregate principal amount of $__________
are outstanding at the date hereof; and
WHEREAS, the Assignor proposes to assign to the Assignee all of
the rights of the Assignor under the Credit Agreement in respect of a portion
of its Commitment thereunder in an amount equal to $__________ (the "Assigned
Amount"), together with a corresponding portion of its outstanding Committed
Loans, and the Assignee proposes to accept assignment of such rights and
assume the corresponding obligations from the Assignor on such terms;
NOW, THEREFORE, in consideration of the foregoing and the
mutual agreements contained herein, the parties hereto agree as follows:
SECTION 1. Definitions. All capitalized terms not otherwise
defined herein shall have the respective meanings set forth in the Credit
Agreement.
SECTION 2. Assignment. The Assignor hereby assigns and sells
to the Assignee all of the rights of the Assignor under the Credit Agreement
to the extent of the Assigned Amount, and the Assignee hereby accepts such
assignment from the Assignor and assumes all of the obligations of the
Assignor under the Credit Agreement to the extent of the Assigned Amount,
including the purchase from the Assignor of the corresponding portion of the
principal amount of the Committed Loans made by the Assignor outstanding at
the date hereof. Upon the execution and delivery hereof by the Assignor, the
Assignee, the Borrower and the Agent and the payment of the amounts specified
in Section 3 required to be paid on the date hereof (i) the Assignee shall, as
of the date hereof, succeed to the rights and be obligated to perform the
obligations of a Bank under the Credit Agreement with a Commitment in an
amount equal to the Assigned Amount, and (ii) the Commitment of the Assignor
shall, as of the date hereof, be reduced by a like amount and the Assignor
released from its obligations under the Credit Agreement to the extent such
obligations have been assumed by the Assignee. The assignment provided for
herein shall be without recourse to the Assignor.
SECTION 3. Payments. As consideration for the assignment and
sale contemplated in Section 2 hereof, the Assignee shall pay to the Assignor
on the date hereof in Federal funds the amount heretofore agreed between
them.(*) It is understood that commitment and/or facility fees accrued to the
date hereof are for the account of the Assignor and such fees accruing from
and including the date hereof are for the account of the Assignee. Each of the
Assignor and the Assignee hereby agrees that if it receives any amount under
the Credit Agreement which is for the account of the other party hereto, it
shall receive the same for the account of such other party to the extent of
such other party's interest therein and shall promptly pay the same to such
other party.
SECTION 4. Consent of the Borrower. This Agreement is
conditioned upon the consent of the Borrower pursuant to Section 9.06(c) of
the Credit Agreement. The execution of this Agreement by the Borrower is
evidence of this consent. Pursuant to Section 9.06(c) the Borrower agrees to
execute and deliver a Note payable to the order of the Assignee to evidence
the assignment and assumption provided for herein.
SECTION 5. Non-Reliance on Assignor. The Assignor makes no
representation or warranty in connection with, and shall have no
responsibility with respect to, the solvency, financial condition, or
statements of the Borrower, or the validity and enforceability of the
obligations of the Borrower in respect of the Credit Agreement or any Note.
The Assignee acknowledges that it has, independently and without reliance on
the Assignor, and based on such documents and information as it has deemed
appropriate, made its own credit analysis and decision to enter into this
Agreement and will continue to be responsible for making its own independent
appraisal of the business, affairs and financial condition of the Borrower.
SECTION 6. Governing Law. This Agreement shall be governed by
and construed in accordance with the laws of the State of New York.
SECTION 7. Counterparts. This Agreement may be signed in any
number of counterparts, each of which shall be an original, with the same
effect as if the signatures thereto and hereto were upon the same instrument.
IN WITNESS WHEREOF, the parties have caused this Agreement to
be executed and delivered by their duly authorized officers as of the date
first above written.
[ASSIGNOR]
By_________________________
Title:
[ASSIGNEE]
By__________________________
Title:
AMERICAN STORES COMPANY
By__________________________
Title:
(*) Amount should combine principal together with accrued interest and
breakage compensation, if any, to be paid by the Assignee, net of any
portion of any upfront fee to be paid by the Assignor to the Assignee. It
may be preferable in an appropriate case to specify these amounts
generically or by formula rather than as a fixed sum.
Exhibit 5
[Letterhead of
Wachtell, Lipton, Rosen & Katz
51 West 52nd Street
New York, N.Y. 10019-6150
Telephone: (212) 403-1000
Facsimile: (212) 403-2000]
November 1, 1994
American Stores Company
709 East South Temple
Salt Lake City, Utah 84102
Ladies and Gentlemen:
We have acted as special counsel to American Stores Com-
pany (the "Company") in connection with the preparation of the
Registration Statement on Form S-3 of the Company, filed with
the Securities and Exchange Commission on February 18, 1994, as
amended (Registration No. 33-52331) (the "Registration State-
ment"), relating to the registration under the Securities Act
of 1933, as amended (the "Act"), of $800,000,000 aggregate
principal amount of debt securities (the "Debt Securities") for
an offering to be made on a delayed or continuous basis pur-
suant to the provisions of Rule 415 under the Act.
In this connection, we have reviewed the (i) Restated
Certificate of Incorporation and By-Laws of the Company as
currently in effect; (ii) the Registration Statement; (iii)
certain resolutions adopted or to be adopted by the Board of
Directors or Pricing Committee of the Board of Directors of the
Company; (iv) the form of Senior Indenture under which the Debt
Securities may be issued and (v) such other documents, records
and papers as we have deemed necessary or appropriate in order
to give the opinions set forth herein. We are familiar with
the proceedings heretofore taken, and with the additional
proceedings proposed to be taken, by the Company in connection
with the authorization, registration, issuance and sale of the
Debt Securities. We have, with your consent, relied as to
factual matters on certificates or other documents furnished by
the Company or its officers and by governmental authorities and
PAGE
<PAGE>
American Stores Company
November 1, 1994
Page 2
upon such other documents and data that we have deemed ap-
propriate. We have assumed the authenticity of all documents
submitted to us as originals and the conformity to original
documents of all documents submitted to us as copies.
We are not members of the Bar of any jurisdiction other
than the State of New York.
Based on such examination and review, and subject to the
proposed additional proceedings being taken as now contemplated
prior to the issuance of the Debt Securities and the terms of
the Debt Securities being otherwise in compliance with ap-
plicable law, in our opinion the Debt Securities will, upon the
issuance and sale thereof in the manner referred to in the
Registration Statement, be legally issued and binding obliga-
tions of the Company in accordance with their terms, subject to
the effect of (i) bankruptcy, insolvency, reorganization, mor-
atorium or other similar laws relating to or affecting the
rights of creditors generally or (ii) the application of gen-
eral principles of equity (regardless of whether enforcement is
considered in proceedings at law or in equity).
We consent to the use of this opinion as an Exhibit to the
Registration Statement and to the reference to our firm in the
Prospectus that is a part of the Registration Statement. In
giving such consent, we do not hereby admit that we are in the
category of persons whose consent is required under Section 7
of the Securities Act of 1933.
Very truly yours,
/s/ Wachtell, Lipton, Rosen & Katz
<PAGE>
Exhibit 12
<TABLE>
AMERICAN STORES COMPANY
COMPUTATION OF RATIO OF EARNINGS TO FIXED
CHARGES
($ in thousands)
<CAPTION>
26 Weeks 26 Weeks Fiscal Year Ended
Ended Ended ==============================================================
7/30/94 7/31/93 1/29/94 1/30/93(1) 2/01/92(1) 2/02/91(1) 2/03/90(1)(2)
======= ======= ======= ========== ========== ========== =============
<S> <C> <C> <C> <C> <C> <C> <C>
Earnings before income taxes
and before cumulative effect of
changes in accounting principles
and an extraordinary item $210,806 $206,012 $480,805 $378,281 $438,468 $350,316 $241,180
Fixed Charges (detail below) 136,913 146,185 284,834 311,937 371,056 456,992 501,627
Adjusted for:
Capitalized Interest (1,457) (1,381) (3,416) (1,966) (4,003) (4,068) (7,067)
Previously Capitalized Interest
Amortized during the period 629 615 1,246 1,288 1,488 1,426 1,297
======== ========= ========= ========= ========= ========= =========
Earnings $346,891 $351,431 $763,469 $689,540 $807,009 $804,666 $737,037
======== ======== ======== ======== ======== ======== =========
Interest Expense(3) $ 89,634 $ 97,016 $189,773 $214,394 $265,098 $358,895 $401,914
Capitalized Interest 1,457 1,381 3,416 1,966 4,003 4,068 7,067
Interest Factor for Rental Expense
of Operating Leases 45,822 47,788 91,645 95,577 101,955 94,029 92,646
======== ======== ======== ======== ======== ======== ========
Fixed Charges $136,913 $146,185 $284,834 $311,937 $371,056 $456,992 $501,627
======== ======== ======== ======== ======== ======== ======
Ratio of Earnings to Fixed Charges 2.53 2.40 2.68 2.21 2.17 1.76 1.47
(1) Restated to reflect adoption of Statement of Financial Accounting
Standards No. 109, "Accounting for Income Taxes" as if effective at
the beginning of the fiscal year ended February 3, 1990.
(2) 53 Weeks. All other fiscal years presented are 52 weeks.
(3) As reported in financial statements. Includes amortization of debt
expense and interest on capital leases and is net of capitalized
interest.
</TABLE>
EXHIBIT 23.1
Consent of Ernst & Young LLP, Independent Auditors
We consent to the reference to our firm under the caption
"Experts" in this Registration Statement (Form S-3, No. 33-
52331) and related Prospectus of American Stores Company for
the registration of $800,000,000 of Debt Securities and to the
incorporation by reference therein of our report dated March
21, 1994, with respect to the consolidated financial statements
of American Stores Company included in its Annual Report (Form
10-K) for the fiscal year ended January 29, 1994, filed with
the Securities and Exchange Commission.
/s/ Ernst & Young LLP
ERNST & YOUNG LLP
Salt Lake City, Utah
November 1, 1994
<PAGE>
Exhibit 24
POWER OF ATTORNEY
KNOW ALL PERSONS BY THESE PRESENTS, that each
person whose signature appears below constitutes and appoints
Victor L. Lund as his or her true and lawful attorney-in-fact
and agent, with full power of substitution and resubstitu-
tion, for and on his or her behalf to execute, in any and all
capacities, and to file with the Securities and Exchange
Commission on behalf of American Stores Company under the
Securities Act of 1933, as amended, any and all Registration
Statements (including any and all amendments or post-
effective amendments thereto), with all exhibits thereto, and
other documents in connection therewith, pursuant to which up
to $800 million of American Stores Company debt securities
are to be sold.
In witness whereof, the undersigned have executed
this Power of Attorney on this 31st day of October, 1994.
Signature Title
Director
Henry I. Bryant
/s/ Arden B. Engebretsen Director
Arden B. Engebretsen
/s/ James B. Fisher Director
James B. Fisher
Director
Fernando R. Gumucio
Director
John E. Masline
/s/ Barbara S. Preiskel Director
Barbara S. Preiskel
/s/ J.L. Scott Director
J. L. Scott
/s/ Don L. Skaggs Director
Don L. Skaggs
PAGE
<PAGE>
POWER OF ATTORNEY
KNOW ALL PERSONS BY THESE PRESENTS, that each person whose
signature appears below constitutes and appoints Victor L.
Lund as his or her true and lawful attorney-in-fact and agent,
with full power of substitution and resubstitution, for and on
his or her behalf to execute, in any and all capacities, and to
file with the Securities and Exchange Commission on behalf of
American Stores Company under the Securities Act of 1933, as
amended, any and all Registration Statements (including any and
all amendments or post-effective amendments thereto), with all
exhibits thereto, and other documents in connection therewith,
pursuant to which up to $800 million of American Stores Company
debt securities are to be sold.
In witness whereof, the undersigned have executed this
Power of Attorney on this 24th day of October, 1994.
Signature Title
/s/ Donald B. Holbrook Director
Donald B. Holbrook
PAGE
<PAGE>
POWER OF ATTORNEY
KNOW ALL PERSONS BY THESE PRESENTS, that each person whose
signature appears below constitutes and appoints Victor L.
Lund as his or her true and lawful attorney-in-fact and agent,
with full power of substitution and resubstitution, for and on
his or her behalf to execute, in any and all capacities, and to
file with the Securities and Exchange Commission on behalf of
American Stores Company under the Securities Act of 1933, as
amended, any and all Registration Statements (including any and
all amendments or post-effective amendments thereto), with all
exhibits thereto, and other documents in connection therewith,
pursuant to which up to $800 million of American Stores Company
debt securities are to be sold.
In witness whereof, the undersigned have executed this
Power of Attorney on this 18th day of February, 1994.
Signature Title
/s/ L.S. Skaggs Chairman of the Board
L.S. Skaggs and Director
/s/ Teresa Beck Executive Vice President
Teresa Beck Administration and
Assistant Secretray
/s/ Louis H. Callister Director
Louis H. Callister
/s/ Leon G. Harmon Director
Leon G. Harmon
/s/ Michael T. Miller Director
Michael T. Miller
/s/ L. Tom Perry Director
L. Tom Perry
/s/ Aline W. Skaggs Director
Aline W. Skaggs
/s/ Arthur K. Smith Director
Arthur K. Smith
<PAGE>
