<PAGE>
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D. C. 20549
_______________________
FORM 10-K
(Mark One)
/X/ ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF
THE SECURITIES EXCHANGE ACT OF 1934
[FEE REQUIRED]
For the fiscal year ended December 31, 1993
OR
/ / TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF
THE SECURITIES EXCHANGE ACT OF 1934
[NO FEE REQUIRED]
Commission file number 1-8714
TAMBRANDS INC.
--------------
(Exact name of registrant as specified in its charter)
Delaware 13-1366500
-------- ----------
(State or other jurisdiction (I.R.S. Employer
of incorporation or organization) Identification No.)
777 Westchester Avenue
White Plains, New York 10604
- ---------------------- -----
(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code, is 914-696-6000
------------
Securities registered pursuant to Section 12(b) of the Act:
Name of each exchange
Title of each class on which registered
------------------- -------------------
Common Stock, par New York Stock Exchange
value $.25 per share; and Pacific Stock Exchange
Common Share Purchase Rights
Securities registered pursuant to Section 12(g) of the Act: None
Indicate by check mark whether the registrant (1) has filed all
reports required to be filed by Section 13 or 15(d) of the Securities Exchange
Act of 1934 during the preceding 12 months, and (2) has been subject to such
filing requirements for the past 90 days.
Yes X No ________
---------
<PAGE>
FORM 10-K
(Facing Sheet Continuation)
Indicate by check mark if disclosure of delinquent filers pursuant to
Item 405 of Regulation S-K is not contained in this Form 10-K, and will not be
contained, to the best of the registrant's knowledge, in definitive proxy or
information statements incorporated by reference in Part III of this Form 10-K
or any amendment to this Form 10-K. [ ]
The aggregate market value of the voting stock held by non-affiliates
of the registrant as of February 9, 1994 was
$1,600,048,069. (For this computation, the registrant has excluded the market
value of all shares of its Common Stock reported as beneficially owned by
officers and directors of the registrant; such exclusion shall not be deemed to
constitute an admission that any such person is an "affiliate" of the
registrant.)
As of March 15, 1994, 37,314,597 shares of the registrant's Common
Stock were outstanding.
Documents Incorporated by Reference
- -----------------------------------
Part III of this Form 10-K incorporates by reference portions of the
definitive Proxy Statement for the registrant's annual meeting of shareholders
to be held on April 26, 1994, filed with the Securities and Exchange Commission
pursuant to Regulation 14A.
<PAGE>
PART I
------
Item 1. Business
- ------ --------
General
- -------
Tambrands Inc. (the "Company") has been manufacturing and marketing
menstrual tampons, which are sold under the trademark TAMPAX(R), since 1936. It
is the leading manufacturer and marketer of tampons in the world. The Company
operates in one business segment, personal care products. In recent years, the
Company has focused on its core TAMPAX tampon business worldwide and has been
expanding its international operations. The Company has manufacturing
operations in eight countries. In 1993, TAMPAX tampons were sold in over 150
countries.
The Company has subsidiaries operating in Brazil, Canada, the Czech
Republic, France, Ireland, Mexico, Poland, Russia, South Africa, Switzerland,
Ukraine, the United Kingdom and Venezuela. The Company also has an 80% interest
in a joint venture in the People's Republic of China.
The Company was incorporated under the laws of the State of Delaware in
1936. The Company's principal executive offices are located at 777 Westchester
Avenue, White Plains, New York 10604 (telephone number 914-696-6000).
Recent Developments
- -------------------
In June 1989, the Company adopted a new corporate strategy of
concentrating on the Company's core TAMPAX tampon business. As part of this
strategy, the Company announced in December 1989 a major restructuring program
designed to reduce costs and improve performance. The restructuring program has
included sales of the Company's businesses that were not supportive of the
Company's core activities, reductions in workforce and consolidation of certain
administrative, manufacturing and research and development facilities in the
United States, Canada and Europe. This program has been virtually completed.
In December 1991, the Company announced a program to restructure its
worldwide manufacturing operations to improve efficiency and reduce costs. The
program includes workforce reductions and consolidation of facilities. The
program has been virtually completed, and has included the sale of non-core
businesses in Brazil and Mexico and the closing of manufacturing plants in
Canada and the United States.
In June 1993, the Company announced that it would provide a $30 million
charge ($20 million after-tax) to provide for restructuring of manufacturing and
administrative operations and the cost of management changes, including the
adoption of a
<PAGE>
consolidated international management strategy. The program includes workforce
reductions and consolidation of facilities.
In order to implement these restructuring programs, the number of
manufacturing plants has been reduced by approximately 50% and the Company has
sold (i) its cosmetics, diagnostics and MAXITHINS(R) pad and panty shield
businesses; (ii) its headquarters in Lake Success, New York; (iii) its non-
tampon businesses in Spain, which included sanitary pads, disposable diapers and
other baby products; (iv) its interest in a joint venture in Turkey, which
primarily produced sanitary pads and diapers; (v) its disposable diaper and
external pad businesses in Brazil; and (vi) its alcohol, cotton, baby wipes and
external pad businesses in Mexico.
The Company currently is engaged in an ongoing program of substantially
upgrading production equipment at its remaining manufacturing facilities through
further automation and computerization. The Company's 1993 capital spending
programs were related to investments in equipment to improve product quality and
productivity, modernize facilities and reduce costs. See "Management's
Discussion and Analysis of Results of Operations and Financial Condition"
contained in item 7 of Part II hereof.
In June 1989, the Company initiated a stock repurchase program. As of
December 31, 1993, the Company had spent approximately $365 million to purchase
approximately 5.9 million shares of its Common Stock under four repurchase
programs. The Company was authorized as of December 31, 1993 to purchase 2.02
million additional shares. The Company is continuing its repurchases as
conditions warrant.
In 1992, the Company established a commercial paper program under which it
may borrow up to $150 million for general corporate purposes. At December 31,
1993, $48 million was outstanding under this program. In addition, in 1993, the
Company established a $150 million Medium-Term Note program. At December 31,
1993, $30 million was outstanding under this program.
On June 1, 1993, Martin F. C. Emmett resigned from his position as Chairman
and Chief Executive Officer. Howard B. Wentz, Jr. replaced Mr. Emmett as the
Chairman of the Board of Directors and, pending the appointment of a Chief
Executive Officer, is performing the duties of Chief Executive Officer. Certain
other changes in senior management also occurred in mid-1993. The Company is
currently in the process of evaluating candidates for the position of Chief
Executive Officer.
Products
- --------
Menstrual tampons represent virtually all of the Company's sales. The
Company's largest selling tampon is the TAMPAX
-2-
<PAGE>
flushable applicator tampon, which first became commercially
available in 1936. The Company also manufactures and sells (i) TAMPAX tampons
with plastic applicators in the United States; (ii) TAMPAX COMPAK(R) tampons,
with a compact all-plastic applicator, in the United States, Canada, France, the
United Kingdom and other countries in Europe; and (iii) TAMPAX comfort shaped
flushable applicator tampons, with an all-paper rounded-end applicator and a
slimmer design than the Company's standard product, in the United States,
Canada, Australia, parts of Europe and several other countries.
In 1993, the Company introduced nationally in Canada the new TAMPAX SATIN
TOUCH/TM/ tampon. This tampon offers the ease and comfort of a plastic
applicator but has an all-paper applicator that is flushable and biodegradable.
In 1993, the Company introduced nationally its new TAMPAX TAMPETS(R) non-
applicator tampon in Ireland. The Company also introduced this tampon in test
market in the United Kingdom in 1993 and plans to introduce this tampon
nationally in the United Kingdom in 1994. The Company continues to evaluate the
possible introduction of these and other products in additional markets.
Marketing and Sales
- -------------------
Marketing operations are conducted either directly by the Company and its
subsidiaries and joint venture, or by independent brokers or sales agents and
distributors. Sales are made directly to drug, grocery, variety and discount
stores and other comparable outlets, as well as to wholesalers and distributors
in those trades. No single customer (including distributors) of the Company and
its subsidiaries and joint venture accounted for 10% or more of total net sales
in 1993. A small number of significant customers have highly leveraged capital
structures, making them particularly sensitive to adverse market interest rate
changes and other economic variables. This situation has not significantly
affected the Company in prior years.
Substantially all sales involve extensions of credit. Credit terms
generally are consistent with terms typically extended under local industry
practices. Default rates by the Company's customers in the United States have
been at or below industry averages, based on information from the Credit
Research Foundation.
In the United States, the Company's internal sales management group
directly handles sales to certain large customer accounts. These sales have
been increasing as a percentage of total sales. Other sales in the United
States and sales in Belgium, Canada, France and the Netherlands are handled
through independent sales brokers, who also may sell other branded consumer
products but generally do not carry products that compete with the products of
the Company and its subsidiaries. Sales are conducted in the Czech
-3-
<PAGE>
Republic, Poland, Russia, Ukraine and the United Kingdom by the Company's
subsidiaries and in the People's Republic of China by its joint venture. Sales
are conducted in other countries through independent distributors and agents.
During 1993, retailers in the United States and Europe and distributors in
Europe continued to reduce their inventories of TAMPAX tampons, as part of an
industry-wide trend to reduce consumer goods inventory levels. This inventory
reduction adversely affected the Company's 1993 financial results. This
inventory reduction trend has continued in the first quarter of 1994 and the
Company believes that the trend will continue. However, the rate of inventory
reduction in future periods is expected to be significantly less than the rate
of reduction experienced in 1993.
Media advertising is important to the overall success of the TAMPAX tampon
brand. In the United States, Canada and Europe, the Company focuses its
advertising on women aged 12-34, using a variety of media, including television
and print advertisements. The Company increased its advertising and promotional
spending substantially in the second half of 1993, in the face of a significant
decline in the Company's market share of the tampon category in the United
States in the first half of 1993 and a decline in the tampon share of the
sanitary protection category in Europe in 1992 and 1993. The advertising and
promotional spending is being concentrated in the Company's five largest markets
(the United States, the United Kingdom, Canada, France and Spain) and in the
four international markets believed to have the greatest development potential
(CIS, principally Russia and Ukraine, Mexico, China and Brazil).
The Company also seeks to attract and retain customers through its teen
education program, which is designed to help female teenagers understand the
various forms of sanitary protection and promotes trial usage of TAMPAX tampons.
Competition
- -----------
Highly competitive conditions prevail in the feminine protec-tion industry
for external pads and menstrual tampons, which are directly competitive in both
performance and price, the principal methods of competition.
In the United States, there are four other manufacturers whose sales,
directly or through subsidiaries, are significant in the total sanitary
protection market: Johnson & Johnson, Kimberly-Clark Corporation, Playtex Family
Products Corporation and The Procter & Gamble Company. Each of these
corporations manufactures and sells external pads or menstrual tampons or both.
Each makes and sells products other than external pads and tampons, and the
total sales
-4-
<PAGE>
of all products by and the capitalization of each of Johnson & Johnson,
Kimberly-Clark and Procter & Gamble are substantially greater than the total
sales and capitalization of the Company. These factors may be helpful to the
respective competitive positions of these companies in the feminine protection
industry. Substantially all of the tampons manufactured by the above-mentioned
four companies are sold under these companies' brand names. In addition, there
is a small but growing private label segment of the industry. Management
believes that the TAMPAX tampon's leading market share position in the U.S.
tampon category (approximately 50.3% in dollars and 53.7% in units for the year
1993, according to Information Resources, Inc.) and strong brand loyalty among
consumers (as verified by household panel data obtained by Nielsen Marketing
Research), are positive factors in the Company's ability to compete in the
feminine protection industry. During 1993, the level of competitive activity
increased in the United States, particularly in the area of price discounting.
Highly competitive conditions prevail in virtually all foreign markets.
Competition tends to be fragmented and regional in nature in most of those
markets, but tampons produced by, or under license from, Johnson & Johnson, and
external pads produced by Procter & Gamble, are sold in many of the foreign
markets where the Company does business. Competitive activity intensified in
Europe in 1993. This activity included the introduction and aggressive
marketing of several new external pad products.
Management expects that highly competitive conditions will continue in
1994, including price discounting, new product introductions and continued
growth in private label tampons.
Raw Materials
- -------------
The principal raw materials used in the Company's business are cotton and
rayon for tampons, paper and plastic for tampon applicators, and paperboard for
cartons and containers. Most of these raw materials are readily available in
the market from many sources.
Trademarks and Patents
- ----------------------
The Company, directly or through its subsidiaries, owns a number of
trademarks, trademark registrations and trademark applications in the United
States and other countries, which, in the opinion of management, are
significant. The Company's trademark registrations vary in duration and are
typically renewable by the Company. Certain features of TAMPAX tampons are the
subject of U.S. and foreign patents or patent applications owned by the Company.
In management's opinion, certain of these patents are significant. The duration
of the Company's patents ranges from 5 to 19 years (i.e., the patents have
----
expiration dates
-5-
<PAGE>
ranging from the year 1999 to the year 2013).
Research and Development
- ------------------------
The Company maintains a research and development laboratory at its
facilities in each of Palmer, Massachusetts and Havant, England. The Company's
research and development expenditures have approximated 2% of net sales in each
of the past three years. Management believes that developing better protecting
and more comfortable and convenient products, and products which are
environmentally sound, is important to maintaining the Company's competitive
position. Research is directed toward these goals.
Employees
- ---------
As part of the restructuring program announced in 1989, the staff of the
Company's headquarters and North American Division has been reduced
substantially. The sale of non-core businesses also has reduced the number of
employees. Additional headcount reductions have occurred and will occur as a
result of the restructuring programs announced in 1991 and 1993. At December
31, 1993, the Company and its consolidated subsidiaries employed approximately
3,600 persons, including 900 employees in the People's Republic of China, Russia
and Ukraine.
Foreign and Domestic Operations; Export Sales
- ---------------------------------------------
The information regarding foreign and domestic operations of the Company
and its subsidiaries set forth on page 38 under the caption "Segment and
Geographic Information" in the Notes to Consolidated Financial Statements is
incorporated herein by reference.
Over the past three years, sales by the Company's foreign operations
accounted for approximately one-half of total unit sales.
In 1993, sales between geographic areas and export sales of the Company
were not significant.
Item 2. Properties
- ------ ----------
Domestic Properties
- -------------------
As part of its worldwide manufacturing restructuring program, during 1993,
the Company's Palmer, Massachusetts manufacturing plant was converted to a
facility for testing new equipment and developing new products. The Company has
consolidated its U.S. manufacturing operations in its three other U.S. plants,
located in Auburn, Maine; Claremont, New Hampshire; and Rutland, Vermont.
-6-
<PAGE>
Technical and research and development operations are conducted at the Company's
Technical Center, also located in Palmer, Massachusetts. This facility is a
testing center for the application of advanced manufacturing technology to the
Company's products. The Company owns each of these plants and the Technical
Center. The Company leases headquarters office space in White Plains, New York.
The Company's production machinery and equipment and the properties owned
by it described above are held free and clear of encumbrances.
During the last fiscal year, the Company's domestic plants were suitable
and adequate for the Company's requirements. The Company's domestic plants
operate principally on a three-shift basis, and have sufficient additional
capacity to satisfy the foreseeable requirements of the Company.
Foreign Properties
- ------------------
The Company's foreign subsidiaries own and operate manufacturing plants in
France, Ireland, Russia, South Africa, Ukraine and the United Kingdom. The
Company's joint venture in the People's Republic of China has contractual rights
to use a manufacturing plant there. The Company's foreign subsidiaries lease
office space in Brazil, Canada, France, Mexico, Switzerland, Venezuela and in
several other countries. The Company's subsidiary in the United Kingdom leases
office space there for the Company's international headquarters.
In 1993, as part of the Company's worldwide manufacturing restructuring
program, the Company determined to effect a restructuring of the manufacturing
operations conducted at the plant owned by its subsidiary in France. All
European production of COMPAK tampons now will be concentrated at the French
plant, and production of other tampons will be consolidated in the Company's
other European plants. As part of the restructuring program, the Company also
decided in 1993 to close the tampon manufacturing plant in Mexico leased by a
subsidiary. The Mexican manufacturing operations are being consolidated in the
Company's U.S. plants.
The production machinery and equipment and properties owned by the
Company's foreign subsidiaries described above are held free and clear of
encumbrances.
During the last fiscal year, the Company's foreign facilities were suitable
and adequate for the Company's requirements. In general, the Company's foreign
manufacturing facilities operate on a two- or three-shift basis, and have
sufficient additional capacity to satisfy the foreseeable requirements of the
Company.
-7-
<PAGE>
Item 3. Legal Proceedings
- ------ -----------------
The Company or a subsidiary is a defendant in a small number of pending
product liability lawsuits based on allegations that toxic shock syndrome
("TSS") was contracted through the use of tampons. A small number of pre-suit
claims involving similar allegations have also been asserted. The damages
alleged vary from case to case and often include claims for punitive damages.
The Company and certain of its present and former officers have been named
as defendants in certain shareholder lawsuits that have been filed in the United
States District Court for the Southern District of New York and that have been
consolidated under the caption In Re Tambrands Inc. Securities Litigation. The
------------------------------------------
consolidated lawsuit purports to be a federal securities fraud class action on
behalf of all purchasers of the Company's common stock during the period
December 14, 1992 through June 2, 1993. The complaint alleges that the
Company's disclosures during the alleged class period contained material
misstatements and omissions concerning its anticipated future earnings. The
complaint seeks an unspecified amount of damages on behalf of the purported
class.
The Company is a nominal defendant in three purported shareholder
derivative lawsuits that have been filed in the Supreme Court of the State of
New York for Westchester County and that have been consolidated into a single
action. Named collectively in the consolidated complaint as individual
defendants are the Company's directors (and certain of its former directors) and
two of its former officers. The complaint alleges that the officer-defendants
exposed the Company to liability in the purported shareholder class action
described in the preceding paragraph and misappropriated corporate opportunities
by trading in the Company's stock on the basis of nonpublic information. One of
the former officers is also alleged to have received improper reimbursements
from the Company for alleged personal expenses. The director-defendants are
alleged to have acquiesced in the aforesaid alleged violations. The complaint
seeks to recover on behalf of the Company an unspecified amount of damages from
the individual defendants. No relief is sought against the Company.
The Company is involved in certain other legal proceedings incidental to
the normal conduct of its business.
While it is not feasible to predict the outcome of these legal proceedings
and claims with certainty, management is of the belief that any ultimate
liabilities for damages either are covered by insurance, are provided for in the
Company's financial statements or, to the extent not so covered or provided for,
should not individually or in the aggregate have a material adverse effect on
the Company's financial position.
-8-
<PAGE>
Item 4. Submission of Matters to a Vote of Security Holders
- ------ ---------------------------------------------------
No matters were submitted to a vote of security holders during the fourth
quarter of the fiscal year covered by this report.
Executive Officers of the Registrant
- ------------------------------------
The names and ages of all executive officers of the Company, the current
office held by each, and the period during which each has served as such are set
forth in the following table:
<TABLE>
<CAPTION>
Period Served
Name Age Current Office In Current Office
---- --- -------------- -----------------
<S> <C> <C> <C>
Charles J. Chapman 55 Executive Vice President 1993 to date
and President,
North America (1)
Helen G. Goodman 53 Senior Vice President- 1990 to date
Human Resources
Harry E. Raber 52 Vice President- 1991 to date
Corporate Engineering
and Manufacturing
Alain Strasser 47 Group Vice President- 1989 to date
International
Jerome B. Wainick 53 Vice President-Research 1990 to date
and Development (2)
Howard B. Wentz, Jr. 64 Chairman of the Board (3) 1993 to date
Raymond F. Wright 55 Senior Vice President- 1989 to date
Chief Financial
Officer (4)
</TABLE>
Each executive officer is appointed by the Board of Directors to serve until
the first meeting of directors following the annual meeting of shareholders of
the Company. Except as indicated in the footnotes below, the principal
occupation and employment during the past five years of each of the above-named
executive officers have been as an officer or other member of management of the
Company or one or more of its subsidiaries.
(1) Mr. Chapman has served as an officer of the Company since August 1989.
From prior to March 1989 until August 1989, he was employed by The Spectrum
Group, Inc. (an investment company) as Vice President.
(2) Mr. Wainick has served as an officer of the Company since June 1990.
From prior to March 1989 until June 1990, he was employed by Binney & Smith,
Inc. (a manufacturer of arts and crafts
-9-
<PAGE>
supplies), a subsidiary of Hallmark Cards, Inc., as Director of Technical
Development.
(3) Mr. Wentz is a non-employee director of the Corporation and has been
Chairman of the Board and has performed the duties of the Chief Executive
Officer of the Corporation since June 2, 1993. Mr. Wentz has served as Chairman
of the Board of ESSTAR Incorporated (a manufacturer of portable electric tools
and architectural hardware) since July 1989. From prior to March 1989 until
June 1989, he served as Chairman, President and Chief Executive Officer of
Amstar Corporation (a diversified manufacturer).
(4) Mr. Wright has served as an officer of the Company since August 1989.
From prior to March 1989 until August 1989, he was employed by International
Nabisco Brands as Senior Vice President-Finance.
-10-
<PAGE>
PART II
-------
Item 5. Market for Registrant's Common Equity and Related
- ------ -------------------------------------------------
Shareholder Matters
-------------------
The Company's Common Stock is traded on the New York and Pacific Stock
Exchanges. The following table provides quarterly dividend and Common Stock
price range information for the years 1992 and 1993:
<TABLE>
<CAPTION>
Common Stock
Price Range (a)
--------------------------------
Dividends
High Low Per Share
-------- -------- ------------
<S> <C> <C> <C>
1993
- ----------------
First Quarter $ 65 $ 53 1/2 $ 0.38
Second Quarter 54 1/8 39 1/2 0.38
Third Quarter 49 7/8 40 3/4 0.80(b)
Fourth Quarter 46 3/8 41 1/4 -- (b)
1992
- ----------------
First Quarter $ 70 1/2 $ 60 3/4 $ 0.34
Second Quarter 64 3/4 58 5/8 0.34
Third Quarter 66 3/4 58 5/8 0.34
Fourth Quarter 69 7/8 60 5/8 0.38
</TABLE>
(a) Reflects trading on the New York Stock Exchange.
(b) Dividends of $0.42 per share declared in the third quarter were paid in
December 1993.
As of March 15, 1994, there were 7,001 holders of record of the Company's Common
Stock.
Item 6. Selected Financial Data
- ------ -----------------------
The information required by this item is set forth in a separate section of
this Annual Report on Form 10-K under the caption "Selected Financial Data"
appearing on page 25 and is incorporated herein by reference.
-11-
<PAGE>
Item 7. Management's Discussion and Analysis of Results of
- ------ --------------------------------------------------
Operations and Financial Condition
----------------------------------
The information required by this item is set forth in a separate section of
this Annual Report on Form 10-K under the caption "Management's Discussion and
Analysis" beginning on page 26 and is incorporated herein by reference.
Item 8. Financial Statements and Supplementary Data
- ------ -------------------------------------------
The information required by this item is set forth in a separate section of
this Annual Report on Form 10-K as indicated in the "Index to Financial
Information" appearing on page 24 and is incorporated herein by reference.
Item 9. Changes in and Disagreements with Accountants on
- ------ ------------------------------------------------
Accounting and Financial Disclosure
-----------------------------------
None.
PART III
--------
Item 10. Directors and Executive Officers of the Registrant
- ------- --------------------------------------------------
The information relating to nominees for election as directors of the Company
set forth under the caption "Election of Directors" in the Company's definitive
Proxy Statement for the annual meeting of shareholders to be held on April 26,
1994 is incorporated herein by reference.
Mr. Brian Healey is currently a director of the Company, but he is retiring
from the Board of Directors, and he is not a nominee for election as a director
at the annual meeting of shareholders to be held on April 26, 1994. Mr. Healey
has been a Principal of Brian Healey & Associates, Victoria, Australia (a
business consulting firm), since before March 1989. He has been a director of
the Company since 1992 and is 60 years old.
The information on executive officers set forth under the caption "Executive
Officers of the Registrant" beginning on page 9 is incorporated herein by
reference.
The information relating to compliance with Section 16(a) of the Securities
Exchange Act of 1934, as amended, set forth under the caption "Executive
Compensation and Other Information - Other Information" in the Company's
definitive Proxy Statement for the annual meeting of shareholders to be held on
April 26, 1994 is incorporated herein by reference.
Item 11. Executive Compensation
- ------- ----------------------
The information regarding executive compensation set forth under the captions
"Information Regarding the Board of Directors -
-12-
<PAGE>
Compensation of Directors," "Executive Compensation and Other Information" and
"Proposal to Approve Amendment to the 1992 Directors Stock Incentive Plan" in
the Company's definitive Proxy Statement for the annual meeting of shareholders
to be held on April 26, 1994 is incorporated herein by reference.
Item 12. Security Ownership of Certain Beneficial Owners and
- ------- ----------------------------------------------------
Management
----------
The information regarding the security ownership of certain beneficial owners
and management set forth under the caption "Security Ownership by Management and
Others" in the Company's definitive Proxy Statement for the annual meeting of
shareholders to be held on April 26, 1994 is incorporated herein by reference.
Item 13. Certain Relationships and Related Transactions
- ------- ----------------------------------------------
The information pertaining to certain relationships and related transactions
set forth under the captions "Information Regarding the Board of Directors -
Compensation of Directors" and "Executive Compensation and Other Information -
Other Information" in the Company's definitive Proxy Statement for the annual
meeting of shareholders to be held on April 26, 1994 is incorporated herein by
reference. The services performed for the Company by Doherty, Wallace,
Pillsbury & Murphy, P.C. were on terms no less favorable to the Company than if
such services had been provided by unaffiliated parties.
PART IV
-------
Item 14. Exhibits, Financial Statement Schedules,
- ------- ----------------------------------------
and Reports on Form 8-K
-----------------------
(a) Documents filed as part of this report
1. Financial Statements
The list of financial statements set forth under the caption "Index to
Financial Information" on page 24 is incorporated herein by reference.
2. Financial Statement Schedules
The list of financial statement schedules set forth under the caption
"Index to Financial Information" on page 24 is incorporated herein by
reference. All other schedules have been omitted, as the required
information is inapplicable or the information is presented in the
financial statements or related notes.
-13-
<PAGE>
3. Exhibits
Exhibit
Number Description
------- -----------
3(1) Certificate of Incorporation of the Company, as amended through
April 28, 1987, filed April 30, 1987 as Exhibit 4(a) to the
Company's Form S-8 Registration Statement (Reg. No. 33-13902),
incorporated herein by reference.
3(2) Certificate of Amendment of Certificate of Incorporation of the
Company, dated April 24, 1990, filed May 15, 1990 as Exhibit
4(2) to the Company's Report on Form 10-Q for the quarter ended
March 31, 1990, incorporated herein by reference.
3(3) Certificate of Amendment of Certificate of Incorporation of the
Company, dated April 28, 1992, filed May 15, 1992 as Exhibit
4(2) to the Company's Report on Form 10-Q for the quarter ended
March 31, 1992, incorporated herein by reference.
3(4) By-Laws of the Company, as amended, filed herewith.
4(1) Description of the rights of security holders set forth in the
Certificate of Incorporation of the Company, as amended through
April 28, 1987, filed April 30, 1987 as Exhibit 4(a) to the
Company's Form S-8 Registration Statement (Reg. No. 33-13902),
incorporated herein by reference.
4(2) Description of the rights of security holders set forth in the
Certificate of Amendment of Certificate of Incorporation of the
Company, dated April 28, 1992, filed May 15, 1992 as Exhibit
4(2) to the Company's Report on Form 10-Q for the quarter ended
March 31, 1992, incorporated herein by reference.
4(3) Rights Agreement, dated as of October 24, 1989, between the
Company and First Chicago Trust Company of New York, which
includes the Form of Right Certificate as Exhibit A and the
Summary of Rights to Purchase Common Shares as Exhibit B, filed
October 27, 1989 as Exhibit 1 to the Company's Form 8-A
Registration Statement,
-14-
<PAGE>
incorporated herein by reference.
4(4)(a) Indenture dated as of December 1, 1993 between the Company and
Citibank, N.A., as trustee, relating to the Company's Medium-
Term Note Program, filed herewith.
4(4)(b) Form of Floating Rate Debt Security, filed December 16, 1993 as
Exhibit 4-a to the Company's Report on Form 8-K, incorporated
herein by reference.
4(4)(c) Form of Fixed Rate Debt Security, filed December 16, 1993 as
Exhibit 4-b to the Company's Report on Form 8-K, incorporated
herein by reference.
Management Contracts and
Compensatory Plans and Arrangements
(Exhibits 10(1) - 10(21))
-----------------------
10(1)(a) 1981 Long Term Incentive Plan, as amended through November 4,
1988, filed as Exhibit 10(1)(a) to the Company's Report on Form
10-K for the year 1988, incorporated herein by reference.
10(1)(b) Amendment to 1981 Long Term Incentive Plan, dated as of
February 27, 1990, filed as Exhibit 10(1)(b) to the Company's
Report on Form 10-K for the year 1989, incorporated herein by
reference.
10(1)(c) Amendment to 1981 Long Term Incentive Plan, effective as of
June 25, 1991, filed as Exhibit 10(1)(c) to the Company's
Report on Form 10-K for the year 1991, incorporated herein by
reference.
10(1)(d) Amendment to 1981 Long Term Incentive Plan, effective as of
June 23, 1992, filed as Exhibit 10(1)(d) to the Company's
Report on Form 10-K for the year 1992, incorporated herein by
reference.
10(1)(e) Amendment to 1981 Long Term Incentive Plan, effective as of
February 23, 1993, filed as Exhibit 10(1)(e) to the Company's
Report on Form 10-K for the year 1992, incorporated herein by
reference.
10(1)(f) Addendum to 1981 Long Term Incentive Plan, filed April 30, 1987
as Exhibit 28(a) to the
-15-
<PAGE>
Company's Form S-8 Registration Statement (Reg. No. 33-13902),
incorporated herein by reference.
10(2)(a) 1981 Incentive Stock Option Plan, as amended
through April 30, 1987, filed April 30, 1987 as Exhibit 28(a)
to the Company's Form S-8 Registration Statement (Reg. No. 33-
13902), incorporated herein by reference.
10(2)(b) Amendment to 1981 Incentive Stock Option Plan, dated as of
February 27, 1990, filed as Exhibit 10(2)(b) to the Company's
Report on Form 10-K for the year 1989, incorporated herein by
reference.
10(2)(c) Amendment to 1981 Incentive Stock Option Plan, effective as of
June 23, 1992, filed as Exhibit 10(2)(c) to the Company's
Report on Form 10-K for the year 1992, incorporated herein by
reference.
10(2)(d) Amendment to 1981 Incentive Stock Option Plan, effective as of
February 23, 1993, filed as Exhibit 10(2)(d) to the Company's
Report on Form 10-K for the year 1992, incorporated herein by
reference.
10(3)(a) 1991 Stock Option Plan, filed as Exhibit 10(3) to the Company's
Report on Form 10-K for the year 1990, incorporated herein by
reference.
10(3)(b) First Amendment to 1991 Stock Option Plan, effective as of July
1, 1991, filed as Exhibit 10(3)(b) to the Company's Report on
Form 10-K for the year 1991, incorporated herein by reference.
10(3)(c) Second Amendment to 1991 Stock Option Plan, effective as of
July 1, 1991, filed as Exhibit 10(3)(c) to the Company's Report
on Form 10-K for the year 1991, incorporated herein by
reference.
10(3)(d) Third Amendment to 1991 Stock Option Plan, effective as of June
23, 1992, filed as Exhibit 10(3)(d) to the Company's Report on
Form 10-K for the year 1992, incorporated herein by reference.
10(3)(e) Fourth Amendment to 1991 Stock Option Plan, effective as of
February 23, 1993, filed as Exhibit 10(3)(e) to the Company's
Report on Form 10-K for the year 1992, incorporated herein by
reference.
-16-
<PAGE>
10(3)(f) Fifth Amendment to 1991 Stock Option Plan, effective as of
February 23, 1993, filed as Exhibit 10(3)(f) to the Company's
Report on Form 10-K for the year 1992, incorporated herein by
reference.
10(3)(g) Addendum to 1991 Stock Option Plan, filed as Exhibit 10(3)(g)
to the Company's Report on Form 10-K for the year 1992,
incorporated herein by reference.
10(3)(h) Sixth Amendment to 1991 Stock Option Plan, effective as of
February 1, 1994, filed herewith.
10(4)(a) 1989 Restricted Stock Plan, as amended through December 31,
1990, filed as Exhibit 10(4) to the Company's Report on Form
10-K for the year 1990, incorporated herein by reference.
10(4)(b) Amendment to 1989 Restricted Stock Plan, effective as of
February 23, 1993, filed as Exhibit 10(4)(b) to the Company's
Report on Form 10-K for the year 1992, incorporated herein by
reference.
10(5)(a) Supplemental Executive Retirement Plan, effective July 1, 1986,
as amended and restated effective July 1, 1994, filed herewith.
10(5)(b) Resolutions of the Compensation Committee of the Board of
Directors of the Company with respect to certain benefits under
the Supplemental Executive Retirement Plan, adopted on February
11, 1993, filed as Exhibit 10(5)(b) to the Company's Report on
Form 10-K for the year 1992, incorporated herein by reference.
10(6) Trust Agreement between the Company and The Northern Trust
Company, dated as of October 31, 1988, filed as Exhibit 10(6)
to the Company's
Report on Form 10-K for the year 1988, incorporated herein by
reference.
10(7) Pension Plan for Non-Employee Directors, filed as Exhibit
10(10) to the Company's Report on Form 10-K for the year 1990,
incorporated herein by reference.
10(8)(a) 1992 Directors Stock Incentive Plan, filed as
Exhibit 10(11) to the Company's Report on Form 10-K for the
year 1991, incorporated herein by
-17-
<PAGE>
reference.
10(8)(b) First Amendment to 1992 Directors Stock
Incentive Plan, effective as of August 18, 1992, filed as
Exhibit 10(8)(b) to the Company's Report on Form 10-K for the
year 1992, incorporated herein by reference.
10(8)(c) Second Amendment to 1992 Directors Stock
Incentive Plan, effective as of February 23, 1993, filed as
Exhibit 10(8)(c) to the Company's Report on Form 10-K for the
year 1992, incorporated herein by reference.
10(8)(d) Third Amendment to the 1992 Directors Stock Incentive Plan,
effective as of August 24, 1993, filed as Exhibit 10(3) to the
Company's Report on Form 10-Q/A for the quarterly period ended
September 30, 1993, incorporated herein by reference.
10(8)(e) Fourth Amendment to 1992 Directors Stock Incentive Plan,
effective as of March 1, 1994 (subject to shareholder approval
at the annual meeting of shareholders to be held on April 26,
1994), filed herewith.
10(9)(a) Amended and Restated Employment Protection Agreement between
the Company and Mr. Martin F.C. Emmett, dated as of October 16,
1990, filed as Exhibit 10(11)(a) to the Company's Report on
Form 10-K for the year 1990, incorporated herein by reference.
10(9)(b) Employment Protection Agreement between the
Company and Mr. Charles J. Chapman, dated as of August 23,
1989, and First Amendment to Employment Protection Agreement
between the Company and Mr. Charles J. Chapman, dated as of
October 16, 1990, filed as Exhibit 10(11)(b) to the Company's
Report on Form 10-K for the year
1990, incorporated herein by reference;
10(9)(c) Employment Protection Agreement between the
Company and Mr. Alain Strasser, dated as of November 15, 1989,
and First Amendment to Employment Protection Agreement between
the Company and Mr. Alain Strasser, dated as of October 16,
1990, filed as Exhibit 10(11)(e) to the Company's Report on
Form 10-K for the year 1990, incorporated herein by reference;
-18-
<PAGE>
10(9)(d) Employment Protection Agreement between the
Company and Mr. Raymond F. Wright, dated as of August 23, 1989,
and First Amendment to Employment Protection Agreement between
the Company and Mr. Raymond F. Wright, dated as of October 16,
1990, filed as Exhibit 10(11)(c) to the Company's Report on
Form 10-K for the year 1990, incorporated herein by reference;
10(9)(e) Employment Protection Agreement between the
Company and Ms. Helen G. Goodman, dated as of December 1, 1989,
and First Amendment to Employment Protection Agreement between
the Company and Ms. Helen G. Goodman, dated as of October 16,
1990, filed herewith;
The Company has agreements similar to the agreements listed as
Exhibits 10(9)(b), 10(9)(c), 10(9)(d) and 10(9)(e) with its
other executive officers.
10(10) Letter Agreement between the Company and Mr. Martin F.C.
Emmett, dated October 16, 1990, filed as Exhibit 10(12) to the
Company's Report on Form 10-K for the year 1990, incorporated
herein by reference.
10(11) Amended and Restated Stock Option Agreement between the Company
and Mr. Martin F.C. Emmett, dated October 16, 1990, filed as
Exhibit 10(13) to the Company's Report on Form 10-K for the
year 1990, incorporated herein by reference.
10(12) Consulting Agreements between the Company and Mr. Brian Healey,
dated July 1, 1989, filed as Exhibit 10(12) to the Company's
Report on Form 10-K for the year 1992, incorporated herein by
reference.
10(13) Executive Severance Program of the Company, filed as Exhibit
10(15) to the Company's Report on Form 10-K for the year 1989,
incorporated herein by reference.
10(14) Annual Incentive Plan of the Company, filed as Exhibit 10(6) to
the Company's Report on Form 10-K for the year 1984,
incorporated herein by reference.
10(15) Summary of supplemental pension plan of Tambrands France S.A.,
filed as Exhibit 10(16) to the Company's Report on Form 10-K
for the
-19-
<PAGE>
year 1992, incorporated herein by reference.
10(16) Summary of Revision to Non-Employee Director Cash Compensation,
approved August 24, 1993, filed as Exhibit 10(1) to the
Company's Report on Form 10-Q/A for the quarterly period ended
September 30, 1993, incorporated herein by reference.
10(17) Amended and Restated Letter Agreement between the Company and
Mr. Howard B. Wentz, Jr., dated August 24, 1993, filed as
Exhibit 10(2) to the Company's Report on Form 10-Q/A for the
quarterly period ended September 30, 1993, incorporated herein
by reference.
10(18) Letter Agreement between the Company and Mr. James G. Mitchell,
dated June 30, 1993, and amendment thereto, dated October 13,
1993, filed as Exhibit 10(5) to the Company's Report on Form
10-Q/A for the quarterly period ended September 30, 1993,
incorporated herein by reference.
10(19) Letter Agreement between the Company and Mr. Constantin B.
Ohanian, dated August 18, 1993, filed as Exhibit 10(6) to the
Company's Report on Form 10-Q/A for the quarterly period ended
September 30, 1993, incorporated herein by reference.
10(20) Severance Agreement between the Company and Mr. Martin F. C.
Emmett, dated July 21, 1993, filed as Exhibit 10(4) to the
Company's Report on Form 10-Q/A for the quarterly period ended
September 30, 1993, incorporated herein by reference.
10(21) Retirement Agreement between the Company and Mr. Charles J.
Chapman, dated as of February 28, 1994, filed herewith.
10(22)(a) Commercial Paper Dealer Agreement between the Company and
Merrill Lynch Money Markets, Inc., dated November 18, 1992,
filed as Exhibit 10(15)(a) to the Company's Report on Form 10-K
for the year 1992, incorporated herein by reference.
10(22)(b) Letter Agreement between the Company and The First National
Bank of Chicago, dated as of November 18, 1992, filed as
Exhibit 10(15)(b)
-20-
<PAGE>
to the Company's Report on Form 10-K for the year 1992,
incorporated herein by reference.
10(22)(c) Credit Agreement by and among the Company, the signatory banks
thereto and The Bank of New York, as agent, dated as of October
16, 1992, filed as Exhibit 10(15)(c) to the Company's Report on
Form 10-K for the year 1992, incorporated herein by reference.
12 Computation of Ratio of Earnings to Fixed Charges, filed
herewith.
21 Subsidiaries of the Company, filed herewith.
23 Independent Auditors' Consent, filed herewith.
24 Powers of attorney, filed herewith.
99 Trust Agreement, dated as of November 1, 1991, between the
Company and Manufacturers Hanover Trust Company, as trustee
under the Tambrands Inc. Savings Plan, filed as Exhibit 28 to
the Company's Report on Form 10-K for the year 1991,
incorporated herein by reference.
(b) Reports on Form 8-K
The Company filed a Report under Item 5 of Form 8-K on December 16,
1993 in order to file the forms of Floating Rate Debt Security and Fixed
Rate Debt Security to be used in connection with the Company's Medium-
Term Note Program.
TAMPAX, COMPAK, SATIN TOUCH and TAMPETS are trademarks of Tambrands Inc.
-21-
<PAGE>
SIGNATURES
----------
Pursuant to the requirements of Section 13 or 15(d) of the Securities
Exchange Act of 1934, the registrant has duly caused this report to be signed on
its behalf by the undersigned, thereunto duly authorized.
TAMBRANDS INC.
Date: March 28, 1994 By /s/ HOWARD B. WENTZ, JR.
-----------------------------
Howard B. Wentz, Jr.
Chairman
Pursuant to the requirements of the Securities Exchange Act of 1934,
this report has been signed below by the following persons on behalf of the
registrant and in the capacities and on the dates indicated.
Signature Title Date
--------- ----- ----
/s/ HOWARD B. WENTZ, JR. Chairman and March 28, 1994
- ---------------------------- Director (Principal
HOWARD B. WENTZ, JR. Executive Officer)
/s/ RAYMOND F. WRIGHT Senior Vice President- March 28, 1994
- ---------------------------- Chief Financial
RAYMOND F. WRIGHT Officer (Principal
Financial Officer and
Principal Accounting
Officer)
* Director March 28, 1994
- ----------------------------
LILYAN H. AFFINITO
/s/ CHARLES J. CHAPMAN Executive Vice March 28, 1994
- ---------------------------- President and
CHARLES J. CHAPMAN President,
North America
and Director
* Director March 28, 1994
- ----------------------------
PAUL S. DOHERTY
* Director March 28, 1994
- ----------------------------
FLOYD HALL
* Director March 28, 1994
- ----------------------------
BRIAN HEALEY
-22-
<PAGE>
Signature Title Date
--------- ----- ----
* Director March 28, 1994
- ---------------------------
ROBERT P. KILEY
* Director March 28, 1994
- ---------------------------
JOHN LOUDON
* Director March 28, 1994
- ---------------------------
RUTH M. MANTON
* Director March 28, 1994
- ---------------------------
JOHN A. MEYERS
* Director March 28, 1994
- ---------------------------
H.L. TOWER
* Director March 28, 1994
- ---------------------------
ROBERT M. WILLIAMS
* By /s/ HOWARD B. WENTZ, JR.
---------------------------
Howard B. Wentz, Jr.
Attorney-in-Fact
-23-
<PAGE>
INDEX TO FINANCIAL INFORMATION
------------------------------
Page
Reference
---------
Selected Financial Data................................. 25
Management's Discussion and Analysis of
Results of Operations and Financial Condition........... 26
Financial Statements:
Consolidated Statements of Earnings
for the years ended
December 31, 1993, 1992 and 1991................. 28
Consolidated Statements of Retained
Earnings for the years ended
December 31, 1993, 1992 and 1991................. 28
Consolidated Statements of Cash
Flows for the years ended
December 31, 1993, 1992 and 1991................. 29
Consolidated Balance Sheets as of
December 31, 1993 and 1992....................... 30
Notes to Consolidated Financial
Statements....................................... 31
Independent Auditors' Report on
Consolidated Financial Statements................ 39
Financial Statement Schedules:
V Property, Plant and Equipment.............. 40
VI Accumulated Depreciation of
Property, Plant and Equipment.............. 43
VIII Reserves................................... 46
IX Short-Term Borrowings...................... 47
X Supplementary Income Statement
Information................................ 50
Independent Auditors' Report on
Financial Statement Schedules.................... 51
Supplementary Financial Information
and Quarterly Data for the years
ended December 31, 1993 and 1992................. 52
-24-
<PAGE>
<TABLE>
<CAPTION>
Selected Financial Data
-------- -------- -------- -------- --------
Years Ended December 31 (in thousands, except per share amounts) 1993 1992 1991 1990 1989
<S> <C> <C> <C> <C> <C>
Net sales $611,465 $684,113 $660,722 $631,511 $583,408
Gross profit as a percent of sales 67.0% 66.7% 63.3% 61.0% 60.9%
Net earnings 63,450(a) 121,400 79,035(a) 97,768 1,719(a)
Per share 1.64 3.06 1.92 2.30 0.04
Earnings before cumulative effect of
accounting change 73,702(a) 122,409 79,035(a) 97,768 1,719(a)
Per share 1.91 3.09 1.92 2.30 0.04
Dividends per share 1.56 1.40 1.24 1.11 1.04
Capital expenditures 45,636 55,125 44,642 39,158 14,896
Cash utilized for purchase of shares for treasury 57,946 123,451 52,796 107,745 22,694
Medium-Term Notes outstanding 30,000 - - - -
Total Assets 362,398 372,981 390,266 381,029 411,002
-------- -------- -------- -------- --------
</TABLE>
Per share amounts have been restated to reflect a two-for-one stock split
effected in the form of a 100% stock dividend in December 1990.
(a) Net of Restructuring and other charges which reduced Net earnings by
$20,273, $23,477 and $65,692 in 1993, 1991 and 1989, respectively.
-25-
<PAGE>
MANAGEMENT'S DISCUSSION AND ANALYSIS
Results of Operations
1993 VS. 1992 Consolidated Net sales for 1993 were $611.5 million, a decrease
of 10.6% from 1992. The decrease is the result of lower unit sales in the USA
and Europe, unfavorable foreign exchange rates in Europe and the elimination of
non-core products. Volume shortfalls in 1993 were principally caused by a
continuing trend by US retailers and European distributors to reduce consumer
goods inventory levels. The decline was partially offset by favorable pricing
adjustments associated with the European restaging in 1992.
Gross profit as a percent of Net sales was 67% for 1993, up from 66.7% in 1992.
This increase is attributable to elimination of lower-margin sales of divested
products and worldwide manufacturing efficiencies, partially offset by the
impact of lower sales volume.
In 1993, the Company provided $30.0 million for restructuring of manufacturing
and administrative operations and the cost of management changes including the
adoption of a consolidated international management strategy. The anticipated
annual savings of approximately $20.0 million resulting from work force
reductions and worldwide manufacturing restructuring are expected to be fully
realized by 1995.
Operating income was $116.3 million in 1993, down $78.4 million from 1992. In
addition to the restructuring charge of $30.0 million, the decline in Operating
income is primarily due to lower Net sales. Marketing, selling and distribution
expenses increased 4.4% over 1992. The Company raised its level of advertising
and promotional spending to support the Tampax brand in the face of increased
competition and to regain market share in the second half of 1993. The increase
in brand support was partially offset by reductions in the other components of
Marketing, selling and distribution as well as lower administrative spending in
1993. These reductions were the result of the continuing program to reduce
overhead expenses.
Interest, net and other improved by $5.2 million primarily due to net gains on
foreign exchange contracts in the current year, somewhat mitigated by interest
expense on increased borrowings.
The effective tax rate for 1993, exclusive of the restructuring charge, was
36.8%, compared to 36.2% in 1992.
OUTLOOK The Company believes that the recent trend by retailers and
distributors to reduce inventories and the related adverse impact on shipments
will continue in future periods. However, the rate of inventory reduction in
future periods is expected to be significantly less than the rate of reduction
experienced in 1993. The Company intends to continue in 1994 the increased
advertising and promotional activities in the USA and Europe to provide support
for the Tampax brand.
1992 VS. 1991 Consolidated Net sales for 1992 were $684.1 million, an increase
of 4% over 1991. The increase was due primarily to pricing adjustments
associated with the restaging programs in North America and Europe, partially
offset by elimination of non-core sanitary pad and disposable diaper products
and lower restaged volume in Europe, but aided somewhat by favorable foreign
exchange rates in Europe.
Gross profit as a percent of sales in 1992 improved by 3.4 percentage points
over 1991, to 66.7%, reflecting the successful North American restaging
implemented in the third quarter of 1991, the European restaging of 1992,
elimination of non-core products and worldwide manufacturing efficiencies.
Operating income rose 21% in 1992 compared to 1991 exclusive of the
restructuring charge. Marketing, selling and distribution expenses in the USA
decreased in 1992 compared to the prior year's unusually high levels incurred to
support the 1991 restaging. This reduction was offset by promotional spending to
support the European restaging program and heavy planned advertising and
education expenditures designed to build the Tampax franchise worldwide.
Operating margins continued to rise in 1992 as marketing and promotional
spending normalized and the benefit of the worldwide restaging program was felt.
-26-
<PAGE>
Interest, net and other declined significantly in 1992 compared to 1991 due to
reductions in cash and marketable securities balances combined with interest
expense on increased Short-term borrowings as a result of the Company's share
buyback program.
The effective tax rate for 1992 was 36.2%, compared to 36.8% in 1991, exclusive
of the restructuring charge.
Financial Condition
CASH FLOWS FROM OPERATING ACTIVITIES 1993 Cash flows from operating activities
amounted to $128.7 million versus $95.8 million in 1992. The reduction in Net
earnings was more than offset by the 1993 restructuring charge, the cumulative
effect of accounting change, and an improvement in working capital. Over the
past three years, Cash flows from operating activities totaled $331.9 million.
These funds were used for the repurchase of Common Stock for treasury purposes,
payment of dividends and capital expenditures.
CAPITAL EXPENDITURES The 1993 capital spending programs relate to investments
in equipment to improve product quality and productivity, modernize production
facilities and reduce costs. Over the past three years, the Company has spent
$145.4 million on capital improvements. Capital expenditures in 1994 are
expected to be somewhat below 1993 levels.
LIQUIDITY AND CAPITAL RESOURCES During 1993, the Company continued to utilize
its strong debt rating and a favorable financial climate to take advantage of
low US interest rates through short-term bank credit lines and a commercial
paper program. Additionally, to provide financial flexibility, the Company
established a $150 million Medium-Term Note facility and accessed the debt
market in December 1993 by issuing $30 million of these notes.
Cash flows from operations and the ability to borrow from a variety of sources
will provide the Company with the liquidity to continue the investments
necessary to meet the Company's long-term strategic goals.
The Company also utilizes cash resources to enhance shareholder value through
the payment of dividends and its stock repurchase program. In 1993, the Company
paid record cash dividends of $60.1 million. This is the 42nd consecutive year
of higher annual dividend payments. During the year, Tambrands spent $57.9
million in its Common Stock repurchase program. Since 1989, a total of 5,901,900
shares have been purchased. The Company will continue the share repurchase
program as conditions warrant.
-27-
<PAGE>
CONSOLIDATED STATEMENTS OF EARNINGS Tambrands Inc. and subsidiaries
<TABLE>
<CAPTION>
-------- -------- --------
Years Ended December 31 (in thousands, except per share amounts) 1993 1992 1991
<S> <C> <C> <C>
NET SALES $611,465 $684,113 $660,722
Cost of products sold 201,706 228,081 242,567
-------- -------- --------
Gross profit 409,759 456,032 418,155
Selling, administrative and general expenses:
Marketing, selling and distribution 202,031 193,477 194,646
Administrative and general 61,378 67,823 63,027
Restructuring and other charges 30,042 - 30,348
-------- -------- --------
293,451 261,300 288,021
-------- -------- --------
OPERATING INCOME 116,308 194,732 130,134
Interest, net and other 2,344 (2,869) 1,691
-------- -------- --------
Earnings before provision for income taxes and
cumulative effect of accounting change 118,652 191,863 131,825
Provision for income taxes 44,950 69,454 52,790
-------- -------- --------
EARNINGS BEFORE CUMULATIVE EFFECT OF ACCOUNTING CHANGE 73,702 122,409 79,035
Cumulative effect of accounting change (10,252) (1,009) -
-------- -------- --------
NET EARNINGS $ 63,450 $121,400 $ 79,035
======== ======== ========
Average number of shares outstanding 38,632 39,640 41,216
PER SHARE
Earnings before cumulative effect of accounting change $1.91 $3.09 $1.92
Cumulative effect of accounting change (0.27) (0.03) -
-------- -------- --------
Net earnings $1.64 $3.06 $1.92
======== ======== ========
</TABLE>
CONSOLIDATED STATEMENTS OF RETAINED EARNINGS
<TABLE>
<CAPTION>
-------- -------- --------
Years Ended December 31 (in thousands, except per share amounts) 1993 1992 1991
<S> <C> <C> <C>
Balance at beginning of year $433,851 $375,329 $350,983
Net earnings 63,450 121,400 79,035
Dividends (60,154) (55,469) (51,089)
Net issuance of treasury stock in fulfillment of various
employee benefit, stock option and award plans (6,325) (7,409) (3,600)
-------- -------- --------
Balance at end of year $430,822 $433,851 $375,329
======== ======== ========
Dividends per share $1.56 $1.40 $1.24
-------- -------- --------
</TABLE>
See accompanying notes to consolidated financial statements.
-28-
<PAGE>
CONSOLIDATED STATEMENTS OF CASH FLOWS Tambrands Inc. and subsidiaries
<TABLE>
<CAPTION>
-------- --------- ---------
Years Ended December 31 (in thousands) 1993 1992 1991
<S> <C> <C> <C>
CASH FLOWS FROM OPERATING ACTIVITIES
Net earnings $ 63,450 $ 121,400 $ 79,035
Adjustments to reconcile Net earnings to Net
Cash Provided by Operating Activities:
Depreciation and amortization 18,372 17,315 15,506
Deferred income taxes (3,400) (3,414) (2,036)
Cumulative effect of accounting change 10,252 1,009 -
Restructuring and other 14,946 (18,439) 23,048
Change in:
Accounts receivable 21,485 (4,017) (23,728)
Inventories 537 (4,193) 708
Prepaid expenses and other current assets (81) 1,791 (4,489)
Taxes on income 3,426 (12,695) 7,690
Accounts payable and accrued expenses (256) (2,958) 11,670
-------- -------- --------
Net Cash Provided by Operating Activities 128,731 95,799 107,404
-------- -------- --------
CASH FLOWS FROM INVESTING ACTIVITIES
Capital expenditures (45,636) (55,125) (44,642)
Proceeds from sales of property, plant and equipment 3,686 7,343 18,049
Proceeds from sales of marketable securities, net 1,164 14,243 16,938
-------- -------- --------
Net Cash Used in Investing Activities (40,786) (33,539) (9,655)
-------- -------- --------
CASH FLOWS FROM FINANCING ACTIVITIES
Payment of dividends (60,154) (55,469) (51,089)
Purchase of shares for treasury (57,946) (123,451) (52,796)
Short-term debt changes (18,308) 72,316 (6,956)
Issuance of Medium-Term Notes 30,000 - -
Proceeds from exercise of stock options and other 12,432 14,584 3,237
-------- -------- --------
Net Cash Used in Financing Activities (93,976) (92,020) (107,604)
-------- -------- --------
Effect of Exchange Rate Changes on Cash (658) (3,147) (979)
-------- -------- --------
Net Decrease in Cash and Cash Equivalents (6,689) (32,907) (10,834)
Cash and Cash Equivalents at Beginning of Year 21,987 54,894 65,728
-------- -------- --------
Cash and Cash Equivalents at End of Year $ 15,298 $ 21,987 $ 54,894
======== ========= =========
SUPPLEMENTAL CASH FLOW INFORMATION
Cash flow data:
Income taxes paid $ 49,567 $ 82,446 $ 52,296
Interest paid 4,574 8,006 8,090
Non-cash investing activities:
Capital leases - - 525
-------- -------- --------
</TABLE>
See accompanying notes to consolidated financial statements.
-29-
<PAGE>
CONSOLIDATED BALANCE SHEETS Tambrands Inc. and subsidiaries
<TABLE>
<CAPTION>
-------- ---------
December 31 (in thousands, except share data) 1993 1992
<S> <C> <C>
ASSETS
Current Assets
Cash and cash equivalents $ 15,298 $ 21,987
Marketable securities 639 1,798
Accounts receivable, net 75,592 98,639
Inventories 38,000 38,578
Deferred taxes on income 20,427 13,252
Prepaid expenses and other current assets 23,806 22,948
-------- --------
Total Current Assets 173,762 197,202
Property, Plant and Equipment, Net 180,396 158,187
Investments in Affiliates - 9,463
Brands, Trademarks, Patents and Other Intangibles, Net 8,240 8,129
-------- --------
Total Assets $362,398 $ 372,981
======== =========
LIABILITIES AND SHAREHOLDERS' EQUITY
Current Liabilities
Short-term borrowings $ 64,368 $ 80,160
Accounts payable 25,793 27,656
Accrued expenses 81,083 62,951
Taxes on income 15,137 13,543
-------- --------
Total Current Liabilities 186,381 184,310
Medium-Term Notes Payable 30,000 -
Deferred Taxes on Income 17,119 19,432
Other Liabilities 13,873 1,033
-------- --------
Total Liabilities 247,373 204,775
Shareholders' Equity
Common Stock, authorized 300,000,000 shares, par value
$.25 per share; issued 43,547,938 shares 10,887 10,887
Retained earnings 430,822 433,851
Cumulative foreign currency translation adjustment (20,659) (10,586)
Treasury stock (303,948) (264,555)
Unamortized value of restricted stock and pension costs (2,077) (1,391)
-------- --------
Total Shareholders' Equity 115,025 168,206
-------- --------
Total Liabilities and Shareholders' Equity $362,398 $ 372,981
======== =========
</TABLE>
See accompanying notes to consolidated financial statements.
-30-
<PAGE>
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS Tambrands Inc. and subsidiaries
(dollar amounts in thousands, except per share amounts)
Accounting Policies
The consolidated financial statements are prepared in accordance with generally
accepted accounting principles in the United States. Where alternatives exist,
the choices selected are described below.
CONSOLIDATION The 1993 consolidated financial statements include the accounts
of Tambrands Inc. and all majority owned subsidiaries (the "Company"). Prior to
1993, businesses in China, Russia and Ukraine were accounted for under the cost
method and carried as Investments in Affiliates. The financial results and
positions of these businesses were consolidated in 1993. The effect of
consolidation of these subsidiaries is not material to the financial statements
as a whole; therefore, prior years have not been restated.
FOREIGN CURRENCY TRANSLATION For subsidiaries not located in highly
inflationary economies, gains or losses resulting from the translation of
subsidiary companies' assets and liabilities denominated in foreign currencies
are shown as a separate component of Shareholders' Equity.
For subsidiaries operating in highly inflationary economies, working capital
items are translated using current rates of exchange with adjustments included
in Operating income.
CASH EQUIVALENTS Highly liquid investments with a maturity of three months or
less when purchased are considered to be cash equivalents.
MARKETABLE SECURITIES Marketable securities, comprised of corporate
obligations, are stated at cost, which approximates market.
INVENTORIES Inventories are stated at the lower of cost or market. Cost is
determined using the LIFO method for all domestic inventories. All other
inventories are stated at FIFO.
DEPRECIATION Depreciation is computed on the straight-line and accelerated
methods over the useful lives of the assets.
BRANDS, TRADEMARKS, PATENTS AND OTHER INTANGIBLE ASSETS Intangible assets are
amortized on a straight-line basis over periods not exceeding 40 years.
INCOME TAXES In 1992, the Company adopted Statement of Financial Accounting
Standards (SFAS) No. 109, "Accounting for Income Taxes," which requires a
provision for deferred taxes for differences between the financial statement and
tax bases of assets and liabilities. Prior to 1992, deferred income taxes were
provided on timing differences between financial and income tax reporting
methods.
Provision has not been made for income taxes on foreign subsidiaries' unremitted
earnings to the extent that such earnings have been reinvested in the business;
any United States income taxes payable on the distribution of available earnings
should generally be offset by credits for foreign taxes paid.
RECLASSIFICATIONS Certain reclassifications have been made to prior years'
financial statements to conform to the 1993 presentation.
-31-
<PAGE>
Balance Sheet Components
The components of certain balance sheet accounts at December 31 are as follows:
<TABLE>
<CAPTION>
-------- --------
1993 1992
<S> <C> <C>
ACCOUNTS RECEIVABLE, NET
Accounts receivable trade $ 75,798 $ 97,003
Less allowance for doubtful accounts 1,453 1,560
-------- --------
74,345 95,443
Other 1,247 3,196
-------- --------
$ 75,592 $ 98,639
======== ========
INVENTORIES
Raw materials $ 10,140 $ 11,569
Finished goods 27,860 27,009
-------- --------
$ 38,000 $ 38,578
======== ========
Current cost of LIFO inventories $ 26,837 $ 27,035
Stated value of LIFO inventories 9,838 9,577
-------- --------
Excess of current cost over stated value $ 16,999 $ 17,458
======== ========
PROPERTY, PLANT AND EQUIPMENT, NET (at cost)
Buildings, leaseholds and improvements $ 51,907 $ 56,148
Machinery, equipment and fixtures 189,518 152,457
Land 4,536 3,864
Construction in progress 29,388 32,519
-------- --------
275,349 244,988
Less accumulated depreciation 94,953 86,801
-------- --------
$180,396 $158,187
======== ========
BRANDS, TRADEMARKS, PATENTS AND OTHER INTANGIBLES, NET
Cost $ 14,147 $ 14,131
Less accumulated amortization 5,907 6,002
-------- --------
$ 8,240 $ 8,129
======== ========
ACCRUED EXPENSES
Promotions $ 16,774 $ 12,885
Salaries and benefits 24,691 22,459
Restructuring reserves 18,071 8,348
Other 21,547 19,259
-------- --------
$ 81,083 $ 62,951
======== ========
OTHER LIABILITIES
Capital lease obligations $ 536 $ 1,033
Postemployment benefits 13,337 -
-------- --------
$13,873 $ 1,033
======== ========
</TABLE>
-32-
<PAGE>
Statement of Earnings Information
<TABLE>
<CAPTION>
------- ------- -------
1993 1992 1991
<S> <C> <C> <C>
Interest, Net and Other
Net Financing:
Interest income $ 983 $ 3,323 $ 4,906
Interest expense (4,890) (8,567) (8,871)
Translation gain on foreign currency loans - 3,427 5,329
------- ------- -------
(3,907) (1,817) 1,364
Net Realization on Foreign Currency Transactions 6,551 (462) 156
Other (300) (590) 171
------- ------- -------
Interest, Net and Other $ 2,344 $(2,869) $ 1,691
======= ======= =======
Depreciation $17,570 $15,749 $14,099
Research and Development 9,881 11,769 10,950
</TABLE>
Benefit Plans
The Company maintains several non-contributory pension plans covering domestic
and foreign employees who meet certain minimum service and age requirements and
provides supplemental non-qualified retirement benefits to non-employee
directors, certain officers and key employees. Pensions are based upon earnings
of covered employees during their periods of credited service. The Company's
funding policy for its pensions is to make the annual contributions required by
applicable regulations.
The following table sets forth the funded status of the plans and the amounts
recognized in the accompanying financial statements.
<TABLE>
<CAPTION>
-------- -------
1993 1992
<S> <C> <C>
Plan assets at fair value, primarily stocks and bonds $ 91,242 $79,867
Actuarial present value of benefit obligations
Vested benefits 91,491 77,596
Nonvested benefits 6,120 4,485
-------- -------
Accumulated benefit obligation 97,611 82,081
Effect of projected future salary increases 11,723 9,704
-------- -------
Projected benefit obligation 109,334 91,785
-------- -------
Projected benefit obligation in excess of plan assets 18,092 11,918
Deferred actuarial adjustments 4,738 3,038
Deferred prior service cost 3,907 2,583
-------- -------
Accrued pension cost included in accrued expenses $ 9,447 $ 6,297
======== =======
</TABLE>
At December 31, 1993 and 1992, the accumulated benefit obligation of the
domestic plans exceeded plan assets by $10,251 and $4,400, respectively.
-33-
<PAGE>
The net cost of pensions included in the Statements of Earnings consists of:
<TABLE>
<CAPTION>
-------- ------- --------
1993 1992 1991
<S> <C> <C> <C>
Service cost - benefits earned during the period $ 4,940 $ 4,880 $ 4,227
Interest cost on projected benefit obligation 7,288 7,368 6,624
Actual return on plan assets (12,703) (7,501) (12,363)
Net amortization and deferral 6,697 654 6,556
-------- ------- --------
Net cost of pensions $ 6,222 $ 5,401 $ 5,044
======== ======= ========
</TABLE>
In 1993 and 1992, the discount rate used to determine the projected benefit
obligation for the domestic plans was 7.5% and the rate of increase in future
compensation was 6%. For the international plans, the discount rate used to
determine the projected benefit obligation was 8% in 1993 and ranged from 8.5%
to 9% in 1992, and the rate of increase in future compensation ranged from 5.5%
to 6.5% and 5.5% to 7% in 1993 and 1992, respectively. Expected long-term rates
of return on plan assets ranged from 8.5% to 9.25% in 1993 and 8.4% to 9% in
1992. Prior service costs arising from plan amendments are amortized on a
straight-line basis over the average remaining service period of employees
expected to receive benefits under each plan.
As of January 1, 1993, the Company adopted SFAS No. 112, "Employers' Accounting
for Postemployment Benefits," recognizing a pre-tax charge to earnings of
$16,000, amounting to $10,252 or $.27 per share after tax. In 1992, the Company
recognized the full amount of its estimated accumulated postretirement benefit
obligation in accordance with the provisions of SFAS No. 106, "Employers'
Accounting for Postretirement Benefits Other Than Pensions." The pre-tax charge
to 1992 earnings was $1,627 with a net earnings effect of $1,009 or $.03 per
share. The after-tax amounts of these accounting changes have been reflected in
the 1993 and 1992 Statements of Earnings as a cumulative effect of accounting
change. The incremental annual cost of accounting for postretirement and
postemployment benefits under the new accounting methods is not material. The
actuarial assumptions used to measure the cost of postretirement benefits are
consistent with those used to measure the cost of the pension plans.
The Company also sponsors a defined contribution 401(k) savings plan available
to domestic employees who meet certain minimum age and service requirements. The
plan, which is funded principally with the Company's Common Stock, includes
provision for a discretionary contribution by the Company of up to 2% of each
employee's covered earnings based on Company performance.
Income Taxes
Provision for income taxes for the years ended December 31 has been made as
follows:
<TABLE>
<CAPTION>
------- ------- -------
1993 1992 1991
<S> <C> <C> <C>
Current:
United States $44,558 $65,885 $40,851
Foreign 3,792 6,983 13,975
------- ------- -------
48,350 72,868 54,826
Deferred:
United States (3,915) (3,154) (2,474)
Foreign 515 (260) 438
------- ------- -------
(3,400) (3,414) (2,036)
------- ------- -------
$44,950 $69,454 $52,790
======= ======= =======
</TABLE>
-34-
<PAGE>
Changes in deferred taxes are due primarily to the restructuring provisions
established in 1993, 1991 and 1989 and "safe harbor" leases entered into in 1981
and 1982.
The difference between the Company's effective tax rate and the statutory
federal rate is principally due to state income taxes and the restructuring and
other charges.
During 1993 and 1992, Shareholders' Equity was credited for $1,330 and $2,336,
respectively, relating to compensation expense for tax purposes in excess of the
amounts recognized for financial reporting purposes.
In 1992, the Company adopted SFAS No. 109, "Accounting for Income Taxes." The
adoption of the statement did not have a material effect on Net earnings.
Deferred tax liabilities and assets are determined based on the difference
between the financial statement and tax bases of assets and liabilities using
enacted tax rates in effect for the year in which the differences are expected
to reverse.
The components of the net deferred tax asset (liability) for the
years ended December 31 are as follows:
<TABLE>
<CAPTION>
------- -------
1993 1992
<S> <C> <C>
Deferred tax assets:
Employee benefits $ 5,219 $ 5,594
Postemployment benefits 5,748 -
Intercompany transactions 2,263 5,410
Restructuring 6,879 1,558
Other 7,416 3,462
------- -------
27,525 16,024
------- -------
Deferred tax liabilities:
Property, plant and equipment 16,172 12,563
Safe harbor leases 7,490 7,823
Other 555 1,818
------- -------
24,217 22,204
------- -------
Net deferred tax asset (liability) $ 3,308 $(6,180)
======= =======
</TABLE>
Restructuring and Other Charges
In 1991, the Company announced a program to restructure its worldwide
manufacturing operations to improve efficiency and reduce costs and its
intention to exit the sanitary pad and diaper businesses in Brazil. As a result,
the Company recorded a $30,348 ($23,477 after tax) restructuring charge. In
1993, the Company announced further restructuring as its previous investments in
technology will enable it to operate with reduced manufacturing and
administrative overhead and number of employees. The Company provided $30,042,
or $20,273 after tax, for this restructuring and the cost of management changes
including the adoption of a consolidated international management strategy. The
provision includes the costs associated with salary and benefit continuation due
to work force reductions and the revaluation and consolidation of certain
manufacturing and office facilities.
Commitments and Contingencies
The Company's lease of its headquarters in White Plains, New York and European
headquarters in the United Kingdom are non-cancelable operating leases. Certain
computers and related equipment are held under capital leases.
Future minimum lease payments under operating leases with terms in excess of one
year amount to $4,593 in 1994, $4,088 in 1995, $3,560 in 1996, $3,221 in 1997
and $3,021 in 1998. Rent expense in 1993, 1992 and 1991 amounted
-35-
<PAGE>
to $5,027, $4,031 and $4,204, respectively. Future minimum lease payments under
capital leases with terms in excess of one year amount to approximately $550 in
both 1994 and 1995; no capital leases extend beyond 1995.
The Company has been named in product liability litigation and claims arising
from the alleged association of tampons with Toxic Shock Syndrome. The cases
seek compensatory and punitive damages in various amounts.
The Company and certain of its present and former officers have been named as
defendants in certain shareholder lawsuits now consolidated into one action. The
consolidated lawsuit purports to be a federal securities fraud class action on
behalf of all purchasers of the Company's Common Stock during the period
December 14, 1992 through June 2, 1993. The complaint alleges that the Company's
disclosures during the alleged class period contained material misstatements and
omissions concerning its anticipated future earnings. The complaint seeks an
unspecified amount of damages on behalf of the purported class.
The Company is a nominal defendant in three purported shareholder derivative
lawsuits that have been consolidated into a single action. Named in the
consolidated complaint as individual defendants are the Company's directors (and
certain of its former directors) and two of its former officers. The complaint
alleges that, among other things, the officer-defendants exposed the Company to
liability in the purported shareholder class action described in the preceding
paragraph. The director-defendants are alleged to have acquiesced in the alleged
violations. The complaint seeks to recover on behalf of the Company an
unspecified amount of damages from the individual defendants. No relief is
sought against the Company.
While it is not feasible to predict the outcome of these legal proceedings and
claims with certainty, management is of the belief that any ultimate liabilities
for damages either are covered by insurance or should not have a material
adverse effect on the Company's financial position.
Borrowings
The Company's Short-term borrowings consist of unsecured commercial paper and
notes payable bearing interest at prevailing market rates and supported by bank
lines of credit amounting to $161,000 at December 31, 1993 and 1992. Commercial
paper borrowings at December 31, 1993 and 1992 were $48,425 and $79,135 at
average annual interest rates of 3.4% and 4%, respectively, with maturities in
the first quarter of the subsequent year. Notes payable at December 31, 1993 and
1992 totaled $15,943 and $1,025 at average annual rates of 4.3% and 7%,
respectively. Commitment fees to secure the lines of credit are not material.
In 1993, the Company established a $150,000 Medium-Term Note facility and issued
$30,000 of these unsecured notes at interest rates ranging from 5.525% to 5.58%
maturing in January 1999.
The terms of the borrowing facilities include various covenants which provide,
among other things, for limitations on liens and the maintenance of a minimum
debt service ratio. The Company was in compliance with such covenants at
December 31, 1993.
Financial Instruments
The Company minimizes its exposure to foreign currency fluctuation through the
use of forward exchange contracts and options. Realized and unrealized gains and
losses on hedging contracts designated as hedges of foreign currency
transactions are deferred and recognized in the Statement of Earnings in the
same period as the underlying transactions. All other realized and unrealized
gains and losses are recognized in the current period. At December 31, 1993 and
1992, the Company had forward exchange contracts outstanding with face values of
$50,627 and $24,038, respectively, the carrying value of which approximated
market. The contracts mature in less than one year. The estimated fair value of
Medium-Term Notes payable at December 31, 1993 approximated their carrying value
of $30,000.
-36-
<PAGE>
Shareholders' Equity
COMMON STOCK In 1992, the Company increased the number of authorized shares of
Common Stock from 150 million to 300 million. Changes in outstanding shares for
the years ended December 31 are as follows:
<TABLE>
<CAPTION>
---------- ---------- ----------
1993 1992 1991
<S> <C> <C> <C>
Shares outstanding at beginning of year 39,162,634 40,647,529 41,537,853
Purchased for treasury (1,187,100) (1,856,200) (1,059,300)
Issued for stock option and
other employee plans from treasury 317,418 371,305 168,976
---------- ---------- ----------
Shares outstanding at end of year 38,292,952 39,162,634 40,647,529
========== ========== ==========
Shares held in treasury at end of year 5,254,986 4,385,304 2,900,409
---------- ---------- ----------
</TABLE>
The Company has stock option plans which provide for the granting of options to
directors, officers and key employees to purchase shares of its Common Stock
within ten years at prices equal to the fair market value on the date of grant.
Activity for the years 1993, 1992 and 1991 is as follows:
<TABLE>
<CAPTION>
Average Average Average
Shares Price Shares Price Shares Price
------------------- ------------------- -------------------
1993 1992 1991
<S> <C> <C> <C> <C> <C> <C>
Options for Common Stock:
Outstanding at beginning of year 2,755,451 $51.22 2,561,623 $46.07 973,952 $31.88
Granted 452,272 43.96 590,075 63.47 1,704,598 52.91
Cancelled (446,546) 54.04 (80,580) 53.35 (16,300) 36.01
Exercised (236,291) 30.42 (315,667) 31.76 (100,627) 26.16
------------------- ------------------- -------------------
Outstanding at end of year 2,524,886 $51.36 2,755,451 $51.22 2,561,623 $46.07
=================== =================== ===================
</TABLE>
At December 31, 1993 and 1992, respectively, there were 1,137,470 and 616,003
shares exercisable at average prices of $51.18 and $42.45 and there were
2,741,522 and 337,887 shares available for granting options.
UNAMORTIZED VALUE OF RESTRICTED STOCK AND PENSION COSTS Changes in the
unamortized value of restricted stock represent charges for the market value of
grants made during the year offset by periodic amortization. Such net charges
amounted to ($577), ($442) and $827 for the years ended December 31, 1993, 1992
and 1991, respectively. In 1993, an excess pension liability adjustment
amounting to $1,263, net of tax benefits, was charged to Shareholders' Equity.
CUMULATIVE FOREIGN CURRENCY TRANSLATION ADJUSTMENT Amounts charged to
Shareholders' Equity were $10,073, $19,804 and $1,014 for the years ended
December 31, 1993, 1992 and 1991, respectively.
-37-
<PAGE>
Segment and Geographic Information
The Company operates in one industry segment, personal care products. The
Company markets these products around the world. Sales are made and credit is
granted to drug, grocery, variety and discount stores and other comparable
outlets as well as to wholesalers and distributors in those trades. A small
number of significant customers are financed through highly leveraged capital
structures, making them particularly sensitive to market interest rate changes
and other economic variables.
Information about the Company's operations in different geographic areas
follows:
<TABLE>
<CAPTION>
-------- -------- --------
1993 1992 1991
<S> <C> <C> <C>
Net sales
United States $363,337 $393,494 $377,880
Europe 182,854 204,114 185,213
Other international 65,274 86,505 97,629
-------- -------- --------
Consolidated $611,465 $684,113 $660,722
======== ======== ========
Earnings before provision for income taxes and
cumulative effect of accounting change
United States $107,484 $147,437 $118,344
Europe 18,202 43,010 32,671
Other international (7,034) 1,416 (19,190)
-------- -------- --------
Consolidated $118,652 $191,863 $131,825
======== ======== ========
Identifiable assets at December 31
United States $196,907 $195,192 $172,885
Europe 153,016 158,835 161,688
Other international 11,836 17,156 37,875
Marketable securities 639 1,798 17,818
-------- -------- --------
Consolidated $362,398 $372,981 $390,266
======== ======== ========
</TABLE>
Certain overhead costs are allocated to the geographic areas based on the
anticipated benefit to be derived by the area.
Net current assets of consolidated subsidiaries operating outside of the United
States and the total net assets of such subsidiaries were as follows:
<TABLE>
<CAPTION>
-------- -------- --------
1993 1992 1991
<S> <C> <C> <C>
Net current assets at December 31
Europe $ 57,870 $ 65,668 $ 62,406
Other international 4,384 8,068 11,784
======== ======== ========
Total net assets at December 31
Europe $132,973 $130,530 $120,349
Other international 5,314 13,691 24,763
======== ======== ========
</TABLE>
-38-
<PAGE>
INDEPENDENT AUDITORS' REPORT
To the Board of Directors and Shareholders of Tambrands Inc.:
We have audited the accompanying consolidated balance sheets of Tambrands Inc.
and subsidiaries as of December 31, 1993 and 1992 and the related consolidated
statements of earnings, retained earnings and cash flows for each of the years
in the three-year period ended December 31, 1993. These consolidated financial
statements are the responsibility of the Company's management. Our
responsibility is to express an opinion on these consolidated financial
statements based on our audits.
We conducted our audits in accordance with generally accepted auditing
standards. Those standards require that we plan and perform the audit to obtain
reasonable assurance about whether the financial statements are free of material
misstatement. An audit includes examining, on a test basis, evidence supporting
the amounts and disclosures in the financial statements. An audit also includes
assessing the accounting principles used and significant estimates made by
management, as well as evaluating the overall financial statement presentation.
We believe that our audits provide a reasonable basis for our opinion.
In our opinion, the consolidated financial statements referred to above present
fairly, in all material respects, the financial position of Tambrands Inc. and
subsidiaries as of December 31, 1993 and 1992 and the results of their
operations and cash flows for each of the years in the three-year period ended
December 31, 1993, in conformity with generally accepted accounting principles.
As discussed in the notes to the consolidated financial statements, the Company
changed its method for accounting for postemployment benefits in 1993 and for
postretirement benefits in 1992.
KPMG PEAT MARWICK
Stamford, Connecticut
January 25, 1994
-39-
<PAGE>
Schedule V - Page 1
-------------------
TAMBRANDS INC. AND SUBSIDIARIES
Property, Plant and Equipment
Year Ended December 31, 1993
(dollars in thousands)
<TABLE>
<CAPTION>
Transfers Foreign Restruc-
Balance at between currency turing Balance
beginning Additions classi- trans- and other at end
Classification of period at cost Retirements fications lation charges of period
- -------------- ---------- -------- ----------- ---------- -------- --------- ---------
<S> <C> <C> <C> <C> <C> <C> <C>
Land $ 3,864 $ 799 $ (23) $ 0 $ (92) $ (12) $ 4,536
Buildings,
leaseholds
and improve-
ments 56,148 1,818 (3,023) 3,413 (1,145) (5,304) 51,907
Machinery,
equipment
and fixtures 152,457 9,103 (7,059) 41,391 (3,648) (2,726) 189,518
Construction
in progress 32,519 43,696 (192) (44,804) (636) (1,195) 29,388
-------- ------- -------- -------- ------- ------- --------
$244,988 $55,416(a) $(10,297) $ 0 $(5,521) $(9,237) $275,349
======== ======= ======== ======== ======= ======= ========
</TABLE>
(a) Includes assets of previously unconsolidated subsidiaries of $9,780.
-40-
<PAGE>
Schedule V - Page 2
-------------------
TAMBRANDS INC. AND SUBSIDIARIES
Property, Plant and Equipment
Year Ended December 31, 1992
(dollars in thousands)
<TABLE>
<CAPTION>
Transfers Foreign
Balance at between currency Balance
beginning Additions classi- trans- at end
Classification of period at cost Retirements fications lation of period
- -------------- ---------- -------- ----------- ---------- -------- ---------
<S> <C> <C> <C> <C> <C> <C>
Land $ 1,074 $ 358 $ (18) $ 2,924 $ (474) $ 3,864
Buildings,
leaseholds
and improve-
ments 55,782 469 (2,635) 5,549 (3,017) 56,148
Machinery,
equipment
and fixtures 159,864 5,161 (33,202) 29,195 (8,561) 152,457
Construction
in progress 23,008 50,396 (867) (37,668) (2,350) 32,519
-------- ------- -------- -------- -------- --------
$239,728 $56,384 (a) $(36,722) $ 0 $(14,402) $244,988
======== ======= ======== ======== ======== ========
</TABLE>
(a) Includes assets of subsidiary acquired of $1,259.
-41-
<PAGE>
Schedule V - Page 3
-------------------
TAMBRANDS INC. AND SUBSIDIARIES
Property, Plant and Equipment
Year Ended December 31, 1991
(dollars in thousands)
<TABLE>
<CAPTION>
Transfers Foreign Restruc-
Balance at between currency turing Balance
beginning Additions classi- trans- and other at end
Classification of period at cost Retirements fications lation charges of period
- -------------- ---------- -------- ----------- ---------- -------- --------- ---------
<S> <C> <C> <C> <C> <C> <C> <C>
Land $ 1,123 $ 0 $ (44) $ 0 $ (5) $ 0 $ 1,074
Buildings,
leaseholds
and improve-
ments 44,704 10,820 0 563 (305) 0 55,782
Machinery,
equipment
and fixtures 140,448 20,898 (6,750) 8,676 (318) (3,090) 159,864
Construction
in progress 19,308 13,449 0 (9,239) (172) (338) 23,008
-------- ------- ------- ------- ----- ------- --------
$205,583 $45,167 (a) $(6,794) $ 0 $(800) $(3,428) $239,728
======== ======= ======= ======= ===== ======= ========
</TABLE>
(a) Includes capital leases of $525.
-42-
<PAGE>
Schedule VI - Page 1
--------------------
TAMBRANDS INC. AND SUBSIDIARIES
Accumulated Depreciation of Property, Plant and Equipment
Year Ended December 31, 1993
(dollars in thousands)
<TABLE>
<CAPTION>
Additions Transfers Foreign Restruc-
Balance at charged to between currency turing Balance
beginning costs and classi- trans- and other at end
Classification of period expenses Retirements fications lation charges of period
- -------------- ---------- ---------- ----------- --------- -------- --------- ---------
<S> <C> <C> <C> <C> <C> <C> <C>
Buildings,
leaseholds
and improve-
ments $18,295 $ 2,740 $(1,460) $ 0 $ (387) $ 0 $19,188
Machinery,
equipment
and fixtures 68,506 17,309 (3,953) 0 (1,242) (4,855) 75,765
------- ------- ------- ---- ------- ------- -------
$86,801 $20,049 (a) $(5,413) $ 0 $(1,629) $(4,855) $94,953
======= ======= ======= ==== ======= ======= =======
</TABLE>
(a) Includes accumulated and current year depreciation of previously
unconsolidated subsidiaries amounting to $2,916.
-43-
<PAGE>
Schedule VI - Page 2
--------------------
TAMBRANDS INC. AND SUBSIDIARIES
Accumulated Depreciation of Property, Plant and Equipment
Year Ended December 31, 1992
(dollars in thousands)
<TABLE>
<CAPTION>
Additions Transfers Foreign
Balance at charged to between currency Balance
beginning costs and classi- trans- at end
Classification of period expenses Retirements fications lation of period
- -------------- ---------- ---------- ----------- --------- -------- ---------
<S> <C> <C> <C> <C> <C> <C>
Buildings,
leaseholds
and improve-
ments $ 16,927 $ 2,340 $ (124) $ 52 $ (900) $18,295
Machinery,
equipment
and fixtures 87,124 13,409 (28,706) (52) (3,269) 68,506
-------- ------- -------- ---- ------- -------
$104,051 $15,749 $(28,830) $ 0 $(4,169) $86,801
======== ======= ======== ==== ======= =======
</TABLE>
-44-
<PAGE>
Schedule VI - Page 3
--------------------
TAMBRANDS INC. AND SUBSIDIARIES
Accumulated Depreciation of Property, Plant and Equipment
Year Ended December 31, 1991
(dollars in thousands)
<TABLE>
<CAPTION>
Additions Transfers Foreign Restruc-
Balance at charged to between currency turing Balance
beginning costs and classi- trans- and other at end
Classification of period expenses Retirements fications lation charges of period
- -------------- ---------- ---------- ----------- --------- -------- --------- ---------
<S> <C> <C> <C> <C> <C> <C> <C>
Buildings,
leaseholds
and improve-
ments $15,440 $ 1,546 $ 0 $ 0 $ (59) $ 0 $ 16,927
Machinery,
equipment
and fixtures 80,444 12,553 (5,009) 0 (291) (573) 87,124
------- ------- ------- ---- ----- ----- --------
$95,884 $14,099 $(5,009) $ 0 $(350) $(573) $104,051
======= ======= ======= ==== ===== ===== ========
</TABLE>
-45-
<PAGE>
Schedule VIII
-------------
TAMBRANDS INC. AND SUBSIDIARIES
Reserves
Years Ended December 31, 1993, 1992 and 1991
(dollars in thousands)
<TABLE>
<CAPTION>
1993 1992 1991
------ ------ ------
<S> <C> <C> <C>
Reserve deducted in the balance
sheet from the asset to which
it applies - allowance for
doubtful accounts
Balance at beginning of period $1,560 $1,580 $1,379
Additions charged to cost and
expenses 556 532 423
Reclassification of unrecover-
able promotional allowance & other (144) (88) (20)
Write-off of bad debts (519) (464) (202)
------ ------ ------
Balance at end of period $1,453 $1,560 $1,580
====== ====== ======
</TABLE>
-46-
<PAGE>
Schedule IX - Page 1
--------------------
TAMBRANDS INC. AND SUBSIDIARIES
Short-Term Borrowings
December 31, 1993
(dollars in thousands)
<TABLE>
<CAPTION>
Maximum Average Weighted
Description Weighted Amount Amount Average
of Balance Average Outstanding Outstanding Interest
Short-Term at Interest During the During the Rate During
Borrowings 12/31/93 Rate Year Year the Year
- ----------- -------- -------- ----------- ----------- -----------
<S> <C> <C> <C> <C> <C>
Bank Borrowings $15,943 4.4476% $29,044 $14,516 4.2866%
Commercial Paper 48,425 3.5197% 107,792 77,750 3.4058%
-------
$64,368
=======
</TABLE>
-47-
<PAGE>
Schedule IX - Page 2
--------------------
TAMBRANDS INC. AND SUBSIDIARIES
Short-Term Borrowings
December 31, 1992
(dollars in thousands)
<TABLE>
<CAPTION>
Maximum Average Weighted
Description Weighted Amount Amount Average
of Balance Average Outstanding Outstanding Interest
Short-Term at Interest During the During the Rate During
Borrowings 12/31/92 Rate Year Year the Year
- ----------- -------- -------- ----------- ----------- -----------
<S> <C> <C> <C> <C> <C>
Bank Borrowings $ 1,025 7.0326% $ 94,767 $47,310 6.9857%
Commercial Paper 79,135 3.9605% 79,135 6,087(a) 3.9605%
-------
$80,160
=======
</TABLE>
(a) Commercial paper was outstanding only in the month of December. Average
outstanding for the month was $50,287.
-48-
<PAGE>
Schedule IX - Page 3
--------------------
TAMBRANDS INC. AND SUBSIDIARIES
Short-Term Borrowings
December 31, 1991
(dollars in thousands)
<TABLE>
<CAPTION>
Maximum Average Weighted
Description Weighted Amount Amount Average
of Balance Average Outstanding Outstanding Interest
Short-Term at Interest During the During the Rate During
Borrowings 12/31/91 Rate Year Year the Year
- ----------- -------- -------- ----------- ----------- -----------
<S> <C> <C> <C> <C> <C>
Bank Borrowings (a) $7,597 16.3979% $18,562 $8,170 30.6094%(b)
Other 250 N/A 250 250 N/A
------
$7,847
======
</TABLE>
(a) Loans outstanding in hyperinflationary countries.
(b) Nominal rate excluding devaluation.
-49-
<PAGE>
Schedule X
----------
TAMBRANDS INC. AND SUBSIDIARIES
Supplementary Income Statement Information
Years Ended December 31, 1993, 1992 and 1991
(dollars in thousands)
<TABLE>
<CAPTION>
Charged to Costs and Expenses
-----------------------------
1993 1992 1991
------- ------- -------
<S> <C> <C> <C>
Maintenance and repairs $ 8,857 $10,424 $10,727
======= ======= =======
Taxes, other than payroll and
income taxes:
Franchise and licenses $ 7,100 $10,052 $ 5,354
Real estate, personal
property, etc. 2,583 2,633 3,261
------- ------- -------
$ 9,683 $12,685 $ 8,615
======= ======= =======
Media Advertising costs $48,309 $37,980 $36,158
======= ======= =======
</TABLE>
-50-
<PAGE>
Independent Auditors' Report
----------------------------
The Board of Directors and Shareholders
Tambrands Inc.:
Under date of January 25, 1994, we reported on the consolidated balance sheets
of Tambrands Inc. and subsidiaries as of December 31, 1993 and 1992, and the
related consolidated statements of earnings, retained earnings and cash flows
for each of the years in the three-year period ended December 31, 1993, as
contained in the annual report on Form 10-K for the year 1993. Our report
refers to a change in accounting for postemployment benefits in 1993 and
postretirement benefits in 1992. In connection with our audits of the
aforementioned consolidated financial statements, we also have audited the
related financial statement schedules as listed in Item 14(a)2 of the annual
report on Form 10-K for the year 1993. These financial statement schedules are
the responsibility of the Company's management. Our responsibility is to
express an opinion on these financial statement schedules based on our audits.
In our opinion, such financial statement schedules, when considered in
relation to the basic consolidated financial statements taken as a whole,
present fairly, in all material respects, the information set forth therein.
KPMG PEAT MARWICK
Stamford, Connecticut
January 25, 1994
-51-
<PAGE>
Supplementary Financial Information
and Quarterly Data
-----------------------------------
QUARTERLY DATA (unaudited)
<TABLE>
<CAPTION>
First Second Third Fourth
---------------- ---------------- -------------- --------------
(in millions, except per share amounts) 1993 1992 1993(a) 1992 1993 1992 1993 1992
------- ------ ------- ------ ------ ------ ------ ------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
Net sales $154.3 $174.9 $149.0 $169.4 $161.4 $174.5 $146.7 $165.3
Gross profit 105.1 116.1 100.9 112.4 107.5 116.3 96.2 111.2
Net earnings before cumulative
effect of accounting change 32.2 29.3 (3.4) 28.4 23.8 33.6 21.1 31.1
Per share 0.82 0.73 (0.09) 0.72 0.62 0.85 0.55 0.80
Net earnings 21.9 28.3 (3.4) 28.4 23.8 33.6 21.1 31.1
Per share 0.56 0.70 (0.09) 0.72 0.62 0.85 0.55 0.80
</TABLE>
(a) Results have been adversely affected by the restructuring and other charges
as described in the notes to the consolidated financial statements.
-52-
<PAGE>
Index to Exhibits
-----------------
<TABLE>
<CAPTION>
Exhibit
Number Description
- ---------- --------------------------------------
<S> <C>
3(4) By-Laws of the Company, as amended.
4(4)(a) Indenture dated as of December 1,
1993 between the Company and
Citibank, N.A., as trustee, relating
to the Company's Medium-Term Note
Program.
10(3)(h) Sixth Amendment to 1991 Stock Option
Plan, effective as of February 1,
1994.
10(5)(a) Supplemental Executive Retirement
Plan, effective July 1, 1986, as
amended and restated effective July
1, 1994.
10(8)(e) Fourth Amendment to 1992 Directors
Stock Incentive Plan, effective as of
March 1, 1994 (subject to shareholder
approval at the annual meeting of
shareholders to be held on April 26,
1994).
10(9)(e) Employment Protection Agreement
between the Company and Ms. Helen G.
Goodman, dated as of December 1, 1989,
and First Amendment to Employment
Protection Agreement between the
Company and Ms. Helen G. Goodman,
dated as of October 16, 1990.
10(21) Retirement Agreement between the
Company and Mr. Charles J. Chapman,
dated as of February 28, 1994.
12 Computation of Ratio of Earnings to
Fixed Charges.
21 Subsidiaries of the Company.
23 Independent Auditors' Consent.
24 Powers of attorney.
</TABLE>
The Company will furnish a copy of any exhibit to a shareholder requesting
such exhibit in writing upon payment by the shareholder of a fee representing
the Company's reasonable expenses in furnishing such exhibit.
<PAGE>
EXHIBIT 3(4)
BY-LAWS
OF
TAMBRANDS INC.
--------------
as amended through September 20, 1993
ARTICLE I
STOCKHOLDERS.
------------
Section 1. The annual meeting of the stockholders of the Corporation
shall be held, at such time and at such place within or without the State of
Delaware as may be fixed by the Board of Directors from time to time, for the
purpose of electing directors and for the transaction of such other business as
may properly be brought before the meeting. Any previously scheduled annual
meeting of the stockholders may be postponed by resolution of the Board of
Directors upon public notice given on or prior to the date previously scheduled
for such annual meeting of stockholders. To be properly brought before an annual
meeting, business must be (a) specified in the notice of meeting (or any
---
supplement thereto) given by or at the direction of the Board of Directors, (b)
---
otherwise properly brought before the meeting by or at the direction of the
Board of Directors, or (c) otherwise properly brought before the meeting by a
---
stockholder of the Corporation who was a stockholder of record at the time of
giving of notice provided for in this Section 1, who is entitled to vote at the
meeting and who complied with the notice procedures set forth in this Section 1.
For business to be properly brought before an annual meeting by a stockholder,
if such business is related to the election of directors of the Corporation, the
procedures in Article II, Section 9 of these By-Laws must be complied with. If
such business relates to any other
<PAGE>
matter, the stockholder must have given timely notice thereof in writing to the
Secretary of the Corporation. To be timely, a stockholder's notice shall be
delivered to or mailed to and received at the principal executive offices of the
Corporation not less than 60 days nor more than 90 days prior to the first
anniversary of the preceding year's annual meeting; provided, however, that in
the event that the date of the annual meeting is advanced by more than 30 days
or delayed by more than 60 days from such anniversary date, notice by the
stockholder to be timely must be so delivered not earlier than the 90th day
prior to such annual meeting and not later than the close of business on the
later of the 60th day prior to such annual meeting or the 10th day
following the day on which public announcement of the date of such meeting is
first made. Such stockholder's notice shall set forth in writing as to each
matter the stockholder proposes to bring before the annual meeting (i) a brief
---
description of the business desired to be brought before the annual meeting, the
reasons for conducting such business at the annual meeting, and any material
interest in such business of such stockholder and the beneficial owner, if any,
on whose behalf the proposal is made; and (ii) as to the stockholder giving the
----
notice and the beneficial owner, if any, on whose behalf the nomination or
proposal is made (A) the name and address of such stockholder, as they appear on
the Corporation's books, and of such beneficial owner and (B) the class and
number of shares of the Corporation which are owned beneficially and of record
by such stockholder and such beneficial owner. Notwithstanding anything in these
By-Laws to the contrary, no business shall be conducted at any annual meeting
except in accordance with the procedures set forth in this Section 1. The
Chairman of the meeting shall, if the facts warrant, determine and declare to
the meeting that business was not
-2-
<PAGE>
properly brought before the meeting in accordance with the provisions of this
Section 1, and if he should so determine, the Chairman shall declare to the
meeting that any such business not properly brought before the meeting shall not
be transacted. For purposes of this Section 1 and Article II, Section 9, "public
announcement" shall mean disclosure in a press release reported by the Dow Jones
News Service, Associated Press or comparable national news service or in a
document publicly filed by the Corporation with the Securities and Exchange
Commission pursuant to Section 13, 14 or 15(d) of the Securities Exchange Act of
1934, as amended (the "Exchange Act"). In addition to the provisions of this
Section 1, a stockholder shall also comply with all applicable requirements of
the Exchange Act and the rules and regulations thereunder with respect to the
matters set forth herein. Nothing in these By-Laws shall be deemed to affect any
rights of stockholders to request inclusion of proposals in the Corporation's
proxy statement pursuant to Rule 14a-8 under the Exchange Act.
Section 2. Special meetings of the stockholders may be held only upon
call of the Board of Directors or of the Executive Committee or of the Chairman
of the Board or of the President, at such time and at such place within or
without the State of Delaware as may be fixed by the Board of Directors or by
the Executive Committee or by the Chairman of the Board or by the President, as
the case may be, and as may be stated in the notice setting forth such call. Any
previously scheduled special meeting of the stockholders may be postponed by
resolution of the Board of Directors upon public notice given on or prior to the
date previously scheduled for such special meeting of stockholders.
-3-
<PAGE>
The purpose or purposes of any special meeting of stockholders shall be
set forth in the notice of meeting, and, except as otherwise required by law or
by the Certificate of Incorporation, no business shall be transacted at any
special meeting of stockholders other than the items of business stated in the
notice of meeting. The Chairman of the meeting shall, if the facts warrant,
determine and declare to the meeting that business was not properly brought
before the meeting in accordance with the provisions of this Section 2, and if
he should so determine, the Chairman shall declare to the meeting that any such
business not properly brought before the meeting shall not be transacted.
Section 3. Notice of the time and place of every meeting of stockholders
shall be delivered personally or mailed not less than ten days nor more than 60
days prior to such meeting to each stockholder of record entitled to vote
thereat, who shall have furnished a written address to the Secretary of the
Corporation for the purpose. Such further notice shall be given as may be
required by law. Meetings may be held without notice, if all stockholders
entitled to vote are present, or if notice is waived by those not present.
Section 4. The holders of record of a majority of the shares of the
capital stock of the Corporation, issued and outstanding, and entitled to vote,
present in person or by proxy shall, except as otherwise provided by law,
constitute a quorum at all meetings of the stockholders. Whether or not a quorum
is present at the meeting, the Chairman of the meeting or the holders of a
majority of such shares so present or represented may adjourn the meeting from
time to time. The stockholders present at any duly organized meeting may
continue to transact business until adjournment, notwithstanding the
-4-
<PAGE>
withdrawal of sufficient stockholders to constitute the remaining stockholders
less than a quorum.
Section 5. Meetings of the stockholders shall be presided over by the
Chairman of the Board, or if he is not present, by the President, or if neither
of them is present, by a Vice President, or, if neither the Chairman of the
Board, the President nor a Vice President is present, by a Chairman to be chosen
at the meeting. The Secretary of the Corporation, or in his absence, an
Assistant Secretary, shall act as Secretary of the meeting, or, if neither the
Secretary nor an Assistant Secretary is present, then the meeting shall choose
its Secretary.
Section 6. Each stockholder entitled to vote at any meeting shall have
one vote in person or by proxy for each share of stock held by him which has
voting power upon the matter in question at the time; but no proxy shall be
voted on after three years from its date, unless such proxy provides for a
longer period.
Section 7. Unless otherwise provided by express provision of applicable
law, the Certificate of Incorporation or these By-Laws, all matters to be
decided at a meeting of stockholders shall be by the vote of a majority of the
shares present, either in person or by proxy, that are entitled to vote at such
meeting, except that the election of directors shall be by a plurality of votes
cast. At all elections of directors by the stockholders the voting shall be by
ballot. The Corporation shall, in advance of any meeting of stockholders,
appoint one or more inspectors to act at the meeting and make a written report
thereof. The Corporation may designate one or more persons as alternate
inspectors to replace any inspector who fails to act. If no inspector or
alternate is able to act at a meeting of stockholders, the
-5-
<PAGE>
Chairman of such meeting shall appoint one or more inspectors to act at such
meeting. No director or candidate for the office of director shall be appointed
as such inspector. Each inspector shall first take and subscribe an oath or
affirmation faithfully to execute the duties of inspector at such meeting with
strict impartiality and according to the best of his ability, shall make a
certificate of the result of the vote taken after the balloting, and shall have
such other duties as are prescribed by law. The Chairman of the meeting shall
fix and announce at the meeting the date and time of the opening and the closing
of the polls for each matter upon which the stockholders will vote at the
meeting.
Section 8. In order to determine the stockholders entitled to notice of
or to vote at any meeting of stockholders or any adjournment thereof, or
entitled to receive payment of any dividend or other distribution or allotment
of any rights, or entitled to exercise any rights in respect of any change,
conversion or exchange of stock or for the purpose of any other lawful action
(other than action by consent, which is the subject of Article I Section 9 of
these By-Laws), the Board of Directors may fix a record date, which record date
shall not precede the date upon which the resolution fixing the record date is
adopted by the Board of Directors, and which record date shall not be more than
60 nor less than 10 days before the date of any such meeting, nor more than 60
days prior to any other such action. A determination of the stockholders of
record entitled to notice of or to vote at a meeting of stockholders shall apply
to any adjournment of the meeting, provided, however, that the Board of
Directors may fix a new record date for the adjourned meeting.
Section 9. (a) Unless otherwise provided in the Certificate of
-6-
<PAGE>
Incorporation, any action required to be taken at any annual or special meeting
of the stockholders of the Corporation, or any action which may be taken at any
annual or special meeting of such stockholders, may, subject to the provisions
of this Section 9, be taken without a meeting, without prior notice and without
a vote, if a consent or consents in writing, setting forth the actions so
taken, shall be signed by the holders of outstanding stock having not less than
the minimum number of votes that would be necessary to authorize or take such
action at a meeting at which all shares entitled to vote thereon were present
and voted and shall be delivered to the Corporation. Prompt notice of the taking
of the corporate action without a meeting by less than unanimous written consent
shall be given to those stockholders who have not consented in writing.
(b) Every written consent shall bear the date of signature of each
stockholder who signs the consent and no written consent shall be effective to
take the corporate action referred to therein unless, within 60 days of the
earliest dated consent delivered to the Corporation, written consents signed by
a sufficient number of holders to take action are delivered to the Corporation.
(c) The record date for determining stockholders entitled to consent
to corporate action in writing without a meeting shall be fixed by the Board of
Directors. Any stockholder seeking to have the stockholders authorize or take
corporate action by written consent without a meeting shall, by written notice
to the Secretary of the Corporation, request the Board of Directors to fix a
record date. Upon receipt of such a request, the Secretary of the Corporation
shall, as promptly as practicable, direct the Chairman or the President to call
a special meeting of the Board of Directors to be held
-7-
<PAGE>
as promptly as practicable, but in any event not more than 10 days following the
date of receipt of such a request. At such a meeting, the Board of Directors
shall fix a record date which shall not precede the date upon which the
resolution fixing the record date is adopted by the Board of Directors, and
which shall not be more than 10 days after the date that the resolution fixing
the record date is adopted by the Board of Directors. Notice of the record date
shall be published in accordance with the rules and policies of any stock
exchange on which securities of the Corporation are then listed or, if the
securities of the Corporation are not listed on a stock exchange, then notice of
the record date shall be published in accordance with the rules and policies of
the National Association of Securities Dealers Automatic Quotation National
Market System. If no record date has been so fixed by the Board of Directors,
the record date for determining the stockholders entitled to consent to
corporate action in writing without a meeting, where no prior action by the
Board of Directors is required by the Delaware General Corporation Law, shall be
the first date on which a signed written consent setting forth the action taken
or proposed to be taken is delivered to the Corporation. If no date has been
fixed by the Board of Directors and prior action by the Board of Directors is
required by the Delaware General Corporation Law, the record date for
determining stockholders entitled to consent to corporate action in writing
without a meeting shall be at the close of business on the day on which the
Board of Directors adopts the resolution taking such prior action.
(d) In the event of the delivery to the Corporation of a written consent
or consents purporting to represent the requisite voting power to authorize or
take corporate action and/or related revocations, the Secretary
-8-
<PAGE>
of the Corporation shall provide for the safekeeping of such consents and
revocations and shall, as promptly as practicable, engage inspectors for the
purpose of promptly performing a ministerial review of the validity of the
consents and revocations. No action by written consent without a meeting shall
be effective until such inspectors have completed their review, determined that
the requisite number of valid and unrevoked consents has been obtained to
authorize or take actions specified in the consents and certified such
determination for entry in the records of the Corporation for the purpose of
recording the proceedings of meetings of the stockholders.
(e) For purposes of this Section 9, delivery to the Corporation shall be
effected by delivery to its registered office in the State of Delaware, its
principal place of business, or an officer or agent of the Corporation having
custody of the book in which proceedings of meetings of stockholders are
recorded. Delivery made to the Corporation's registered office shall be by hand
or by certified or registered mail, return receipt requested.
ARTICLE II
DIRECTORS.
----------
Section 1. The number of directors shall be fixed by the Board of
Directors from time to time by appropriate resolution, provided that the number
of directors shall not be less than three. A director shall hold office until
his successor is elected and has qualified. A director need not be a
stockholder. One-third of the total number of directors shall constitute a
quorum for the transaction of business, provided that a quorum shall never be
less than two directors. If at any meeting of the Board of Directors there
-9-
<PAGE>
shall be less than a quorum present, a majority of those present may adjourn the
meeting from time to time until a quorum shall have been obtained. The Board of
Directors may designate the Chairman of the Board as an officer.
Section 2. Whenever any vacancy shall have occurred in the Board of
Directors by reason of death, resignation, increase in the number of directors,
or otherwise, it shall be filled by a majority of the remaining directors,
though less than a quorum, and the person so chosen shall hold office for the
unexpired term of the director whom he will have succeeded, or in a case of the
increase of the number of directors, the person so chosen shall hold office
until his successor is elected and has qualified.
Section 3. Meetings of the Board of Directors shall be held at such
place within or without the State of Delaware as may from time to time be fixed
by resolution of the Board, or as may be specified in the notice of any meeting.
Regular meetings of the Board of Directors shall be held at such times as may
from rime to time be fixed by resolution of the Board. Notice need not be given
of regular meetings of the Board held at times fixed by resolution of the Board.
A meeting of the Board may be held without notice immediately after the annual
meeting of stockholders at the same place at which such meeting was held.
Special meetings of the Board of Directors may be called at any time by
or at the direction of the Board of Directors itself, the Executive Committee,
the Chairman of the Board or the President or, in the event of the absence or
disability of the Chairman and the President, by or at the direction of the
Secretary by oral, telegraphic or written notice to each director, duly served
or sent at least 24 hours before such meeting or, if mailed, mailed no later
than the fourth calendar day before such meeting. Meetings
-10-
<PAGE>
may be held at any time without notice if all the directors are present or if
those not present waive notice of the meeting, in writing.
Section 4. The Board of Directors may, in its discretion, by resolution
passed by a majority of the whole Board, designate an Executive Committee to
consist of the Chairman or the President and such number of other directors (not
less than two) as the Board may from time to time determine, which Committee
shall have, and may exercise when the Board is not in session, all the powers
and authority of the Board of Directors in the management of the business and
affairs of the Corporation, and may authorize the seal of the Corporation to be
affixed to all papers which may require it, may declare a dividend or dividends,
may authorize the issuance of stock and may adopt a certificate of ownership and
merger pursuant to Section 253 (or its successor provision) of the Delaware
General Corporation Law; but the power and authority of the Executive Committee
shall be subject to the provisions of Section 141(c) (or its successor
provision) of the Delaware General Corporation Law and any other applicable
statute.
The Board may designate one or more directors as alternate members of
the Executive Committee, who may replace any absent or disqualified member at
any meeting of the Executive Committee. The Board shall have the power at any
time to change the membership of the Executive Committee, or to fill vacancies
in it, or to dissolve it. The Executive Committee may make such rules for the
conduct of its business as it shall from time to time deem necessary or
appropriate. A majority of the members of the Executive Committee shall
constitute a quorum.
Section 5. The Board of Directors may, in its discretion, by resolution
passed by a majority of the whole Board, appoint one or more other
-11-
<PAGE>
Committees in addition to the Executive Committee, each consisting of one or
more of the directors of the Corporation, which shall have and may exercise such
of the powers and authority of the Board of Directors in the management of the
business and affairs of the Corporation as shall be conferred by the resolution
appointing it, and which, in furtherance thereof, may authorize the seal of the
Corporation to be affixed to all papers which may require it; but the power and
authority of any such Committee shall be subject to the provisions of Section
141(c) (or its successor provision) of the Delaware General Corporation Law and
any other applicable statue.
The Board may designate one or more directors as alternate members of
any such Committee, who may replace any absence or disqualified member at any
meeting of such Committee. The Board shall have the power at any time to change
the membership of any such Committee, or to fill vacancies in it, or to dissolve
it. Any such Committee may make such rules for the conduct of its business as it
shall from time to time deem necessary or appropriate. Except as may be
otherwise provided by resolution of the Board, a majority of the members of any
such Committee, composed of more than two members, shall constitute a quorum.
Section 6. Each director who is not also an officer of the Corporation
shall receive as compensation for all his or her services as a Director, an
annual fee plus an additional fee for attendance at each meeting of the Board of
Directors and each meeting of any committee of the Board of which he or she is a
member, each such fee to be in such amount as may from time to time be fixed by
resolution of the Board. Directors who are also officers shall receive no
additional compensation for their services as Directors of the Corporation.
-12-
<PAGE>
Section 7. The Board of Directors may (but need not) elect one of the
directors as Chairman of the Board, but a director so elected shall not be an
officer or employee of the Corporation, and shall not exercise the functions of
an officer, unless expressly so designated as provided in Section 1 of Article
III. The Chairman of the Board shall serve until the meeting of the Board next
following the ensuing annual meeting of stockholders but may be removed at any
time by the affirmative vote of a majority of the members of the Board then in
office.
Section 8. Each director shall retire from the Board not later than the
date of the annual meeting of the stockholders of the Corporation next following
his 70th birthday.
Section 9. Nomination of Directors. (a) Only persons who are nominated
-----------------------
in accordance with the procedures set forth in this Section 9 shall be eligible
for election as directors of the Corporation. Nominations of persons for
election to the Board of Directors of the Corporation may be made at any annual
meeting of stockholders by or at the direction of the Board of Directors or by
any stockholder of the Corporation entitled to vote for the election of
directors at the meeting who was a stockholder of record at the time of giving
of notice provided for in this Section 9 and who complies with the notice
procedures see forth in this Section 9. Any such nomination by a stockholder
shall be made pursuant to timely notice in writing to the Secretary of the
Corporation. To be timely notice for an annual meeting, a stockholder's notice
shall be delivered to the Secretary of the Corporation at the principal
executive offices of the Corporation not less than 60 days nor more than 90 days
prior to the first anniversary of the preceding year's annual meeting; provided,
however, that in the event that the date of the
-13-
<PAGE>
annual meeting is advanced by more than 30 days or delayed-by more than 60 days
from such anniversary date, notice by the stockholder to be timely must be so
delivered not earlier than the 90th day prior to such annual meeting and not
later than the close of business on the later of the 60th day prior to such
annual meeting or the 10th day following the day on which public announcement
(as defined in Article I, Section 1) of the date of such meeting is first made.
Notwithstanding anything in the foregoing sentence to the contrary, in the event
that the number of directors to be elected to the Board of Directors of the
Corporation is increased and there is no public announcement naming all of the
nominees for director or specifying the size of the increased Board of Directors
made by the Corporation at least 70 days prior to the first anniversary of the
preceding year's annual meeting, a stockholder's notice required by this Section
9 shall also be considered timely, but only with respect to nominees for any new
positions created by such increase, if it shall be delivered to the Secretary of
the Corporation at the principal executive offices of the Corporation not later
than the close of business on the 10th day following the day on which such
public announcement is first made by the Corporation. Such stockholder's notice
shall set forth in writing (i) as to each person whom the stockholder proposes
to nominate for election or re-election as a director (A) the name, age,
business address and residence address of such person, (B) the principal
occupation or employment of such person, (C) the number of shares of stock of
the Corporation which are beneficially owned by such person, and (D) any other
information relating to such person that is required to be disclosed in
connection with the solicitation of proxies for election of directors, or as
otherwise required, in each case pursuant to Regulation 14A under the Exchange
Act (including,
-14-
<PAGE>
without limitation, such person's written consent to being named in a proxy
statement as a nominee and to serving as a director if elected); and (ii) as to
the stockholder giving the notice and the beneficial owner, if any, on whose
behalf the nomination is made (A) the name and address of such stockholder, as
they appear on the Corporation's books, and of such beneficial owner and (B) the
class and number of shares of the Corporation which are owned beneficially and
of record by such stockholder and such beneficial owner.
(b) Nominations of persons for election to the Board of Directors of the
Corporation may be made at a special meeting of stockholders at which directors
are to be elected pursuant to the Corporation's notice of meeting (i) by or at
the direction of the Board of Directors or (ii) provided that the Board of
Directors has determined that directors shall be elected at such special
meeting, by any stockholder of the Corporation who is a stockholder of record at
the time of giving of notice provided for in this Section 9, who shall be
entitled to vote at the meeting and who complies with the notice procedures set
forth in this Section 9. In the event the Corporation calls a special meeting of
stockholders for the purpose of electing one or more directors to the Board of
Directors, any such stockholder may nominate a person or persons (as the case
may be), for election to such position(s) as specified ln the Corporation's
notice of meeting, if the stockholder's notice shall be delivered to the
Secretary of the Corporation at the principal executive offices of the
Corporation not earlier than the 90th day prior to such special meeting and not
later than the close of business on the later of the 60th day prior to such
special meeting or the 10th day following the day on which public announcement
is first made of the date of the special meeting
-15-
<PAGE>
and of the nominees proposed by the Board of Directors to be elected at such
meeting.
(c) At the request of the Board of Directors, any person nominated by
the Board of Directors for election as a director shall furnish to the Secretary
of the Corporation that information required to be set forth in a stockholder's
notice of nomination which pertains to the nominee. No person shall be eligible
for election as a director of the Corporation unless nominated in accordance
with the procedures set forth in this Section 9. The Chairman of the meeting
shall, if the facts warrant, determine and declare to the meeting that a
nomination was not made in accordance with the procedures prescribed by these
By-Laws and in that event the defective nomination shall be disregarded. In
addition to the provisions of this Section 9, a stockholder shall also comply
with all applicable requirements of the Exchange Act and the rules and
regulations thereunder with respect to the matters set forth herein.
ARTICLE III
OFFICERS.
---------
Section l. The Board of Directors as soon as may be after the election
held in each year shall choose a President of the Corporation, one or more Vice
Presidents, a Secretary and a Treasurer. One or more of the Vice Presidents may
be designated Executive Vice President, and one or more of the Vice Presidents
may be designated Senior Vice President. The Board of Directors or the Executive
Committee may from time to time appoint such additional Vice Presidents, such
Assistant Vice Presidents, Assistant Secretaries and Assistant Treasurers and
such other officers as it may deem proper and may
-16-
<PAGE>
fill vacancies in any office. The office of Secretary and Treasurer may be held
by the same person and a Vice President of the Corporation may be either the
Secretary or the Treasurer. The President shall be chosen from the directors.
The Board of Directors may at any time choose a Chairman of the Board.
Section 2. The term of office of all officers shall be one year, or
until their respective successors are chosen, but any officer may be removed
from office at any time by the affirmative vote of a majority of the members of
the Board then in office.
Section 3. The officers of the Corporation shall each have such powers
and duties as generally pertain to their respective offices, as well as such
powers and duties as from time to time may be conferred by the Board of
Directors or by the Executive Committee. The Treasurer and the Assistant
Treasurers may be required to give bond for the faithful discharge of their
duties, in such form and with such surety or sureties as the Board of Directors
may from time to time prescribe.
ARTICLE IV
INDEMNIFICATION.
----------------
Section 1. Nature of Indemnity. The Corporation shall indemnify any
--------------------
person who was or is a party or is threatened to be made a party to any
threatened, pending or completed action, suit or proceeding, whether civil,
criminal, administrative or investigative, by reason of the fact that he is or
was or has agreed to become a director or officer of the Corporation, or is or
was serving or has agreed to serve at the request of the Corporation as a
director or officer of another corporation, partnership, joint venture, trust
-17-
<PAGE>
or other enterprise, including an employee benefit plan, or by reason of any
action alleged to have been taken or omitted in such capacity, and may indemnify
any person who was or is a party or is threatened to be made a party to such an
action, suit or proceeding by reason of the fact that he is or was or has agreed
to become an employee or agent of the Corporation, or is or was serving or has
agreed to serve at the request of the Corporation as an employee or agent of
another corporation, partnership, joint venture, trust or other enterprise,
including an employee benefit plan, against expenses (including attorneys'
fees), judgments, fines, excise taxes or penalties (including those payable
under the Employee Retirement Income Security Act of 1974, as amended) and
amounts paid in settlement actually and reasonably incurred by him or on his
behalf in connection with such action, suit or proceeding and any appeal
therefrom, except to the extent prohibited 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 permitted the Corporation
to provide prior to such amendment), provided, however, that, except as provided
-------- -------
in Section 5 of this Article IV, the Corporation shall indemnify any such person
seeking indemnification in connection with an action, suit or proceeding (or
part thereof) initiated by such person only if such action, suit or proceeding
(or part thereof) was authorized by the Board of Directors.
The termination of any action, suit or proceeding by judgment, order,
settlement, conviction, or upon a plea of nolo contendere or its equivalent,
---- ----------
shall not, of itself, create a presumption that the person did not act in
accordance with any applicable standard of conduct under the Delaware
-18-
<PAGE>
General Corporation Law making it permissible for the Corporation to indemnify
the claimant for the amount claimed.
Section 2. Successful Defense. To the extent that a director, officer,
-------------------
employee or agent of the Corporation has been successful on the merits or
otherwise in defense of any action, suit or proceeding referred to in Section 1
hereof or in defense of any claim, issue or matter therein, he shall be
indemnified against expenses (including attorneys' fees) actually and reasonably
incurred by him in connection therewith.
Section 3. Determination That Indemnification Is Proper. Any
---------------------------------------------
indemnification of a director or officer of the Corporation under Section 1 of
this Article IV (unless ordered by a court) shall be made by the Corporation
unless a determination is made that indemnification of the director or officer
is not proper in the circumstances because he has not met the applicable
standard of conduct or because indemnification would otherwise be prohibited
under the Delaware General Corporation Law. Any indemnification of an employee
or agent of the Corporation under Section 1 of this Article IV (unless ordered
by a court) may be made by the Corporation upon a determination that
indemnification of the employee or agent is proper in the circumstances because
he has met the applicable standard of conduct and indemnification is not
otherwise prohibited. Any such determination shall be made (a) if requested by
the indemnitee, by Independent Counsel (as hereinafter defined) in a written
opinion to the Board of Directors, a copy of which shall be delivered to the
indemnitee, or (b) if no request is made by the indemnitee for a determination
by Independent Counsel, (i) by the Board of Directors by a majority vote of a
quorum consisting of Disinterested Directors (as hereinafter defined), or (ii)
if a quorum of the Board of Directors consisting of Disinterested Directors is
not obtainable, or even if
-19-
<PAGE>
obtainable, such quorum of Disinterested Directors so directs, by Independent
Counsel in a written opinion to the Board of Directors, a copy of which shall be
delivered to the indemnitee, or (iii) by the stockholders of the Corporation. In
the event the determination of entitlement to indemnification is to be made by
Independent Counsel at the request of the indemnitee, Independent Counsel shall
be selected by the indemnitee unless the indemnitee shall request that such
selection be made by the Board of Directors, in which event Independent Counsel
shall be selected by the Board of Directors. If it is so determined that the
indemnitee is entitled to indemnification, payment to the indemnitee shall be
made within 10 days after such determination. In making a determination with
respect to entitlement to indemnification hereunder, the person, persons or
entity making such determination shall presume that the indemnitee is entitled
to indemnification under this Article IV, and the Corporation shall have the
burden of proof to overcome that presumption in connection with the making by
any person, persons or entity of any determination contrary to that presumption.
For purposes of this Section 3, "Disinterested Director" means a director of the
Corporation who is not and was not a party to the matter in respect of which
indemnification is sought by the indemnitee, and "Independent Counsel" means a
law firm, or a member of a law firm, that is experienced in matters of
corporation law and neither presently is, nor in the past five years has been,
retained to represent: (a) the Corporation or the indemnitee in any matter
material to either such party, or (b) any other party to the matter giving rise
to a claim for indemnification. Notwithstanding the foregoing, the term
"Independent Counsel" shall not include any person who, under the applicable
standards of professional conduct then prevailing, would have a conflict of
interest in
-20-
<PAGE>
representing either the Corporation or the indemnitee in an action to determine
the indemnitee's rights under this Article IV.
Section 4. Advance Payment of Expenses. Expenses (including attorney's
----------------------------
fees) incurred by a director or officer in defending any civil, criminal,
administrative or investigative action, suit or proceeding shall be paid by the
Corporation in advance of the final disposition of such action, suit or
proceeding upon receipt of an undertaking by or on behalf of the director or
officer to repay such amount if it shall ultimately be determined that he is not
entitled to be indemnified by the Corporation as authorized in this Article IV.
Such expenses (including attorney's fees) incurred by other employees and agents
may be so paid upon such terms and conditions, if any, as the Board of Directors
deems appropriate. The Board of Directors may authorize the Corporation's
counsel to represent such director, officer or employee or agent in any action,
suit or proceeding, whether or not the Corporation is a party to such action,
suit or proceeding.
Section 5. Procedure for Indemnification of Directors and Officers. Any
--------------------------------------------------------
indemnification of a director or officer of the Corporation under Sections 1 and
2 of this Article IV, or advance of costs, charges or expenses to a director or
officer under Section 4 of this Article IV, shall be made promptly, and in any
event within 30 days, upon the written request of the director or officer. If a
determination by the Corporation that the director or officer is entitled to
indemnification or advances pursuant to this Article IV is required, and the
Corporation fails to respond within 30 days to a written request therefor, the
Corporation shall be deemed to have approved such request. If the Corporation
denies a written request for indemnification or advances, in whole or in part,
or if payment in full
-21-
<PAGE>
pursuant to such request is not made within 30 days, the right to
indemnification or advances as granted by this Article IV shall be enforceable
by the director or officer in any court of competent jurisdiction. Such person's
costs and expenses incurred in connection with successfully establishing his
right to indemnification or advances, in whole or in part, in any such action
shall also be indemnified by the Corporation. It shall be a defense to any such
action (other than an action brought to enforce a claim for advance of costs,
charges and expenses under Section 4 of this Article IV where the required
undertaking, if any, has been received by the Corporation) that the claimant
has not met the applicable standard of conduct or that indemnification is
otherwise prohibited under the Delaware General Corporation Law, but the burden
of proving such defense shall be on the Corporation. Neither the failure of the
Corporation (including the Board of Directors, Independent Counsel and the
Corporation's stockholders) to have made a determination prior to the
commencement of such action that indemnification of the claimant is proper in
the circumstances because he has met the applicable standard of conduct, nor the
fact that there has been an actual determination by the Corporation (including
the Board of Directors, Independent Counsel and the Corporation's 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.
Section 6. Survival; Preservation of Other Rights. The foregoing
---------------------------------------
provisions of this Article shall be deemed to be a contract between the
Corporation and each director, officer, employee and agent who serves in such
capacity at any time while these provisions and the relevant provisions of the
-22-
<PAGE>
Delaware General Corporation Law are in effect, and any repeal or modification
thereof shall not affect any right or obligation then existing with respect to
any state of facts then or previously existing or any action, suit or proceeding
previously or thereafter brought or threatened based in whole or in part upon
any such state of facts. Such contract may not be modified retroactively without
the consent of such director, officer, employee or agent.
The indemnification provided by this Article shall not be deemed
exclusive of any other rights to which those indemnified may be entitled under
any by-law, agreement, vote of stockholders or disinterested directors or
otherwise, both as to action in his official capacity and as to action in
another capacity while holding such office, and shall inure to the benefit of
the heirs, executors and administrators of such a person and shall continue as
to a person who has ceased to be a director, officer, employee or agent.
The Corporation may, upon a vote of a majority of the directors, enter
into an indemnity agreement with any director, officer, employee or agent of the
Corporation providing for the maximum right to indemnification permissible under
the applicable laws of the State of Delaware.
Section 7. Insurance. The Corporation shall purchase and maintain
----------
insurance on behalf of any person who is or was or has agreed to become a
director or officer of the Corporation, or is or was serving at the request of
the Corporation as a director or officer of another corporation, partnership,
joint venture, trust or other enterprise, including an employee benefit plan,
against any liability asserted against him and incurred by him or on his behalf
in any such capacity, or arising out of his status as such, whether or not the
Corporation would have the power to indemnify him against such liability under
the provisions of this Article IV, provided that such
-23-
<PAGE>
insurance is available on acceptable terms, which determination shall be made by
a vote of a majority of the entire Board of Directors.
Section 8. Savings Clause. If this Article or any portion hereof shall
---------------
be invalidated on any ground by any court of competent jurisdiction, then the
Corporation shall nevertheless indemnify each director or officer and may
indemnify each employee or agent of the Corporation as to costs, charges and
expenses (including attorneys' fees), judgments, fines and amounts paid in
settlement with respect to any action, suit or proceeding, whether civil,
criminal, administrative or investigative, includlng an action by or in the
right of the Corporation, to the full extent permitted by any applicable portion
of this Article that shall not have been invalidated and to the full extent
permitted by applicable law.
Section 9. Amendments. This Article may be amended solely by the
-----------
affirmative vote of (i) a majority of the Board of Directors, but only to the
extent that such amendment would permit the Corporation to provide broader
indemnification rights than were provided hereby immediately prior to such
amendment, or (ii) the holders of 75% or more of the outstanding shares of
Common Stock of the Corporation.
ARTICLE V
CERTIFICATES OF STOCK.
----------------------
Section 1. The interest of each stockholder of the Corporation shall be
evidenced by certificates for shares of stock in such form as the Board of
Directors may from time to time prescribe. The shares in the stock of the
Corporation shall be transferred on the books of the Corporation by the holder
thereof in person or by his attorney, upon surrender for cancellation
-24-
<PAGE>
of certificates for the same number of shares, with an assignment and power of
transfer endorsed thereon or attached thereto, duly executed, with such proof of
the authenticity of the signature as the Corporation or its agents may
reasonably require.
Section 2. The certificates of stock shall be signed by the Chairman of
the Board or the President or a Vice President and by the Secretary or an
Assistant Secretary, or the Treasurer or an Assistant Treasurer, and may be
countersigned and registered in such manner, if any, and sealed as the Board of
Directors or the Executive Committee may by resolution prescribe.
ARTICLE VI
CHECKS, NOTES, ETC.
-------------------
All checks and drafts on the Corporation's bank accounts and all bills
of exchange and promissory notes, and all acceptances, obligations and other
instruments for the payment of money, shall be signed by such officer or
officers, agent or agents as shall be thereunto authorized from time to time by
the Board of Directors or the Executive Committee.
ARTICLE VII
OFFICES.
--------
The Corporation and the stockholders and the directors may have offices
outside of the State of Delaware at such places as shall be determined from time
to time by the Board of Directors or the Executive Committee.
-25-
<PAGE>
ARTICLE VIII
AMENDMENTS.
-----------
The By-Laws of the Corporation, regardless of whether made by the
stockholders or by the Board of Directors, may be amended, added to, rescinded
or repealed at any meeting of the Board of Directors or of the stockholders,
provided notice of the proposed change is given in the notice of the meeting.
-26-
<PAGE>
COVER
EXHIBIT 4(4)(a)
TAMBRANDS INC.
TO
CITIBANK, N.A.
Trustee
______________
Indenture
Dated as of December 1, 1993
______________
<PAGE>
..............................................................
Certain Sections of this Indenture relating to Sections 310 through 318,
inclusive, of the Trust Indenture Act of 1939:
Trust Indenture
Act Section
Indenture Section
sec. 310(a)(1) . . . . . . . . . . . . . . . . 609
(a)(2) . . . . . . . . . . . . . . . . 609
(a)(3) . . . . . . . . . . . . . . . . Not Applicable
(a)(4) . . . . . . . . . . . . . . . . Not Applicable
(b) . . . . . . . . . . . . . . . . . . 608
610
sec. 311(a) . . . . . . . . . . . . . . . . . . 613
(b) . . . . . . . . . . . . . . . . . . 613
sec. 312(a) . . . . . . . . . . . . . . . . . . 701
702
(b) . . . . . . . . . . . . . . . . . . 702
(c) . . . . . . . . . . . . . . . . . . 702
sec. 313(a) . . . . . . . . . . . . . . . . . . 703
(b) . . . . . . . . . . . . . . . . . . 703
(c) . . . . . . . . . . . . . . . . . . 703
(d) . . . . . . . . . . . . . . . . . . 703
sec. 314(a) . . . . . . . . . . . . . . . . . . 704
(a)(4) . . . . . . . . . . . . . . . . 101
1004
(b) . . . . . . . . . . . . . . . . . . Not Applicable
(c)(1) . . . . . . . . . . . . . . . . 102
(c)(2) . . . . . . . . . . . . . . . . 102
(c)(3) . . . . . . . . . . . . . . . . Not Applicable
(d) . . . . . . . . . . . . . . . . . . Not Applicable
(e) . . . . . . . . . . . . . . . . . . 102
sec. 315(a) . . . . . . . . . . . . . . . . . . 601
(b) . . . . . . . . . . . . . . . . . . 602
(c) . . . . . . . . . . . . . . . . . . 601
(d) . . . . . . . . . . . . . . . . . . 601
(e) . . . . . . . . . . . . . . . . . . 514
sec. 316(a) . . . . . . . . . . . . . . . . . . 101
(a)(1)(A) . . . . . . . . . . . . . . . 502
512
(a)(1)(B) . . . . . . . . . . . . . . . 513
(a)(2) . . . . . . . . . . . . . . . . Not Applicable
(b) . . . . . . . . . . . . . . . . . . 508
(c) . . . . . . . . . . . . . . . . . . 104
sec. 317(a)(1) . . . . . . . . . . . . . . . . 503
(a)(2) . . . . . . . . . . . . . . . . 504
(b) . . . . . . . . . . . . . . . . . . 1003
sec. 318(a) . . . . . . . . . . . . . . . . . . 107
___________________
NOTE: This reconciliation and tie shall not, for any purpose, be deemed to
be a part of the Indenture.
<PAGE>
i
TABLE OF CONTENTS
__________
PAGE
PARTIES . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1
RECITALS OF THE COMPANY . . . . . . . . . . . . . . . . . . . . . 1
ARTICLE ONE
DEFINITIONS AND OTHER PROVISIONS OF GENERAL APPLICATION
SECTION 101. Definitions:
Act . . . . . . . . . . . . . . . . . . . . . . 2
Affiliate; control . . . . . . . . . . . . . . . 2
Attributable Debt . . . . . . . . . . . . . . . 2
Authenticating Agent . . . . . . . . . . . . . . 2
Board of Directors . . . . . . . . . . . . . . . 2
Board Resolution . . . . . . . . . . . . . . . . 2
Business Day . . . . . . . . . . . . . . . . . . 3
Commission . . . . . . . . . . . . . . . . . . . 3
Company . . . . . . . . . . . . . . . . . . . . 3
Company Request; Company Order . . . . . . . . . 3
Composite Rate . . . . . . . . . . . . . . . . . 3
Consolidated Assets . . . . . . . . . . . . . . 3
Corporate Trust Office . . . . . . . . . . . . . 3
corporation . . . . . . . . . . . . . . . . . . 4
Covenant Defeasance . . . . . . . . . . . . . . 4
Defaulted Interest . . . . . . . . . . . . . . . 4
Defeasance . . . . . . . . . . . . . . . . . . . 4
Depositary . . . . . . . . . . . . . . . . . . . 4
Event of Default . . . . . . . . . . . . . . . . 4
Exchange Act . . . . . . . . . . . . . . . . . . 4
Expiration Date . . . . . . . . . . . . . . . . 4
Funded Indebtedness . . . . . . . . . . . . . . 4
GAAP . . . . . . . . . . . . . . . . . . . . . . 4
Global Security . . . . . . . . . . . . . . . . 4
Holder . . . . . . . . . . . . . . . . . . . . . 4
Indebtedness . . . . . . . . . . . . . . . . . . 4
Indenture . . . . . . . . . . . . . . . . . . . 5
interest . . . . . . . . . . . . . . . . . . . . 5
Interest Payment Date . . . . . . . . . . . . . 5
Investment Company Act . . . . . . . . . . . . . 5
Maturity . . . . . . . . . . . . . . . . . . . . 6
Notice of Default . . . . . . . . . . . . . . . 6
<PAGE>
ii
Officers' Certificate . . . . . . . . . . . . . 6
Opinion of Counsel . . . . . . . . . . . . . . . 6
Original Issue Discount Security . . . . . . . . 6
Outstanding . . . . . . . . . . . . . . . . . . 6
Paying Agent . . . . . . . . . . . . . . . . . . 7
Person . . . . . . . . . . . . . . . . . . . . . 7
Place of Payment . . . . . . . . . . . . . . . . 7
Predecessor Security . . . . . . . . . . . . . . 7
Principal Property . . . . . . . . . . . . . . . 7
Redemption Date . . . . . . . . . . . . . . . . 8
Redemption Price . . . . . . . . . . . . . . . . 8
Regular Record Date . . . . . . . . . . . . . . 8
Responsible Officer . . . . . . . . . . . . . . 8
Restricted Subsidiary . . . . . . . . . . . . . 8
Securities . . . . . . . . . . . . . . . . . . . 8
Securities Act . . . . . . . . . . . . . . . . . 8
Security Register and Security Registrar . . . . 8
Special Record Date . . . . . . . . . . . . . . 9
Stated Maturity . . . . . . . . . . . . . . . . 9
Subsidiary . . . . . . . . . . . . . . . . . . . 9
Trustee . . . . . . . . . . . . . . . . . . . . 9
Trust Indenture Act . . . . . . . . . . . . . . 9
U.S. Government Obligation . . . . . . . . . . . 9
Vice President . . . . . . . . . . . . . . . . . 9
SECTION 102. Compliance Certificates and Opinions . . . . . . 9
SECTION 103. Form of Documents Delivered to Trustee . . . . . 10
SECTION 104. Acts of Holders; Record Dates . . . . . . . . . 11
SECTION 105. Notices, Etc., to Trustee and Company . . . . . 13
SECTION 106. Notice to Holders; Waiver . . . . . . . . . . . 13
SECTION 107. Conflict with Trust Indenture Act . . . . . . . 14
SECTION 108. Effect of Headings and Table of Contents . . . . 14
SECTION 109. Successors and Assigns . . . . . . . . . . . . . 14
SECTION 110. Separability Clause . . . . . . . . . . . . . . 14
SECTION 111. Benefits of Indenture . . . . . . . . . . . . . 14
SECTION 112. Governing Law . . . . . . . . . . . . . . . . . 15
SECTION 113. Legal Holidays . . . . . . . . . . . . . . . . . 15
<PAGE>
iii
ARTICLE TWO
SECURITY FORMS
SECTION 201. Forms Generally . . . . . . . . . . . . . . . . 15
SECTION 202. Form of Face of Security . . . . . . . . . . . . 16
SECTION 203. Form of Reverse of Security . . . . . . . . . . 17
SECTION 204. Form of Legend for Global Securities . . . . . . 22
SECTION 205. Form of Trustee's Certificate of Authentication 22
ARTICLE THREE
THE SECURITIES
SECTION 301. Amount Unlimited; Issuable in Series . . . . . . 22
SECTION 302. Denominations . . . . . . . . . . . . . . . . . 25
SECTION 303. Execution, Authentication, Delivery
and Dating . . . . . . . . . . . . . . . . . . 25
SECTION 304. Temporary Securities . . . . . . . . . . . . . . 27
SECTION 305. Registration, Registration of Transfer
and Exchange . . . . . . . . . . . . . . . . . 27
SECTION 306. Mutilated, Destroyed, Lost and Stolen
Securities . . . . . . . . . . . . . . . . . . 29
SECTION 307. Payment of Interest; Interest Rights
Preserved . . . . . . . . . . . . . . . . . . . 30
SECTION 308. Persons Deemed Owners . . . . . . . . . . . . . 31
SECTION 309. Cancellation . . . . . . . . . . . . . . . . . . 31
SECTION 310. Computation of Interest . . . . . . . . . . . . 32
ARTICLE FOUR
SATISFACTION AND DISCHARGE
SECTION 401. Satisfaction and Discharge of Indenture . . . . 32
SECTION 402. Application of Trust Money . . . . . . . . . . . 33
<PAGE>
iv
ARTICLE FIVE
REMEDIES
SECTION 501. Events of Default . . . . . . . . . . . . . . . 33
SECTION 502. Acceleration of Maturity; Rescission
and Annulment . . . . . . . . . . . . . . . . . 35
SECTION 503. Collection of Indebtedness and Suits
for Enforcement by Trustee . . . . . . . . . . 36
SECTION 504. Trustee May File Proofs of Claim . . . . . . . . 37
SECTION 505. Trustee May Enforce Claims Without
Possession of Securities . . . . . . . . . . . 37
SECTION 506. Application of Money Collected . . . . . . . . . 38
SECTION 507. Limitation on Suits . . . . . . . . . . . . . . 38
SECTION 508. Unconditional Right of Holders to
Receive Principal, Premium and
Interest . . . . . . . . . . . . . . . . . . . 39
SECTION 509. Restoration of Rights and Remedies . . . . . . . 39
SECTION 510. Rights and Remedies Cumulative . . . . . . . . . 39
SECTION 511. Delay or Omission Not Waiver . . . . . . . . . . 39
SECTION 512. Control by Holders . . . . . . . . . . . . . . . 40
SECTION 513. Waiver of Past Defaults . . . . . . . . . . . . 40
SECTION 514. Undertaking for Costs . . . . . . . . . . . . . 40
SECTION 515. Waiver of Usury, Stay or Extension Laws . . . . 41
ARTICLE SIX
THE TRUSTEE
SECTION 601. Certain Duties and Responsibilities . . . . . . 41
SECTION 602. Notice of Defaults . . . . . . . . . . . . . . . 41
SECTION 603. Certain Rights of Trustee . . . . . . . . . . . 42
SECTION 604. Not Responsible for Recitals or
Issuance of Securities . . . . . . . . . . . . 43
SECTION 605. May Hold Securities . . . . . . . . . . . . . . 43
SECTION 606. Money Held in Trust . . . . . . . . . . . . . . 43
SECTION 607. Compensation and Reimbursement . . . . . . . . . 43
SECTION 608. Conflicting Interests . . . . . . . . . . . . . 44
SECTION 609. Corporate Trustee Required;
Eligibility . . . . . . . . . . . . . . . . . . 44
SECTION 610. Resignation and Removal; Appointment of
Successor . . . . . . . . . . . . . . . . . . . 44
SECTION 611. Acceptance of Appointment by Successor . . . . . 46
SECTION 612. Merger, Conversion, Consolidation or
Succession to Business . . . . . . . . . . . . 47
<PAGE>
v
SECTION 613. Preferential Collection of Claims
Against Company . . . . . . . . . . . . . . . . 47
SECTION 614. Appointment of Authenticating Agent . . . . . . 47
ARTICLE SEVEN
HOLDERS' LISTS AND REPORTS BY TRUSTEE AND COMPANY
SECTION 701. Company to Furnish Trustee Names and Addresses
of Holders . . . . . . . . . . . . . . . . . . 49
SECTION 702. Preservation of Information; Communications
to Holders . . . . . . . . . . . . . . . . . . 49
SECTION 703. Reports by Trustee . . . . . . . . . . . . . . . 50
SECTION 704. Reports by Company . . . . . . . . . . . . . . . 50
ARTICLE EIGHT
CONSOLIDATION, MERGER, CONVEYANCE, TRANSFER OR LEASE
SECTION 801. Company May Consolidate, Etc., Only on Certain
Terms . . . . . . . . . . . . . . . . . . . . . 50
SECTION 802. Successor Substituted . . . . . . . . . . . . . 51
ARTICLE NINE
SUPPLEMENTAL INDENTURES
SECTION 901. Supplemental Indentures Without Consent of
Holders . . . . . . . . . . . . . . . . . . . . 52
SECTION 902. Supplemental Indentures with Consent of
Holders . . . . . . . . . . . . . . . . . . . . 53
SECTION 903. Execution of Supplemental Indentures . . . . . . 54
SECTION 904. Effect of Supplemental Indentures . . . . . . . 54
SECTION 905. Conformity with Trust Indenture Act . . . . . . 54
SECTION 906. Reference in Securities to Supplemental
Indentures . . . . . . . . . . . . . . . . . . 55
ARTICLE TEN
COVENANTS
SECTION 1001. Payment of Principal, Premium and Interest . . . 55
SECTION 1002. Maintenance of Office or Agency . . . . . . . . 55
SECTION 1003. Money for Securities Payments to Be Held in
Trust . . . . . . . . . . . . . . . . . . . . . 56
SECTION 1004. Statement by Officers as to Default . . . . . . 57
SECTION 1005. Existence . . . . . . . . . . . . . . . . . . . 57
SECTION 1006. Maintenance of Properties . . . . . . . . . . . 57
SECTION 1007. Payment of Taxes and Other Claims . . . . . . . 57
<PAGE>
vi
SECTION 1008. Limitation on Liens . . . . . . . . . . . . . . 58
SECTION 1009. Limitation on Sale and Lease-Back . . . . . . . 60
SECTION 1010. Waiver of Certain Covenants . . . . . . . . . . . 61
ARTICLE ELEVEN
REDEMPTION OF SECURITIES
SECTION 1101. Applicability of Article . . . . . . . . . . . . 61
SECTION 1102. Election to Redeem; Notice to Trustee . . . . . 61
SECTION 1103. Selection by Trustee of Securities to Be
Redeemed . . . . . . . . . . . . . . . . . . . 62
SECTION 1104. Notice of Redemption . . . . . . . . . . . . . . 62
SECTION 1105. Deposit of Redemption Price . . . . . . . . . . 63
SECTION 1106. Securities Payable on Redemption Date . . . . . 63
SECTION 1107. Securities Redeemed in Part . . . . . . . . . . 64
ARTICLE TWELVE
SINKING FUNDS
SECTION 1201. Applicability of Article . . . . . . . . . . . . 64
SECTION 1202. Satisfaction of Sinking Fund Payments with
Securities . . . . . . . . . . . . . . . . . . 64
SECTION 1203. Redemption of Securities for Sinking Fund . . . 65
ARTICLE THIRTEEN
DEFEASANCE AND COVENANT DEFEASANCE
SECTION 1301. Company's Option to Effect Defeasance or Covenant
Defeasance . . . . . . . . . . . . . . . . . . 65
SECTION 1302. Defeasance and Discharge . . . . . . . . . . . . 65
SECTION 1303. Covenant Defeasance . . . . . . . . . . . . . . 66
SECTION 1304. Conditions to Defeasance or Covenant Defeasance 66
SECTION 1305. Deposited Money and U.S. Government Obligations to Be
Held in Trust; Miscellaneous Provisions . . . 68
SECTION 1306. Reinstatement . . . . . . . . . . . . . . . . . 69
TESTIMONIUM . . . . . . . . . . . . . . . . . . . . . . . . 70
SIGNATURES AND SEALS . . . . . . . . . . . . . . . . . . . . . . 70
ACKNOWLEDGEMENTS . . . . . . . . . . . . . . . . . . . . . . . . 70
<PAGE>
1
INDENTURE, dated as of December 1, 1993, between TAMBRANDS INC., a
corporation duly organized and existing under the laws of the State of
Delaware (herein called the "Company"), having its principal office at 777
Westchester Avenue, White Plains, New York 10604, and CITIBANK, N.A., a
national banking association duly organized and existing under the laws of
the United States, as Trustee (herein called the "Trustee").
RECITALS OF THE COMPANY
The Company has duly authorized the execution and delivery of this
Indenture to provide for the issuance from time to time of its unsecured
debentures, notes or other evidences of indebtedness (herein called the
"Securities"), to be issued in one or more series as in this Indenture
provided.
All things necessary to make this Indenture a valid agreement of the
Company, in accordance with its terms, have been done.
NOW, THEREFORE, THIS INDENTURE WITNESSETH:
For and in consideration of the premises and the purchase of the
Securities by the Holders thereof, it is mutually agreed, for the equal and
proportionate benefit of all Holders of the Securities or of any series
thereof, as follows:
ARTICLE ONE
DEFINITIONS AND OTHER PROVISIONS
OF GENERAL APPLICATION
SECTION 101. Definitions.
For all purposes of this Indenture, except as otherwise expressly
provided or unless the context otherwise requires:
(1) the terms defined in this Article have the meanings assigned
to them in this Article and include the plural as well as the
singular;
(2) all other terms used herein which are defined in the Trust
Indenture Act, either directly or by reference therein, have the
meanings assigned to them therein;
(3) all accounting terms not otherwise defined herein have the
meanings assigned to them in accordance with generally accepted
accounting principles, and, except as otherwise herein expressly
provided, the term "generally accepted accounting principles" with
respect to any computation required or permitted hereunder shall
mean such accounting principles as are generally accepted at the
date of this instrument;
<PAGE>
2
(4) unless the context otherwise requires, any reference to an
"Article" or a "Section" refers to an Article or a Section, as the
case may be, of this Indenture; and
(5) the words "herein", "hereof" and "hereunder" and other words
of similar import refer to this Indenture as a whole and not to any
particular Article, Section or other subdivision.
"Act", when used with respect to any Holder, has the meaning
specified in Section 104.
"Affiliate" of any specified Person means any other Person directly
or indirectly controlling or controlled by or under direct or indirect
common control with such specified Person. For the purposes of this
definition, "control" when used with respect to any specified Person means
the power to direct the management and policies of such Person, directly or
indirectly, whether through the ownership of voting securities, by contract
or otherwise; and the terms "controlling" and "controlled" have meanings
correlative to the foregoing.
"Attributable Debt", when used in connection with a Sale and Lease-
Back Transaction, shall mean, as of any particular time, the lesser of (a)
the fair value (as determined by the Board of Directors) of the property
subject to such arrangement and (b) the then present value (computed by
discounting at the Composite Rate) of the obligation of a lessee for net
rental payments during the remaining term of any lease in respect of such
property (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 for any period shall mean the sum of the rental
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, 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, insurance, taxes, assessments, water rates or
similar charges.
"Authenticating Agent" means any Person authorized by the Trustee
pursuant to Section 614 to act on behalf of the Trustee to authenticate
Securities of one or more series.
"Board of Directors" means either the board of directors of the
Company or any duly authorized committee of that board.
"Board Resolution" means a copy of a resolution certified by the
Secretary or an Assistant Secretary of the Company to have been duly
adopted by the Board of Directors and to be in full force and effect on the
date of such certification, and delivered to the Trustee.
<PAGE>
3
"Business Day", when used with respect to any Place of Payment,
means each Monday, Tuesday, Wednesday, Thursday and Friday which is not a
day on which banking institutions in that Place of Payment are authorized
or obligated by law or executive order to close.
"Commission" means the Securities and Exchange Commission, as from
time to time constituted, created under the Exchange Act, or, if at any
time after the execution of this instrument such Commission is not existing
and performing the duties now assigned to it under the Trust Indenture Act,
then the body performing such duties at such time.
"Company" means the Person named as the "Company" in the first
paragraph of this instrument until a successor Person shall have become
such pursuant to the applicable provisions of this Indenture, and
thereafter "Company" shall mean such successor Person.
"Company Request" or "Company Order" means a written request or
order signed in the name of the Company by its Chairman of the Board, its
President or a Senior Vice President, and by a Vice President, its
Treasurer, an Assistant Treasurer, its Secretary or an Assistant Secretary,
and delivered to the Trustee.
"Composite Rate" means, as of any particular time, the rate of
interest, per annum, compounded semiannually, equal to the sum of the rates
of interest borne by each of the Securities Outstanding hereunder (as
specified on the face of each of the Securities, provided, that, in the
case of Securities with variable rates of interest, the interest rate to be
used in calculating the Composite Rate shall be the interest rate
applicable to such Securities at the beginning of the most recent period
for which the interest rate was determined for such Securities in
accordance with the terms thereof and provided, further, that, in the case
of Securities which do not bear interest, the interest rate to be used in
calculating the Composite Rate shall be a rate equal to the yield to
Maturity on such Securities, calculated at the time of issuance of such
Securities) multiplied, in the case of each of the Securities, by the
percentage of the aggregate principal amount of all of the Securities then
Outstanding represented by such Security.
"Consolidated Assets" means the Company's assets, determined in
accordance with GAAP and consolidated for financial reporting purposes in
accordance with GAAP, such assets to be valued at book value.
"Corporate Trust Office" means the principal office of the Trustee
in the borough of Manhattan in The City of New York at which at any
particular time its corporate trust business shall be administered, on the
date of execution of this Indenture at 120 Wall Street, 13th Floor, New
York, New York 10043, except that with respect to presentation of
Securities for payment or for registration of transfer or exchange, such
term shall mean the office or agency of the Trustee at which, at any
particular time, its corporate agency business shall be conducted, which
office or agency on the date of execution of this Indenture is located at
111 Wall Street, 5th Floor, New York, New York 10043.
<PAGE>
4
"Corporation" means a corporation, association, company, joint-stock
company or business trust.
"Covenant Defeasance" has the meaning specified in Section 1303.
"Defaulted Interest" has the meaning specified in Section 307.
"Defeasance" has the meaning specified in Section 1302.
"Depositary" means, with respect to Securities of any series
issuable in whole or in part in the form of one or more Global Securities,
a clearing agency registered under the Exchange Act that is designated to
act as Depositary for such Securities as contemplated by Section 301.
"Event of Default" has the meaning specified in Section 501.
"Exchange Act" means the Securities Exchange Act of 1934 and any
statute successor thereto, in each case as amended from time to time.
"Expiration Date" has the meaning specified in Section 104.
"Funded Indebtedness" means all Indebtedness of the Company and its
Restricted Subsidiaries maturing by its terms more than one year after, or
which is renewable or extendible at the option of the Company for a period
ending more than one year after, the date as of which Funded Indebtedness
is being determined.
"GAAP" means such accounting principles as are generally accepted in
the United States at the date of this Indenture.
"Global Security" means a Security that evidences all or part of the
Securities of any series and bears the legend set forth in Section 204 (or
such legend as may be specified as contemplated by Section 301 for such
Securities).
"Holder" means a Person in whose name a Security is registered in
the Security Register.
"Indebtedness" means, without duplication, (i) all obligations in
respect of borrowed money or for the deferred purchase or acquisition price
of property (including all types of real, personal, tangible, intangible or
mixed property) or services (excluding trade accounts payable, deferred
taxes and accrued liabilities which arise in the ordinary course of
business) which are, in accordance with GAAP, includible as a liability on
a balance sheet consolidated for financial reporting purposes in accordance
with GAAP, (ii) all amounts representing the capitalization of rental
obligations in accordance with GAAP, and (iii) all Contingent Obligations
with respect to the foregoing; for purposes of clause (iii), "Contingent
Obligation" means, as to any Person, any obligation of such Person
guaranteeing or in effect guaranteeing any Indebtedness, leases, dividends
or other obligations ("primary obligations") of any other Person (the
"primary obligor") in any
<PAGE>
5
manner, whether directly or indirectly, including, without limitation, any
obligation of such Person, whether or not contingent, (i) to purchase any
such primary obligation or any Property constituting direct or indirect
security therefor, (ii) to advance or supply funds (a) for the purchase or
payment of any such primary obligation or (b) to maintain working capital
or equity capital of the primary obligor or otherwise to maintain the net
worth or solvency of the primary obligor, (iii) to purchase Property,
securities or services primarily for the purpose of assuring the
beneficiary of any such primary obligation of the ability of the primary
obligor to make payment of such primary obligation or (iv) otherwise to
assure or hold harmless the beneficiary of such primary obligation against
loss in respect thereof; provided, however, that the term "Contingent
Obligation" shall not include the indorsement of instruments for deposit or
collection in the ordinary course of business. The term "Contingent
Obligation" shall also include the liability of a general partner in
respect of the primary obligations of a partnership in which it is a
general partner. The amount of any Contingent Obligation of a Person shall
be deemed to be an amount equal to the principal amount of the primary
obligation in respect to which such Contingent Obligation is made.
"Indenture" means this instrument as originally executed and as it
may from time to time be supplemented or amended by one or more indentures
supplemental hereto entered into pursuant to the applicable provisions
hereof, including, for all purposes of this instrument and any such
supplemental indenture, the provisions of the Trust Indenture Act that are
deemed to be a part of and govern this instrument and any such supplemental
indenture, respectively. The term "Indenture" shall also include the terms
of particular series of Securities established as contemplated by
Section 301, provided, however, that, if at any time more than one Person
is acting as Trustee under this Indenture due to the appointment of one or
more separate Trustees for any one or more separate series of Securities
pursuant to Section 610, "Indenture" shall mean, with respect to such
series of Securities for which any such Person is Trustee, this instrument
as originally executed or as it may from time to time be supplemented or
amended by one or more indentures supplemental hereto entered into pursuant
to the applicable provisions hereof and shall include the terms of
particular series of Securities for which such Person is Trustee
established as contemplated by Section 301, exclusive, however, of any
provisions or terms which relate solely to other series of Securities for
which such Person is not Trustee, regardless of when such terms or
provisions were adopted, and exclusive of any provisions or terms adopted
by means of one or more indentures supplemental hereto executed and
delivered after such Person had become such Trustee but to which such
Person, as such Trustee, was not a party.
"interest", when used with respect to an Original Issue Discount
Security which by its terms bears interest only after Maturity, means
interest payable after Maturity.
"Interest Payment Date", when used with respect to any Security,
means the Stated Maturity of an instalment of interest on such Security.
"Investment Company Act" means the Investment Company Act of 1940
and any successor statute thereto, in each case as amended from time to
time.
<PAGE>
6
"Maturity", when used with respect to any Security, means the date
on which the principal of such Security or an instalment of principal
becomes due and payable as therein or herein provided, whether at the
Stated Maturity or by declaration of acceleration, call for redemption or
otherwise.
"Notice of Default" means a written notice of the kind specified in
Section 501(4) or 501(5).
"Officers' Certificate" means a certificate signed by the Chairman
of the Board, the President or a Senior Vice President, and by a Vice
President, the Treasurer, an Assistant Treasurer, the Secretary or an
Assistant Secretary, of the Company, and delivered to the Trustee. One of
the officers signing an Officers' Certificate given pursuant to
Section 1004 shall be the principal executive, financial or accounting
officer of the Company.
"Opinion of Counsel" means a written opinion of counsel, who may be
counsel for the Company, and who shall be acceptable to the Trustee.
"Original Issue Discount Security" means any Security which provides
for an amount less than the principal amount thereof to be due and payable
upon a declaration of acceleration of the Maturity thereof pursuant to Sec-
tion 502.
"Outstanding", when used with respect to Securities, means, as of
the date of determination, all Securities theretofore authenticated and
delivered under this Indenture, except:
(1) Securities theretofore cancelled by the Trustee or delivered
to the Trustee for cancellation;
(2) Securities for whose payment or redemption money in the
necessary amount has been theretofore deposited with the Trustee or
any Paying Agent (other than the Company) in trust or set aside and
segregated in trust by the Company (if the Company shall act as its
own Paying Agent) for the Holders of such Securities; provided that,
if such Securities are to be redeemed, notice of such redemption has
been duly given pursuant to this Indenture or provision therefor
satisfactory to the Trustee has been made;
(3) Securities as to which Defeasance has been effected pursuant
to Section 1302; and
(4) Securities which have been paid pursuant to Section 306 or
in exchange for or in lieu of which other Securities have been
authenticated and delivered pursuant to this Indenture, other than
any such Securities in respect of which there shall have been pre-
sented to the Trustee proof satisfactory to it that such Securities
are held by a bona fide purchaser in whose hands such Securities are
valid obligations of the Company;
<PAGE>
7
provided, however, that in determining whether the Holders of the requisite
principal amount of the Outstanding Securities of any Series have given,
made or taken any request, demand, authorization, direction, notice,
consent, waiver or other action provided or permitted by this Indenture to
be given, made or taken by Holders of Securities of such series, (A) the
principal amount of an Original Issue Discount Security that shall be
deemed to be Outstanding shall be the amount of the principal thereof that
would be due and payable as of the date of such determination upon
acceleration of the Maturity thereof to such date pursuant to Section 502,
(B) the principal amount of a Security denominated in one or more foreign
currencies or currency units which shall be deemed to be Outstanding shall
be the U.S. dollar equivalent, determined as of the date of original
issuance of such Security in the manner provided as contemplated by
Section 301, of the principal amount (or, in the case of an Original Issue
Discount Security, of the amount determined as provided in
Clause (A) above) of such Security, (C) if the principal amount payable at
Stated Maturity of any Security is not determinable upon original issuance,
the principal amount of such Security that shall be deemed to be
Outstanding shall be the amount as specified or determined as contemplated
by Section 301, and (D) Securities owned by the Company or any other
obligor upon the Securities or any Affiliate of the Company or of such
other obligor shall be disregarded and deemed not to be Outstanding, except
that, in determining whether the Trustee shall be protected in relying upon
any such request, demand, authorization, direction, notice, consent, waiver
or other action provided or permitted by this Indenture to be given, made
or taken by Holders of Securities of such series, only Securities which the
Trustee knows to be so owned shall be so disregarded. Securities so owned
which have been pledged in good faith may be regarded as Outstanding if the
pledgee establishes to the satisfaction of the Trustee the pledgee's right
so to act with respect to such Securities and that the pledgee is not the
Company or any other obligor upon the Securities or any Affiliate of the
Company or of such other obligor.
"Paying Agent" means any Person authorized by the Company to pay the
principal of or any premium or interest on any Securities on behalf of the
Company.
"Person" means any individual, corporation, partnership, joint
venture, trust, unincorporated organization or government or any agency or
political subdivision thereof.
"Place of Payment", when used with respect to the Securities of any
series, means the place or places where the principal of and any premium
and interest on the Securities of that series are payable as specified as
contemplated by Section 301.
"Predecessor Security" of any particular Security means every
previous Security evidencing all or a portion of the same debt as that
evidenced by such particular Security; and, for the purposes of this
definition, any Security authenticated and delivered under Section 306 in
exchange for or in lieu of a mutilated, destroyed, lost or stolen Security
shall be deemed to evidence the same debt as the mutilated, destroyed, lost
or stolen Security.
"Principal Property" shall mean the principal manufacturing
facilities owned by the Company or a Restricted Subsidiary located in the
United States, England or Ireland
<PAGE>
8
except such as the Board of Directors by resolution reasonably determines
(taking into account, among other things, the importance of such property
to the business, financial condition and earnings of the Company and its
consolidated subsidiaries taken as a whole) not to be a Principal Property
and except for (i) any and all personal property including, without
limitation, (x) motor vehicles and other rolling stock, and (y) office
furnishings and equipment and information and electronic data processing
equipment, (ii) any property financed through obligations issued by a
state, territory or possession of the United States, or any political
subdivision or instrumentality of the foregoing, or (iii) any real property
held for development or sale.
"Redemption Date", when used with respect to any Security to be
redeemed, means the date fixed for such redemption by or pursuant to this
Indenture.
"Redemption Price", when used with respect to any Security to be
redeemed, means the price at which it is to be redeemed pursuant to this
Indenture.
"Regular Record Date" for the interest payable on any Interest
Payment Date on the Securities of any series means the date specified for
that purpose as contemplated by Section 301.
"Responsible Officer", when used with respect to the Trustee, means
the chairman or any vice-chairman of the board of directors, the chairman
or any vice-chairman of the executive committee of the board of directors,
the chairman of the trust committee, the president, any vice president, the
secretary, any assistant secretary, the treasurer, any assistant treasurer,
the cashier, any assistant cashier, any senior trust officer, trust officer
or assistant trust officer, the controller or any assistant controller or
any other officer of the Trustee customarily performing functions similar
to those performed by any of the above designated officers and also means,
with respect to a particular corporate trust matter, any other officer to
whom such matter is referred because of his knowledge of and familiarity
with the particular subject.
"Restricted Subsidiary" means any consolidated Subsidiary that owns
any Principal Property.
"Securities" has the meaning stated in the first recital of this
Indenture and more particularly means any Securities authenticated and
delivered under this Indenture, provided, however, that if at any time
there is more than one Person acting as Trustee under this Indenture,
"Securities" when used with respect to a Person acting as Trustee under
this Indenture shall mean Securities authenticated and delivered under this
Indenture, exclusive, however, of Securities of any series as to which such
Person is not Trustee.
"Securities Act" means the Securities Act of 1933 and any statute
successor thereto, in each case as amended from time to time.
"Security Register" and "Security Registrar" have the respective
meanings specified in Section 305.
<PAGE>
9
"Special Record Date" for the payment of any Defaulted Interest
means a date fixed by the Trustee pursuant to Section 307.
"Stated Maturity", when used with respect to any Security or any
instalment of principal thereof or interest thereon, means the date
specified in such Security as the fixed date on which the principal of such
Security or such instalment of principal or interest is due and payable.
"Subsidiary" means a corporation more than 50% of the outstanding
voting stock of which is owned, directly or indirectly, by the Company or
by one or more other Subsidiaries, or by the Company and one or more other
Subsidiaries. For the purposes of this definition, "voting stock" means
stock which ordinarily has voting power for the election of directors,
whether at all times or only so long as no senior class of stock has such
voting power by reason of any contingency.
"Trustee" means the Person named as the "Trustee" in the first
paragraph of this instrument until a successor Trustee shall have become
such pursuant to the applicable provisions of this Indenture, and
thereafter "Trustee" shall mean or include each Person who is then a
Trustee hereunder, and if at any time there is more than one such Person,
"Trustee" as used with respect to the Securities of any series shall mean
the Trustee with respect to Securities of that series.
"Trust Indenture Act" means the Trust Indenture Act of 1939 as in
force at the date as of which this instrument was executed; provided,
however, that in the event the Trust Indenture Act of 1939 is amended after
such date, "Trust Indenture Act" means, to the extent required by any such
amendment, the Trust Indenture Act of 1939 as so amended.
"U.S. Government Obligation" has the meaning specified in
Section 1304.
"Vice President", when used with respect to the Company or the
Trustee, means any vice president, whether or not designated by a number or
a word or words added before or after the title "vice president".
SECTION 102. Compliance Certificates and Opinions.
Upon any application or request by the Company to the Trustee to
take any action under any provision of this Indenture, the Company shall
furnish to the Trustee such certificates and opinions as may be required
under the Trust Indenture Act. Each such certificate or opinion shall be
given in the form of an Officers' Certificate, if to be given by an officer
of the Company, or an Opinion of Counsel, if to be given by counsel, and
shall comply with the requirements of the Trust Indenture Act and any other
requirements set forth in this Indenture.
<PAGE>
10
Every certificate or opinion with respect to compliance with a
condition or covenant provided for in this Indenture (except for
certificates provided for in Section 1004) shall include,
(1) a statement that each individual signing such certificate or
opinion has read such covenant or condition and the definitions
herein relating thereto;
(2) a brief statement as to the nature and scope of the
examination or investigation upon which the statements or opinions
contained in such certificate or opinion are based;
(3) a statement that, in the opinion of each such individual, he
has made such examination or investigation as is necessary to enable
him to express an informed opinion as to whether or not such
covenant or condition has been complied with; and
(4) a statement as to whether, in the opinion of each such
individual, such condition or covenant has been complied with.
SECTION 103. Form of Documents Delivered to Trustee.
In any case where several matters are required to be certified by,
or covered by an opinion of, any specified Person, it is not necessary that
all such matters be certified by, or covered by the opinion of, only one
such Person, or that they be so certified or covered by only one document,
but one such Person may certify or give an opinion with respect to some
matters and one or more other such Persons as to other matters, and any
such Person may certify or give an opinion as to such matters in one or
several documents.
Any certificate or opinion of an officer of the Company may be
based, insofar as it relates to legal matters, upon a certificate or
opinion of, or representations by, counsel, unless such officer knows, or
in the exercise of reasonable care should know, that the certificate or
opinion or representations with respect to the matters upon which his
certificate or opinion is based are erroneous. Any such certificate or
opinion of counsel may be based, insofar as it relates to factual matters,
upon a certificate or opinion of, or representations by, an officer or
officers of the Company stating that the information with respect to such
factual matters is in the possession of the Company, unless such counsel
knows, or in the exercise of reasonable care should know, that the
certificate or opinion or representations with respect to such matters are
erroneous.
Where any Person is required to make, give or execute two or more
applications, requests, consents, certificates, statements, opinions or
other instruments under this Indenture, they may, but need not, be consoli-
dated and form one instrument.
<PAGE>
11
SECTION 104. Acts of Holders; Record Dates.
Any request, demand, authorization, direction, notice, consent,
waiver or other action provided or permitted by this Indenture to be given
or taken by Holders may be embodied in and evidenced by one or more
instruments of substantially similar tenor signed by such Holders in person
or by an 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 and, where it is hereby
expressly required, to the Company. Such instrument or instruments (and the
action embodied therein and evidenced thereby) are herein sometimes
referred to as the "Act" of the Holders signing such instrument or
instruments. Proof of execution of any such instrument or of a writing
appointing any such agent shall be sufficient for any purpose of this
Indenture and (subject to Section 601) conclusive in favor of the Trustee
and the Company, if made in the manner provided in this Section.
The fact and date of the execution by any Person of any such
instrument or writing may be proved by the affidavit of a witness of such
execution or by a certificate of a notary public or other officer
authorized by law to take acknowledgments of deeds, certifying that the
individual signing such instrument or writing acknowledged to him the
execution thereof. Where such execution is by a signer acting in a capacity
other than his individual capacity, such certificate or affidavit shall
also constitute sufficient proof of his authority. The fact and date of the
execution of any such instrument or writing, or the authority of the Person
executing the same, may also be proved in any other manner which the
Trustee deems sufficient.
The ownership of Securities shall be proved by the Security
Register.
Any request, demand, authorization, direction, notice, consent,
waiver or other Act of the Holder of any Security shall bind every future
Holder of the same Security and the Holder of every Security issued upon
the registration of transfer thereof or in exchange therefor or in lieu
thereof in respect of anything done, omitted or suffered to be done by the
Trustee or the Company in reliance thereon, whether or not notation of such
action is made upon such Security.
The Company may set any day as a record for the purpose of
determining the Holders of Outstanding Securities of any series entitled to
give, make or take any request, demand, authorization, direction, notice,
consent, waiver or other action provided or permitted by this Indenture to
be given, made or taken by Holders of Securities of such series, provided
that the Company may not set a record date for, and the provisions of this
paragraph shall not apply with respect to, the giving or making of (i) any
Notice of Default, (ii) any declaration of acceleration referred to in
Section 502, (iii) any request to institute proceedings referred to in
Section 507(2) or (iv) any direction referred to in Section 512. If any
record date is set pursuant to this paragraph, the Holders of Outstanding
Securities of the relevant series on such record date, and no other
Holders, shall be entitled to take the relevant action, whether or not such
Holders remain Holders after such record date; provided that no such action
shall be effective hereunder unless taken on or prior to the applicable
Expiration Date by Holders of the requisite principal
<PAGE>
12
amount of Outstanding Securities of such series on such record date; and
provided, further, that for the purpose of determining whether Holders of
the requisite principal amount of such Securities have taken such action,
no Security shall be deemed to have been Outstanding on such record date
unless it is also Outstanding on the date such action is to become
effective. Nothing in this paragraph shall be construed to prevent the
Company from setting a new record date for any action for which a record
date has previously been set pursuant to this paragraph (whereupon the
record date previously set shall automatically and with no action by any
Person be cancelled and of no effect), and nothing in this paragraph shall
be construed to render ineffective any action taken by Holders of the
requisite principal amount of Outstanding Securities of the relevant series
on the date such action is taken. Promptly after any record date is set
pursuant to this paragraph, the Company, at its own expense, shall cause
notice of such record date, the proposed action by Holders and the
applicable Expiration Date to be given to the Trustee in writing and to
each Holder of Securities of the relevant series in the manner set forth in
Section 106.
The Trustee may set any day as a record date for the purpose of
determining the Holders of Outstanding Securities of any series entitled to
join in the giving or making of (i) any Notice of Default, (ii) any
declaration or acceleration referred to in Section 502, (iii) any request
to institute proceedings referred to in Section 507(2) or (iv) any
direction referred to in Section 512, in each case with respect to
Securities of such series. If any record date is set pursuant to this
paragraph, the Holders of Outstanding Securities of such series on such
record date, and no other Holders, shall be entitled to join in such
notice, declaration, request or direction, whether or not such Holders
remain Holders after such record date; provided that no such action shall
be effective hereunder unless taken on or prior to the applicable
Expiration Date by Holders of the requisite principal amount of Outstanding
Securities of such series on such record date; and provided, further, that
for the purpose of determining whether Holders of the requisite principal
amount of such Securities have taken such action, no Security shall be
deemed to have been Outstanding on such record date unless it is also
Outstanding on the date such action is to become effective. Nothing in this
paragraph shall be construed to prevent the Trustee from setting a new
record date for any action for which a record date has previously been set
pursuant to this paragraph (whereupon the record date previously set shall
automatically and with no action by any Person be cancelled and of no
effect), and nothing in this paragraph shall be construed to render
ineffective any action taken by Holders of the requisite principal amount
of Outstanding Securities of the relevant series on the date such action is
taken. Promptly after any record date is set pursuant to this paragraph,
the Trustee, at the Company's expense, shall cause notice of such record
date, the proposed action by Holders and the applicable Expiration Date to
be given to the Company in writing and to each Holder of Securities of the
relevant series in the manner set forth in Section 106.
With respect to any record date set pursuant to this Section, the
party hereto which sets such record date may designate any day as the
"Expiration Date" and from time to time may change the Expiration Date to
any earlier or later day; provided that no such change shall be effective
unless notice of the proposed new Expiration Date is given to the other
party hereto in writing, and to each Holder of Securities of the relevant
series
<PAGE>
13
in the manner set forth in Section 106, on or prior to the existing
Expiration Date. Notwithstanding the foregoing, no Expiration Date shall be
later than the 180th day after the applicable record date and, if an
Expiration Date is not designated with respect to any record date set
pursuant to this Section, the party hereto which set such record date shall
be deemed to have designated the 180th day after such record date as the
Expiration Date with respect thereto.
Without limiting the foregoing, a Holder entitled hereunder to take
any action hereunder with regard to any particular Security may do so with
regard to all or any part of the principal amount of such Security or by
one or more duly appointed agents each of which may do so pursuant to such
appointment with regard to all or any part of such principal amount.
SECTION 105. Notices, Etc., to Trustee and Company.
Any request, demand, authorization, direction, notice, consent,
waiver or Act of Holders or other document provided or permitted by this
Indenture to be made upon, given or furnished to, or filed with,
(1) the Trustee by any Holder or by the Company shall be
sufficient for every purpose hereunder if made, given, furnished or
filed in writing to or with the Trustee at its Corporate Trust
Office, Attention: Corporate Trust Administration, or
(2) the Company by the Trustee or by any Holder shall be
sufficient for every purpose hereunder (unless otherwise herein
expressly provided) if in writing and mailed, first-class postage
prepaid, to the Company addressed to it at the address of its
principal office specified in the first paragraph of this instrument
or at any other address previously furnished in writing to the
Trustee by the Company.
SECTION 106. Notice to Holders; Waiver.
Where this Indenture provides for notice to Holders of any event,
such notice shall be sufficiently given (unless otherwise herein expressly
provided) if in writing and mailed, first-class postage prepaid, to each
Holder affected by such event, at his address as it appears in the Security
Register, not later than the latest date (if any), and not earlier than the
earliest date (if any), prescribed for the giving of such notice. In any
case where notice to Holders is given by mail, neither the failure to mail
such notice, nor any defect in any notice so mailed, to any particular
Holder shall affect the sufficiency of such notice with respect to other
Holders. Where this Indenture provides for notice in any manner, such
notice may be waived in writing by the Person entitled to receive such
notice, either before or after the event, and such waiver shall be the
equivalent of such notice. Waivers of notice by Holders shall be filed with
the Trustee, but such filing shall
<PAGE>
14
not be a condition precedent to the validity of any action taken in
reliance upon such waiver.
In case by reason of the suspension of regular mail service or by
reason of any other cause it shall be impracticable to give such notice by
mail, then such notification as shall be made with the approval of the
Trustee shall constitute a sufficient notification for every purpose
hereunder.
SECTION 107. Conflict with Trust Indenture Act.
If any provision hereof limits, qualifies or conflicts with a
provision of the Trust Indenture Act which is required under such Act to be
a part of and govern this Indenture, the latter provision shall control. If
any provision of this Indenture modifies or excludes any provision of the
Trust Indenture Act which may be so modified or excluded, the latter
provision shall be deemed to apply to this Indenture as so modified or to
be excluded, as the case may be.
SECTION 108. Effect of Headings and Table of Contents.
The Article and Section headings herein and the Table of Contents
are for convenience only and shall not affect the construction hereof.
SECTION 109. Successors and Assigns.
All covenants and agreements in this Indenture by the Company shall
bind its successors and assigns, whether so expressed or not.
SECTION 110. Separability Clause.
In case any provision in this Indenture or in the Securities shall
be invalid, illegal or unenforceable, the validity, legality and
enforceability of the remaining provisions shall not in any way be affected
or impaired thereby.
SECTION 111. Benefits of Indenture.
Nothing in this Indenture or in the Securities, express or implied,
shall give to any Person, other than the parties hereto and their
successors hereunder and the Holders, any benefit or any legal or equitable
right, remedy or claim under this Indenture.
<PAGE>
15
SECTION 112. Governing Law.
This Indenture and the Securities shall be governed by and construed
in accordance with the laws of the State of New York.
SECTION 113. Legal Holidays.
In any case where any Interest Payment Date, Redemption Date or
Stated Maturity of any Security shall not be a Business Day at any Place of
Payment, then (notwithstanding any other provision of this Indenture or of
the Securities (other than a provision of any Security which specifically
states that such provision shall apply in lieu of this Section)) payment of
interest or principal (and premium, if any) need not be made at such Place
of Payment on such date, but may be made on the next succeeding Business
Day at such Place of Payment with the same force and effect as if made on
the Interest Payment Date or Redemption Date, or at the Stated Maturity.
ARTICLE TWO
SECURITY FORMS
SECTION 201. Forms Generally.
The Securities of each series shall be in substantially the form set
forth in this Article, or in such other form as shall be established by or
pursuant to a Board Resolution or in one or more indentures supplemental
hereto, in each case with such appropriate insertions, omissions, sub-
stitutions and other variations as are required or permitted by this
Indenture, and may have such letters, numbers or other marks of
identification and such legends or endorsements placed thereon as may be
required to comply with the rules of any securities exchange or Depository
therefor or as may, consistently herewith, be determined by the officers
executing such Securities, as evidenced by their execution thereof. If the
form of Securities of any series is established by action taken pursuant to
a Board Resolution, a copy of an appropriate record of such action shall be
certified by the Secretary or an Assistant Secretary of the Company and
delivered to the Trustee at or prior to the delivery of the Company Order
contemplated by Section 303 for the authentication and delivery of such
Securities.
The definitive Securities shall be printed, lithographed or engraved
on steel engraved borders or may be produced in any other manner, all as
determined by the officers executing such Securities, as evidenced by their
execution of such Securities.
<PAGE>
16
SECTION 202. Form of Face of Security.
[Insert any legend required by the Internal Revenue Code and the
regulations thereunder.]
.................................
............................................
No. ......... $ ........
Tambrands Inc., a corporation duly organized and existing under the
laws of the State of Delaware (herein called the "Company", which term
includes any successor Person under the Indenture hereinafter referred to),
for value received, hereby promises to pay to
..............................................., or registered assigns, the
principal sum of ...................................... Dollars on
............................ ........................... [if the Security
is to bear interest prior to Maturity, insert -- , and to pay interest
thereon from ............. or from the most recent Interest Payment Date to
which interest has been paid or duly provided for, semi-annually on
............ and ............ in each year, commencing ........., at the
rate of ....% per annum, until the principal hereof is paid or made
available for payment [if applicable, insert -- , provided that any
principal and premium, and any such instalment of interest, which is
overdue shall bear interest at the rate of ...% per annum (to the extent
that the payment of such interest shall be legally enforceable), from the
dates such amounts are due until they are paid or made available for
payment, and such interest shall be payable on demand]. The interest so
payable, and punctually paid or duly provided for, on any Interest Payment
Date will, as provided in such Indenture, be paid to the Person in whose
name this Security (or one or more Predecessor Securities) is registered at
the close of business on the Regular Record Date for such interest, which
shall be the ....... or ....... (whether or not a Business Day), as the
case may be, next preceding such Interest Payment Date. Any such interest
not so punctually paid or duly provided for will forthwith cease to be
payable to the Holder on such Regular Record Date and may either be paid to
the Person in whose name this Security (or one or more Predecessor
Securities) is registered at the close of business on a Special Record Date
for the payment of such Defaulted Interest to be fixed by the Trustee,
notice whereof shall be given to Holders of Securities of this series not
less than 10 days prior to such Special Record Date, or be paid at any time
in any other lawful manner not inconsistent with the requirements of any
securities exchange on which the Securities of this series may be listed,
and upon such notice as may be required by such exchange, all as more fully
provided in said Indenture].
[If the Security is not to bear interest prior to Maturity, insert -- The
principal of this Security shall not bear interest except in the case of a
default in payment of principal upon acceleration, upon redemption or at
Stated Maturity and in such case the overdue principal and any overdue
premium shall bear interest at the rate of ....% per annum (to the extent
that the payment of such interest shall be legally enforceable), from the
dates such amounts are due until they are paid or made available for
payment. Interest on any overdue principal or premium shall be payable on
demand. [Any such interest on overdue
<PAGE>
17
principal or permium which is not paid on demand shall bear interest at the
rate of ...% per annum (to the extent that the payment of such interest on
interest shall be legally enforceable), from the date of such demand until
the amount so demanded is paid or made available for payment. Interest on
any overdue interest shall be payable on demand.]]
Payment of the principal of (and premium, if any) and [if
applicable, insert -- any such] interest on this Security will be made at
the office or agency of the Company maintained for that purpose in
............, in such coin or currency of the United States of America as
at the time of payment is legal tender for payment of public and private
debts [if applicable, insert -- ; provided, however, that at the option of
the Company payment of interest may be made by check mailed to the address
of the Person entitled thereto as such address shall appear in the Security
Register].
Reference is hereby made to the further provisions of this Security
set forth on the reverse hereof, which further provisions shall for all
purposes have the same effect as if set forth at this place.
Unless the certificate of authentication hereon has been executed by
the Trustee referred to on the reverse hereof by manual signature, this
Security shall not be entitled to any benefit under the Indenture or be
valid or obligatory for any purpose.
IN WITNESS WHEREOF, the Company has caused this instrument to be
duly executed under its corporate seal.
Dated:
TAMBRANDS INC.
By...................................................
Attest:
.........................................
SECTION 203. Form of Reverse of Security.
This Security is one of a duly authorized issue of securities of the
Company (herein called the "Securities"), issued and to be issued in one
or more series under an Indenture, dated as of _______ __, 1993 (herein
called the "Indenture", which term shall have the meaning assigned to it in
such instrument), between the Company and Citibank, N.A., as Trustee
(herein called the "Trustee", which term includes any successor trustee
under the Indenture), and reference is hereby made to the Indenture for a
statement of the respective rights, limitations of rights, duties and
immunities thereunder of the Company, the Trustee and the Holders of the
Securities and of the terms upon which the
<PAGE>
18
Securities are, and are to be, authenticated and delivered. This Security
is one of the series designated on the face hereof [if applicable,
insert--, limited in aggregate principal amount to $...........].
[If applicable, insert -- The Securities of this series are subject
to redemption upon not less than 30 days' notice by mail, [if applicable,
insert -- (1) on ........... in any year commencing with the year ......
and ending with the year ...... through operation of the sinking fund for
this series at a Redemption Price equal to 100% of the principal amount,
and (2)] at any time [if applicable, insert -- on or after ..........,
19..], as a whole or in part, at the election of the Company, at the
following Redemption Prices (expressed as percentages of the principal
amount): If redeemed [if applicable, insert -- on or before
..............., ...%, and if redeemed] during the 12-month period begin-
ning ............. of the years indicated,
Redemption Redemption
Year Price Year Price
and thereafter at a Redemption Price equal to .....% of the principal
amount, together in the case of any such redemption [if applicable,
insert -- (whether through operation of the sinking fund or otherwise)]
with accrued interest to the Redemption Date, but interest instalments
whose Stated Maturity is on or prior to such Redemption Date will be
payable to the Holders of such Securities, or one or more Predecessor
Securities, of record at the close of business on the relevant Record Dates
referred to on the face hereof, all as provided in the Indenture.]
[If applicable, insert -- The Securities of this series are subject
to redemption upon not less than 30 days' notice by mail, (1) on
............ in any year commencing with the year .... and ending with the
year .... through operation of the sinking fund for this series at the
Redemption Prices for redemption through operation of the sinking fund
(expressed as percentages of the principal amount) set forth in the table
below, and (2) at any time [if applicable, insert -- on or after
............], as a whole or in part, at the election of the Company, at
the Redemption Prices for redemption otherwise than through
<PAGE>
19
operation of the sinking fund (expressed as percentages of the principal
amount): If redeemed [if applicable, insert -- on or before ......, ....%,
and if redeemed] during the 12-month period beginning ............ of the
years indicated,
Redemption Price
For Redemption Redemption Price For
Through Operation Redemption Otherwise
of the Than Through Operation
Year Sinking Fund of the Sinking Fund
and thereafter at a Redemption Price equal to .....% of the principal
amount, together in the case of any such redemption (whether through
operation of the sinking fund or otherwise) with accrued interest to the
Redemption Date, but interest instalments whose Stated Maturity is on or
prior to such Redemption Date will be payable to the Holders of such
Securities, or one or more Predecessor Securities, of record at the close
of business on the relevant Record Dates referred to on the face hereof,
all as provided in the Indenture.]
[If applicable, insert -- Notwithstanding the foregoing, the Company
may not, prior to ............., redeem any Securities of this series as
contemplated by [if applicable, insert -- Clause (2) of] the preceding
paragraph as a part of, or in anticipation of, any refunding operation by
the application, directly or indirectly, of moneys borrowed having an
interest cost to the Company (calculated in accordance with generally
accepted financial practice) of less than .....% per annum.]
[If applicable, insert -- The sinking fund for this series provides
for the redemption on ............ in each year beginning with the year
....... and ending with the year ...... of [if applicable, insert -- not
less than $.......... ("mandatory sinking fund") and not more than]
$......... aggregate principal amount of Securities of this series.
Securities of this series acquired or redeemed by the Company otherwise
than through [if applicable, insert -- mandatory] sinking fund payments may
be credited against subsequent [if applicable, insert -- mandatory] sinking
fund payments otherwise required to be made [if applicable, insert -- , in
the inverse order in which they become due].]
<PAGE>
20
[If the Security is subject to redemption of any kind, insert -- In
the event of redemption of this Security in part only, a new Security or
Securities of this series and of like tenor for the unredeemed portion
hereof will be issued in the name of the Holder hereof upon the cancella-
tion hereof.]
[If applicable, insert -- The Indenture contains provisions for
defeasance at any time of [the entire indebtedness of this Security] [or]
[certain restrictive covenants and Events of Default with respect to this
Security] [, in each case] upon compliance with certain conditions set
forth in the Indenture.]
[If the Security is not an Original Issue Discount Security,
insert -- If an Event of Default with respect to Securities of this series
shall occur and be continuing, the principal of the Securities of this
series may be declared due and payable in the manner and with the effect
provided in the Indenture.]
[If the Security is an Original Issue Discount Security, insert --
If an Event of Default with respect to Securities of this series shall
occur and be continuing, an amount of principal of the Securities of this
series may be declared due and payable in the manner and with the effect
provided in the Indenture. Such amount shall be equal to -- insert formula
for determining the amount. Upon payment (i) of the amount of principal so
declared due and payable and (ii) of interest on any overdue principal,
premium and interest (in each case to the extent that the payment of such
interest shall be legally enforceable), all of the Company's obligations in
respect of the payment of the principal of and premium and interest, if
any, on the Securities of this series shall terminate.]
The Indenture permits, with certain exceptions as therein provided,
the amendment thereof and the modification of the rights and obligations of
the Company and the rights of the Holders of the Securities of each series
to be affected under the Indenture at any time by the Company and the
Trustee with the consent of the Holders of 66 2/3% in principal amount of
the Securities at the time Outstanding of each series to be affected. The
Indenture also contains provisions permitting the Holders of specified
percentages in principal amount of the Securities of each series at the
time Outstanding, on behalf of the Holders of all Securities of such
series, to waive compliance by the Company with certain provisions of the
Indenture and certain past defaults under the Indenture and their
consequences. Any such consent or waiver by the Holder of this Security
shall be conclusive and binding upon such Holder and upon all future
Holders of this Security and of any Security issued upon the registration
of transfer hereof or in exchange herefor or in lieu hereof, whether or not
notation of such consent or waiver is made upon this Security.
As provided in and subject to the provisions of the Indenture, the
Holder of this Security shall not have the right to institute any
proceeding with respect to the Indenture or for the appointment of a
receiver or trustee or for any other remedy thereunder, unless such Holder
shall have previously given the Trustee written notice of a continuing
Event of Default with respect to the Securities of this series, the Holders
of not less than 25% in principal amount of the Securities of this series
at the time Outstanding shall have made written request to the Trustee to
institute proceedings in respect of such Event of
<PAGE>
21
Default as Trustee and offered the Trustee reasonable indemnity, and the
Trustee shall not have received from the Holders of a majority in principal
amount of Securities of this series at the time Outstanding a direction
inconsistent with such request, and shall have failed to institute any such
proceeding, for 60 days after receipt of such notice, request and offer of
indemnity. The foregoing shall not apply to any suit instituted by the
Holder of this Security for the enforcement of any payment of principal
hereof or any premium or interest hereon on or after the respective due
dates expressed herein.
No reference herein to the Indenture and no provision of this
Security or of the Indenture shall alter or impair the obligation of the
Company, which is absolute and unconditional, to pay the principal of and
any premium and interest on this Security at the times, place and rate, and
in the coin or currency, herein prescribed.
As provided in the Indenture and subject to certain limitations
therein set forth, the transfer of this Security is registrable in the
Security Register, upon surrender of this Security for registration of
transfer at the office or agency of the Company in any place where the
principal of and any premium and interest on this Security are payable,
duly endorsed by, or accompanied by a written instrument of transfer in
form satisfactory to the Company and the Security Registrar duly executed
by, the Holder hereof or his attorney duly authorized in writing, and
thereupon one or more new Securities of this series and of like tenor, of
authorized denominations and for the same aggregate principal amount, will
be issued to the designated transferee or transferees.
The Securities of this series are issuable only in registered form
without coupons in denominations of $....... and any integral multiple
thereof. As provided in the Indenture and subject to certain limitations
therein set forth, Securities of this series are exchangeable for a like
aggregate principal amount of Securities of this series and of like tenor
of a different authorized denomination, as requested by the Holder
surrendering the same.
No service charge shall be made for any such registration of
transfer or exchange, but the Company may require payment of a sum
sufficient to cover any tax or other governmental charge payable in
connection therewith.
Prior to due presentment of this Security for registration of
transfer, the Company, the Trustee and any agent of the Company or the
Trustee may treat the Person in whose name this Security is registered as
the owner hereof for all purposes, whether or not this Security be overdue,
and neither the Company, the Trustee nor any such agent shall be affected
by notice to the contrary.
All terms used in this Security which are defined in the Indenture
shall have the meanings assigned to them in the Indenture.
<PAGE>
22
SECTION 204. Form of Legend for Global Securities.
Unless otherwise specified as contemplated by Section 301 for the
Securities evidenced thereby, every Global Security authenticated and
delivered hereunder shall bear a legend in substantially the following
form:
THIS SECURITY IS A GLOBAL SECURITY WITHIN THE MEANING OF THE INDENTURE
HEREINAFTER REFERRED TO AND IS REGISTERED IN THE NAME OF A DEPOSITARY OR A
NOMINEE THEREOF. THIS SECURITY MAY NOT BE EXCHANGED IN WHOLE OR IN PART FOR
A SECURITY REGISTERED, AND NO TRANSFER OF THIS SECURITY IN WHOLE OR IN PART
MAY BE REGISTERED, IN THE NAME OF ANY PERSON OTHER THAN SUCH DEPOSITARY OR
A NOMINEE THEREOF, EXCEPT IN THE LIMITED CIRCUMSTANCES DESCRIBED IN THE
INDENTURE.
SECTION 205. Form of Trustee's Certificate of Authentication.
The Trustee's certificates of authentication shall be in
substantially the following form:
This is one of the Securities of the series designated therein referred
to in the within-mentioned Indenture.
Citibank, N.A.
As Trustee
By.........................................
Authorized Signatory
ARTICLE THREE
THE SECURITIES
SECTION 301. Amount Unlimited; Issuable in Series.
The aggregate principal amount of Securities which may be
authenticated and delivered under this Indenture is unlimited.
The Securities may be issued in one or more series. There shall be
established in or pursuant to a Board Resolution and, subject to
Section 303, set forth, or determined
<PAGE>
23
in the manner provided, in an Officers' Certificate, or established in one
or more indentures supplemental hereto, prior to the issuance of Securities
of any series,
(1) the title of the Securities of the series (which shall
distinguish the Securities of the series from Securities of any
other series);
(2) any limit upon the aggregate principal amount of the
Securities of the series which may be authenticated and delivered
under this Indenture (except for Securities authenticated and
delivered upon registration of transfer of, or in exchange for, or
in lieu of, other Securities of the series pursuant to Section 304,
305, 306, 906 or 1107 and except for any Securities which, pursuant
to Section 303, are deemed never to have been authenticated and
delivered hereunder);
(3) the Person to whom any interest on a Security of the series
shall be payable, if other than the Person in whose name that
Security (or one or more Predecessor Securities) is registered at
the close of business on the Regular Record Date for such interest;
(4) the date or dates on which the principal of any Securities
of the series is payable;
(5) the rate or rates at which any Securities of the series
shall bear interest, if any, the date or dates from which any such
interest shall accrue, the Interest Payment Dates on which any such
interest shall be payable and the Regular Record Date for any such
interest payable on any Interest Payment Date;
(6) the place or places where the principal of and any premium
and interest on any Securities of the series shall be payable;
(7) the period or periods within which, the price or prices at
which and the terms and conditions upon which any Securities of the
series may be redeemed, in whole or in part, at the option of the
Company and, if other than by a Board Resolution, the manner in
which any election by the Company to redeem the Securities shall be
evidenced;
(8) the obligation, if any, of the Company to redeem or
purchase any Securities of the series pursuant to any sinking fund
or analogous provisions or at the option of a Holder thereof and the
period or periods within which, the price or prices at which and the
terms and conditions upon which any Securities of the series shall
be redeemed or purchased, in whole or in part, pursuant to such
obligation;
(9) if other than denominations of $1,000 and any integral
multiple thereof, the denominations in which any Securities of the
series shall be issuable;
<PAGE>
24
(10) if the amount of principal of or any premium or interest on
any Securities of the series may be determined with reference to an
index or pursuant to a formula, the manner in which such amounts
shall be determined;
(11) if other than the currency of the United States of America,
the currency, currencies or currency units in which the principal of
or any premium or interest on any Securities of the series shall be
payable and any manner of determining the equivalent thereof in the
currency of the United States of America, including for purposes of
the definition of "Outstanding" in Section 101;
(12) if the principal of or any premium or interest on any
Securities of the series is to be payable, at the election of the
Company or the Holder thereof, in one or more currencies or currency
units other than that or those in which the Securities are stated to
be payable, the currency, currencies or currency units in which the
principal of or any premium or interest on such Securities as to
which such election is made shall be payable, and the periods within
which and the terms and conditions upon which such election is to be
made and the amount so payable (or the manner in which such amount
shall be determined);
(13) if other than the principal amount thereof, the portion of
the principal amount of any Securities of the series which shall be
payable upon declaration of acceleration of the Maturity thereof
pursuant to Section 502;
(14) if the principal amount payable at the Stated Maturity of
any Securities of the series is not determinable upon original
issuance thereof, the amount which shall be deemed to be the
principal amount of such Securities for any other purpose thereunder
or hereunder, including the principal amount thereof which shall be
due and payable upon any Maturity other than the Stated Maturity or
which shall be deemed to be Outstanding as of any date (or, in any
such case, any manner in which such principal amount shall be
determined);
(15) if applicable, that the Securities of the series, in whole
or any specified part, shall be defeasible pursuant to Section 1302
or Section 1303 or both such Sections and, if other than by a Board
Resolution, the manner in which any election by the Company to
defease such Securities shall be evidenced;
(16) if applicable, that any Securities of the series shall be
issuable in whole or in part in the form of one or more Global
Securities and, in such case, the respective Depositaries for such
Global Securities, the form of any legend or legends which shall be
borne by any such Global Security in addition to or in lieu of that
set forth in Section 204 and, any circumstances in addition to or in
lieu of those set forth in Clause (2) of the last paragraph of
Section 305 in which any such Global Security may be exchanged in
whole or in part for Securities registered on any transfer of such
Global Security in whole or in part
<PAGE>
25
may be registered in the name or names of Persons other than the
Depositary for such Global Security or a nominee thereof;
(17) any addition to or change in the Events of Default which
applies to any Securities of the series and any change in the right
of the Trustee or the requisite Holders of such Securities to
declare the principal amount thereof due and payable pursuant to
Section 502;
(18) any addition to or change in the covenants set forth in
Article Ten which applies to Securities of the series; and
(19) any other terms of the series (which terms shall not be
inconsistent with the provisions of this Indenture, except as
permitted by Section 901(5)).
All Securities of any one series shall be substantially identical
except as to denomination and except as may otherwise be provided in or
pursuant to the Board Resolution referred to above and (subject to
Section 303) set forth, or determined in the manner provided, in the
Officers' Certificate referred to above or in any such indenture
supplemental hereto.
If any of the terms of the series are established by action taken
pursuant to a Board Resolution, a copy of an appropriate record of such
action shall be certified by the Secretary or an Assistant Secretary of the
Company and delivered to the Trustee at or prior to the delivery of the
Officers' Certificate setting forth the terms of the series.
SECTION 302. Denominations.
The Securities of each series shall be issuable only in registered
form without coupons and only in such denominations as shall be specified
as contemplated by Section 301. In the absence of any such specified
denomination with respect to the Securities of any series, the Securities
of such series shall be issuable in denominations of $1,000 and any
integral multiple thereof.
SECTION 303. Execution, Authentication, Delivery and Dating.
The Securities shall be executed on behalf of the Company by its
Chairman of the Board, its President or one of its Senior Vice Presidents,
under its corporate seal reproduced thereon attested by its Secretary or
one of its Assistant Secretaries. The signature of any of these officers on
the Securities may be manual or facsimile.
Securities bearing the manual or facsimile signatures of individuals
who were at any time the proper officers of the Company shall bind the
Company, notwithstanding that such individuals or any of them have ceased
to hold such offices prior to the authentication and delivery of such
Securities or did not hold such offices at the date of such Securities.
<PAGE>
26
At any time and from time to time after the execution and delivery
of this Indenture, the Company may deliver Securities of any series
executed by the Company to the Trustee for authentication, together with a
Company Order for the authentication and delivery of such Securities, and
the Trustee in accordance with the Company Order shall authenticate and
deliver such Securities. If the form or terms of the Securities of the
series have been established by or pursuant to one or more Board
Resolutions as permitted by Sections 201 and 301, in authenticating such
Securities, and accepting the additional responsibilities under this
Indenture in relation to such Securities, the Trustee shall be entitled to
receive, and (subject to Section 601) shall be fully protected in relying
upon, an Opinion of Counsel stating,
(1) if the form of such Securities has been established by or
pursuant to a Board Resolution as permitted by Section 201, that
such form has been established in conformity with the provisions of
this Indenture;
(2) if the terms of such Securities have been established by or
pursuant to a Board Resolution as permitted by Section 301, that
such terms have been established in conformity with the provisions
of this Indenture; and
(3) that such Securities, when authenticated and delivered by
the Trustee and issued by the Company in the manner and subject to
any conditions specified in such Opinion of Counsel, will constitute
valid and legally binding obligations of the Company enforceable in
accordance with their terms, subject to bankruptcy, insolvency,
fraudulent transfer, reorganization, moratorium and similar laws of
general applicability relating to or affecting creditors' rights and
to general equity principles.
If such form or terms have been so established, the Trustee shall not be
required to authenticate such Securities if the issue of such Securities
pursuant to this Indenture will affect the Trustee's own rights, duties or
immunities under the Securities and this Indenture or otherwise in a manner
which is not reasonably acceptable to the Trustee.
Notwithstanding the provisions of Section 301 and of the preceding
paragraph, if all Securities of a series are not to be originally issued at
one time, it shall not be necessary to deliver the Officers' Certificate
otherwise required pursuant to Section 301 or the Company Order and Opinion
of Counsel otherwise required pursuant to such preceding paragraph at or
prior to the authentication of each Security of such series if such
documents are delivered at or prior to the authentication upon original
issuance of the first Security of such series to be issued.
Each Security shall be dated the date of its authentication.
No Security shall be entitled to any benefit under this Indenture or
be valid or obligatory for any purpose unless there appears on such
Security a certificate of authentication substantially in the form provided
for herein executed by the Trustee by manual signature, and such certif-
icate upon any Security shall be conclusive evidence, and the only
evidence, that such Security has been duly authenticated and delivered
<PAGE>
27
hereunder. Notwithstanding the foregoing, if any Security shall have been
authenticated and delivered hereunder but never issued and sold by the
Company, and the Company shall deliver such Security to the Trustee for
cancellation as provided in Section 309, for all purposes of this Indenture
such Security shall be deemed never to have been authenticated and
delivered hereunder and shall never be entitled to the benefits of this
Indenture.
SECTION 304. Temporary Securities.
Pending the preparation of definitive Securities of any series, the
Company may execute, and upon Company Order the Trustee shall authenticate
and deliver, temporary Securities which are printed, lithographed,
typewritten, mimeographed or otherwise produced, in any authorized denom-
ination, substantially of the tenor of the definitive Securities in lieu of
which they are issued and with such appropriate insertions, omissions,
substitutions and other variations as the officers executing such
Securities may determine, as evidenced by their execution of such
Securities.
If temporary Securities of any series are issued, the Company will
cause definitive Securities of that series to be prepared without
unreasonable delay. After the preparation of definitive Securities of such
series, the temporary Securities of such series shall be exchangeable for
definitive Securities of such series upon surrender of the temporary
Securities of such series at the office or agency of the Company in a Place
of Payment for that series, without charge to the Holder. Upon surrender
for cancellation of any one or more temporary Securities of any series the
Company shall execute and the Trustee shall authenticate and deliver in
exchange therefor one or more definitive Securities of the same series, of
any authorized denominations and of like tenor and aggregate principal
amount. Until so exchanged the temporary Securities of any series shall in
all respects be entitled to the same benefits under this Indenture as
definitive Securities of such series and tenor.
SECTION 305. Registration, Registration of Transfer and Exchange.
The Company shall cause to be kept at the Corporate Trust Office of
the Trustee a register (the register maintained in such office and in any
other office or agency of the Company in a Place of Payment being herein
sometimes collectively referred to as the "Security Register") in which,
subject to such reasonable regulations as it may prescribe, the Company
shall provide for the registration of Securities and of transfers of
Securities. The Trustee is hereby appointed "Security Registrar" for the
purpose of registering Securities and transfers of Securities as herein
provided.
Upon surrender for registration of transfer of any Security of a
series at the office or agency of the Company in a Place of Payment for
that series, the Company shall execute, and the Trustee shall authenticate
and deliver, in the name of the designated transferee or transferees, one
or more new Securities of the same series, of any authorized denominations
and of like tenor and aggregate principal amount.
<PAGE>
28
At the option of the Holder, Securities of any series may be
exchanged for other Securities of the same series, of any authorized
denominations and of like tenor and aggregate principal amount, upon sur-
render of the Securities to be exchanged at such office or agency. Whenever
any Securities are so surrendered for exchange, the Company shall execute,
and the Trustee shall authenticate and deliver, the Securities which the
Holder making the exchange is entitled to receive.
All Securities issued upon any registration of transfer or exchange
of Securities shall be the valid obligations of the Company, evidencing the
same debt, and entitled to the same benefits under this Indenture, as the
Securities surrendered upon such registration of transfer or exchange.
Every Security presented or surrendered for registration of transfer
or for exchange shall (if so required by the Company or the Trustee) be
duly endorsed, or be accompanied by a written instrument of transfer in
form satisfactory to the Company and the Security Registrar duly executed,
by the Holder thereof or his attorney duly authorized in writing.
No service charge shall be made for any registration of transfer or
exchange of Securities, but the Company may require payment of a sum
sufficient to cover any tax or other governmental charge that may be
imposed in connection with any registration of transfer or exchange of
Securities, other than exchanges pursuant to Section 304, 906 or 1107 not
involving any transfer.
In the event of any redemption, in whole or in part, of Securities
of any series (or of any series and specified tenor), the Company shall not
be required (A) to issue, register the transfer of or exchange Securities
of that series (or of that series and specified tenor, as the case may be)
during a period beginning at the opening of business 15 days before the day
of the mailing of a notice of redemption of any such Securities and ending
at the close of business on the day of such mailing, or (B) to register the
transfer of or exchange any Security so selected for redemption in whole or
in part, except the unredeemed portion of any Security being redeemed in
part.
The provisions of Clauses (1), (2), (3) and (4) below shall apply
only to Global Securities:
(1) Each Global Security authenticated under this Indenture
shall be registered in the name of the Depositary designated for
such Global Security or a nominee thereof and delivered to such
Depositary or a nominee thereof or custodian therefor, and each such
Global Security shall constitute a single Security for all purposes
of this Indenture.
(2) Notwithstanding any other provision in this Indenture, no
Global Security may be exchanged for Securities registered, and no
transfer of a Global Security in whole or in part may be registered,
in the name of any Person other than the Depositary for such Global
Security or a nominee thereof unless (A) such Depositary (i) has
notified the Company that it is unwilling or unable to
<PAGE>
29
continue as Depositary for such Global Security or (ii) has ceased
to be a clearing agency registered under the Exchange Act, (B) there
shall have occurred and be continuing an Event of Default with
respect to such Global Security or (C) there shall exist such
circumstances, if any, or in lieu of the foregoing as have been
specified for this purpose as contemplated by Section 301.
(3) Subject to Clause (2) above, any exchange of a Global
Security for other Securities may be made in whole or in part, and
all Securities issued in exchange for a Global Security or any
portion thereof shall be registered in such names as the Depositary
for such Global Security shall direct.
(4) Every Security authenticated and delivered upon
registration of transfer of, or in exchange for or in lieu of, a
Global Security or any portion thereof, whether pursuant to this
Section, Section 304, 306, 906 or 1107 or otherwise, shall be
authenticated and delivered in the form of, and shall be, a Global
Security, unless such Security is registered in the name of a Person
other than the Depositary for such Global Security or a nominee
thereof.
SECTION 306. Mutilated, Destroyed, Lost and Stolen Securities.
If any mutilated Security is surrendered to the Trustee, the Company
shall execute and the Trustee shall authenticate and deliver in exchange
therefor a new Security of the same series and of like tenor and principal
amount and bearing a number not contemporaneously outstanding.
If there shall be delivered to the Company and the Trustee
(i) evidence to their satisfaction of the destruction, loss or theft of any
Security and (ii) such security or indemnity as may be required by them to
save each of them and any agent of either of them harmless, then, in the
absence of notice to the Company or the Trustee that such Security has been
acquired by a bona fide purchaser, the Company shall execute and the
Trustee shall authenticate and deliver, in lieu of any such destroyed, lost
or stolen Security, a new Security of the same series and of like tenor and
principal amount and bearing a number not contemporaneously outstanding.
In case any such mutilated, destroyed, lost or stolen Security has
become or is about to become due and payable, the Company in its discretion
may, instead of issuing a new Security, pay such Security.
Upon the issuance of any new Security under this Section, the
Company may require the payment of a sum sufficient to cover any tax or
other governmental charge that may be imposed in relation thereto and any
other expenses (including the fees and expenses of the Trustee) connected
therewith.
Every new Security of any series issued pursuant to this Section in
lieu of any destroyed, lost or stolen Security shall constitute an original
additional contractual
<PAGE>
30
obligation of the Company, whether or not the destroyed, lost or stolen
Security shall be at any time enforceable by anyone, and shall be entitled
to all the benefits of this Indenture equally and proportionately with any
and all other Securities of that series duly issued hereunder.
The provisions of this Section are exclusive and shall preclude (to
the extent lawful) all other rights and remedies with respect to the
replacement or payment of mutilated, destroyed, lost or stolen Securities.
SECTION 307. Payment of Interest; Interest Rights Preserved.
Except as otherwise provided as contemplated by Section 301 with
respect to any series of Securities, interest on any Security which is
payable, and is punctually paid or duly provided for, on any Interest Pay-
ment Date shall be paid to the Person in whose name that Security (or one
or more Predecessor Securities) is registered at the close of business on
the Regular Record Date for such interest.
Any interest on any Security of any series which is payable, but is
not punctually paid or duly provided for, on any Interest Payment Date
(herein called "Defaulted Interest") shall forthwith cease to be payable to
the Holder on the relevant Regular Record Date by virtue of having been
such Holder, and such Defaulted Interest may be paid by the Company, at its
election in each case, as provided in Clause (1) or (2) below:
(1) The Company may elect to make payment of any Defaulted
Interest to the Persons in whose names the Securities of such series
(or their respective Predecessor Securities) are registered at the
close of business on a Special Record Date for the payment of such
Defaulted Interest, which shall be fixed in the following manner.
The Company shall notify the Trustee in writing of the amount of
Defaulted Interest proposed to be paid on each Security of such
series and the date of the proposed payment, and at the same time
the Company shall deposit with the Trustee an amount of money equal
to the aggregate amount proposed to be paid in respect of such
Defaulted Interest or shall make arrangements satisfactory to the
Trustee for such deposit prior to the date of the proposed payment,
such money when deposited to be held in trust for the benefit of the
Persons entitled to such Defaulted Interest as in this Clause
provided. Thereupon the Trustee shall fix a Special Record Date for
the payment of such Defaulted Interest which shall be not more than
15 days and not less than 10 days prior to the date of the proposed
payment and not less than 10 days after the receipt by the Trustee
of the notice of the proposed payment. The Trustee shall promptly
notify the Company of such Special Record Date and, in the name and
at the expense of the Company, shall cause notice of the proposed
payment of such Defaulted Interest and the Special Record Date
therefor to be given to each Holder of Securities of such series in
the manner set forth in Section 106, not less than 10 days prior to
such Special Record Date. Notice of the proposed payment of such
Defaulted Interest and the Special Record Date therefor having been
so mailed, such Defaulted Interest shall be paid to the
<PAGE>
31
Persons in whose names the Securities of such series (or their
respective Predecessor Securities) are registered at the close of
business on such Special Record Date and shall no longer be payable
pursuant to the following Clause (2).
(2) The Company may make payment of any Defaulted Interest on
the Securities of any series in any other lawful manner not incon-
sistent with the requirements of any securities exchange on which
such Securities may be listed, and upon such notice as may be
required by such exchange, if, after notice given by the Company to
the Trustee of the proposed payment pursuant to this Clause, such
manner of payment shall be deemed practicable by the Trustee.
Subject to the foregoing provisions of this Section, each Security
delivered under this Indenture upon registration of transfer of or in
exchange for or in lieu of any other Security shall carry the rights to
interest accrued and unpaid, and to accrue, which were carried by such
other Security.
SECTION 308. Persons Deemed Owners.
Prior to due presentment of a Security for registration of transfer,
the Company, the Trustee and any agent of the Company or the Trustee may
treat the Person in whose name such Security is registered as the owner of
such Security for the purpose of receiving payment of principal of and any
premium and (subject to Section 307) any interest on such Security and for
all other purposes whatsoever, whether or not such Security be overdue, and
neither the Company, the Trustee nor any agent of the Company or the
Trustee shall be affected by notice to the contrary.
SECTION 309. Cancellation.
All Securities surrendered for payment, redemption, registration of
transfer or exchange or for credit against any sinking fund payment shall,
if surrendered to any Person other than the Trustee, be delivered to the
Trustee and shall be promptly cancelled by it. The Company may at any time
deliver to the Trustee for cancellation any Securities previously
authenticated and delivered hereunder which the Company may have acquired
in any manner whatsoever, and may deliver to the Trustee (or to any other
Person for delivery to the Trustee) for cancellation any Securities
previously authenticated hereunder which the Company has not issued and
sold, and all Securities so delivered shall be promptly cancelled by the
Trustee. No Securities shall be authenticated in lieu of or in exchange for
any Securities cancelled as provided in this Section, except as expressly
permitted by this Indenture. All cancelled Securities held by the Trustee
shall be destroyed by the Trustee and a certificate of destruction
furnished to the Company.
<PAGE>
32
SECTION 310. Computation of Interest.
Except as otherwise specified as contemplated by Section 301 for
Securities of any series, interest on the Securities of each series shall
be computed on the basis of a 360-day year of twelve 30-day months.
ARTICLE FOUR
SATISFACTION AND DISCHARGE
SECTION 401. Satisfaction and Discharge of Indenture.
This Indenture shall upon Company Request cease to be of further
effect (except as to any surviving rights of registration of transfer or
exchange of Securities herein expressly provided for), and the Trustee, at
the expense of the Company, shall execute proper instruments acknowledging
satisfaction and discharge of this Indenture, when
(1) either
(A) all Securities theretofore authenticated and delivered (other
than (i) Securities which have been destroyed, lost or stolen and which
have been replaced or paid as provided in Section 306 and (ii) Securi-
ties for whose payment money has theretofore been deposited in trust or
segregated and held in trust by the Company and thereafter repaid to
the Company or discharged from such trust, as provided in Section 1003)
have been delivered to the Trustee for cancellation; or
(B) all such Securities not theretofore delivered to the Trustee
for cancellation
(i) have become due and payable, or
(ii) will become due and payable at their Stated Maturity within
one year, or
(iii) are to be called for redemption within one year under
arrangements satisfactory to the Trustee for the giving of notice of
redemption by the Trustee in the name, and at the expense, of the
Company,
and the Company, in the case of (i), (ii) or (iii) above, has deposited
or caused to be deposited with the Trustee as trust funds in trust for
the purpose money in an amount sufficient to pay and discharge the
entire indebtedness on such Securities not theretofore delivered to the
Trustee for cancellation, for principal and any premium and interest to
the date of such deposit (in the case of Securities which have become
due and payable) or to the Stated Maturity or Redemption Date, as the
case may be;
(2) the Company has paid or caused to be paid all other sums
payable hereunder by the Company; and
<PAGE>
33
(3) the Company has delivered to the Trustee an Officers'
Certificate and an Opinion of Counsel, each stating that all conditions
precedent herein provided for relating to the satisfaction and
discharge of this Indenture have been complied with.
Notwithstanding the satisfaction and discharge of this Indenture,
the obligations of the Company to the Trustee under Section 607, the
obligations of the Trustee to any Authenticating Agent under Section 614
and, if money shall have been deposited with the Trustee pursuant to
subclause (B) of Clause (1) of this Section, the obligations of the Trustee
under Section 402 and the last paragraph of Section 1003 shall survive.
SECTION 402. Application of Trust Money.
Subject to provisions of the last paragraph of Section 1003, all
money deposited with the Trustee pursuant to Section 401 shall be held in
trust and applied by it, in accordance with the provisions of the
Securities and this Indenture, to the payment, either directly or through
any Paying Agent (including the Company acting as its own Paying Agent) as
the Trustee may determine, to the Persons entitled thereto, of the
principal and any premium and interest for whose payment such money has
been deposited with the Trustee.
ARTICLE FIVE
REMEDIES
SECTION 501. Events of Default.
"Event of Default", wherever used herein with respect to Securities
of any series, means any one of the following events (whatever the reason
for such Event of Default and whether it shall be voluntary or involuntary
or be effected by operation of law or pursuant to any judgment, decree or
order of any court or any order, rule or regulation of any administrative
or governmental body):
(1) default in the payment of any interest upon any Security of
that series when it becomes due and payable, and continuance of such
default for a period of 30 days; or
(2) default in the payment of the principal of or any premium on
any Security of that series at its Maturity; or
(3) default in the deposit of any sinking fund payment, when and as
due by the terms of a Security of that series; or
(4) default in the performance, or breach, of any covenant or
warranty of the Company in this Indenture (other than a covenant or
warranty a default in whose performance or whose breach is elsewhere in
this Section specifically dealt with or
<PAGE>
34
which has expressly been included in this Indenture solely for the
benefit of series of Securities other than that series), and
continuance of such default or breach for a period of 90 days after
there has been given, by registered or certified mail, to the Company
by the Trustee or to the Company and the Trustee by the Holders of at
least 25% in principal amount of the Outstanding Securities of that
series a written notice specifying such default or breach and requiring
it to be remedied and stating that such notice is a "Notice of Default"
hereunder; or
(5) a default under any bond, debenture, note or other evidence of
indebtedness for money borrowed by the Company (including a default
with respect to Securities of any series other than that series) having
an aggregate principal amount outstanding of at least $50,000,000, or
under any mortgage, indenture or instrument (including this Indenture)
under which there may be issued or by which there may be secured or
evidenced any indebtedness for money borrowed by the Company having an
aggregate principal amount outstanding of at least $50,000,000, whether
such indebtedness now exists or shall hereafter be created, which
default shall have resulted in such indebtedness becoming or being
declared due and payable prior to the date on which it would otherwise
have become due and payable, without such indebtedness having been
discharged or such acceleration having been cured, waived, rescinded or
annulled, within a period of 30 days after there shall have been given,
by registered or certified mail, return receipt requested, to the
Company by the Trustee or to the Company and the Trustee by the Holders
of at least 25% in principal amount of the Outstanding Securities of
that series a written notice specifying such default and requiring the
Company to cause such indebtedness to be discharged or cause such
acceleration to be rescinded or annulled, as the case may be, and
stating that such notice is a "Notice of Default" hereunder; provided,
however, that, subject to the provisions of Sections 601 and 602, the
Trustee shall not be deemed to have knowledge of such default unless
either (A) a Responsible Officer of the Trustee shall have actual
knowledge of such default or (B) the Trustee shall have received
written notice thereof from the Company, from any Holder, from the
holder of any such indebtedness or from the trustee under any such
mortgage, indenture or other instrument; and provided, further,
however, that if any such default or acceleration referred to in this
clause (5) shall cease or be cured, waived, rescinded or annulled, then
the Event of Default hereunder by reason thereof shall be deemed
likewise to have been thereupon cured; or
(6) the entry by a court having jurisdiction in the premises of
(A) a decree or order for relief in respect of the Company in an
involuntary case or proceeding under any applicable Federal or State
bankruptcy, insolvency, reorganization or other similar law or (B) a
decree or order adjudging the Company a bankrupt or insolvent, or
approving as properly filed a petition seeking reorganization,
arrangement, adjustment or composition of or in respect of the Company
under any applicable Federal or State law, or appointing a custodian,
receiver, liquidator, assignee, trustee, sequestrator or other similar
official of the Company or of any substantial part of its property, or
ordering the winding up or liquidation of its affairs, and the
continuance of any such decree or order for relief or any such other
decree or order unstayed and in effect for a period of 60 consecutive
days; or
<PAGE>
35
(7) the commencement by the Company of a voluntary case or
proceeding under any applicable Federal or State bankruptcy,
insolvency, reorganization or other similar law or of any other case or
proceeding to be adjudicated a bankrupt or insolvent, or the consent by
it to the entry of a decree or order for relief in respect of the
Company in an involuntary case or proceeding under any applicable
Federal or State bankruptcy, insolvency, reorganization or other
similar law or to the commencement of any bankruptcy or insolvency case
or proceeding against it, or the filing by it of a petition or answer
or consent seeking reorganization or relief under any applicable
Federal or State law, or the consent by it to the filing of such peti-
tion or to the appointment of or taking possession by a custodian,
receiver, liquidator, assignee, trustee, sequestrator or other similar
official of the Company or of any substantial part of its property, or
the making by it of an assignment for the benefit of creditors, or the
admission by it in writing of its inability to pay its debts generally
as they become due, or the taking of corporate action by the Company in
furtherance of any such action; or
(8) any other Event of Default provided with respect to Securities
of that series.
SECTION 502. Acceleration of Maturity; Rescission and Annulment.
If an Event of Default with respect to Securities of any series at
the time Outstanding occurs and is continuing, then in every such case the
Trustee or the Holders of not less than 25% in principal amount of the
Outstanding Securities of that series may declare the principal amount (or,
if any of the Securities of that series are Original Issue Discount
Securities, such portion of the principal amount of such Securities as may
be specified in the terms thereof) of all of the Securities of that series
to be due and payable immediately, by a notice in writing to the Company
(and to the Trustee if given by Holders), and upon any such declaration
such principal amount (or specified amount) shall become immediately due
and payable.
At any time after such a declaration of acceleration with respect to
Securities of any series has been made and before a judgment or decree for
payment of the money due has been obtained by the Trustee as hereinafter in
this Article provided, the Holders of a majority in principal amount of the
Outstanding Securities of that series, by written notice to the Company and
the Trustee, may rescind and annul such declaration and its consequences if
(1) the Company has paid or deposited with the Trustee a sum
sufficient to pay
(A) all overdue interest on all Securities of that series,
(B) the principal of (and premium, if any, on) any Securities of
that series which have become due otherwise than by such declaration
of acceleration and any interest thereon at the rate or rates
prescribed therefor in such Securities,
<PAGE>
36
(C) to the extent that payment of such interest is lawful,
interest upon overdue interest at the rate or rates prescribed
therefor in such Securities, and
(D) all sums paid or advanced by the Trustee hereunder and the
reasonable compensation, expenses, disbursements and advances of the
Trustee, its agents and counsel;
and
(2) all Events of Default with respect to Securities of that
series, other than the non-payment of the principal of Securities of
that series which have become due solely by such declaration of
acceleration, have been cured or waived as provided in Section 513.
No such rescission shall affect any subsequent default or impair any right
consequent thereon.
SECTION 503. Collection of Indebtedness and Suits for Enforcement by
Trustee.
The Company covenants that if
(1) default is made in the payment of any interest on any Security
when such interest becomes due and payable and such default continues
for a period of 30 days, or
(2) default is made in the payment of the principal of (or
premium, if any, on) any Security at the Maturity thereof,
the Company will, upon demand of the Trustee, pay to it, for the benefit of
the Holders of such Securities, the whole amount then due and payable on
such Securities for principal and any premium and interest and, to the
extent that payment of such interest shall be legally enforceable, interest
on any overdue principal and premium and on any overdue interest, at the
rate or rates prescribed therefor in such Securities, and, in addition
thereto, such further amount as shall be sufficient to cover the costs and
expenses of collection, including the reasonable compensation, expenses,
disbursements and advances of the Trustee, its agents and counsel.
If an Event of Default with respect to Securities of any series
occurs and is continuing, the Trustee may in its discretion proceed to
protect and enforce its rights and the rights of the Holders of Securities
of such series by such appropriate judicial proceedings as the Trustee
shall deem most effectual to protect and enforce any such rights, whether
for the specific enforcement of any covenant or agreement in this Indenture
or in aid of the exercise of any power granted herein, or to enforce any
other proper remedy.
<PAGE>
37
SECTION 504. Trustee May File Proofs of Claim.
In case of any judicial proceeding relative to the Company (or any
other obligor upon the Securities), its property or its creditors, the
Trustee shall be entitled and empowered, by intervention in such proceeding
or otherwise, to take any and all actions authorized under the Trust
Indenture Act in order to have claims of the Holders and the Trustee
allowed in any such proceeding. In particular, the Trustee shall be
authorized to collect and receive any moneys or other property payable or
deliverable on any such claims and to distribute the same; and any
custodian, receiver, assignee, trustee, liquidator, sequestrator or other
similar official in any such judicial proceeding is hereby authorized by
each Holder to make such payments to the Trustee and, in the event that the
Trustee shall consent to the making of such payments directly to the
Holders, to pay to the Trustee any amount due it for the reasonable
compensation, expenses, disbursements and advances of the Trustee, its
agents and counsel, and any other amounts due the Trustee under
Section 607.
No provision of this Indenture shall be deemed to authorize the
Trustee to authorize or consent to or accept or adopt on behalf of any
Holder any plan of reorganization, arrangement, adjustment or composition
affecting the Securities or the rights of any Holder thereof or to
authorize the Trustee to vote in respect of the claim of any Holder in any
such proceeding; provided, however, that the Trustee may, on behalf of the
Holders, vote for the election of a trustee in bankruptcy or similar
official and be a member of a creditors' or other similar committee.
SECTION 505. Trustee May Enforce Claims Without Possession of Securities.
All rights of action and claims under this Indenture or the
Securities may be prosecuted and enforced by the Trustee without the
possession of any of the Securities or the production thereof in any
proceeding relating thereto, and any such proceeding instituted by the
Trustee shall be brought in its own name as trustee of an express trust,
and any recovery of judgment shall, after provision for the payment of the
reasonable compensation, expenses, disbursements and advances of the
Trustee, its agents and counsel, be for the ratable benefit of the Holders
of the Securities in respect of which such judgment has been recovered.
SECTION 506. Application of Money Collected.
Any money collected by the Trustee pursuant to this Article shall be
applied in the following order, at the date or dates fixed by the Trustee
and, in case of the distribution of such money on account of principal or
any premium or interest, upon presentation of the Securities and the
notation thereon of the payment if only partially paid and upon surrender
thereof if fully paid:
FIRST: To the payment of all amounts due the Trustee under
Section 607; and
<PAGE>
38
SECOND: To the payment of the amounts then due and unpaid for
principal of and any premium and interest on the Securities in respect
of which or for the benefit of which such money has been collected,
ratably, without preference or priority of any kind, according to the
amounts due and payable on such Securities for principal and any
premium and interest, respectively.
SECTION 507. Limitation on Suits.
No Holder of any Security of any series shall have any right to
institute any proceeding, judicial or otherwise, with respect to this
Indenture, or for the appointment of a receiver or trustee, or for any
other remedy hereunder, unless
(1) such Holder has previously given written notice to the Trustee
of a continuing Event of Default with respect to the Securities of that
series;
(2) the Holders of not less than 25% in principal amount of the
Outstanding Securities of that series shall have made written request
to the Trustee to institute proceedings in respect of such Event of
Default in its own name as Trustee hereunder;
(3) such Holder or Holders have offered to the Trustee reasonable
indemnity against the costs, expenses and liabilities to be incurred in
compliance with such request;
(4) the Trustee for 60 days after its receipt of such notice,
request and offer of indemnity has failed to institute any such
proceeding; and
(5) no direction inconsistent with such written request has been
given to the Trustee during such 60-day period by the Holders of a
majority in principal amount of the Outstanding Securities of that
series;
it being understood and intended that no one or more of such Holders shall
have any right in any manner whatever by virtue of, or by availing of, any
provision of this Indenture to affect, disturb or prejudice the rights of
any other of such Holders, or to obtain or to seek to obtain priority or
preference over any other of such Holders or to enforce any right under
this Indenture, except in the manner herein provided and for the equal and
ratable benefit of all of such Holders.
SECTION 508. Unconditional Right of Holders to Receive Principal, Premium
and Interest.
Notwithstanding any other provision in this Indenture, the Holder of
any Security shall have the right, which is absolute and unconditional, to
receive payment of the principal of and any premium and (subject to
Section 307) interest on such Security on the respective Stated Maturities
expressed in such Security (or, in the case of redemption,
<PAGE>
39
on the Redemption Date) and to institute suit for the enforcement of any
such payment, and such rights shall not be impaired without the consent of
such Holder.
SECTION 509. Restoration of Rights and Remedies.
If the Trustee or any Holder has instituted any proceeding to
enforce any right or remedy under this Indenture and such proceeding has
been discontinued or abandoned for any reason, or has been determined
adversely to the Trustee or to such Holder, then and in every such case,
subject to any determination in such proceeding, the Company, the Trustee
and the Holders shall be restored severally and respectively to their
former positions hereunder and thereafter all rights and remedies of the
Trustee and the Holders shall continue as though no such proceeding had
been instituted.
SECTION 510. Rights and Remedies Cumulative.
Except as otherwise provided with respect to the replacement or
payment of mutilated, destroyed, lost or stolen Securities in the last
paragraph of Section 306, no right or remedy herein conferred upon or
reserved to the Trustee or to the Holders is intended to be exclusive of
any other right or remedy, and every right and remedy shall, to the extent
permitted by law, be cumulative and in addition to every other right and
remedy given hereunder or now or hereafter existing at law or in equity or
otherwise. The assertion or employment of any right or remedy hereunder, or
otherwise, shall not prevent the concurrent assertion or employment of any
other appropriate right or remedy.
SECTION 511. Delay or Omission Not Waiver.
No delay or omission of the Trustee or of any Holder of any
Securities to exercise any right or remedy accruing upon any Event of
Default shall impair any such right or remedy or constitute a waiver of any
such Event of Default or an acquiescence therein. Every right and remedy
given by this Article or by law to the Trustee or to the Holders may be
exercised from time to time, and as often as may be deemed expedient, by
the Trustee or by the Holders, as the case may be.
SECTION 512. Control by Holders.
The Holders of a majority in principal amount of the Outstanding
Securities of any series shall have the right to direct the time, method
and place of conducting any proceeding for any remedy available to the
Trustee, or exercising any trust or power conferred on the Trustee, with
respect to the Securities of such series, provided that
(1) such direction shall not be in conflict with any rule of law or
with this Indenture, and
<PAGE>
40
(2) the Trustee may take any other action deemed proper by the
Trustee which is not inconsistent with such direction.
SECTION 513. Waiver of Past Defaults.
The Holders of not less than a majority in principal amount of the
Outstanding Securities of any series may on behalf of the Holders of all
the Securities of such series waive any past default hereunder with respect
to such series and its consequences, except a default
(1) in the payment of the principal of or any premium or interest
on any Security of such series, or
(2) in respect of a covenant or provision hereof which under
Article Nine cannot be modified or amended without the consent of the
Holder of each Outstanding Security of such series affected.
Upon any such waiver, such default shall cease to exist, and any
Event of Default arising therefrom shall be deemed to have been cured, for
every purpose of this Indenture; but no such waiver shall extend to any
subsequent or other default or impair any right consequent thereon.
SECTION 514. Undertaking for Costs.
In any suit for the enforcement of any right or remedy under this
Indenture, or in any suit against the Trustee for any action taken,
suffered or omitted by it as Trustee, a court may require any party
litigant in such suit to file an undertaking to pay the costs of such suit,
and may assess costs against any such party litigant, in the manner and to
the extent provided in the Trust Indenture Act; provided that neither this
Section nor the Trust Indenture Act shall be deemed to authorize any court
to require such an undertaking or to make such an assessment in any suit
instituted by the Company.
SECTION 515. Waiver of Usury, Stay or Extension Laws.
The Company covenants (to the extent that it may lawfully do so)
that it will not at any time insist upon, or plead, or in any manner
whatsoever claim or take the benefit or advantage of, any usury, stay or
extension law wherever enacted, now or at any time hereafter in force,
which may affect the covenants or the performance of this Indenture; and
the Company (to the extent that it may lawfully do so) hereby expressly
waives all benefit or advantage of any such law and covenants that it will
not hinder, delay or impede the execution of any power herein granted to
the Trustee, but will suffer and permit the execution of every such power
as though no such law had been enacted.
<PAGE>
41
ARTICLE SIX
THE TRUSTEE
SECTION 601. Certain Duties and Responsibilities.
The duties and responsibilities of the Trustee shall be as provided
by the Trust Indenture Act. Notwithstanding the foregoing, no provision of
this Indenture shall require the Trustee to expend or risk its own funds or
otherwise incur any financial liability in the performance of any of its
duties hereunder, or in the exercise of any of its rights or powers, if it
shall have reasonable grounds for believing that repayment of such funds or
adequate indemnity against such risk or liability is not reasonably assured
to it. Whether or not therein expressly so provided, every provision of
this Indenture relating to the conduct or affecting the liability of or
affording protection to the Trustee shall be subject to the provisions of
this Section.
SECTION 602. Notice of Defaults.
If a default occurs hereunder with respect to Securities of any
series, the Trustee shall give the Holders of Securities of such series
notice of such default as and to the extent provided by the Trust Indenture
Act; provided, however, that in the case of any default of the character
specified in Section 501(4) with respect to Securities of such series, no
such notice to Holders shall be given until at least 30 days after the
occurrence thereof. For the purpose of this Section, the term "default"
means any event which is, or after notice or lapse of time or both would
become, an Event of Default with respect to Securities of such series.
SECTION 603. Certain Rights of Trustee.
Subject to the provisions of Section 601:
(1) the Trustee may rely and shall be protected in acting or
refraining from acting upon any resolution, certificate, statement,
instrument, opinion, report, notice, request, direction, consent,
order, bond, debenture, note, other evidence of indebtedness or other
paper or document believed by it to be genuine and to have been signed
or presented by the proper party or parties;
(2) any request or direction of the Company mentioned herein shall
be sufficiently evidenced by a Company Request or Company Order, and
any resolution of the Board of Directors may be sufficiently evidenced
by a Board Resolution;
(3) whenever in the administration of this Indenture the Trustee
shall deem it desirable that a matter be proved or established prior to
taking, suffering or omitting any action hereunder, the Trustee (unless
other evidence be herein specifically
<PAGE>
42
prescribed) may, in the absence of bad faith on its part, rely upon an
Officers' Certificate;
(4) the Trustee may consult with counsel and the written advice of
such counsel or any Opinion of Counsel shall be full and complete
authorization and protection in respect of any action taken, suffered
or omitted by it hereunder in good faith and in reliance thereon;
(5) the Trustee shall be under no obligation to exercise any of the
rights or powers vested in it by this Indenture at the request or
direction of any of the Holders pursuant to this Indenture, unless such
Holders shall have offered to the Trustee reasonable security or
indemnity against the costs, expenses and liabilities which might be
incurred by it in compliance with such request or direction;
(6) the Trustee shall not be bound to make any investigation into
the facts or matters stated in any resolution, certificate, statement,
instrument, opinion, report, notice, request, direction, consent,
order, bond, debenture, note, other evidence of indebtedness or other
paper or document, but the Trustee, in its discretion, may make such
further inquiry or investigation into such facts or matters as it may
see fit, and, if the Trustee shall determine to make such further
inquiry or investigation, it shall be entitled to examine the books,
records and premises of the Company, personally or by agent or
attorney; and
(7) the Trustee may execute any of the trusts or powers hereunder
or perform any duties hereunder either directly or by or through agents
or attorneys and the Trustee shall not be responsible for any
misconduct or negligence on the part of any agent or attorney appointed
with due care by it hereunder.
SECTION 604. Not Responsible for Recitals or Issuance of Securities.
The recitals contained herein and in the Securities, except the
Trustee's certificates of authentication, shall be taken as the statements
of the Company, and neither the Trustee nor any Authenticating Agent
assumes any responsibility for their correctness. The Trustee makes no
representations as to the validity or sufficiency of this Indenture or of
the Securities. Neither the Trustee nor any Authenticating Agent shall be
accountable for the use or application by the Company of Securities or the
proceeds thereof.
SECTION 605. May Hold Securities.
The Trustee, any Authenticating Agent, any Paying Agent, any
Security Registrar or any other agent of the Company, in its individual or
any other capacity, may become the owner or pledgee of Securities and,
subject to Sections 608 and 613, may otherwise deal with the Company with
the same rights it would have if it were not Trustee, Authenticating Agent,
Paying Agent, Security Registrar or such other agent.
<PAGE>
43
SECTION 606. Money Held in Trust.
Money held by the Trustee in trust hereunder need not be segregated
from other funds except to the extent required by law. The Trustee shall be
under no liability for interest on any money received by it hereunder
except as otherwise agreed with the Company.
SECTION 607. Compensation and Reimbursement.
The Company agrees
(1) to pay to the Trustee from time to time reasonable compensation
for all services rendered by it hereunder (which compensation shall not
be limited by any provision of law in regard to the compensation of a
trustee of an express trust);
(2) except as otherwise expressly provided herein, to reimburse the
Trustee upon its request for all reasonable expenses, disbursements and
advances incurred or made by the Trustee in accordance with any provi-
sion of this Indenture (including the reasonable compensation and the
expenses and disbursements of its agents and counsel), except any such
expense, disbursement or advance as may be attributable to its negli-
gence or bad faith; and
(3) to indemnify the Trustee for, and to hold it harmless against,
any loss, liability or expense incurred without negligence or bad faith
on its part, arising out of or in connection with the acceptance or
administration of the trust or trusts hereunder, including the costs
and expenses of defending itself against any claim or liability in
connection with the exercise or performance of any of its powers or
duties hereunder.
SECTION 608. Conflicting Interests.
If the Trustee has or shall acquire a conflicting interest within
the meaning of the Trust Indenture Act, the Trustee shall either eliminate
such interest or resign, to the extent and in the manner provided by, and
subject to the provisions of, the Trust Indenture Act and this Indenture.
To the extent permitted by such Act, the Trustee shall not be deemed to
have a conflicting interest by virtue of being a trustee under this
Indenture with respect to Securities of more than one series.
SECTION 609. Corporate Trustee Required; Eligibility.
There shall at all times be one (and only one) Trustee hereunder
with respect to the Securities of each series, which may be the Trustee
hereunder for Securities of one or more other series. Each Trustee shall
be a Person that is eligible pursuant to the Trust
<PAGE>
44
Indenture Act to act as such has a combined capital and surplus of at least
$50,000,000 and has its Corporate Trust Office in [the Borough of Manhattan
in] The City of New York. If such Person publishes reports of condition at
least annually, pursuant to law or to the requirements of its supervising
or examining authority, then for the purposes of this Section and to the
extent permitted by the Trust Indenture Act, the combined capital and
surplus of such Person shall be deemed to be its combined capital and
surplus as set forth in its most recent report of condition so published.
If at any time the Trustee with respect to the Securities of any series
shall cease to be eligible in accordance with the provisions of this
Section, it shall resign immediately in the manner and with the effect
hereinafter specified in this Article.
SECTION 610. Resignation and Removal; Appointment of Successor.
No resignation or removal of the Trustee and no appointment of a
successor Trustee pursuant to this Article shall become effective until the
acceptance of appointment by the successor Trustee in accordance with the
applicable requirements of Section 611.
The Trustee may resign at any time with respect to the Securities of
one or more series by giving written notice thereof to the Company. If the
instrument of acceptance by a successor Trustee required by Section 611
shall not have been delivered to the Trustee within 30 days after the
giving of such notice of resignation, the resigning Trustee may petition
any court of competent jurisdiction for the appointment of a successor
Trustee with respect to the Securities of such series.
The Trustee may be removed at any time with respect to the
Securities of any series by Act of the Holders of a majority in principal
amount of the Outstanding Securities of such series, delivered to the
Trustee and to the Company.
If at any time:
(1) the Trustee shall fail to comply with Section 608 after written
request therefor by the Company or by any Holder who has been a bona
fide Holder of a Security for at least six months, or
(2) the Trustee shall cease to be eligible under Section 609 and
shall fail to resign after written request therefor by the Company or
by any such Holder, or
(3) the Trustee shall become incapable of acting or shall be
adjudged a bankrupt or insolvent or a receiver of the Trustee or of its
property shall be appointed or any public officer shall take charge or
control of the Trustee or of its property or affairs for the purpose of
rehabilitation, conservation or liquidation,
then, in any such case, (A) the Company by a Board Resolution may remove
the Trustee with respect to all Securities, or (B) subject to Section 514,
any Holder who has been a bona fide Holder of a Security for at least six
months may, on behalf of himself and all others similarly situated,
petition any court of competent jurisdiction for the removal of
<PAGE>
45
the Trustee with respect to all Securities and the appointment of a
successor Trustee or Trustees.
If the Trustee shall resign, be removed or become incapable of
acting, or if a vacancy shall occur in the office of Trustee for any cause,
with respect to the Securities of one or more series, the Company, by a
Board Resolution, shall promptly appoint a successor Trustee or Trustees
with respect to the Securities of that or those series (it being understood
that any such successor Trustee may be appointed with respect to the
Securities of one or more or all of such series and that at any time there
shall be only one Trustee with respect to the Securities of any particular
series) and shall comply with the applicable requirements of Section 611.
If, within one year after such resignation, removal or incapability, or the
occurrence of such vacancy, a successor Trustee with respect to the Secu-
rities of any series shall be appointed by Act of the Holders of a majority
in principal amount of the Outstanding Securities of such series delivered
to the Company and the retiring Trustee, the successor Trustee so appointed
shall, forthwith upon its acceptance of such appointment in accordance with
the applicable requirements of Section 611, become the successor Trustee
with respect to the Securities of such series and to that extent supersede
the successor Trustee appointed by the Company. If no successor Trustee
with respect to the Securities of any series shall have been so appointed
by the Company or the Holders and accepted appointment in the manner
required by Section 611, any Holder who has been a bona fide Holder of a
Security of such series for at least six months may, on behalf of himself
and all others similarly situated, petition any court of competent juris-
diction for the appointment of a successor Trustee with respect to the
Securities of such series.
The Company shall give notice of each resignation and each removal
of the Trustee with respect to the Securities of any series and each
appointment of a successor Trustee with respect to the Securities of any
series to all Holders of Securities of such series in the manner provided
in Section 106. Each notice shall include the name of the successor Trustee
with respect to the Securities of such series and the address of its
Corporate Trust Office.
SECTION 611. Acceptance of Appointment by Successor.
In case of the appointment hereunder of a successor Trustee with
respect to all Securities, every such successor Trustee so appointed shall
execute, acknowledge and deliver to the Company and to the retiring Trustee
an instrument accepting such appointment, and thereupon the resignation or
removal of the retiring Trustee shall become effective and such successor
Trustee, without any further act, deed or conveyance, shall become vested
with all the rights, powers, trusts and duties of the retiring Trustee;
but, on the request of the Company or the successor Trustee, such retiring
Trustee shall, upon payment of its charges, execute and deliver an
instrument transferring to such successor Trustee all the rights, powers
and trusts of the retiring Trustee and shall duly assign, transfer and
deliver to such successor Trustee all property and money held by such
retiring Trustee hereunder.
<PAGE>
46
In case of the appointment hereunder of a successor Trustee with
respect to the Securities of one or more (but not all) series, the Company,
the retiring Trustee and each successor Trustee with respect to the
Securities of one or more series shall execute and deliver an indenture
supplemental hereto wherein each successor Trustee shall accept such
appointment and which (1) shall contain such provisions as shall be
necessary or desirable to transfer and confirm to, and to vest in, each
successor Trustee all the rights, powers, trusts and duties of the retiring
Trustee with respect to the Securities of that or those series to which the
appointment of such successor Trustee relates, (2) if the retiring Trustee
is not retiring with respect to all Securities, shall contain such
provisions as shall be deemed necessary or desirable to confirm that all
the rights, powers, trusts and duties of the retiring Trustee with respect
to the Securities of that or those series as to which the retiring Trustee
is not retiring shall continue to be vested in the retiring Trustee, and
(3) shall add to or change any of the provisions of this Indenture as shall
be necessary to provide for or facilitate the administration of the trusts
hereunder by more than one Trustee, it being understood that nothing herein
or in such supplemental indenture shall constitute such Trustees co-
trustees of the same trust and that each such Trustee shall be trustee of a
trust or trusts hereunder separate and apart from any trust or trusts
hereunder administered by any other such Trustee; and upon the execution
and delivery of such supplemental indenture the resignation or removal of
the retiring Trustee shall become effective to the extent provided therein
and each such successor Trustee, without any further act, deed or
conveyance, shall become vested with all the rights, powers, trusts and
duties of the retiring Trustee with respect to the Securities of that or
those series to which the appointment of such successor Trustee relates;
but, on request of the Company or any successor Trustee, such retiring
Trustee shall duly assign, transfer and deliver to such successor Trustee
all property and money held by such retiring Trustee hereunder with respect
to the Securities of that or those series to which the appointment of such
successor Trustee relates.
Upon request of any such successor Trustee, the Company shall
execute any and all instruments for more fully and certainly vesting in and
confirming to such successor Trustee all such rights, powers and trusts
referred to in the first or second preceding paragraph, as the case may be.
No successor Trustee shall accept its appointment unless at the time
of such acceptance such successor Trustee shall be qualified and eligible
under this Article.
SECTION 612. Merger, Conversion, Consolidation or Succession to Business.
Any corporation into which the Trustee may be merged or converted or
with which it may be consolidated, or any corporation resulting from any
merger, conversion or consolidation to which the Trustee shall be a party,
or any corporation succeeding to all or substantially all the corporate
trust business of the Trustee, shall be the successor of the Trustee
hereunder, provided such corporation shall be otherwise qualified and
eligible under this Article, without the execution or filing of any paper
or any further act on the part of any of the parties hereto. In case any
Securities shall have been authenticated, but not delivered, by the Trustee
then in office, any successor by merger,
<PAGE>
47
conversion or consolidation to such authenticating Trustee may adopt such
authentication and deliver the Securities so authenticated with the same
effect as if such successor Trustee had itself authenticated such
Securities.
SECTION 613. Preferential Collection of Claims Against Company.
If and when the Trustee shall be or become a creditor of the Company
(or any other obligor upon the Securities), the Trustee shall be subject to
the provisions of the Trust Indenture Act regarding the collection of
claims against the Company (or any such other obligor).
SECTION 614. Appointment of Authenticating Agent.
The Trustee may appoint an Authenticating Agent or Agents with
respect to one or more series of Securities which shall be authorized to
act on behalf of the Trustee to authenticate Securities of such series
issued upon original issue and upon exchange, registration of transfer or
partial redemption thereof or pursuant to Section 306, and Securities so
authenticated shall be entitled to the benefits of this Indenture and shall
be valid and obligatory for all purposes as if authenticated by the Trustee
hereunder. Wherever reference is made in this Indenture to the authen-
tication and delivery of Securities by the Trustee or the Trustee's
certificate of authentication, such reference shall be deemed to include
authentication and delivery on behalf of the Trustee by an Authenticating
Agent and a certificate of authentication executed on behalf of the Trustee
by an Authenticating Agent. Each Authenticating Agent shall be acceptable
to the Company and shall at all times be a corporation organized and doing
business under the laws of the United States of America, any State thereof
or the District of Columbia, authorized under such laws to act as
Authenticating Agent, having a combined capital and surplus of not less
than $50,000,000 and subject to supervision or examination by Federal or
State authority. If such Authenticating Agent publishes reports of
condition at least annually, pursuant to law or to the requirements of said
supervising or examining authority, then for the purposes of this Section,
the combined capital and surplus of such Authenticating Agent shall be
deemed to be its combined capital and surplus as set forth in its most
recent report of condition so published. If at any time an Authenticating
Agent shall cease to be eligible in accordance with the provisions of this
Section, such Authenticating Agent shall resign immediately in the manner
and with the effect specified in this Section.
Any corporation into which an Authenticating Agent may be merged or
converted or with which it may be consolidated, or any corporation
resulting from any merger, conversion or consolidation to which such
Authenticating Agent shall be a party, or any corporation succeeding to the
corporate agency or corporate trust business of an Authenticating Agent,
shall continue to be an Authenticating Agent, provided such corporation
shall be otherwise eligible under this Section, without the execution or
filing of any paper or any further act on the part of the Trustee or the
Authenticating Agent.
<PAGE>
48
An Authenticating Agent may resign at any time by giving written
notice thereof to the Trustee and to the Company. The Trustee may at any
time terminate the agency of an Authenticating Agent by giving written
notice thereof to such Authenticating Agent and to the Company. Upon
receiving such a notice of resignation or upon such a termination, or in
case at any time such Authenticating Agent shall cease to be eligible in
accordance with the provisions of this Section, the Trustee may appoint a
successor Authenticating Agent which shall be acceptable to the Company and
shall give notice of such appointment in the manner provided in Section 106
to all Holders of Securities of the series with respect to which such
Authenticating Agent will serve. Any successor Authenticating Agent upon
acceptance of its appointment hereunder shall become vested with all the
rights, powers and duties of its predecessor hereunder, with like effect as
if originally named as an Authenticating Agent. No successor Authenticating
Agent shall be appointed unless eligible under the provisions of this
Section.
The Trustee agrees to pay to each Authenticating Agent from time to
time reasonable compensation for its services under this Section, and the
Trustee shall be entitled to be reimbursed for such payments, subject to
the provisions of Section 607.
If an appointment with respect to one or more series is made
pursuant to this Section, the Securities of such series may have endorsed
thereon, in addition to the Trustee's certificate of authentication, an
alternative certificate of authentication in the following form:
This is one of the Securities of the series designated therein
referred to in the within-mentioned Indenture.
Citibank, N.A.,
As Trustee
By......................................,
As Authenticating Agent
By.......................................
Authorized Officer
<PAGE>
49
ARTICLE SEVEN
HOLDERS' LISTS AND REPORTS BY TRUSTEE AND COMPANY
SECTION 701. Company to Furnish Trustee Names and Addresses of Holders.
The Company will furnish or cause to be furnished to the Trustee
(1) semi-annually, not later than June 1 and December 1 in each
year, a list, in such form as the Trustee may reasonably require, of
the names and addresses of the Holders of Securities of each series
as of the preceding May 15 or November 15, as the case may be, and
(2) at such other times as the Trustee may request in writing,
within 30 days after the receipt by the Company of any such request,
a list of similar form and content as of a date not more than
15 days prior to the time such list is furnished;
excluding from any such list names and addresses received by the Trustee in
its capacity as Security Registrar.
SECTION 702. Preservation of Information; Communications to Holders.
The Trustee shall preserve, in as current a form as is reasonably
practicable, the names and addresses of Holders contained in the most
recent list furnished to the Trustee as provided in Section 701 and the
names and addresses of Holders received by the Trustee in its capacity as
Security Registrar. The Trustee may destroy any list furnished to it as
provided in Section 701 upon receipt of a new list so furnished.
The rights of the Holders to communicate with other Holders with
respect to their rights under this Indenture or under the Securities, and
the corresponding rights and privileges of the Trustee, shall be as
provided by the Trust Indenture Act.
Every Holder of Securities, by receiving and holding the same,
agrees with the Company and the Trustee that neither the Company nor the
Trustee nor any agent of either of them shall be held accountable by reason
of any disclosure of information as to names and addresses of Holders made
pursuant to the Trust Indenture Act.
SECTION 703. Reports by Trustee.
The Trustee shall transmit to Holders such reports concerning the
Trustee and its actions under this Indenture as may be required pursuant to
the Trust Indenture Act at the times and in the manner provided pursuant
thereto.
<PAGE>
50
A copy of each such report shall, at the time of such transmission
to Holders, be filed by the Trustee with each stock exchange upon which any
Securities are listed, with the Commission and with the Company. The Com-
pany will notify the Trustee when any Securities are listed on any stock
exchange.
SECTION 704. Reports by Company.
The Company shall file with the Trustee and the Commission, and
transmit to Holders, such information, documents and other reports, and
such summaries thereof, as may be required pursuant to the Trustee
Indenture Act at the times and in the manner provided pursuant to such Act;
provided that any such information, documents or reports required to be
filed with the Commission pursuant to Section 13 or 15(d) of the Exchange
Act shall be filed with the Trustee within 15 days after the same is so
required to be filed with the Commission.
ARTICLE EIGHT
CONSOLIDATION, MERGER, CONVEYANCE, TRANSFER OR LEASE
SECTION 801. Company May Consolidate, Etc., Only on Certain Terms.
The Company shall not consolidate with or merge into any other
Person or convey, transfer or lease its properties and assets substantially
as an entirety to any Person, and the Company shall not permit any Person
to consolidate with or merge into the Company or convey, transfer or lease
its properties and assets substantially as an entirety to the Company,
unless:
(1) in case the Company shall consolidate with or merge into
another Person or convey, transfer or lease its properties and assets
substantially as an entirety to any Person, the Person formed by such
consolidation or into which the Company is merged or the Person which
acquires by conveyance or transfer, or which leases, the properties and
assets of the Company substantially as an entirety shall be a cor-
poration, partnership or trust, shall be organized and validly existing
under the laws of the United States of America, any State thereof or
the District of Columbia and shall expressly assume, by an indenture
supplemental hereto, executed and delivered to the Trustee, in form
satisfactory to the Trustee, the due and punctual payment of the
principal of and any premium and interest on all the Securities and the
performance or observance of every covenant of this Indenture on the
part of the Company to be performed or observed;
(2) immediately after giving effect to such transaction and
treating any indebtedness which becomes an obligation of the Company or
any Subsidiary as a result of such transaction as having been incurred
by the Company or such Subsidiary at the time of such transaction, no
Event of Default, and no event which, after notice or
<PAGE>
51
lapse of time or both, would become an Event of Default, shall have
happened and be continuing;
(3) if, as a result of any such consolidation or merger or such
conveyance, transfer or lease, properties or assets of the Company
would become subject to a mortgage, pledge, lien, security interest or
other encumbrance which would not be permitted by this Indenture, the
Company or such successor Person, as the case may be, shall take such
steps as shall be necessary effectively to secure the Securities
equally and ratably with (or prior to) all indebtedness secured
thereby; and
(4) the Company has delivered to the Trustee an Officers' Certifi-
cate and an Opinion of Counsel, each stating that such consolidation,
merger, conveyance, transfer or lease and, if a supplemental indenture
is required in connection with such transaction, such supplemental
indenture comply with this Article and that all conditions precedent
herein provided for relating to such transaction have been complied
with.
SECTION 802. Successor Substituted.
Upon any consolidation of the Company with, or merger of the Company
into, any other Person or any conveyance, transfer or lease of the
properties and assets of the Company substantially as an entirety in
accordance with Section 801, the successor Person formed by such
consolidation or into which the Company is merged or to which such
conveyance, transfer or lease is made shall succeed to, and be substituted
for, and may exercise every right and power of, the Company under this
Indenture with the same effect as if such successor Person had been named
as the Company herein, and thereafter, except in the case of a lease, the
predecessor Person shall be relieved of all obligations and covenants under
this Indenture and the Securities.
ARTICLE NINE
SUPPLEMENTAL INDENTURES
SECTION 901. Supplemental Indentures Without Consent of Holders.
Without the consent of any Holders, the Company, when authorized by
a Board Resolution, and the Trustee, at any time and from time to time, may
enter into one or more indentures supplemental hereto, in form satisfactory
to the Trustee, for any of the following purposes:
(1) to evidence the succession of another Person to the Company and
the assumption by any such successor of the covenants of the Company
herein and in the Securities; or
<PAGE>
52
(2) to add to the covenants of the Company for the benefit of the
Holders of all or any series of Securities (and if such covenants are
to be for the benefit of less than all series of Securities, stating
that such covenants are expressly being included solely for the benefit
of such series) or to surrender any right or power herein conferred
upon the Company; or
(3) to add any additional Events of Default for the benefit of the
Holders of all or any series of Securities (and if such additional
Events of Default are to be for the benefit of less than all series of
Securities, stating that such additional Events of Default are
expressly being included solely for the benefit of such series); or
(4) to add to or change any of the provisions of this Indenture to
such extent as shall be necessary to permit or facilitate the issuance
of Securities in bearer form, registrable or not registrable as to
principal, and with or without interest coupons, or to permit or
facilitate the issuance of Securities in uncertificated form; or
(5) to add to, change or eliminate any of the provisions of this
Indenture in respect of one or more series of Securities, provided that
any such addition, change or elimination (A) shall neither (i) apply to
any Security of any series created prior to the execution of such
supplemental indenture and entitled to the benefit of such provision
nor (ii) modify the rights of the Holder of any such Security with
respect to such provision or (B) shall become effective only when there
is no such Security Outstanding; or
(6) to secure the Securities; or
(7) to establish the form or terms of Securities of any series as
permitted by Sections 201 and 301; or
(8) to evidence and provide for the acceptance of appointment
hereunder by a successor Trustee with respect to the Securities of one
or more series and to add to or change any of the provisions of this
Indenture as shall be necessary to provide for or facilitate the
administration of the trusts hereunder by more than one Trustee,
pursuant to the requirements of Section 611; or
(9) to cure any ambiguity, to correct or supplement any provision
herein which may be defective or inconsistent with any other provision
herein, or to make any other provisions with respect to matters or
questions arising under this Indenture, provided that such action
pursuant to this Clause (9) shall not adversely affect the interests of
the Holders of Securities of any series in any material respect.
SECTION 902. Supplemental Indentures with Consent of Holders.
With the consent of the Holders of not less than 662/3% in principal
amount of the Outstanding Securities of each series affected by such
supplemental indenture, by Act of said Holders delivered to the Company and
the Trustee, the Company, when
<PAGE>
53
authorized by a Board Resolution, and the Trustee may enter into an
indenture or indentures supplemental hereto for the purpose of adding any
provisions to or changing in any manner or eliminating any of the
provisions of this Indenture or of modifying in any manner the rights of
the Holders of Securities of such series under this Indenture; provided,
however, that no such supplemental indenture shall, without the consent of
the Holder of each Outstanding Security affected thereby,
(1) change the Stated Maturity of the principal of, or any
instalment of principal of or interest on, any Security, or reduce the
principal amount thereof or the rate of interest thereon or any premium
payable upon the redemption thereof, or reduce the amount of the
principal of an Original Issue Discount Security or other Security that
would be due and payable upon a declaration of acceleration of the
Maturity thereof pursuant to Section 502, or change any Place of
Payment where, or the coin or currency in which, any Security or any
premium or interest thereon is payable, or impair the right to
institute suit for the enforcement of any such payment on or after the
Stated Maturity thereof (or, in the case of redemption, on or after the
Redemption Date), or
(2) reduce the percentage in principal amount of the Outstanding
Securities of any series, the consent of whose Holders is required for
any such supplemental indenture, or the consent of whose Holders is
required for any waiver (of compliance with certain provisions of this
Indenture or certain defaults hereunder and their consequences)
provided for in this Indenture, or
(3) modify any of the provisions of this Section, Section 513 or
Section 1008, except to increase any such percentage or to provide that
certain other provisions of this Indenture cannot be modified or waived
without the consent of the Holder of each Outstanding Security affected
thereby, provided, however, that this clause shall not be deemed to
require the consent of any Holder with respect to changes in the
references to "the Trustee" and concomitant changes in this Section and
Section 1008, or the deletion of this proviso, in accordance with the
requirements of Sections 611 and 901(8).
A supplemental indenture which changes or eliminates any covenant or other
provision of this Indenture which has expressly been included solely for
the benefit of one or more particular series of Securities, or which
modifies the rights of the Holders of Securities of such series with
respect to such covenant or other provision, shall be deemed not to affect
the rights under this Indenture of the Holders of Securities of any other
series.
It shall not be necessary for any Act of Holders under this Section
to approve the particular form of any proposed supplemental indenture, but
it shall be sufficient if such Act shall approve the substance thereof.
<PAGE>
54
SECTION 903. Execution of Supplemental Indentures.
In executing, or accepting the additional trusts created by, any
supplemental indenture permitted by this Article or the modifications
thereby of the trusts created by this Indenture, the Trustee shall be
entitled to receive, and (subject to Section 601) shall be fully protected
in relying upon, an Opinion of Counsel stating that the execution of such
supplemental indenture is authorized or permitted by this Indenture. The
Trustee may, but shall not be obligated to, enter into any such
supplemental indenture which affects the Trustee's own rights, duties or
immunities under this Indenture or otherwise.
SECTION 904. Effect of Supplemental Indentures.
Upon the execution of any supplemental indenture under this Article,
this Indenture shall be modified in accordance therewith, and such
supplemental indenture shall form a part of this Indenture for all
purposes; and every Holder of Securities theretofore or thereafter
authenticated and delivered hereunder shall be bound thereby.
SECTION 905. Conformity with Trust Indenture Act.
Every supplemental indenture executed pursuant to this Article shall
conform to the requirements of the Trust Indenture Act.
SECTION 906. Reference in Securities to Supplemental Indentures.
Securities of any series authenticated and delivered after the
execution of any supplemental indenture pursuant to this Article may, and
shall if required by the Trustee, bear a notation in form approved by the
Trustee as to any matter provided for in such supplemental indenture. If
the Company shall so determine, new Securities of any series so modified as
to conform, in the opinion of the Trustee and the Company, to any such
supplemental indenture may be prepared and executed by the Company and
authenticated and delivered by the Trustee in exchange for Outstanding
Securities of such series.
ARTICLE TEN
COVENANTS
SECTION 1001. Payment of Principal, Premium and Interest.
The Company covenants and agrees for the benefit of each series of
Securities that it will duly and punctually pay the principal of and any
premium and interest on the Securities of that series in accordance with
the terms of the Securities and this Indenture.
<PAGE>
55
SECTION 1002. Maintenance of Office or Agency.
The Company will maintain in each Place of Payment for any series of
Securities an office or agency where Securities of that series may be
presented or surrendered for payment, where Securities of that series may
be surrendered for registration of transfer or exchange and where notices
and demands to or upon the Company in respect of the Securities of that
series and this Indenture may be served. The Company will give prompt
written notice to the Trustee of the location, and any change in the
location, of such office or agency. If at any time the Company shall fail
to maintain any such required office or agency or shall fail to furnish the
Trustee with the address thereof, such presentations, surrenders, notices
and demands may be made or served at the Corporate Trust Office of the
Trustee, and the Company hereby appoints the Trustee as its agent to
receive all such presentations, surrenders, notices and demands.
The Company may also from time to time designate one or more other
offices or agencies where the Securities of one or more series may be
presented or surrendered for any or all such purposes and may from time to
time rescind such designations; provided, however, that no such designation
or rescission shall in any manner relieve the Company of its obligation to
maintain an office or agency in each Place of Payment for Securities of any
series for such purposes. The Company will give prompt written notice to
the Trustee of any such designation or rescission and of any change in the
location of any such other office or agency.
SECTION 1003. Money for Securities Payments to Be Held in Trust.
If the Company shall at any time act as its own Paying Agent with
respect to any series of Securities, it will, on or before each due date of
the principal of or any premium or interest on any of the Securities of
that series, segregate and hold in trust for the benefit of the Persons
entitled thereto a sum sufficient to pay the principal and any premium and
interest so becoming due until such sums shall be paid to such Persons or
otherwise disposed of as herein provided and will promptly notify the
Trustee of its action or failure so to act.
Whenever the Company shall have one or more Paying Agents for any
series of Securities, it will, prior to each due date of the principal of
or any premium or interest on any Securities of that series, deposit with a
Paying Agent a sum sufficient to pay such amount, such sum to be held as
provided by the Trust Indenture Act, and (unless such Paying Agent is the
Trustee) the Company will promptly notify the Trustee of its action or
failure so to act.
The Company will cause each Paying Agent for any series of
Securities other than the Trustee to execute and deliver to the Trustee an
instrument in which such Paying Agent shall agree with the Trustee, subject
to the provisions of this Section, that such Paying Agent will (1) comply
with the provisions of the Trust Indenture Act applicable to it as a Paying
Agent and (2) during the continuance of any default by the Company (or any
other obligor upon the Securities of that series) in the making of any
payment in
<PAGE>
56
respect of the Securities of that series, and upon the written request of
the Trustee, forthwith pay to the Trustee all sums held in trust by such
Paying Agent for payment in respect of the Securities of that series.
The Company may at any time, for the purpose of obtaining the
satisfaction and discharge of this Indenture or for any other purpose, pay,
or by Company Order direct any Paying Agent to pay, to the Trustee all sums
held in trust by the Company or such Paying Agent, such sums to be held by
the Trustee upon the same trusts as those upon which such sums were held by
the Company or such Paying Agent; and, upon such payment by any Paying
Agent to the Trustee, such Paying Agent shall be released from all further
liability with respect to such money.
Any money deposited with the Trustee or any Paying Agent, or then
held by the Company, in trust for the payment of the principal of or any
premium or interest on any Security of any series and remaining unclaimed
for two years after such principal, premium or interest has become due and
payable shall, unless otherwise required by law, be paid to the Company on
Company Request, or (if then held by the Company) shall be discharged from
such trust; and the Holder of such Security shall thereafter, as an
unsecured general creditor, look only to the Company for payment thereof,
and all liability of the Trustee or such Paying Agent with respect to such
trust money, and all liability of the Company as trustee thereof, shall
thereupon cease; provided, however, that the Trustee or such Paying Agent,
before being required to make any such repayment, may at the expense of the
Company cause to be published once, in a newspaper published in the English
language, customarily published on each Business Day and of general
circulation in The City of New York, notice that such money remains
unclaimed and that, after a date specified therein, which shall not be less
than 30 days from the date of such publication, any unclaimed balance of
such money then remaining will be repaid to the Company, unless otherwise
required by law.
SECTION 1004. Statement by Officers as to Default.
The Company will deliver to the Trustee, within 120 days after the
end of each fiscal year of the Company ending after the date hereof, an
Officers' Certificate, stating whether or not to the best knowledge of the
signers thereof the Company is in default in the performance and observance
of any of the terms, provisions and conditions of this Indenture (without
regard to any period of grace or requirement of notice provided hereunder)
and, if the Company shall be in default, specifying all such defaults and
the nature and status thereof of which they may have knowledge.
SECTION 1005. Existence.
Subject to Article Eight, the Company will do or cause to be done
all things necessary to preserve and keep in full force and effect its
existence, rights (charter and statutory) and franchises; provided,
however, that the Company shall not be required to preserve any such right
or franchise if the Board of Directors shall determine that the
<PAGE>
57
preservation thereof is no longer desirable in the conduct of the business
of the Company and that the loss thereof is not disadvantageous in any
material respect to the Holders.
SECTION 1006. Maintenance of Properties.
The Company will cause all properties used or useful in the conduct
of its business or the business of any Subsidiary to be maintained and kept
in good condition, repair and working order and supplied with all necessary
equipment and will cause to be made all necessary repairs, renewals,
replacements, betterments and improvements thereof, all as in the judgment
of the Company may be necessary so that the business carried on in
connection therewith may be properly and advantageously conducted at all
times; provided, however, that nothing in this Section shall prevent the
Company from discontinuing the operation or maintenance of any of such
properties if such discontinuance is, in the judgment of the Company,
desirable in the conduct of its business or the business of any Subsidiary
and not disadvantageous in any material respect to the Holders.
SECTION 1007. Payment of Taxes and Other Claims.
The Company will pay or discharge or cause to be paid or discharged,
before the same shall become delinquent, (1) all taxes, assessments and
governmental charges levied or imposed upon the Company or any Subsidiary
or upon the income, profits or property of the Company or any Subsidiary,
and (2) all lawful claims for labor, materials and supplies which, if
unpaid, might by law become a lien upon the property of the Company or any
Subsidiary; provided, however, that the Company shall not be required to
pay or discharge or cause to be paid or discharged any such tax,
assessment, charge or claim whose amount, applicability or validity is
being contested in good faith by appropriate proceedings.
SECTION 1008. Limitation on Liens.
(a) So long as Securities of any series entitled by their terms
to the benefits of this Section shall be Outstanding, the Company will not
create or assume, and will not permit any Restricted Subsidiary to create
or assume, any notes, bonds, debentures or other similar evidences of
Indebtedness secured by any mortgage, pledge, security interest or lien
(any such mortgage, pledge, security interest or lien being hereinafter
referred to as a "Mortgage" or "Mortgages") of or upon any Principal
Property owned by the Company or any Restricted Subsidiary or shares of
capital stock or evidence of Indebtedness of any Restricted Subsidiary,
whether owned at the date of this Indenture or thereafter acquired, without
making effective provision, and the Company in such case will make or cause
to be made effective provision, whereby all Securities of each series to
which this Section 1008 applies (together with, if the Company shall so
determine, any other Indebtedness of the Company or such Restricted
Subsidiary, whether then existing or thereafter created which is not
subordinated to such Securities) shall be secured by such a Mortgage
equally and ratably with (or prior to) any and all other Indebtedness
<PAGE>
58
thereby secured, so long as such Indebtedness shall be so secured;
provided, however, that the foregoing shall not apply to any of the
following:
(1) Mortgages on any Principal Property, shares of stock or
Indebtedness of any corporation existing at the time such corporation
becomes a Subsidiary;
(2) Mortgages on any Principal Property, shares of stock or
Indebtedness acquired, constructed or improved by the Company or any
Restricted Subsidiary after the date of this Indenture which are
created or assumed prior to, or contemporaneously with, such
acquisition, construction or improvement or within 365 days after the
acquisition, completion of construction or improvement or commencement
of commercial operation of such property, to secure or provide for the
payment of all or any part of the purchase price or the cost of such
construction or improvement thereof, or, in addition to Mortgages
contemplated by clause (3) below, Mortgages on any Principal Property,
shares of stock or Indebtedness existing at the time of acquisition
thereof (including acquisition through merger or consolidation)
existing at the time of acquisition thereof;
(3) Mortgages on any Principal Property or shares of stock or
Indebtedness acquired from a corporation which is merged with or into
the Company or a Restricted Subsidiary;
(4) Mortgages on any Principal Property, shares of stock or
Indebtedness to secure Indebtedness to the Company or to a Restricted
Subsidiary;
(5) Mortgages on any Principal Property, shares of stock or
Indebtedness in favor of the United States of America or any State
thereof or The Commonwealth of Puerto Rico, or any department, agency
or instrumentality or political subdivision of the United States of
America or any State thereof or The Commonwealth of Puerto Rico, to
secure partial, progress, advance or other payments, or to secure any
Indebtedness incurred for the purpose of financing all or any part of
the cost of acquiring, constructing or improving the Principal
Property, shares of stock or Indebtedness subject to such Mortgages
(including Mortgages incurred in connection with pollution control,
industrial revenue, Title XI maritime financings or similar
financings), or other Mortgages in connection with the issuance of tax-
exempt industrial revenue bonds;
(6) Mortgages existing as of the date of this Indenture;
(7) Mortgages for taxes, assessments or other government charges,
the validity of which is being contested in good faith by appropriate
proceedings and materialmen's, mechanics' and other like Mortgages, or
deposits to obtain the release of such Mortgages;
(8) Mortgages created or deposits made to secure the payment of
workers' compensation claims or the performance of, or in connection
with, tenders, bids, leases, public or statutory obligations, surety
and appeal bonds, contracts,
<PAGE>
59
performance and return-of-money bonds or to secure (or in lieu of)
surety or appeal bonds and Mortgages made in the ordinary course of
business for similar purposes; and
(9) any extension, renewal or replacement (or successive
extensions, renewals or replacements), in whole or in part, of any
Mortgage referred to in the foregoing clauses (1) to (8), inclusive;
provided, however, that such extension, renewal or replacement shall be
limited to all or a part of the property, shares of stock or
Indebtedness which secured the Mortgage so extended, renewed or
replaced (plus improvements on such property).
(b) Notwithstanding the provisions of paragraph (a) of this
Section 1008, the Company or any Restricted Subsidiary may create or assume
Mortgages in addition to those permitted by paragraph (a) of this Section
1008, and renew, extend or create such Mortgages, provided, that at the
time of such creation, assumption, renewal or replacement, and after giving
effect thereto, the aggregate amount of all Indebtedness so secured by such
a Mortgage as provided above (not including Indebtedness excluded as
provided in clauses (1) through (9) of paragraph (a) above), plus all
Attributable Debt of the Company and its Restricted Subsidiaries in respect
of Sale and Lease-Back Transactions (as defined in Section 1009) which
would not be permitted by either clause (1) or (2) of paragraph (a) of
Section 1009), would not exceed 20% of Consolidated Assets.
SECTION 1009. Limitation on Sale and Lease-Back.
(a) So long as Securities of any series entitled by their terms
to the benefits of this Section shall be Outstanding, the Company will not,
nor will it permit any Restricted Subsidiary to, enter into any arrangement
with any Person (other than the Company or any Restricted Subsidiary)
providing for the leasing by the Company or a Restricted Subsidiary of any
Principal Property owned by the Company or such Restricted Subsidiary
(except for leases for a term of not more than three years), which property
has been or is to be sold or transferred by the Company or such Restricted
Subsidiary to such person on the security of such Principal Property more
than 365 days after the acquisition thereof or the completion of
construction and commencement of full operation thereof (herein referred to
as a "Sale and Lease-Back Transaction"), unless either (1) the Company or
such Restricted Subsidiary would be entitled pursuant to Section 1008 to
incur Indebtedness secured by a Mortgage on the Principal Property to be
leased back equal in amount to the Attributable Debt with respect to such
Sale and Lease-Back Transaction without equally and ratably securing the
Securities of such series, or (2) the Company shall, and in any such case
the Company covenants that it will, apply or cause to be applied an amount
equal to the greater of the net proceeds or the fair value (as determined
by the Board of Directors) of the property so sold to the purchase of
Principal Property or to the retirement (other than any mandatory
retirement), within 365 days of the effective date of any such Sale and
Lease-Back Transaction, of Securities or other Funded Indebtedness;
provided, however, that any such retirement of Securities shall be made in
accordance with this Indenture; and provided, further, that the amount to
be applied to such retirement of Securities or other Funded Indebtedness
shall be reduced
<PAGE>
60
by an amount equal to the sum of (A) an amount equal to the principal
amount of any Securities delivered within 365 days after the effective date
of such Sale and Lease-Back Transaction to the Trustee for retirement and
cancellation, and (B) the principal amount of other Funded Indebtedness
voluntarily retired by the Company within such 365-day period, excluding in
each case retirements pursuant to mandatory sinking fund or prepayment
provisions and payments at maturity.
(b) Notwithstanding the provisions of paragraph (a) of this
Section 1009,
(i) the Company or any Restricted Subsidiary may enter into Sale
and Lease-Back Transactions in addition to any permitted by paragraph
(a) of this Section 1009 and without any obligation to retire any
Securities or other indebtedness; provided, that at the time of
entering into such Sale and Lease-Back Transaction and after giving
effect thereto, Attributable Debt resulting from such Sale and Lease-
Back Transaction, plus the aggregate amount of all Indebtedness secured
by a Mortgage (not including Indebtedness excluded as provided in
clauses (1) through (9) of paragraph (a) of Section 1008), does not
exceed 20% of Consolidated Assets; and
(ii) the Company or any Restricted Subsidiary may, at any time prior
to December 31, 1995, enter into a Sale and Lease-Back Transaction with
respect to any or all of the following properties: its plants located
in New Hampshire, Vermont or Maine or its research and development
facility located in Palmer, Massachusetts.
SECTION 1010. Waiver of Certain Covenants.
Except as otherwise specified as contemplated by Section 301 for
Securities of such series, the Company may, with respect to the Securities
of any series, omit in any particular instance to comply with any term,
provision or condition set forth in any covenant provided pursuant to
Section 301(18), 901(2) or 901(7) for the benefit of the Holders of such
series if before the time for such compliance the Holders of at least
662/3% in principal amount of the Outstanding Securities of such series
shall, by Act of such Holders, either waive such compliance in such
instance or generally waive compliance with such term, provision or condi-
tion, but no such waiver shall extend to or affect such term, provision or
condition except to the extent so expressly waived, and, until such waiver
shall become effective, the obligations of the Company and the duties of
the Trustee in respect of any such term, provision or condition shall
remain in full force and effect.
<PAGE>
61
ARTICLE ELEVEN
REDEMPTION OF SECURITIES
SECTION 1101. Applicability of Article.
Securities of any series which are redeemable before their Stated
Maturity shall be redeemable in accordance with their terms and (except as
otherwise specified as contemplated by Section 301 for Securities) in
accordance with this Article.
SECTION 1102. Election to Redeem; Notice to Trustee.
The election of the Company to redeem any Securities shall be
established in or pursuant to a Board Resolution or in another manner
specified as contemplated by Section 301 for such Securities and set forth,
or determined in the manner provided, in an Officers' Certificate. In case
of any redemption at the election of the Company of the Securities of any
series (including any such redemption affecting only a single Security),
the Company shall, at least 60 days (in the case of redemption of less than
all of the Securities of a series) or 45 days (in the case of redemption of
all the Securities of a series) prior to the Redemption Date fixed by the
Company (unless a shorter notice shall be satisfactory to the Trustee),
notify the Trustee of such Redemption Date, of the principal amount of
Securities of such series to be redeemed and, if applicable, of the tenor
of the Securities to be redeemed. In the case of any redemption of
Securities prior to the expiration of any restriction on such redemption
provided in the terms of such Securities or elsewhere in this Indenture,
the Company shall furnish the Trustee with an Officers' Certificate
evidencing compliance with such restriction.
SECTION 1103. Selection by Trustee of Securities to Be Redeemed.
If less than all the Securities of any series are to be redeemed
(unless all the Securities of such series and of a specified tenor are to
be redeemed or unless such redemption affects only a single Security), the
particular Securities to be redeemed shall be selected not more than
60 days prior to the Redemption Date by the Trustee, from the Outstanding
Securities of such series not previously called for redemption, by such
method as the Trustee shall deem fair and appropriate and which may provide
for the selection for redemption of a portion of the principal amount of
any Security of such series, provided that the unredeemed portion of the
principal amount of any Security shall be in an authorized denomination
(which shall not be less than the minimum authorized denomination) for such
Security. If less than all of the Securities of such series and of a
specified tenor are to be redeemed (unless such redemption affects only a
single Security), the particular Securities to be redeemed shall be
selected not more than 60 days prior to the Redemption Date by the Trustee,
from the Outstanding Securities of such series and specified tenor not
previously called for redemption in accordance with the preceding sentence.
<PAGE>
62
The Trustee shall promptly notify the Company in writing of the
Securities selected for redemption as aforesaid and, in case of any
Securities selected for partial redemption, the principal amount thereof to
be redeemed.
The provisions of the two preceding paragraphs shall not apply with
respect to any redemption affecting only a single Security, whether such
Security is to be redeemed in whole or in part. In the case of any such
redemption in part, the unredeemed portion of the principal amount of the
Security shall be in an authorized denomination (which shall not be less
than the minimum authorized denomination) for such Security.
For all purposes of this Indenture, unless the context otherwise
requires, all provisions relating to the redemption of Securities shall
relate, in the case of any Securities redeemed or to be redeemed only in
part, to the portion of the principal amount of such Securities which has
been or is to be redeemed.
SECTION 1104. Notice of Redemption.
Notice of redemption shall be given by first-class mail, postage
prepaid, mailed not less than 30 nor more than 60 days prior to the
Redemption Date, to each Holder of Securities to be redeemed, at his
address appearing in the Security Register.
All notices of redemption shall state:
(1) the Redemption Date,
(2) the Redemption Price,
(3) if less than all the Outstanding Securities of any series con-
sisting of more than a single Security are to be redeemed, the identi-
fication (and, in the case of partial redemption of any Securities, the
principal amounts) of the particular Securities to be redeemed and, if
less than all the Outstanding Securities of any series consisting of a
single Security are to be redeemed, the principal amount of the
particular Security to be redeemed,
(4) that on the Redemption Date the Redemption Price will become
due and payable upon each such Security to be redeemed and, if
applicable, that interest thereon will cease to accrue on and after
said date,
(5) the place or places where each such Security is to be
surrendered for payment of the Redemption Price, and
(6) that the redemption is for a sinking fund, if such is the case.
Notice of redemption of Securities to be redeemed at the election of
the Company shall be given by the Company or, at the Company's request, by
the Trustee in the name and at the expense of the Company and shall be
irrevocable.
<PAGE>
63
SECTION 1105. Deposit of Redemption Price.
Prior to any Redemption Date, the Company shall deposit with the
Trustee or with a Paying Agent (or, if the Company is acting as its own
Paying Agent, segregate and hold in trust as provided in Section 1003) an
amount of money sufficient to pay the Redemption Price of, and (except if
the Redemption Date shall be an Interest Payment Date) accrued interest on,
all the Securities which are to be redeemed on that date.
SECTION 1106. Securities Payable on Redemption Date.
Notice of redemption having been given as aforesaid, the Securities
so to be redeemed shall, on the Redemption Date, become due and payable at
the Redemption Price therein specified, and from and after such date
(unless the Company shall default in the payment of the Redemption Price
and accrued interest) such Securities shall cease to bear interest. Upon
surrender of any such Security for redemption in accordance with said
notice, such Security shall be paid by the Company at the Redemption Price,
together with accrued interest to the Redemption Date; provided, however,
that, unless otherwise specified as contemplated by Section 301,
instalments of interest whose Stated Maturity is on or prior to the
Redemption Date shall be payable to the Holders of such Securities, or one
or more Predecessor Securities, registered as such at the close of business
on the relevant Record Dates according to their terms and the provisions of
Section 307.
If any Security called for redemption shall not be so paid upon
surrender thereof for redemption, the principal and any premium shall,
until paid, bear interest from the Redemption Date at the rate prescribed
therefor in the Security.
SECTION 1107. Securities Redeemed in Part.
Any Security which is to be redeemed only in part shall be
surrendered at a Place of Payment therefor (with, if the Company or the
Trustee so requires, due endorsement by, or a written instrument of
transfer in form satisfactory to the Company and the Trustee duly executed
by, the Holder thereof or his attorney duly authorized in writing), and the
Company shall execute, and the Trustee shall authenticate and deliver to
the Holder of such Security without service charge, a new Security or
Securities of the same series and of like tenor, of any authorized
denomination as requested by such Holder, in aggregate principal amount
equal to and in exchange for the unredeemed portion of the principal of the
Security so surrendered.
<PAGE>
64
ARTICLE TWELVE
SINKING FUNDS
SECTION 1201. Applicability of Article.
The provisions of this Article shall be applicable to any sinking
fund for the retirement of Securities of any series except as otherwise
specified as contemplated by Section 301 such Securities.
The minimum amount of any sinking fund payment provided for by the
terms or any Securities is herein referred to as a "mandatory sinking fund
payment", and any payment in excess of such minimum amount provided for by
the terms of such Securities is herein referred to as an "optional sinking
fund payment". If provided for by the terms of any Securities, the cash
amount of any sinking fund payment may be subject to reduction as provided
in Section 1202. Each sinking fund payment shall be applied to the
redemption of Securities as provided for by the terms of such Securities.
SECTION 1202. Satisfaction of Sinking Fund Payments with Securities.
The Company (1) may deliver Outstanding Securities of a series
(other than any previously called for redemption) and (2) may apply as a
credit Securities of a series which have been redeemed either at the
election of the Company pursuant to the terms of such Securities or through
the application of permitted optional sinking fund payments pursuant to the
terms of such Securities, in each case in satisfaction of all or any part
of any sinking fund payment with respect to any Securities of such series
required to be made pursuant to the terms of such Securities as and to the
extent provided for by the terms of such Securities; provided that the
Securities to be so credited have not been previously so credited. The
Securities to be so credited shall be received and credited for such pur-
pose by the Trustee at the Redemption Price, as specified in the Securities
so to be redeemed, for redemption through operation of the sinking fund and
the amount of such sinking fund payment shall be reduced accordingly.
SECTION 1203. Redemption of Securities for Sinking Fund.
Not less than 60 days prior to each sinking fund payment date for
any Securities, the Company will deliver to the Trustee an Officers'
Certificate specifying the amount of the next ensuing sinking fund payment
for such Securities pursuant to the terms of such Securities, the portion
thereof, if any, which is to be satisfied by payment of cash and the
portion thereof, if any, which is to be satisfied by delivering and
crediting Securities pursuant to Section 1202 and will also deliver to the
Trustee any Securities to be so delivered. Not less than 45 days prior to
each such sinking fund payment date, the Trustee shall select the
Securities to be redeemed upon such sinking fund payment date in the manner
specified in Section 1103 and cause notice of the redemption thereof to be
given in the name of and at the expense of the Company in the manner
provided in
<PAGE>
65
Section 1104. Such notice having been duly given, the redemption of such
Securities shall be made upon the terms and in the manner stated in Sec-
tions 1106 and 1107.
ARTICLE THIRTEEN
DEFEASANCE AND COVENANT DEFEASANCE
SECTION 1301. Company's Option to Effect Defeasance or Covenant
Defeasance.
The Company may elect, at its option at any time, to have
Section 1302 or Section 1303 applied to any Securities or any series of
Securities, as the case may be, designated pursuant to Section 301 as being
defeasible pursuant to such Section 1302 or 1303, in accordance with any
applicable requirements provided pursuant to Section 301 and upon
compliance with the conditions set forth below in this Article. Any such
election shall be established in or pursuant to a Board Resolution or in
another manner specified as contemplated by Section 301 for such Securities
and set forth, or determined in the manner provided, in an Officers'
Certificate.
SECTION 1302. Defeasance and Discharge.
Upon the Company's exercise of its option (if any) to have this
Section applied to any Securities or any series of Securities, as the case
may be, the Company shall be deemed to have been discharged from its
obligations with respect to such Securities as provided in this Section on
and after the date the conditions set forth in Section 1304 are satisfied
(hereinafter called "Defeasance"). For this purpose, Defeasance means that
the Company shall be deemed to have paid and discharged the entire
indebtedness represented by such Securities and to have satisfied all its
other obligations under such Securities and this Indenture insofar as such
Securities are concerned (and the Trustee, at the expense of the Company,
shall execute proper instruments acknowledging the same), subject to the
following which shall survive until otherwise terminated or discharged
hereunder: (1) the rights of Holders of such Securities to receive, solely
from the trust fund described in Section 1304 and as more fully set forth
in such Section, payments in respect of the principal of and any premium
and interest on such Securities when payments are due, (2) the Company's
obligations with respect to such Securities under Sections 304, 305, 306,
1002 and 1003, (3) the Company's obligations under Section 607, (4) the
rights, powers, trusts, duties and immunities of the Trustee hereunder and
(5) this Article. Subject to compliance with this Article, the Company may
exercise its option (if any) to have this Section applied to any Securities
notwithstanding the prior exercise of its option (if any) to have
Section 1303 applied such Securities.
SECTION 1303. Covenant Defeasance.
Upon the Company's exercise of its option (if any) to have this
Section applied to any Securities or any series of Securities, as the case
may be, (1) the Company shall
<PAGE>
66
be released from its obligations under Sections 1005 through 1007,
inclusive, any covenants provided pursuant to Section 301(18), 901(2) or
901(7) for the benefit of the Holders of such Securities and Section 801
and (2) the occurrence of any event specified in Sections 501(3), 501(4)
(with respect to any of Sections 1005 through 1007, inclusive, any such
covenants provided pursuant to Section 301(18), 901(2) or 901(7) and
Section 801), 501(5) and 501(8) shall be deemed not to be or result in an
Event of Default, in each case with respect to such Securities as provided
in this Section on and after the date the conditions set forth in
Section 1304 are satisfied (hereinafter called "Covenant Defeasance"). For
this purpose, Covenant Defeasance means that, with respect to such
Securities, the Company may omit to comply with and shall have no liability
in respect of any term, condition or limitation set forth in any such
specified Section (to the extent so specified in the case of
Section 501(4)), whether directly or indirectly by reason of any reference
elsewhere herein to any such Section or by reason of any reference in any
such Section to any other provision herein or in any other document, but
the remainder of this Indenture and such Securities shall be unaffected
thereby.
SECTION 1304. Conditions to Defeasance or Covenant Defeasance.
The following shall be the conditions to the application of
Section 1302 or Section 1303 to any Securities or any series of Securities,
as the case may be:
(1) The Company shall irrevocably have deposited or caused to be
deposited with the Trustee (or another trustee which satisfies the
requirements contemplated by Section 609 and agrees to comply with the
provisions of this Article applicable to it) as trust funds in trust
for the purpose of making the following payments, specifically pledged
as security for, and dedicated solely to, the benefits of the Holders
of such Securities, (A) money in an amount, or (B) U.S. Government
Obligations which through the scheduled payment of principal and
interest in respect thereof in accordance with their terms will
provide, not later than one day before the due date of any payment,
money in an amount, or (C) a combination thereof, in each case
sufficient, in the opinion of a nationally recognized firm of
independent public accountants expressed in a written certification
thereof delivered to the Trustee, to pay and discharge, and which shall
be applied by the Trustee (or any such other qualifying trustee) to pay
and discharge, the principal of and any premium and interest on such
Securities on the respective Stated Maturities, in accordance with the
terms of this Indenture and such Securities. As used herein, "U.S.
Government Obligation" means (x) any security which is (i) a direct
obligation of the United States of America for the payment of which the
full faith and credit of the United States of America is pledged or
(ii) an obligation of a Person controlled or supervised by and acting
as an agency or instrumentality of the United Stats of America the
payment of which is unconditionally guaranteed as a full faith and
credit obligation by the United States of America, which, in either
case (i) or (ii), is not callable or redeemable at the option of the
issuer thereof, and (y) any depositary receipt issued by a bank (as
defined in Section 3(a)(2) of the Securities Act) as custodian with
respect to any U.S. Government Obligation which is specified in
<PAGE>
67
Clause (x) above and held by such bank for the account of the holder of
such depositary receipt, or with respect to any specific payment of
principal of or interest on any U.S. Government Obligation which is so
specified and held, provided that (except as required by law) such
custodian is not authorized to make any deduction from the amount
payable to the holder of such depositary receipt from any amount
received by the custodian in respect of the U.S. Government Obligation
or the specific payment of principal or interest evidenced by such
depositary receipt.
(2) In the event of an election to have Section 1302 apply to
any Securities or any series of Securities, as the case may be, the
Company shall have delivered to the Trustee an Opinion of Counsel
stating that (A) the Company has received from, or there has been
published by, the Internal Revenue Service a ruling or (B) since the
date of this instrument, there has been a change in the applicable
Federal income tax law, in either case (A) or (B) to the effect
that, and based thereon such opinion shall confirm that, the Holders
of such Securities will not recognize gain or loss for Federal
income tax purposes as a result of the deposit, Defeasance and
discharge to be effected with respect to such Securities and will be
subject to Federal income tax on the same amount, in the same manner
and at the same times as would be the case if such deposit,
Defeasance and discharge were not to occur.
(3) In the event of an election to have Section 1303 apply to
any Securities or any series of Securities, as the case may be, the
Company shall have delivered to the Trustee an Opinion of Counsel to
the effect that the Holders of such Securities will not recognize
gain or loss for Federal income tax purposes as a result of the
deposit and Covenant Defeasance to be effected with respect to such
Securities and will be subject to Federal income tax on the same
amount, in the same manner and at the same times as would be the
case if such deposit and Covenant Defeasance were not to occur.
(4) The Company shall have delivered to the Trustee an Officers'
Certificate to the effect that neither such Securities nor any other
Securities of the same series, if then listed on any securities
exchange, will be delisted as a result of such deposit.
(5) No event which is, or after notice or lapse of time or both
would become, an Event of Default with respect to such Securities or
any other Securities shall have occurred and be continuing at the
time of such deposit or, with regard to any such event specified in
Sections 501(6) and (7), at any time on or prior to the 90th day
after the date of such deposit (it being understood that this
condition shall not be deemed satisfied until after such 90th day).
(6) Such Defeasance or Covenant Defeasance shall not cause the
Trustee to have a conflicting interest within the meaning of the
Trust Indenture Act (assuming all Securities are in default within
the meaning of such Act).
<PAGE>
68
(7) Such Defeasance or Covenant Defeasance shall not result in a
breach or violation of, or constitute a default under, any other
agreement or instrument to which the Company is a party or by which
it is bound.
(8) Such Defeasance or Covenant Defeasance shall not result in
the trust arising from such deposit constituting an investment
company within the meaning of the Investment Company Act unless such
trust shall be registered under such Act or exempt from registration
thereunder.
(9) The Company shall have delivered to the Trustee an Officers'
Certificate and an Opinion of Counsel, each stating that all
conditions precedent with respect to such Defeasance or Covenant
Defeasance have been complied with.
SECTION 1305. Deposited Money and U.S. Government Obligations to Be Held
in Trust;
Miscellaneous Provisions.
Subject to the provisions of the last paragraph of Section 1003, all
money and U.S. Government Obligations (including the proceeds thereof)
deposited with the Trustee or other qualifying trustee (solely for purposes
of this Section and Section 1306, the Trustee and any such other trustee
are referred to collectively as the "Trustee") pursuant to Section 1304 in
respect of any Securities shall be held in trust and applied by the
Trustee, in accordance with the provisions of such Securities and this
Indenture, to the payment, either directly or through any such Paying Agent
(including the Company acting as its own Paying Agent) as the Trustee may
determine, to the Holders of such Securities, of all sums due and to become
due thereon in respect of principal and any premium and interest, but money
so held in trust need not be segregated from other funds except to the
extent required by law.
The Company shall pay and indemnify the Trustee against any tax, fee
or other charge imposed on or assessed against the U.S. Government
Obligations deposited pursuant to Section 1304 or the principal and
interest received in respect thereof other than any such tax, fee or other
charge which by law is for the account of the Holders of Outstanding
Securities.
Anything in this Article to the contrary notwithstanding, the
Trustee shall deliver or pay to the Company from time to time upon Company
Request any money or U.S. Government Obligations held by it as provided in
Section 1304 with respect to any Securities which, in the opinion of a
nationally recognized firm of independent public accountants expressed in a
written certification thereof delivered to the Trustee, are in excess of
the amount thereof which would then be required to be deposited to effect
the Defeasance or Covenant Defeasance, as the case may be, with respect to
such Securities.
<PAGE>
69
SECTION 1306. Reinstatement.
If the Trustee or the Paying Agent is unable to apply any money in
accordance with this Article with respect to any Securities by reason of
any order or judgment of any court or governmental authority enjoining,
restraining or otherwise prohibiting such application, then the obligations
under this Indenture and such Securities from which the Company has been
discharged or released pursuant to Section 1302 or 1303 shall be revived
and reinstated as though no deposit had occurred pursuant to this Article
with respect to such Securities, until such time as the Trustee or Paying
Agent is permitted to apply all money held in trust pursuant to
Section 1305 with respect to such Securities in accordance with this
Article; provided, however, that if the Company makes any payment of
principal of or any premium or interest on any such Security following such
reinstatement of its obligations, the Company shall be subrogated to the
rights (if any) of the Holders of such Securities to receive such payment
from the money so held in trust.
_____________________________
<PAGE>
70
This instrument may be executed in any number of counterparts, each
of which so executed shall be deemed to be an original, but all such
counterparts shall together constitute but one and the same instrument.
IN WITNESS WHEREOF, the parties hereto have caused this Indenture to
be duly executed, and their respective corporate seals to be hereunto
affixed and attested, all as of the day and year first above written.
TAMBRANDS INC.
By /s/ Raymond F. Wright
Name: Raymond F. Wright
Title: Senior Vice President -
Chief Financial Officer
and Treasurer
Attest:
/s/ Barry K. Meisenheimer
Barry K. Meisenheimer
Assistant Secretary
CITIBANK, N.A.
By /s/ Robert T. Kirchner
Name: Robert T. Kirchner
Title: Vice President
Attest:
/s/ R.L. Pierce
R.L. Pierce
Assistant Vice President<PAGE>
71
STATE OF NEW YORK )
) ss.:
COUNTY OF NEW YORK )
On the 2nd day of December, 1993, before me personally came
Raymond F. Wright, to me known, who, being by me duly sworn, did
depose and say that he is Senior Vice President - CFO & Treasurer
of Tambrands Inc., one of the corporations described in and which
executed the foregoing instrument; that he knows the seal of said
corporation; that the seal affixed to said instrument is such corporate
seal; that it was so affixed by authority of the Board of Directors of said
corporation, and that he signed his name thereto by like authority.
/s/ Concetta Bazzano
STATE OF NEW YORK )
) ss.:
COUNTY OF NEW YORK )
On the 1st day of December, 1993, before me personally came
Robert T. Kirchner, to me known, who, being by me duly sworn, did
depose and say that he is Vice President of Citibank, N.A.,
one of the corporations described in and which executed the foregoing
instrument; that he knows the seal of said corporation; that the seal
affixed to said instrument is such corporate seal; that it was
so affixed by authority of the Board of Directors of said corporation,
and that he signed his name thereto by like authority.
/s/ Peter M. Pavlyshin
<PAGE>
EXHIBIT 10.3(h)
SIXTH AMENDMENT TO
THE TAMBRANDS INC.
1991 STOCK OPTION PLAN
----------------------
WHEREAS, TAMBRANDS INC. (the "Company") adopted the 1991 Stock Option Plan
(the "Plan"); and
WHEREAS, pursuant to Section 11 of the Plan, the Compensation Committee of
the Board of Directors has the authority to amend the Plan;
NOW, THEREFORE, the Plan is amended as follows, effective February 1, 1994:
1. The last sentences of Section 7(a) and Section 7(b) are deleted in
their entirety and a new sentence is inserted in lieu of each such sentence, to
read as follows:
All such Options shall remain exercisable (i) in the case of any
-
Options granted on or after February 1, 1994 for the lesser of (x)
-
five (5) years (or such shorter period of time that the Committee
shall specify at the time of grant) after the termination of the
Participant's employment and (y) the remainder of their term or (ii)
- --
in the case of any Options not described in clause (i), for the
remainder of their term.
IN WITNESS WHEREOF, the Company has caused this Amendment to be
executed by its duly authorized officer as of the 1st day of February, 1994.
TAMBRANDS INC.
By:/s/HELEN G. GOODMAN
---------------------------
Senior Vice President -
Title:Human Resources
------------------------
WITNESS:
/s/KEVIN J. PARADISE
- -------------------------
Vice President -
Title:Human Resources
-------------------
<PAGE>
EXHIBIT 10(5)(a)
- --------------------------------------------------------------------------------
TAMBRANDS INC.
SUPPLEMENTAL EXECUTIVE RETIREMENT PLAN
Effective
July 1, 1986
As Amended and Restated Effective July 1, 1994
- --------------------------------------------------------------------------------
<PAGE>
TABLE OF CONTENTS
-----------------
<TABLE>
<CAPTION>
Page
----
<S> <C>
ARTICLE I........................................................................... 1
Introduction...................................................................... 1
ARTICLE II.......................................................................... 2
Definitions....................................................................... 2
ARTICLE III......................................................................... 12
Retirement Income................................................................. 12
3.1 Retirement Income........................................................... 12
3.2 Normal Retirement Income.................................................... 12
3.3 Deferred Retirement Income.................................................. 15
3.4 Early Retirement Income..................................................... 15
3.5 Reduction for Benefits Received Under
Other Retirement Plans..................................................... 16
3.6 Form of Benefits............................................................ 18
3.7 Vesting of Retirement Benefit............................................... 19
3.8 Involuntary Termination of Employment
Following a Change of Control.............................................. 19
ARTICLE IV.......................................................................... 20
Death Benefits.................................................................... 20
ARTICLE V........................................................................... 22
Administrative and General Provisions............................................. 22
5.1 Administration............................................................... 22
5.2 Claims Procedure............................................................. 23
5.3 Inalienability and Forfeiture of Benefits.................................... 24
5.4 Unsecured General Creditor................................................... 25
5.5 Trust........................................................................ 25
5.6 Not a Contract of Employment................................................. 26
5.7 Captions..................................................................... 26
5.8 Governing Law................................................................ 26
5.9 Validity..................................................................... 27
5.10 Notice....................................................................... 27
5.11 Incompetent Participant...................................................... 27
ARTICLE VI.......................................................................... 28
Amendment and Termination.......................................................... 28
</TABLE>
<PAGE>
TAMBRANDS INC.
SUPPLEMENTAL EXECUTIVE RETIREMENT PLAN
ARTICLE I
Introduction
------------
The Tambrands Inc. Supplemental Executive Retirement Plan (the "Plan")
has been adopted to provide supplemental retirement and death benefits to
certain officers and other key employees of Tambrands Inc., its subsidiaries and
its divisions. The purpose of this Plan is to attract and retain in the employ
of Tambrands Inc. and its subsidiaries and divisions officers and other key
employees of superior competence. This Plan was established effective July 1,
1986, and no employee who terminated employment with the Company for any reason
before such date shall have any rights under this Plan. This Plan was amended
and restated effective July 1, 1988, July 1, 1990, and July 1, 1991 and is
hereby amended and restated effective July 1, 1994. Any employee who
terminated employment prior to this amendment and restatement shall have no
rights under this Plan as amended and restated, but shall look solely to the
terms of this Plan prior to this amendment and restatement.
<PAGE>
ARTICLE II
Definitions
-----------
"Actuarial Equivalent" means the equivalent in value, based on an
--------------------
interest rate and mortality tables and other actuarial methods and assumptions
selected from time to time by the Company or an actuary selected by the Company.
"Adjusted" means the cost of living adjustment factor prescribed by
--------
the Secretary of the Treasury under Section 415(d) of the Code, as applied to
such items and in such manner as such Secretary shall provide.
"Affiliate" means the Company and any entity affiliated with the
---------
Company within the meaning of Code Sections 414(b) with respect to controlled
groups of corporations, 414(c) with respect to trades or businesses under
common control with the Company, 414(m) with respect to affiliated service
groups, and any other entity required to be aggregated with the Company pursuant
to regulations under Section 414(o) of the Code. No entity shall be treated as
an Affiliate for any period during which it is not part of the controlled group,
under common control or otherwise required to be aggregated under Code Section
414.
2
<PAGE>
A "Change of Control" shall occur if:
-----------------
(i) any person (as defined in Section 3(a)(9) of the Securities
Exchange Act of 1934, as amended from time to time (the "Exchange Act"), and as
used in Sections 13(d) and 14(d) thereof), excluding the Company, any Affiliate
and any employee benefit plan sponsored or maintained by the Company or any
Affiliate (including any trustee of such plan acting as trustee), but including
a "group" as defined in Section 13(d)(3) of the Exchange Act (a "Person"),
becomes the beneficial owner of shares of the Company having at least 20% of
the total number of votes that may be cast for the election of directors of the
Company (the "Voting Shares") provided, however, that such an event shall not
constitute a Change of Control if the acquiring Person has entered into an
agreement with the Company approved by the Board of Directors which materially
restricts the right of such Person to direct or influence the management or
policies of the Company;
(ii) the shareholders of the Company shall approve any merger or
other business combination of the Company, sale of the Company's assets or
combination of the foregoing transactions (a "Transaction") other than a Trans-
action involving only the Company and one or more of its Affiliates or a
Transaction immediately following which the
3
<PAGE>
shareholders of the Company immediately prior to the Transaction continue to
have a majority of the voting power in the resulting entity excluding for this
purpose any shareholder owning directly or indirectly more than 10% of the
shares of the other company involved in the Transaction; or
(iii) within any 24-month period beginning on or after April 30,
1989, the persons who were directors of the Company immediately before the
beginning of such period (the "Incumbent Directors") shall cease (for any reason
other than death) to constitute at least a majority of the Board of Directors or
the board of directors of any successor to the Company, provided that any
director who was not a director as of May 1, 1989 shall be deemed to be an
Incumbent Director if such director was elected to the Board of Directors by,
or on the recommendation of or with the approval of, at least two-thirds of the
directors who then qualified as Incumbent Directors either actually or by prior
operation of this Section.
"Code" means the Internal Revenue Code of 1986, as amended from time
----
to time.
"Committee" means the Compensation Committee of the Board of Directors
---------
of Tambrands Inc.
"Company" means Tambrands Inc., its successors and assigns and any
-------
company which shall acquire all or substan-
4
<PAGE>
tially all of its assets, and certain of their Affiliates as selected by the
Committee.
"Deferred Retirement Date" means the first day of the month coinciding
------------------------
with or next following the retirement of the Participant after his Normal
Retirement
Date.
"Deferred Retirement Income" means an amount determined, with respect
--------------------------
to any Participant, under Section 3.3.
"Designated Participant" means an Executive Participant designated by
----------------------
the Committee to be included as a participant for purposes of the benefit
formula under Section 3.2(c).
"Early Retirement Date" means the first day of the month coinciding
---------------------
with or next following the retirement from the Company and any Affiliate of a
Participant on or after the attainment of his 55th birthday and the completion
of 10 Years of Service.
"Early Retirement Income" means an amount deter-mined with respect to
-----------------------
any Participant under Section 3.4.
"Earnings" for Plan Years on or after July 1, 1989, means "wages" as
--------
defined under Section 3121(a) of the Code for purposes of calculating social
security taxes, but determined without regard to the wage base limitation in
5
<PAGE>
Section 3121(a)(1) of the Code, the special rules in Section 3121(v) of the Code
(except that elective nonqualified deferred compensation shall be included), any
rules that limit covered employment based on the type or location of an
Employee's employer, and any rules that limit the remuneration included in
wages based on familiar relationship or based on the nature or location of the
employment or the services performed (such as the exceptions to the definition
of employment in Section 3121(b)(1) through (20) of the Code). Without limiting
the generality of the foregoing, Earnings shall include amounts contributed on
behalf of an Employee as part of a salary reduction agreement under a qualified
cash or deferred arrangement pursuant to Code Section 401(k), amounts
contributed to a plan under Code Section 125 pursuant to a salary reduction
election, and elective nonqualified deferred compensation, including, without
limitation, any amount that would otherwise have been paid to a Participant as
salary or an annual bonus which is forgone by such Participant in order to
receive a grant of stock options, but exclude all noncash compensation, non-
elective nonqualified deferred compensation, reimbursements or other expense
allowances, fringe benefits (cash and non-cash), moving expenses, welfare
benefits and any lump sum severance payments other than two weeks severance
payments
6
<PAGE>
in lieu of notice. For Plan Years prior to July 1, 1989, "Earnings" means the
Employee's total cash compensation received during the period, including but not
limited to base salary, bonuses, Annual Incentive Plan payments, prior to
application of any deferrals pursuant to Code Section 125 or 401(k) or pursuant
to any nonqualified plan or elective deferrals, and excluding moving allowances,
expense reimbursement, value of stock options, value of equity units, any other
stock awards or grants, any fringe benefits or other non-cash items or any
payments to, or from, any benefit or deferred compensation plan except as
otherwise specifically provided. With respect to any Participant who is
employed by an Affiliate not otherwise designated as a participating company in
the Plan, the Committee may decide, in its sole discretion, to include
compensation earned by such Participant while employed by such Affiliate in the
calculation of Earnings under the Plan; provided, however, that the same
inclusions and exclusions applicable to Earnings of other Participants shall
apply to the Participant's compensation earned while employed by such Affiliate.
"Employee" means any person who is regularly employed by the Company.
--------
"Executive Participant" means any corporate officers or other key
---------------------
employees of Tambrands Inc. or of a
7
<PAGE>
Company or division of a Company as are designated by the Committee and approved
by the Chief Executive Officer of Tambrands Inc. to be included as a Participant
for purposes of the benefit formula under Section 3.2(b).
"Grandfathered Participant" means any Executive Participant who, as of
-------------------------
June 30, 1990, had attained age 55 and completed 10 Years of Service and was
determined by the Committee to be a principal officer of the Company.
"Highest Average Earnings" means the arithmetical average of the
------------------------
annual Earnings received by a Participant in each of those five consecutive Plan
Years of employment, out of the last ten Plan Years of employment ending with
(or immediately preceding) the date as of which Highest Average Earnings is
being determined, which produce the highest average. In the event that a
Participant shall have been employed by the Company for less than five completed
Plan Years, his Highest Average Earnings shall be his average annual Earnings
for the completed Plan Years of his employment.
"Involuntarily Terminated" means a termination of a Participant's
------------------------
employment (i) by the Company or (ii) by the Participant within ninety days
following (a) a material reduction in such Participant's compensation and
-
benefits (including the termination of this Plan or the reduction of
8
<PAGE>
benefits under this Plan, in which case the Participant shall be deemed to have
been vested as of the date of the termination of this Plan or the reduction in
benefits hereunder), (b) a material change in such Participant's duties or
-
responsibilities or (c) a transfer of the Participant's principal place of
-
employment to a location more than 35 miles from the location at which such
Participant was principally employed immediately prior to the transfer, unless
the Participant shall consent in writing to any such reduction, change or
transfer.
"Normal Retirement Date" means the first day of the month coinciding
----------------------
with or next following the 65th birthday of the Participant.
"Normal Retirement Income" means an amount determined, with respect
------------------------
to any Participant, under Section 3.2.
"Participant" means an Employee whose benefits under the Pension Plan
-----------
are limited by reason of the limitations under the Code specified in Section
3.2(a) or because certain elements of compensation included in the definition of
Earnings are not taken into account under the Pension Plan, an Executive
Participant, a Designated Participant or a Grandfathered Participant. Any
person who was a Participant but does not qualify under the ongoing definition
of Participant shall cease to be a Participant and shall have
9
<PAGE>
no further rights hereunder. The participation of a Participant in this Plan
shall terminate automatically if the Participant ceases to qualify as a
Participant hereunder, unless the Committee authorizes and approves such
Participant's renewed or continued participation in this Plan. The Committee,
in its sole discretion, shall have the right to terminate the participation of a
Participant in this Plan at any time. In the event any Participant ceases to be
a Participant either automatically or as a result of Committee action, his
rights to benefits he has accrued and is vested in, if any, through his date of
ceasing to be a Participant may not be altered or impaired.
"Pension Plan" means the Pension Plan for Employees of Tambrands Inc.,
------------
as amended from time to time.
"Plan" means the Tambrands Inc. Supplemental Executive Retirement
----
Plan.
"Plan Year" means each twelve (12) consecutive month period beginning
---------
on July 1 and ending on June 30 of the succeeding calendar year.
"Primary Social Security Benefit" means the Primary Insurance Amount
-------------------------------
as defined under the Federal Social Security Act, computed on an annual basis,
and based upon the following assumptions:
10
<PAGE>
(i) Payments commence on the later of the last day of the month
following the date on which a Participant attains age 62, or the date on which a
Participant's retirement income under this Plan commences to be paid;
(ii) The Participant had no Earnings during the year which includes
the date his employment with the Company terminates or at any time thereafter;
(iii) The Participant's Earnings in each prior year are equal to the
maximum amount of wages subject to tax under the Federal Insurance Contributions
Act.
"Retirement Benefit" means the benefit determined under Section 3.1.
------------------
"Trust" means the trust, if any, described in Section 5.4.
-----
"Years of Service" means the service credited to a Participant under
----------------
the Pension Plan, provided, that the Committee shall have the discretion to
--------
grant additional Years of Service to Participants.
Wherever appropriate, words used in this Plan in the singular may
include the plural or the plural may be read as the singular; the masculine
gender may include the feminine, and the feminine may include the masculine.
11
<PAGE>
ARTICLE III
Retirement Income
-----------------
3.1 Retirement Income. A Participant who has satisfied the vesting
-----------------
conditions related to such benefits set forth in Section 3.7 shall receive
retirement income in the amount determined under Section 3.2, 3.3, or 3.4, as
such amount may be reduced under Section 3.5. Any such vested retirement income
("Retirement Benefit") shall be payable in the form specified in Section 3.6.
3.2 Normal Retirement Income. Subject to his meeting the applicable
------------------------
requirements of Section 3.7, a Participant shall receive under this Section 3.2
monthly payments ("Normal Retirement Income") commencing at the date specified
in and in an annual amount determined under Subsection 3.2(a), (b), (c), or (d),
as the case may be. Notwithstanding the foregoing, the Committee in its sole
discretion may increase the amount of Normal Retirement Income payable under
this Plan.
(a) A Participant who has attained his Normal Retirement Date,
terminated employment with the Company and notified the Company of his desire to
commence benefits under this Subsection, shall receive annually, commencing on
his Normal Retirement Date, an amount equal to the benefit payable under the
benefit formula in the Pension Plan in the
12
<PAGE>
form of a straight life annuity without regard to the $150,000 maximum salary
limitation, as such limitation may be Adjusted, under Section 401(a)(17) of the
Code, and without regard to the $90,000 maximum dollar limitation, as such
limitation may be Adjusted, on benefits (or, if applicable, the percentage limit
set forth therein) under Section 415(b) of the Code.
(b) An Executive Participant who meets the conditions to receive a
benefit under Subsection 3.2(a) shall receive annually, commencing on his Normal
Retirement Date, an amount equal to the greater of (i) the amount payable to
-
such Executive Participant under Subsection 3.2(a) or (ii) (x) 3% of his Highest
-- -
Average Earnings multiplied by his Years of Service not in excess of 15 years,
less (y) 3% of his Primary Social Security Benefit multiplied by his Years of
-
Service not in excess of 15 years.
(c) A Designated Participant who meets the conditions to receive a
benefit under Subsection 3.2(a) shall receive annually, commencing on his Normal
Retirement Date, an amount equal to the greater of (i) the amount payable to
-
such Designated Participant under Subsection 3.2(b) or (ii)(x) 45% (or such
--
other percentage as shall be designated by the Committee at the time it
designates the Employee as a Designated Participant) of his Highest Average
Earnings
13
<PAGE>
times the lesser of (1) one or (2) a fraction, the numerator of which is the
Designated Participant's Years of Service and the denominator of which is the
remainder of 62 minus the Participant's age at his or her birthday occurring in
the calendar year in which he or she first becomes an employee of the Company
less (y) the product of his Primary Social Security Benefit times a percentage
equal to the percentage determined under subclause (ii)(x).
(d) A Grandfathered Participant who meets the conditions to receive a
benefit under subsection 3.2(a) shall receive annually, commencing on his Normal
Retirement Date, an amount equal to the greater of (i) the largest amount
-
payable to such Grandfathered Participant under Subsection 3.2(a), (b) or (c)
or (ii) the greater of (x) an amount equal to 1.5% of his Highest Average
-
Earnings multiplied by the number of his Years of Service, less $762, and (y)
-
an amount equal to 3% of his Highest Average Earnings multiplied by the number
of his Years of Service not in excess of 15 Years of Service, less $762.
3.3 Deferred Retirement Income. A Participant who continues in
-------------------------------
employment after his Normal Retirement Date shall continue to accrue benefits
under this Plan after his Normal Retirement Date which shall be determined under
Section 3.2 based on Years of Service and Earnings to the
14
<PAGE>
Deferred Retirement Date. Alternatively, the Committee, in its sole discretion,
may adjust the Normal Retirement Income of a Participant who retires after he
attains his Normal Retirement Date to provide a benefit which is the Actuarial
Equivalent of the accrued benefit the Participant would have received at his
Normal Retirement Date or at any time thereafter, provided that in no event
shall a Participant's Deferred Retirement Income be less than that determined
under the first sentence of this Section 3.3.
3.4 Early Retirement Income. Subject to his meeting the requirements
-----------------------
of Section 3.7, a Participant who has attained his Early Retirement Date and who
wishes to receive benefits determined in accordance with Section 3.2 before the
attainment of his Normal Retirement Date shall so notify the Company and shall
thereupon receive Early Retirement Income commencing before his Normal
Retirement Date. The annual amount of Early Retirement Income shall be equal to
the greater of (i) the Normal Retirement Income credited under Section 3.2(a)
-
based on Years of Service and earnings, as defined in the Pension Plan, to his
Early Retirement Date and (ii) the Normal Retirement Income credited under
--
Section 3.2(b) or 3.2(c), whichever is applicable, assuming that the Participant
retired at the later of age 62 or his age on his Early Retirement Date (without
giving effect to the require-
15
<PAGE>
ment of Section 3.2 that the Participant have attained his Normal Retirement
Date) and based on his current Highest Average Earnings, multiplied by a
fraction, the numerator of which is his actual Years of Service and the
denominator of which is his projected Years of Service had he continued
employment until the attainment of the later of age 62 or his age on his Early
Retirement Date, or (c) the Normal Retirement Income credited under Section
3.2(d) based on Years of Service and Highest Average Earnings to his Early
Retirement Date. The amount determined under the preceding sentence (whether
under subclause (a), (b) or (c)) shall be reduced by 1/3 of 1% for each month by
which his age, when payment commences, is less than 62. No adjustment shall be
made for commencements after age 62. The Committee shall have complete
discretion as to whether to decrease or eliminate the reductions described in
this Section 3.4, and its decision shall be final in all respects.
3.5 Reduction for Benefits Received Under Other Retirement Plans.
------------------------------------------------------------
The amount of Normal Retirement Income payable to a Participant shall be reduced
by the Actuarial Equivalent of any amount paid or payable to the Participant
under any plan, program or agreement providing pension, retirement, or related
benefits (but excluding benefits under any savings, stock bonus or incentive
plan unless the
16
<PAGE>
Committee in its sole discretion determines to include such a plan at either the
time a person becomes eligible for this Plan or at the time of the awarding of
recognition of additional Years of Service pursuant to Article I hereof or an
additional benefit pursuant to Section 3.2 hereof, but in the event of such
additional recognition of service or additional benefit, the reduction shall
not be greater than the additional Retirement Income created by such additional
recognition of service or additional benefit (an "Other Retirement Plan"))
maintained by the Company or any Affiliate (unless it expressly provides
otherwise). In the event the Committee, in its sole discretion, grants
additional Years of Service to Participants based on prior service with previous
employers, the amount of Normal Retirement Income described in the preceding
sentence shall be further reduced by the Actuarial Equivalent of any amount paid
or payable to the Participant under any Other Retirement Plan maintained by the
Participant's previous employers (unless the Committee in its sole discretion
modifies such reduction).
3.6 Form of Benefits. If a Participant is married on the date his
----------------
Retirement Benefit commences to be paid such Benefit shall be payable in the
form of a joint and survivor annuity which is the Actuarial Equivalent of such
Benefit and is payable to the Participant for his life-
17
<PAGE>
time and following his death to his surviving spouse for the lifetime of the
spouse in one-half the amount payable to the Participant.
If a Participant is not married on the date his Retirement Benefit
commences to be paid such Benefit shall be payable in the form of a life annuity
for his life.
Notwithstanding the foregoing, with the consent of the Committee,
which it may grant or deny in its sole discretion, a Participant may receive
his Retirement Benefit in a form other than specified above, if such optional
form of payment is available under the Pension Plan and the Participant meets
each requirement under the Pension Plan respecting the election of such form of
payment. Each optional form of payment shall be the Actuarial Equivalent of the
Participant's Retirement Benefit.
If an amount is payable under this Plan in respect of a Participant,
and the present value of such amount does not exceed $3,500, such present value
may be immediately distributed to the Participant (or his beneficiary, as the
case may be) at the discretion of the Company, without the consent of the
Participant.
3.7 Vesting of Retirement Benefit. Except as provided in Section
-----------------------------
3.8, no amount shall be payable to a Participant as a Retirement Benefit unless
such Participant
18
<PAGE>
is vested in such Retirement Benefit in accordance with the provisions of this
Section 3.7. A Participant who has completed 5 Years of Service shall be
vested in the Retirement Benefit payable under subsection 3.2(a) and, to the
extent applicable, 3.2(d). A Participant who has attained his Early Retirement
Date (age 55 with 10 Years of Service) while a Participant shall be vested in
the Retirement Benefit described in subsection 3.2(b) or 3.2(c), whichever is
applicable, and payable under Section 3.4. A Participant who has attained his
Normal Retirement Date and completed 10 Years of Service while a Participant
shall be vested in the Retirement Benefit described in subsection 3.2(b) or
3.2(c), whichever is applicable, and payable under either Section 3.2 or 3.3.
3.8 Involuntary Termination of Employment Following a Change of
-----------------------------------------------------------
Control. Notwithstanding anything else in this Plan to the contrary, in the
- -------
event a Participant is Involuntarily Terminated within two years following the
occurrence of a Change of Control, regardless of the Participant's age and
Years of Service at such termination, such Participant shall be entitled to
receive a monthly benefit commencing at or after the later of age 55 and such
termination of employment equal to the benefit that would have been payable to
such Participant at his Normal Retirement Date
19
<PAGE>
(but subject to an actuarial reduction for early commencement to the extent
such reduction would be imposed under Section 3.4) based on the number of Years
of Service such Participant had completed prior to such termination, plus two
additional Years of Service.
ARTICLE IV
Death Benefits
--------------
If a Participant dies after becoming eligible (other than satisfying
the requirement for actual retirement) for Early Retirement Income under
Section 3.4 and is survived by a spouse, such spouse shall be paid a benefit (a
"Surviving Spouse's Benefit") commencing on the first day of the month in which
the Participant would have attained his Early Retirement Date had he survived.
The monthly amount of the Surviving Spouse's Benefit payable in accordance with
this Article shall be equal to the monthly amount which would have been payable
to the Participant's spouse if the deceased Participant had separated from
service on the date of death, survived until his Early Retirement Date, retired
on his Early Retirement Date with a "joint and survivor annuity" as described in
Section 3.6, and died on the day following his Early Retirement Date.
20
<PAGE>
If a Participant dies while employed by the Company and is not
married, no death benefit shall be payable under this Plan.
Notwithstanding the preceding provisions of this Article IV, (i) if a
-
Participant dies while employed by the Company and after properly electing an
optional form of payment in accordance with Section 3.6 that has been consented
to by the Committee, payment shall be made in accordance with such election or
(ii) if a Participant who is entitled to receive a Retirement Benefit under
--
subsection 3.2(a) dies, the Company shall pay a death benefit hereunder to the
beneficiary, if any, to whom the Pension Plan pays a death benefit in respect of
such Participant in an amount equal to the amount which would have been payable
to such beneficiary under the Pension Plan had such Retirement Benefit been
payable under the Pension Plan.
ARTICLE V
Administrative and General Provisions
-------------------------------------
5.1 Administration. This Plan shall be administered by Tambrands
--------------
Inc. Tambrands Inc. shall have the power, subject to the terms of this Plan, to
make all interpretations and other determinations not reserved to the Committee
which may be necessary or desirable for this
21
<PAGE>
Plan's administration. Any interpretations and determinations of the Committee
or Tambrands Inc. shall be final and conclusive. No member of the Committee or
employee of Tambrands Inc. may act or vote upon a decision specifically relating
to his own participation in this Plan. No member of the Board of Directors of
Tambrands Inc. or the Committee and no employee of Tambrands Inc. shall be
liable for any action or determination made in good faith with respect to this
Plan or the rights of any person under this Plan, nor shall Tambrands Inc. be
liable for any such action or determination. Tambrands Inc. or its agents
shall keep such records as may be necessary for the administration of this Plan
and shall furnish Participants such statements as it may determine to be
necessary or desirable to show their interests in this Plan.
22
<PAGE>
5.2 Claims Procedure.
----------------
(a) The Committee shall be responsible for determining all claims
for benefits under this Plan by Participants or their beneficiaries. Within 90
days after receiving a claim (or within up to 180 days, if the claimant is so
notified, including the reason for the delay), the Committee shall notify the
Participant or beneficiary of its decision in writing, giving the reasons for
its decision if adverse to the claim. If the decision is adverse to the
claimant, the Committee shall advise him of the Plan provisions involved, of
any additional information which he must provide to perfect his claim and why,
and of his right to request a review of the decision.
(b) A claimant may request a review of an adverse decision by written
request to the Committee made within 60 days after receipt of the decision. The
claimant, or his attorney, may review pertinent documents and submit written
issues and comments.
(c) Within 60 days after receiving a request for review, the
Committee shall notify the claimant in writing of (i) its decision, (ii) the
reasons therefor, and (iii) the Plan provisions upon which it is based.
(d) The Committee may at any time alter the claims procedure set
forth above, so long as the revised
23
<PAGE>
claims procedure complies with ERISA and the regulations issued thereunder.
5.3 Inalienability and Forfeiture of Benefits. Except as set forth
-----------------------------------------
below, the benefits payable under this Plan shall not be subject to alienation,
transfer, assignment, garnishment, execution or levy of any kind, and any
attempt to cause any benefits to be so subjected shall not be recognized. If
any Participant entitled to a benefit under this Plan is discharged for cause,
enters into competition with the Company, interferes with the relations between
the Company and any customer, discloses confidential information that has an
adverse effect on the Company, or engages in any activity that would result in
any decrease in sales or income of the Company, the rights of such Participant
to a benefit under this Plan will be forfeited, unless the Committee in its sole
discretion determines that such activity is not detrimental to the best interest
of the Company. The foregoing sentence of this Section 5.3 shall not apply (a)
to any event or action occurring after a Change of Control, or (b) to any event
occurring prior to a Change of Control unless the Participant had been notified
in writing prior to such Change of Control of implementation of the foregoing
sentence or the Committee had otherwise taken formal actions to implement the
foregoing sentence.
24
<PAGE>
5.4 Unsecured General Creditor. Participants shall have no legal or
--------------------------
equitable rights, interest or claims in any property or assets of the Company.
Except as expressly otherwise provided by the Company pursuant to Section 5.5,
no assets of the Company shall be held under any trust for the benefit of
Participants, or held in any way as collateral security for the fulfilling of
the obligations of the Company under this Plan. The Company's obligation
under this Plan shall be merely that of an unfunded and unsecured promise of the
Company to pay money in the future. Notwithstanding any other provision of this
Plan, any claim for benefits under this Plan shall be subordinate to claims by
general creditors of the Company against the assets of the Company and against
the assets of any trust that may be established by the Company pursuant to
Section 5.4.
5.5 Trust. The Company shall be responsible for the payment of all
-----
benefits provided under this Plan. At its discretion, Tambrands Inc. may
establish one or more trusts, with such trustees as the Committee may approve,
for the purpose of providing for the payment of such benefits. Such trust or
trusts may be irrevocable, but the assets thereof shall be subject to the claims
of the Company's creditors. To the extent any benefits provided under this Plan
are actually paid from any such trust, the Company
25
<PAGE>
shall have no further obligation with respect thereto, but to the extent not so
paid, such benefits shall remain the obligation of, and shall be paid by, the
Company. In the event that assets of any such trust are applied to satisfy
claims of creditors of the Company, an amount equal to the amount so applied
shall be contributed promptly to the trust by the Company.
5.6 Not a Contract of Employment. The terms and conditions of this
----------------------------
Plan shall not be deemed to constitute a contract of employment between the
Company and the Participant, and the Participant shall have no rights against
the Company except as may otherwise be specifically provided herein. Moreover,
nothing in this Plan shall be deemed to give a Participant the right to be
retained in the service of the Company or to interfere with the right of the
Company to discipline or discharge him at any time for any reason whatsoever.
5.7 Captions. The captions of the articles, sections and paragraphs
--------
of this Plan are for convenience only and shall not control or affect the
meaning or construction of any of its provisions.
5.8 Governing Law. The provisions of this Plan shall be construed
-------------
and interpreted according to the laws of the State of New York.
26
<PAGE>
5.9 Validity. In case any provision of this Plan shall be illegal or
--------
invalid for any reason, said illegality or invalidity shall not affect the
remaining parts hereof, but this Plan shall be construed and enforced as if such
illegal and invalid provision had never been inserted herein.
5.10 Notice. Any notice or filing required or permitted to be given
------
to the Committee or the Company under this Plan shall be sufficient if in
writing and hand delivered, or sent by registered or certified mail, to the
Committee or the Company, as the case may be, at the principal office of the
Company. Such notice shall be deemed given as of the date of delivery or, if
delivery is made by mail, as of the date shown on the postmark on the receipt
for registration or certification.
5.11 Incompetent Participant. In the event that it shall be found
-----------------------
upon evidence satisfactory to the Company that any Participant to whom a benefit
is payable under this Plan is unable to care for his affairs because of illness
or accident, any payment due (unless prior claim therefor shall have been made
by a duly authorized guardian or other legal representative) may be paid, upon
appropriate indemnification of the Company and the Committee, to the spouse or
other person deemed by the Company to have incurred expense
27
<PAGE>
for such Participant. Any such payment shall be a payment for the account of
the Participant and shall be a complete discharge of any liability of this Plan
therefor.
ARTICLE VI
Amendment and Termination
-------------------------
The Committee may terminate or amend this Plan in any respect at any
time, provided that no action of the Committee may, without the consent of the
person involved, alter or impair the rights of a Participant to any benefits
accrued and vested hereunder.
IN WITNESS WHEREOF, the Company has caused this instrument to be
executed by its duly authorized officer, as of this 24th day of March, 1994.
TAMBRANDS INC.
By:/s/ Helen G. Goodman
__________________________
Title: Senior Vice President -
Human Resources
28
<PAGE>
EXHIBIT 10.8(e)
FOURTH AMENDMENT TO
THE TAMBRANDS INC.
1992 DIRECTORS STOCK INCENTIVE PLAN
-----------------------------------
WHEREAS, TAMBRANDS INC. (the "Company") adopted the 1992 Directors Stock
Incentive Plan (the "Plan"); and
WHEREAS, pursuant to Section 13 of the Plan, the Board of Directors
retained the right to amend the Plan;
NOW, THEREFORE, the Plan is amended as follows:
1. Section 8(b) is amended to delete the first sentence thereof and to
substitute a new first sentence thereof, to read as follows:
The date of each grant shall be November 15 for Awards granted in
1991, August 15 for Awards granted in 1992 to Participating Directors,
August 24 for Awards granted in 1993 to Participating Directors, August 23
for Awards granted in 1994 to Participating Directors and September 15 for
Awards granted in 1994 to Eligible Directors (the "Date of Grant").
2. Section 8(d) is amended to delete the first sentence thereof and
to substitute a new first sentence thereof, to read as follows:
A Participant who wishes to elect to receive an Exchange Option in
accordance with Section 8(a) shall deliver to the Secretary of the Company
a written irrevocable election, in a form acceptable to the General Counsel
of the Company, not later than November 8, 1991 for grants to be made in
November 1991, August 10, 1992 for grants to be made in August 1992, August
17, 1993 for grants to be made in August 1993, August 16, 1994 for grants
to be made in August 1994 and September 8 for grants to be made in
September 1994, specifying the type and amount of compensation such
Participant wishes to forgo.
<PAGE>
-2-
3. This Fourth Amendment to the Plan shall be effective as of March
1, 1994.
IN WITNESS WHEREOF, the Company has caused this Fourth Amendment to be
executed by its duly authorized officer on the ______ day of ________________,
1994.
TAMBRANDS INC.
By:___________________________
Title:________________________
WITNESS:
_________________________
Title:___________________
<PAGE>
EXHIBIT 10.9(E)
EMPLOYMENT PROTECTION AGREEMENT
-------------------------------
THIS AGREEMENT between Tambrands Inc., a Delaware corporation (the
"Corporation"), and Helen G. Goodman (the "Executive"), dated as of this 1st day
of December 1989.
W I T N E S S E T H :
- - - - - - - - - -
WHEREAS, the Corporation and the Executive have agreed to enter into an
agreement providing the Corporation and the Executive with certain rights upon
the occurrence of a Change of Control (as defined below) to assure the
Corporation of continuity of management in the event of any Change of Control;
NOW, THEREFORE, in consideration of the premises and mutual covenants
herein contained, it is hereby agreed by and between the Corporation and the
Executive as follows:
1. Operation of Agreement. The effective date of this Agreement shall
----------------------
be the date on which a Change of Control occurs (the "Effective Date"), provided
that if the Executive is not employed by the Corporation on the Effective Date
this Agreement shall be void and without effect. This Agreement shall terminate
on November 30, 1992, provided that the termination date of this Agreement shall
be extended for one additional year on December 1, 1990 and each subsequent
December 1, unless the Executive shall have received written notice from the
Corporation prior to the September 1 immediately preceding such December 1 that
the Board of Directors of the Corporation (the "Board") has determined that the
termination date of this Agreement shall not be so extended. Notwithstanding
the foregoing, this Agreement shall not terminate on the date determined in
accordance with the preceding sentence if a Change of Control shall have
occurred prior to such date.
2. Definitions. (a) Change of Control. For purposes of this
----------- -----------------
Agreement, a "Change of Control" shall be deemed to have occurred if: (i) any
---
person (as defined in Section 3(a)(9) of the Securities Exchange Act of 1934, as
amended from time to time (the "Exchange Act"), and as used in Sections 13(d)
and 14(d) thereof)), excluding the Corporation, any majority owned subsidiary
of the Corporation (a "Subsidiary") and any employee benefit plan sponsored or
maintained by the Corporation or any Subsidiary (including any trustee of such
plan acting as trustee), but including a "group" as defined in Section 13(d)(3)
of the Exchange Act (a "Person"), becomes the beneficial owner of shares of the
Corporation having at least 20% of the total number of votes that may be cast
for the election of directors of the Corporation (the "Voting Shares") provided,
however, that such an event shall not constitute a Change of Control if the
acquiring Person has entered into an agreement with the Corporation approved by
the Board which materially restricts the right of such Person to direct or
influence the management or policies of the Corporation; (ii) the shareholders
----
of the Corporation shall approve any merger or other business combination of the
Corporation, sale of the Corporation's assets or combination of the foregoing
transactions (a "Transaction") other than a Transaction involving only the
Corporation and one or more of its Subsidiaries, or a Transaction immediately
following which the shareholders of the Corporation immediately prior to the
Transaction continue to have a majority of the voting power in the resulting
entity excluding for this purpose any shareholder owning directly or indirectly
more than 10% of the shares of the other company involved in the Transaction, or
(iii) within any 24-month period beginning on or after November 30, 1989, the
- -----
persons
<PAGE>
who were directors of the Corporation immediately before the beginning of such
period (the "Incumbent Directors") shall cease (for any reason other than death)
to constitute at least a majority of the Board or the board of directors of any
successor to the Corporation, provided that any director who was not a director
as of December 1, 1989 shall be deemed to be an Incumbent Director if such
director was elected to the Board by, or on the recommendation of or with the
approval of, at least two-thirds of the directors who then qualified as
Incumbent Directors either actually or by prior operation of this Section
2(a)(iii).
(b) Participation by Executive. Notwithstanding the foregoing, no
--------------------------
Change of Control shall be deemed to have occurred for purposes of this
Agreement by reason of any actions or events in which the Executive participates
in a capacity other than in his capacity as the Executive (or as a director of
the Corporation or a Subsidiary, where applicable).
3. Employment Period. If the Executive is employed on the Effective
-----------------
Date, the Corporation agrees to continue the Executive in its employ, and the
Executive agrees to remain in the employ of the Corporation, for the period
(the "Employment Period") commencing on the Effective Date and ending on the
earliest to occur of (i) the second anniversary of the Effective Date, (ii) the
--- ----
Executive's normal retirement date under the Corporation's retirement plans as
in effect from time to time and (iii) the date of any termination of the
-----
Executive's employment in accordance with Section 6 of this Agreement.
4. Position and Duties. (a) No Reduction in Position. During the
------------------- ------------------------
Employment Period, the Executive's position (including titles), authority and
responsibilities shall be at least commensurate with the highest of those held,
exercised and assigned at any time during the 90-day period immediately
preceding the Effective Date.
(b) Business Time. From and after the Effective Date, the Executive
-------------
agrees to devote his full business time during normal business hours to the
business and affairs of the Corporation and to use his best efforts to perform
faithfully and efficiently the responsibilities assigned to him hereunder, to
the extent necessary to discharge such responsibilities, except for
(i) reasonable time spent in serving on corporate, civic or charitable
boards or committees approved by the Board, in each case only if and
to the extent not substantially interfering with the performance of
such responsibilities, and
(ii) periods of vacation and sick leave to which he is entitled.
It is expressly understood and agreed that the Executive's continuing to serve
on any boards and committees on which he is serving or with which he is
otherwise associated with the consent or approval of the Corporation immediately
preceding the Effective Date shall not be deemed to interfere with the
performance of the Executive's services to the Corporation.
5. Compensation. (a) Base Salary. During the Employment Period, the
------------ -----------
Executive shall receive a base salary ("Base Salary") at a monthly rate at least
equal to the monthly salary paid to the Executive by the Corporation and any of
its affiliated companies immediately prior to the Effective Date. The Base
Salary shall be reviewed at least once each year after the Effective Date, and
may be increased (but not decreased) at any time and from time to time by action
of the Board or any committee thereof or any individual having authority to take
such action in accordance with the Corporation's regular practices. Neither
payment of the Base Salary nor payment of any increased Base Salary after the
Effective
-2-
<PAGE>
Date shall serve to limit or reduce any other obligation of the Corporation
hereunder. For purposes of the remaining provisions of this Agreement, the
term "Base Salary" shall mean Base Salary as defined in this Section 5(a) or, if
increased after the Effective Date, the Base Salary as so increased.
(b) Annual Bonus. In addition to the Base Salary, the Executive shall
------------
be awarded for each fiscal year of the Corporation ending during the Employment
Period an annual bonus (either pursuant to a bonus plan or program of the
Corporation or otherwise) in cash at least equal to the last annual bonus
(annualized, if awarded in respect of a partial year) awarded to the Executive
under the Annual Incentive Plan of the Corporation prior to the Effective Date
("Annual Bonus"). If a fiscal year of the Corporation begins, but does not end,
during the Employment Period, the Executive shall receive an amount with respect
to such fiscal year at least equal to the amount of the Annual Bonus multiplied
by a fraction, the numerator of which is the number of days in such fiscal year
occurring during the Employment Period and the denominator of which is 365.
Each amount payable in respect of the Executive's Annual Bonus shall be paid not
later than the last day of March of the year next following the year for which
the Annual Bonus (or pro-rated portion) is earned or awarded, unless electively
deferred by the Executive pursuant to any deferral programs or arrangements that
the Corporation may make available to the Executive, in which event such
deferred amount shall be payable in accordance with the terms of such deferral
program or arrangement. Neither the Annual Bonus nor any bonus amount paid in
excess thereof after the Effective Date shall serve to limit or reduce any other
obligation of the Corporation hereunder.
(c) Incentive and Savings Plans and Retirement Programs. In addition
---------------------------------------------------
to the Base Salary and Annual Bonus payable as hereinabove provided, during the
Employment Period, the Executive shall be entitled to participate in all
incentive and savings plans and programs, including stock option plans and other
equity based compensation plans, and in all retirement plans, on a basis
providing him with the opportunity to receive compensation (without duplication
of the amount payable as an Annual Bonus) and benefits equal to those provided
by the Corporation to the Executive on an annualized basis under such plans and
programs as in effect at any time during the 90-day period immediately preceding
the Effective Date.
(d) Benefit Plans. During the Employment Period, the Executive and his
-------------
family shall be entitled to participate in or be covered under all welfare
benefit plans and programs of the Corporation and its affiliated companies,
including all medical, dental, disability, group life, accidental death and
travel accident insurance plans and programs, as in effect at any time during
the 90-day period immediately preceding the Effective Date.
(e) Expenses. During the Employment Period, the Executive shall be
--------
entitled to receive prompt reimbursement for all reasonable expenses incurred by
the Executive in accordance with the policies and procedures of the Corporation
as in effect at any time during the 90-day period immediately preceding the
Effective Date.
(f) Vacation and Fringe Benefits. During the Employment Period, the
----------------------------
Executive shall be entitled to paid vacation and fringe benefits in accordance
with the policies of the Corporation as in effect at any time during the 90-day
period immediately preceding the Effective Date.
(g) Office and Support Staff. During the Employment Period, the
------------------------
Executive shall be entitled to an office or offices of a size and with
-3-
<PAGE>
furnishings and other appointments, and to secretarial and other assistance, at
least equal to the most favorable of the foregoing provided to the Executive at
any time during the 90-day period immediately preceding the Effective Date.
6. Termination. (a) Death, Disability or Retirement. Subject to the
----------- -------------------------------
provisions of Section 1 hereof, this Agreement shall terminate automatically
upon the Executive's death or attainment of normal retirement age under the
Corporation's retirement plans as in effect from time to time, provided that,
after the Effective Date, the normal retirement age may not be lowered for
purposes of this Agreement without the Executive's consent. The Corporation
may terminate this Agreement, after having established the Executive's
Disability, by giving the Executive written notice of its intention to terminate
his employment, and his employment with the Corporation shall terminate
effective on the 90th day after receipt of such notice if, within 90 days after
such receipt, the Executive shall fail to return to full-time performance of his
duties. For purposes of this Agreement, "Disability" means disability which,
after the expiration of more than 26 weeks after its commencement, is determined
to be total and permanent by a physician selected by the Corporation or its
insurers and acceptable to the Executive or his legal representatives (such
agreement to acceptability not to be withheld unreasonably).
(b) Voluntary Termination. Notwithstanding anything in this Agreement
---------------------
to the contrary, the Executive may, upon not less than 30 days' written notice
to the Corporation, voluntarily terminate employment during the Employment
Period for any reason (including early retirement under the terms of the
Corporation's retirement plan as in effect from time to time), provided that any
termination by the Executive pursuant to Section 6(d) of this Agreement on
account of Good Reason (as defined therein) shall not be treated as a voluntary
termination under this Section 6(b).
(c) Cause. The Corporation may terminate the Executive's employment
-----
during the Employment Period for Cause. For purposes of this Agreement, "Cause"
means (i) an act or acts of dishonesty or gross misconduct on the Executive's
---
part which result or are intended to result in material damage to the
Corporation's business or reputation or (ii) repeated material violations by the
----
Executive of his obligations under Section 4 of this Agreement which violations
are demonstrably willful and deliberate on the Executive's part.
(d) Good Reason. The Executive may terminate his employment during the
-----------
Employment Period for Good Reason. For purposes of this Agreement, "Good
Reason" means
(i) a good faith determination by the Executive that, without his prior
written consent, the Corporation or any of its officers has taken or failed
to take any action (including, without limitation, (A) exclusion of the
---
Executive from consideration of material matters within his area of
responsibility, (B) statements or actions which undermine the Executive's
---
authority with respect to persons under his supervision or reduce his
standing with his peers, (C) a pattern of discrimination against or
---
harassment of the Executive or persons under his supervision and (D) the
---
subjection of the Executive to procedures not generally applicable to other
similarly situated executives) which changes the Executive's position
(including titles), authority or responsibilities under Section 4 of this
Agreement or reduces the Executive's ability to carry out his duties and
responsibilities under Section 4 of this Agreement;
(ii) any failure by the Corporation to comply with any of the
provisions of Section 5 of this Agreement, other than an insubstantial or
inadvertent failure remedied by the Corporation promptly
-4-
<PAGE>
after receipt of notice thereof from the Executive;
(iii) the Corporation's requiring the Executive to be employed at any
location more than 50 miles further from his principal residence than the
location at which the Executive was employed immediately preceding the
Effective Date; or
(iv) any failure by the Corporation to obtain the assumption of and
agreement to perform this Agreement by a successor as contemplated by
Section 14(b) of this Agreement, provided that the successor has had actual
written notice of the existence of this Agreement and its terms and an
opportunity to assume the Corporation's responsibilities under this
Agreement during a period of 10 business days after receipt of such notice.
(e) Notice of Termination. Any termination by the Corporation for
---------------------
Cause or by the Executive for Good Reason during the Employment Period shall be
communicated by Notice of Termination to the other party hereto given in
accordance with Section 15(c) of this Agreement. For purposes of this
Agreement, a "Notice of Termination" means a written notice given, in the case
of a termination for Cause, within 10 business days of the Corporation's having
actual knowledge of all of the events giving rise to such termination, and in
the case of a termination for Good Reason, within 180 days of the Executive's
having actual knowledge of the events giving rise to such termination, and which
(i) indicates the specific termination provision in this Agreement relied upon,
- ---
(ii) sets forth in reasonable detail the facts and circumstances claimed to
- ----
provide a basis for termination of the Executive's employment under the
provision so indicated, and (iii) if the termination date is other than the date
-----
of receipt of such notice, specifies the termination date of this Agreement
(which date shall be not more than 15 days after the giving of such notice).
The failure by the Executive to set forth in the Notice of Termination any fact
or circumstance which contributes to a showing of Good Reason shall not waive
any right of the Executive hereunder or preclude the Executive from asserting
such fact or circumstance in enforcing his rights hereunder.
(f) Date of Termination. For purposes of this Agreement, the term
-------------------
"Date of Termination" means (i) in the case of a termination for which a Notice
---
of Termination is required, the date of receipt of such Notice of Termination
or, if later, the date specified therein and (ii) in all other cases, the actual
date on which the Executive's employment terminates during the Employment
Period.
7. Obligations of the Corporation upon Termination. (a) Death. If
----------------------------------------------- ------
the Executive's employment is terminated during the Employment Period by reason
of the Executive's death, this Agreement shall terminate without further
obligations to the Executive's legal representatives under this Agreement other
than those obligations accrued hereunder at the date of his death, including,
for this purpose (i) the Executive's full Base Salary through the Date of
---
Termination, (ii) the product of the Annual Bonus and a fraction, the numerator
----
of which is the number of days in the current fiscal year of the Corporation
through the Date of Termination, and the denominator of which is 365 (the "Pro-
rated Bonus Obligation"), (iii) any compensation previously deferred by the
-----
Executive (together with any accrued earnings thereon) and not yet paid by the
Corporation and (iv) any other amounts or benefits owing to the Executive under
----
the then applicable employee benefit plans or policies of the Corporation (such
amounts specified in clauses (i), (ii), (iii) and (iv) are hereinafter referred
to as "Accrued Obligations"). Unless otherwise directed by the Executive (or,
in the case of any employee benefit plan qualified (a "Qualified Plan") under
Section 401(a) of the Internal Revenue Code of 1986, as amended (the "Code"), as
may be required by such plan), all such Accrued Obligations shall be paid to the
Executive's legal representatives
-5-
<PAGE>
in a lump sum in cash within 30 days of the Date of Termination. Anything in
this Agreement to the contrary notwithstanding, the Executive's family shall be
entitled to receive benefits at least equal to the most favorable level of
benefits available to surviving families of executives of the Corporation and
its affiliates under such plans, programs and policies relating to family death
benefits, if any, of the Corporation and its affiliates in effect at any time
during the 90-day period immediately preceding the Effective Date.
(b) Disability. If the Executive's employment is terminated by reason
----------
of the Executive's Disability, the Executive shall be entitled, after the Date
of Termination until the date when the Employment Period would otherwise have
terminated, to continue to participate in or be covered under the benefit plans
and programs referred to in Section 5(d) of this Agreement or, at the
Corporation's option, to receive equivalent benefits by alternate means at least
equal to those provided in accordance with Section 5(d) of this Agreement.
Unless otherwise directed by the Executive (or, in the case of any Qualified
Plan, as may be required by such plan), the Executive shall also be paid all
Accrued Obligations in a lump sum in cash within 30 days of the Date of
Termination. Anything in this Agreement to the contrary notwithstanding, the
Executive shall be entitled to receive disability and other benefits at least
equal to the most favorable level of benefits available to disabled employees
and/or their families in accordance with the plans, programs and policies main-
tained by the Corporation or its affiliates relating to disability at any time
during the 90-day period immediately preceding the Effective Date.
(c) Cause and Voluntary Termination. If, during the Employment Period,
-------------------------------
the Executive's employment shall be terminated for Cause or voluntarily
terminated by the Executive (other than on account of Good Reason), the
Corporation shall pay the Executive the Accrued Obligations other than the Pro-
rated Bonus Obligation. Unless otherwise directed by the Executive (or, in the
case of any Qualified Plan, as may be required by such plan), the Executive
shall be paid all such Accrued Obligations in a lump sum in cash within 30 days
of the Date of Termination and the Corporation shall have no further obligations
to the Executive under this Agreement.
(d) Termination by Corporation other than for Cause or Disability and
-----------------------------------------------------------------
Termination by Executive for Good Reason. (i) Lump Sum Payment. If, during
- ---------------------------------------- ----------------
the Employment Period, the Corporation terminates the Executive's employment
other than for Cause or Disability, or the Executive terminates his employment
for Good Reason, the Corporation shall pay to the Executive in a lump sum in
cash within 15 days after the Date of Termination the aggregate of the following
amounts:
(A) if not theretofore paid, the Executive's Base Salary through the
Date of Termination at the rate specified in Section 5(a) of this Agreement;
(B) a cash amount equal to two times the sum of
(1) the Executive's annual Base Salary at the rate specified in
Section 5(a) of this Agreement;
(2) the Annual Bonus; and
(3) the present value, calculated using the annual federal short-
term rate as determined under Section 1274(d) of the Code, of (without
duplication) (x) the annual cost to the Corporation (based on the
---
premium rates or other costs to it) of obtaining coverage equivalent to
the coverage under the plans and programs described in Section 5(d) of
this Agreement, and (y) the annual-
---
-6-
<PAGE>
ized value of the fringe benefits described under Section 5(f) of this
Agreement;
provided, however, that in no event shall the Executive be entitled to
receive under this clause (B) more than the product obtained by multiplying
the amount determined under this clause by a fraction whose numerator shall
be the number of months (including fractions of a month) which at the Date
of Termination remain until the Executive's normal retirement date under
the Corporation's retirement plan or any successor plan as in effect from
time to time and whose denominator shall be 24, and provided further that,
with respect to the life and medical insurance coverage referred to in
Section 5(d) of this Agreement, at the Executive's election made prior to
the Date of Termination, the Corporation shall use its best efforts to
secure conversion coverage and shall pay the cost of such coverage in lieu
of paying the lump sum amount attributable to such life or medical insurance
coverage; and
(C) a cash amount equal to any amounts (other than amounts payable to
the Executive under any Qualified Plans) described in Sections 7(a)(iii) and
(iv) of this Agreement.
(ii) Discharge of Corporation's Obligations. Subject to the performance
--------------------------------------
of its obligations under this Section 7(d), the Corporation shall have no
further obligations to the Executive in respect of any termination by the
Executive for Good Reason or by the Corporation other than for Cause or
Disability, except to the extent expressly provided under any of the plans
referred to in Section 5(c) or 5(d) of this Agreement.
8. Non-exclusivity of Rights. Nothing in this Agreement shall prevent
-------------------------
or limit the Executive's continuing or future participation in any benefit,
bonus, incentive or other plan or program provided by the Corporation or any of
its affiliated companies and for which the Executive may qualify, nor shall
anything herein limit or otherwise prejudice such rights as the Executive may
have under any stock option or other plans or agreements with the Corporation or
any of its affiliated companies. Amounts which are vested benefits or which the
Executive is otherwise entitled to receive under any plan or program of the
Corporation or any of its affiliated companies at or subsequent to the Date of
Termination shall be payable in accordance with such plan or program.
9. Certain Reduction of Payments by the Corporation. (a) For purposes
------------------------------------------------
of this Section 9, (i) "Payment" shall mean any payment or distribution in the
---
nature of compensation to or for the benefit of the Executive, whether paid or
payable pursuant to this Agreement or otherwise; (ii) "Agreement Payment" shall
----
mean a Payment paid or payable pursuant to this Agreement (disregarding this
Section 9); (iii) "Net After Tax Receipts" shall mean the Present Value of a
-----
Payment net of all applicable Federal, State and local income and excise taxes
(the "Taxes") imposed on the Executive with respect thereto (calculated in the
manner described in Section 7(d)(ii) of this Agreement); (iv) "Present Value"
----
shall mean the present value of a Payment or an Agreement Payment determined in
accordance with Section 280G(d)(4) of the Code; and (v) "Reduced Amount" shall
---
mean the aggregate amount of Payments which (a) is less than the sum of all
---
Payments and (b) results in the greatest aggregate Net After Tax Receipts.
(b) Anything in this Agreement to the contrary notwithstanding, in the
event the Corporation's independent public accounting firm (the "Accounting
Firm") shall determine that receipt of all Payments would subject the Executive
to tax under Section 4999 of the Code, it shall
-7-
<PAGE>
determine whether some amount of Payments would meet the definition of a Reduced
Amount. If the Accounting Firm determines that there is a Reduced Amount, the
aggregate Agreement Payments shall be reduced to such Reduced Amount; provided,
however, that if the Reduced Amount exceeds the aggregate Agreement Payments,
the aggregate Payments shall, after the reduction of all Agreement Payments, be
reduced (but not below zero) in the amount of such excess.
(c) If the Accounting Firm determines that aggregate Agreement Payments
or Payments, as the case may be, should be reduced to the Reduced Amount, the
Corporation shall promptly give the Executive notice to that effect and a copy
of the detailed calculation thereof, and the Executive may then elect, in his
sole discretion, which and how much of the Payments shall be eliminated or
reduced (as long as after such election the present value of the aggregate
Payments equals the Reduced Amount), and shall advise the Corporation in writing
of his election within ten days of his receipt of notice. If no such election
is made by the Executive within such ten-day period, the Corporation may elect
which of the Agreement Payments or Payments, as the case may be, shall be
eliminated or reduced (as long as after such election the present value of the
aggregate Agreement Payments or Payments, as the case may be, equals the
Reduced Amount) and shall notify the Executive promptly of such election. All
determinations made by the Accounting Firm under this Section 9 shall be
binding upon the Corporation and the Executive and shall be made within 60 days
of a termination of employment of the Executive. As promptly as practicable
following such determination, the Corporation shall pay to or distribute for the
benefit of the Executive such Payments as are then due to the Executive under
this Agreement and shall promptly pay to or distribute for the benefit of the
Executive in the future such Payments as become due to the Executive under this
Agreement.
(d) While it is the intention of the Corporation and the Executive to
reduce the amounts payable or distributable to the Executive hereunder only if
the aggregate Net After Tax Receipts to the Executive would thereby be
increased, as a result of the uncertainty in the application of Section 4999 of
the Code at the time of the initial determination by the Accounting Firm
hereunder, it is possible that amounts will have been paid or distributed by the
Corporation to or for the benefit of the Executive pursuant to this Agreement
which should not have been so paid or distributed ("Overpayment") or that
additional amounts which will not have been paid or distributed by the
Corporation to or for the benefit of the Executive pursuant to this Agreement
should have been so paid or distributed ("Underpayment"), in each case,
consistent with the calculation of the Reduced Amount hereunder. In the event
that the Accounting Firm, based either upon the assertion of a deficiency by the
Internal Revenue Service against the Corporation or the Executive which the Ac-
counting Firm believes has a high probability of success or controlling
precedent or other substantial authority, determines that an Overpayment has
been made, any such Overpayment paid or distributed by the Corporation to or for
the benefit of the Executive shall be treated for all purposes as a loan ab
--
initio to the Executive which the Executive shall repay to the Corporation
- ------
together with interest at the applicable federal rate provided for in Section
7872(f)(2) of the Code; provided, however, that no such loan shall be deemed to
have been made and no amount shall be payable by the Executive to the
Corporation if and to the extent such deemed loan and payment would not either
reduce the Executive's Taxes or generate a refund of such Taxes. In the event
that the Accounting Firm, based upon controlling precedent or other substantial
authority, determines that an Underpayment has occurred, any such Underpayment
shall be promptly paid by the Corporation to or for the benefit of the Executive
together with interest at the applicable federal rate provided for in Section
7872(f)(2) of the Code.
-8-
<PAGE>
10. Full Settlement. The Corporation's obligation to make the payments
---------------
provided for in this Agreement and otherwise to perform its obligations
hereunder shall not be affected by any circumstances, including, without
limitation, any set-off, counterclaim, recoupment, defense or other right which
the Corporation may have against the Executive or others whether by reason of
the subsequent employment of the Executive or otherwise. In no event shall the
Executive be obligated to seek other employment by way of mitigation of the
amounts payable to the Executive under any of the provisions of this Agreement,
and no amount payable under this Agreement shall be reduced on account of any
compensation received by the Executive from other employment. In the event that
the Executive shall in good faith give a Notice of Termination for Good Reason
and it shall thereafter be determined by mutual consent of the Executive and the
Corporation or by a tribunal having jurisdiction over the matter that Good
Reason did not exist, the employment of the Executive shall, unless the
Corporation and the Executive shall otherwise mutually agree, be deemed to have
terminated, at the date of giving such purported Notice of Termination, by
mutual consent of the Corporation and the Executive and, except as provided in
the last preceding sentence, the Executive shall be entitled to receive only
those payments and benefits which he would have been entitled to receive at such
date otherwise than under this Agreement.
11. Legal Fees and Expenses. In the event that a claim for payment of
-----------------------
benefits under this Agreement is disputed, the Corporation shall pay all
reasonable legal fees and expenses incurred by the Executive in pursuing such
claim, provided that the Executive is successful as to at least part of the
disputed claim by reason of litigation, arbitration or settlement.
12. Confidential Information. The Executive shall hold in a fiduciary
------------------------
capacity for the benefit of the Corporation all secret or confidential
information, knowledge or data relating to the Corporation or any of its
affiliated companies, and their respective businesses, (i) obtained by the
---
Executive during his employment by the Corporation or any of its affiliated
companies and (ii) not otherwise public knowledge (other than by reason of an
----
unauthorized act by the Executive). After termination of the Executive's
employment with the Corporation, the Executive shall not, without the prior
written consent of the Corporation, unless compelled pursuant to an order of a
court or other body having jurisdiction over such matter, communicate or
divulge any such information, knowledge or data to anyone other than the
Corporation and those designated by it. In no event shall an asserted
violation of the provisions of this Section 12 constitute a basis for deferring
or withholding any amounts otherwise payable to the Executive under this
Agreement.
13. Employment Contract or Severance Benefits. Notwithstanding
-----------------------------------------
anything else in this Agreement to the contrary, any amount payable to the
Executive hereunder on account of his termination of employment shall be reduced
on a dollar for dollar basis by each dollar actually paid to the Executive with
respect to such termination under the terms of any employment contract between
the Executive and the Corporation or under any severance program or policy
applicable to the Executive. Nothing in this Agreement shall be construed to
require duplication of any compensation, benefits or other entitlements provided
to the Executive by the Corporation under the terms of any employment contract
which may address similar matters.
14. Successors. (a) This Agreement is personal to the Executive and,
----------
without the prior written consent of the Corporation, shall not be assignable by
the Executive otherwise than by will or the laws of descent and distribution.
This Agreement shall inure to the benefit of and be enforceable by the
Executive's legal representatives.
-9-
<PAGE>
(b) This Agreement shall inure to the benefit of and be binding upon
the Corporation and its successors. The Corporation shall require any successor
to all or substantially all of the business and/or assets of the Corporation,
whether direct or indirect, by purchase, merger, consolidation, acquisition of
stock, or otherwise, by an agreement in form and substance satisfactory to the
Executive, expressly to assume and agree to perform this Agreement in the same
manner and to the same extent as the Corporation would be required to perform if
no such succession had taken place.
15. Miscellaneous. (a) Applicable Law. This Agreement shall be
------------- --------------
governed by and construed in accordance with the laws of the State of Delaware,
applied without reference to principles of conflict of laws.
(b) Amendments. This Agreement may not be amended or modified
----------
otherwise than by a written agreement executed by the parties hereto or their
respective successors and legal representatives.
(c) Notices. All notices and other communications hereunder shall be
-------
in writing and shall be given by hand delivery to the other party or by
registered or certified mail, return receipt requested, postage prepaid,
addressed as follows:
If to the Executive: at the address listed below
If to the Corporation: Tambrands Inc.
One Marcus Avenue
Lake Success, New York 11042
Attention: Secretary
(with a copy to the
attention of the
General Counsel)
or to such other address as either party shall have furnished to the other in
writing in accordance herewith. Notices and communications shall be effective
when actually received by the addressee.
(d) Tax Withholding. The Corporation may withhold from any amounts
---------------
payable under this Agreement such Federal, State or local taxes as shall be
required to be withheld pursuant to any applicable law or regulation.
(e) Severability. The invalidity or unenforceability of any provision
------------
of this Agreement shall not affect the validity or enforceability of any other
provision of this Agreement.
(f) Captions. The captions of this Agreement are not part of the
--------
provisions hereof and shall have no force or effect.
IN WITNESS WHEREOF, the Executive has hereunto set his hand and the
Corporation has caused this Agreement to be executed in its name on its behalf,
and its corporate seal to be hereunto affixed and attested by its Assistant
Secretary, all as of the day and year first above written.
-10-
<PAGE>
ATTEST: TAMBRANDS INC.
/s/MARILYN K. JONES By/s/PAUL E. KONNEY
- ------------------------- --------------------------------
Assistant Secretary Title: Senior Vice President-
General Counsel and
(Seal) Secretary
EXECUTIVE: HELEN G. GOODMAN
/s/HELEN G. GOODMAN
----------------------------------
Address:
Tambrands Inc.
One Marcus Avenue
Lake Success, New York 11042
GOODMAN.EPA
-11-
<PAGE>
FIRST AMENDMENT
---------------
This FIRST AMENDMENT, dated as of October 16, 1990, to the Employment
Protection Agreement, dated as of December 1, 1989 (the "Employment Protection
Agreement"), by and between Helen G. Goodman (the "Executive") and Tambrands
Inc., a Delaware corporation (the "Corporation"), witnesseth:
WHEREAS, the Corporation and the Executive entered into the Employment
Protection Agreement to assure the Corporation of continuity of management in
the event of any change of control;
WHEREAS, the Board of Directors of the Corporation has authorized an
amendment to the Employment Protection Agreement that it has determined to be in
the best interests of the Corporation and its stockholders; and
WHEREAS, the Executive has agreed to such amendment;
NOW THEREFORE, in consideration of the premises, it is hereby agreed
by and between the Corporation and the Executive as follows:
1. Section 9 of the Employment Protection Agreement is hereby
amended and restated as follows:
9. Certain Additional Payments by the Corporation.
----------------------------------------------
(a) Anything in this Agreement to the contrary notwithstanding, in
the event it shall be determined that any payment or distribution by the
Corporation to or for the benefit of the Executive (whether paid or payable
or distributed or distributable pursuant to the terms of this Agreement or
otherwise, but determined without regard to any additional payments
required under this Section 9) (a "Payment") would be subject to the excise
tax imposed by Section 4999 of the Code (or any successor provision) or any
interest or penalties are incurred by the Executive with respect to such
excise tax (such excise tax, together with any such interest and penalties,
are hereinafter collectively referred to as the "Excise Tax"), then the
Executive shall be entitled to receive an additional payment (a "Gross-Up
Payment") in an amount such that after payment by the Executive of all
taxes with respect to the Gross-Up Payment (including any interest or
penalties imposed with respect to such taxes), including, without
limitation, any income taxes (and any interest and penalties imposed with
respect thereto) and Excise Tax imposed upon the Gross-Up Payment, the
Executive retains an amount of the Gross-Up Payment equal to the Excise Tax
imposed upon the Payments.
(b) Subject to the provisions of Section 9(c), all determinations
required to be made under this Section 9, including whether and when a
Gross-Up Payment is required and the amount of such Gross-Up Payment and
the assumptions to be utilized in arriving at such determination, shall be
made by KPMG Peat Marwick or other firm then auditing the accounts of the
Corporation (the "Accounting Firm") which shall provide detailed supporting
calculations both to the Corporation and the Executive within 15 business
days of the receipt of notice from the Executive that there has been a
Payment, or such earlier time as is requested by the Corporation. In the
event that the Accounting Firm is serving as accountant or auditor for the
individual, entity or group effecting the Change of Control, or is
unwilling or unable to perform its obligations pursuant to this Section 9,
the Executive shall appoint another nationally recognized accounting firm
to make the determinations required hereunder (which accounting firm shall
then be referred to as the
<PAGE>
Accounting Firm hereunder). All fees and expenses of the Accounting Firm
shall be borne solely by the Corporation. Any Gross-Up Payment, determined
pursuant to this Section 9, shall be paid by the Corporation to the
Executive within five days of the receipt of the Accounting Firm's
determination. Any determination by the Accounting Firm shall be binding
upon the Corporation and the Executive. As a result of the potential
uncertainty in the application of Section 4999 of the Code (or any
successor provision) at the time of the initial determination by the
Accounting Firm hereunder, it is possible that Gross-Up Payments which will
not have been made by the Corporation should have been made
("Underpayment"), consistent with the calculations required to be made
hereunder. In the event that the Corporation exhausts its remedies
pursuant to Section 9(c) and the Executive thereafter is required to make a
payment of any Excise Tax, the Accounting Firm shall determine the amount
of the Underpayment that has occurred and any such Underpayment shall be
promptly paid by the Corporation to or for the benefit of the Executive.
(c) The Executive shall notify the Corporation in writing of any
claim by the Internal Revenue Service that, if successful, would require
the payment by the Corporation of the Gross-Up Payment. Such notification
shall be given as soon as practicable but no later than 10 business days
after the Executive is informed in writing of such claim and shall apprise
the Corporation of the nature of such claim and the date on which such
claim is requested to be paid. the Executive shall not pay such claim
prior to the expiration of the 30-day period following the date on which he
gives such notice to the Corporation (or such shorter period ending on the
date that any payment of taxes with respect to such claim is due). If the
Corporation notifies the Executive in writing prior to the expiration of
such period that it desires to contest such claim, the Executive shall:
(i) give the Corporation any information reasonably requested by the
Corporation relating to such claim,
(ii) take such action in connection with contesting such claim as the
Corporation shall reasonably request in writing from time to
time, including, without limitation, accepting legal
representation with respect to such claim by an attorney
reasonably selected by the Corporation,
(iii) cooperate with the Corporation in good faith in order
effectively to contest such claim, and
(iv) permit the Corporation to participate in any proceedings relating
to such claim;
provided, however, that the Corporation shall bear and pay directly all
costs and expenses (including additional interest and penalties) incurred
in connection with such contest and shall indemnify and hold the Executive
harmless, on a after-tax basis, for any Excise Tax or income tax (including
interest and penalties with respect thereto) imposed as a result of such
representation and payment of costs and expenses. Without limiting the
foregoing provisions of this Section 9(c), the Corporation shall control
all proceedings taken in connection with such contest and, at its sole
option, may pursue or forgo any and all administrative appeals,
proceedings, hearings and conferences with the taxing authority in respect
of
-2-
<PAGE>
such claim and may, at its sole option, either direct the Executive to pay
the tax claimed and sue for a refund or contest the claim in any
permissible manner, and the Executive agrees to prosecute such contest to a
determination before any administrative tribunal, in a court of initial
jurisdiction and in one or more appellate courts, as the Corporation shall
determine; provided, however, that if the Corporation directs the Executive
to pay such claim and sue for a refund, the Corporation shall advance the
amount of such payment to the Executive, on an interest-free basis, and
shall indemnify and hold the Executive harmless, on an after-tax basis,
from any Excise Tax or income tax (including interest or penalties with
respect thereto) imposed with respect to such advance or with respect to
any imputed income with respect to such advance; and further provided that
any extension of the statue of limitations relating to payment of taxes for
the taxable year of the Executive with respect to which such contested
amount is claimed to be due is limited solely to such contested amount.
Furthermore, the Corporation's control of the contest shall be limited to
issues with respect to which a Gross-Up Payment would be payable hereunder
and the Executive shall be entitled to settle or contest, as the case may
be, any other issue raised by the Internal Revenue Service or any other
taxing authority.
(d) If, after the receipt by the Executive of an amount advanced by
the Corporation pursuant to Section 9(c), the Executive becomes entitled to
receive any refund with respect to such claim, the Executive shall (subject
to the Corporation's complying with the requirements of Section 9(c))
promptly pay to the Corporation the amount of such refund (together with
any interest paid or credited thereon after taxes applicable thereto). If,
after the receipt by the Executive of an amount advanced by the Corporation
pursuant to Section 9(c), a determination is made that the Executive shall
not be entitled to any refund with respect to such claim and the
Corporation does not notify the Executive in writing of its intent to
contest such denial of refund prior to the expiration of 30 days after such
determination, then such advance shall be forgiven and shall not be
required to be repaid and the amount of such advance shall offset, to the
extent thereof, the amount of Gross-Up Payment required to be paid.
2. This First Amendment may not be amended or modified other than by a
written agreement executed by the parties hereto or their respective successors
and legal representatives.
3. Except as expressly set forth herein, this First Amendment shall not
modify or amend any of the provisions contained in the Employment Protection
Agreement, all of which are ratified and affirmed in all respects and shall
continue in full force and effect.
-3-
<PAGE>
IN WITNESS WHEREOF, the Executive has hereunto set his hand and the
Corporation has caused this First Amendment to be executed in its name on its
behalf, and its corporate seal to be hereunto affixed and attested, all as of
the day and year first above written.
ATTEST: TAMBRANDS INC.
/s/JONATHAN W. EMERY By/s/PAUL E. KONNEY
- -------------------- ---------------------------
Title: Senior Vice President
General Counsel and Secretary
EXECUTIVE
(Seal)
/s/HELEN G. GOODMAN
-----------------------------
Name: Helen G. Goodman
FIRSTAMN
-4-
<PAGE>
EXHIBIT 10.(21)
EARLY RETIREMENT AGREEMENT
--------------------------
EARLY RETIREMENT AGREEMENT, dated as of February 28, 1994, by and between
TAMBRANDS INC., a Delaware corporation (the "Company"), and Charles J. Chapman
("Employee").
WHEREAS, Employee has expressed his intention to retire from employment
with the Company;
WHEREAS, Employee holds a position of significant importance to the
Company;
WHEREAS, the Company believes that it is in its best interest to retain the
services of Employee for at least several months; and
WHEREAS, Employee is willing to delay his early retirement and to remain
employed by the Company on the terms and conditions hereinafter set forth;
NOW, THEREFORE, in consideration of their mutual promises, the Company and
Employee agree as follows:
1. Employment Period. Employee shall remain in the Company's employ from
-----------------
the date hereof until at least July 1, 1994 (the "Earliest Retirement Date").
Employee's employment hereunder shall cease on or after the Earliest Retirement
Date upon the first to occur of (i) his retirement or other voluntary
-
termination of employment, (ii) the date the Company terminates his employment
--
pursuant to Section 9 below, (iii) his death or his termination of employment
---
due to disability (within the meaning of section 105(d)(4) of the Internal
Revenue Code of 1986, as amended) and (iv) April 25, 1995. The period during
--
which Employee remains an employee hereunder (regardless of whether after the
Earliest Retirement Date) shall be referred to as the "Employment Period".
2. Title and Responsibilities. During the Employment Period, Employee
--------------------------
shall have the title of Executive Vice President and President, North America
and shall have the responsibilities associated with such title and his position
as in effect immediately prior to the date hereof. Notwithstanding anything
else contained herein to the contrary, regardless of when the Employment Period
ends, it is the current intention of the parties that, if reelected as a member
of the Board of Directors (the "Board") at the Company's 1994 annual meeting of
shareholders, Employee will continue to serve as a member of the Board for his
full term.
3. Salary. During the Employment Period, the Company shall pay Employee a
------
base salary at the rate of $350,000 annually, payable in installments at the
same time and in the same manner as the Company pays salary to executive
employees located at its headquarters and subject to all applicable deductions
or reductions therein made pursuant to Employee's elections under the Company's
<PAGE>
compensation plans or programs (the "Applicable Reductions"). Salary shall be
payable to Employee only with respect to the Employment Period, provided that if
-------------
Employee continues in the Company's employ through October 1, 1994 (the "Later
Retirement Date"), the Company shall pay Employee, in addition to his salary
referred to above, an amount as salary continuance equal to $87,500 minus the
Applicable Reductions. The salary continuation amount described in the
preceding sentence shall be paid in approximately equal installments (paid not
less frequently than monthly) over the period from the end of the Employment
Period until April 25, 1995 (the "Salary Continuance Period"), or if the
Employment Period ends on April 25, 1995, in a single lump sum as soon as
practicable following such date.
4. Bonus. If the Employee is employed on the Earliest Retirement Date,
-----
but not the Later Retirement Date, he shall be eligible to receive a bonus for
1994 services in an amount equal to the product of (i) the amount, if any, which
-
would have been payable to him under the Annual Incentive Plan ("AIP") based on
a base salary of $350,000 and assuming that he remained employed for all of
1994, calculated based on actual 1994 performance (the "1994 Bonus"), and (ii) a
--
fraction, the numerator of which is the number of days during 1994 during which
Employee is employed and the denominator of which is 365. If Employee remains
employed through the Later Retirement Date, he shall be eligible to receive the
full 1994 Bonus. Any bonus payable to Employee with respect to 1994 shall be
paid to Employee at the same time as bonuses are paid to other executives under
the AIP. No bonus shall be payable to Employee with respect to services
performed after December 31, 1994.
5. Employee Benefits. Until the later of the end of the Employment Period
-----------------
or, if applicable, the end of the Salary Continuance Period (such later date
referred to as the "End Date"), the Company will provide Employee with coverage
under the employee benefit plans, policies and arrangements generally available
to its employees, including, but not limited to, participation in the Company's
qualified retirement plan and coverage under the Company's medical, dental, life
and disability insurance plans (other than long-term disability coverage during
the Salary Continuance Period). Accrued vacation days which are unused as of
the end of the Employment Period shall be paid to Employee as soon as
practicable thereafter. Following the End Date, Employee shall be entitled to
continued medical and dental coverage under Section 601 et seq. of the Employee
-- ---
Retirement Income Security Act of 1974, as amended, subject to the payment by
Employee of the applicable premiums. All other benefits shall, unless
otherwise expressly provided herein or in the relevant plan, policy or
arrangement, cease as of the End Date.
6. Stock Options. With respect to stock options granted to Employee under
-------------
the 1991 Stock Option Plan (the "1991 Plan") and the 1981 Long Term Incentive
Plan (the "1981 Plan") that have vested and become exercisable on or prior to
the End Date, Employee shall be treated as having retired from the Company's
employ with the consent of the committee responsible for administering such Plan
so long as
<PAGE>
Employee is employed on the Earliest Retirement Date; provided that, in
-------- ----
conjunction with the execution of this Agreement, Employee agrees and
acknowledges, that the term of such options shall be reduced from ten years from
the date of their initial grant to the fifth anniversary of the End Date. Any
unvested options held by Employee at the end of the Employment Period which
would not become vested and exercisable in the ordinary course based upon the
passage of time during the Salary Continuance Period, if applicable, shall be
forfeited as of the date the Employment Period ends. Notwithstanding the
provisions of Section 5, Employee shall not be eligible for any additional stock
option grants to be made after the date hereof. Except as otherwise provided in
this Section 6, all of the terms and conditions of the 1991 Plan and 1981 Plan
and the grants made thereunder to Employee shall continue to be applicable to
him.
7. Restricted Stock. All shares of restricted stock held by Employee at
----------------
the end of the Employment Period which would not become vested solely based upon
the passage of time during the Salary Continuance Period, if applicable, shall
be forfeited as of the date the Employment Period ends. Any shares of
restricted stock which have or will vest as of a date prior to the End Date
shall become vested in accordance with their terms. Notwithstanding anything
else contained herein to the contrary, Employee shall not be eligible for any
additional restricted stock grants to be made after the date hereof.
8. Retirement Benefits. Following the End Date, Employee shall be
-------------------
entitled to receive his accrued vested benefit under the Pension Plan for
Employees of Tambrands Inc. (the "Pension Plan"). If Employee is employed on
the Earliest Retirement Date, he shall also be entitled to receive a retirement
benefit under the formula in the Company's Supplemental Executive Retirement
Plan (the "SERP"), giving him service credit through the End Date, which
replicates that formula contained in the Pension Plan but without regard to the
limits imposed under the Internal Revenue Code or ERISA on the amount of
compensation that may be taken into account in determining a participant's
benefits. Payment of any benefit under the Pension Plan or the SERP shall be
made in accordance with their respective terms, and Employee shall have all
rights of a participant under the Pension Plan and the SERP, including all
elections as to the form of benefit.
9. Termination by Company. Notwithstanding anything else contained
----------------------
herein to the contrary, if the Company terminates Employee's employment
hereunder at any time, whether before or after the Earliest Retirement Date or
the Later Retirement Date, other than due to Employee's conviction of a felony
or wilful misconduct or gross negligence or if Employee voluntarily terminates
his employment hereunder within 60 days following a reduction in his base salary
as provided in Section 2 or an adverse change in his title or a material
reduction in his responsibilities, as each are set forth in Section 3, Employee
shall be entitled to receive the amounts and benefits which would have been
payable to Employee had he voluntarily terminated his employment on the Later
Retirement Date, and the amount payable as salary
<PAGE>
continuation shall also include the amount of salary which would have been paid
to Employee from the date of such termination to such Later Retirement Date,
provided that if such termination of employment occurs prior to the Earliest
- -------------
Retirement Date the retirement benefits that would have been provided under the
SERP in accordance with Section 8 shall be paid by the Company under this
Agreement. In no event shall Employee be or become entitled to receive any
other severance or termination benefits by reason of such termination under any
plan, policy or program of the Company or any of its subsidiaries.
10. Non-competition. During the Employment Period and for one year after
---------------
the End Date, Employee shall not engage directly or indirectly in or become
employed by, serve as an agent or consultant to, become a partner, principal or
stockholder of any partnership, corporation or other entity (a "Competitor")
which is engaged in a business competitive with the Company or its subsidiaries
in any geographical area in which the Company or its subsidiaries are engaged
prior to the end of the Employment Period; provided that Employee's ownership
of less than 2% of the issued and outstanding stock of any corporation whose
stock is traded on an established securities market shall not constitute
competition with the Company.
11. Non-cooperation. During the Employment Period and for five years
---------------
after the End Date, Employee will not become associated with (whether through an
investment of capital or otherwise), provide services to or otherwise solicit,
aid, assist or cooperate with any person, group or entity (an "Acquiror") in any
effort to effect a change of ownership in, or otherwise gain control of, the
Company, whether through a stock purchase, merger, asset acquisition, proxy
solicitation or any other means. Nothing in this Section 11 shall be construed
to preclude Employee from owning less than 1% of the outstanding Common Stock of
the Company or an Acquiror, whether acquired pursuant to the terms of any
employee benefit plan or otherwise.
12. Non-solicitation. During the Employment Period and for two years
----------------
after the End Date, Employee will not solicit or otherwise induce any employee
of the Company or its subsidiaries to leave the employ of the Company or such
subsidiaries or to become associated, whether as an employee, officer, partner,
director, consultant or otherwise, with any business organization, including,
but not limited to, a Competitor or Acquiror.
13. Non-disclosure. Without the prior written consent of the Company,
--------------
except to the extent required by an order of a court having competent
jurisdiction or under subpoena from an appropriate government agency, Employee
shall not disclose any trade secrets, customer lists, drawings, designs,
product development and related information, marketing plans and related
information, sales plans and related information, manufacturing plans and
related information, management organization and related information (including
data and other information related to members of the Board and management),
operating policies and manuals, business plans and related information,
financial records and related information, packaging design and related
<PAGE>
information or other financial, commercial, business or technical information
related to the Company or any of its subsidiaries to any third person unless
such information has been previously disclosed to the public by the Company or
has become public knowledge other than by a breach of this Agreement.
14. Intention of the Parties. If any provision of Sections 10, 11, 12 or
------------------------
13 is determined by a court of competent jurisdiction not to be enforceable in
the manner set forth in this Agreement, the Company and Employee agree that it
is the intention of the parties that such provision should be enforceable to the
maximum extent possible under applicable law and that such court shall reform
such provision to make it enforceable in accordance with the intent of the
parties.
15. Release. In consideration of the benefits provided to Employee
-------
hereunder, Employee hereby releases and absolves the Company from any and all
claims that Employee may now have or may hereafter have against the Company or
any of its subsidiaries arising out of or in connection with Employee's
employment with, or service as an officer or a director of, the Company or any
of its subsidiaries, other than any claim for the benefits to be provided to
Employee under this Agreement.
16. Change of Control Agreement. The Employment Protection Agreement by
---------------------------
and between the Company and Employee dated as of August 23, 1989, as amended by
the first amendment thereto, dated as of October 16, 1990, regarding the
continuation of Employee's employment following the occurrence of a "change of
control" of the Company (as defined in such agreement) shall terminate upon the
last day of the Employment Period.
17. Indemnity. The Company or one of its subsidiaries, as appropriate,
---------
shall indemnify Employee for any claim arising out of or in connection with
Employee's service as a member of the Board, as an officer of the Company or as
an officer or director of any of the Company's subsidiaries in the same manner
and to the same extent as the Company or such subsidiary, as the case may be,
indemnifies its then current directors, officers or employees, as the case may
be.
18. Remedies. Employee acknowledges that a material part of the
--------
inducement for the Company to enter into this Agreement is Employee's covenants
with respect to non-competition, non-disclosure, non-cooperation and non-
solicitation set forth in Sections 10 through 13 hereof. Employee agrees that
if Employee shall breach any of those covenants, the Company shall have no
further obligation to pay Employee any benefits otherwise payable hereunder
(except as may otherwise be required at law) and shall be entitled to such other
legal and equitable relief as a court or arbitrator shall reasonably determine
unless such breach is an inadvertent breach that does not result in any signi-
ficant harm to the Company.
19. Withholding. All cash payments to be made under this Agreement shall
-----------
be made net of all applicable
<PAGE>
income and employment taxes required to be withheld from such payments. To the
extent any compensation is payable to Employee in accordance with this Agreement
other than as a payment in cash, Employee shall be required to pay the Company
an amount equal to all applicable income and employment taxes required to be
withheld with respect thereto.
20. Miscellaneous. This Agreement may be amended only by a written
-------------
instrument signed by the Company and Employee. Except with respect to any other
agreement between the Company and Employee that is specifically referenced
herein and intended to continue beyond the execution of this Agreement, this
Agreement shall constitute the entire agreement between the Company and Employee
with respect to the subject matter hereof. The obligations of the Company to
Employee and the covenants of Employee in favor of the Company shall survive the
termination of the Employment Period. This Agreement shall be binding upon and
inure to the benefit of the parties hereto and their respective successors,
heirs (in the case of Employee) and assigns. This Agreement may be executed in
counterparts, each of which shall be deemed an original but all of which
together shall constitute one and the same instrument. Any notices to be given
and any payments to be made hereunder shall be delivered in hand or sent by
registered mail, return receipt requested, to the respective party at the
<PAGE>
address noted above for such party or to such other address as either such party
shall direct in accordance with this Section 20.
21. Governing Law. This Agreement shall be governed by the laws of the
-------------
State of New York, without reference to the principles of conflict of laws.
IN WITNESS WHEREOF, the parties have executed this Agreement effective as
of the day first written above.
TAMBRANDS INC.
By: /s/ Howard B. Wentz, Jr.
------------------------
Title: Chairman of the Board
Attest:
/s/ Helen G. Goodman
- --------------------
/s/ Charles J. Chapman
----------------------
Charles J. Chapman
Witness:
/s/ Lynda M. Riley
- ------------------
<PAGE>
EXHIBIT 12
Tambrands Inc.
FORM 10-K
PART IV, Item 14., Exhibit 12
COMPUTATION OF RATIO OF EARNINGS TO FIXED CHARGES
(Unaudited)
The following table sets forth the Company's ratio of earnings to fixed charges
for the periods indicated.
<TABLE>
<CAPTION>
Year Ended
(in thousands, except ratios) December 31,
------------------------------------------
1993 1992 1991 1990 1989
------- ------- ------- ------- ------
<S> <C> <C> <C> <C> <C>
Earnings:
Income before income taxes 118,652 191,863 131,825 154,696 30,859
Fixed charges 6,549 9,897 10,258 13,149 9,490
------- ------- ------- ------- ------
EARNINGS 125,201 201,760 142,083 167,845 40,349
======= ======= ======= ======= ======
Fixed charges:
Interest portion of operating
lease expense:
Operating lease expense 5,027 4,031 4,204 2,221 2,053
Assumed interest factor 0.33 0.33 0.33 0.33 0.33
------- ------- ------- ------- ------
Interest portion of operating
lease expense 1,659 1,330 1,387 733 677
Interest expense 4,890 8,567 8,871 12,416 8,813
------- ------- ------- ------- ------
FIXED CHARGES 6,549 9,897 10,258 13,149 9,490
======= ======= ======= ======= ======
RATIO OF EARNINGS TO FIXED CHARGES 19.1 20.4 13.9 12.8 4.3
======= ======= ======= ======= ======
</TABLE>
<PAGE>
EXHIBIT 21
----------
TAMBRANDS INC.
Subsidiaries of the registrant.
- ------------------------------
<TABLE>
<CAPTION>
(1) (2) (3)
Percentage of Voting
Securities Owned
------------------------------
State or Country By the By Other
Name of Subsidiary of Organization Company Subsidiaries
- --------------------------- ----------------- ------- --------------------
<S> <C> <C> <C>
Tambrands Europe Ltd. Delaware 100%
Industrial Catenation South Africa 100% (a)
Services (Pty) Ltd.
TIM International Delaware 100%
Investments Incorporated
Tambrands Dosmil, Mexico 100% (b)
S.A. de C.V.
Tambrands Brasil Ltd. Delaware 100%
Shenyang Tambrands People's Republic 80%
Company Limited of China
Tambrands AG Switzerland 100% (a)
Tambrands Benelux S.A. Belgium 100% (c)
Tambrands Canada Inc. Canada 100%
Tambrands PACE, Inc. Delaware 100%
Tambrands Czech Republic 100% (d)
Czechoslovakia Limited
Tambrands France S.A. France 100% (a)
Tambrands Industria e Brazil 100% (e)
Comercio Limitada
Tambrands Limited United Kingdom 100% (a)
Tambrands Ireland Ireland 100% (f)
Limited
Tambrands Poland Ltd. Poland 100% (d)
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
(1) (2) (3)
Percentage of Voting
Securities Owned
------------------------------
State or Country By the By Other
Name of Subsidiary of Organization Company Subsidiaries
- --------------------------- ----------------- ------- --------------------
<S> <C> <C>
Tambrands South Africa South Africa 100% (g)
(Pty) Ltd.
Tambrands - St. Petersburg Russia 100% (h)
Tambrands Ukraine Ukraine 100% (h)
Tambrands de Venezuela, C.A. Venezuela 100% (d)
ZAO Tambrands Russia 100% (i)
</TABLE>
Notes: (a) Owned by Tambrands Europe Ltd.
(b) Owned by TIM International Investments Incorporated.
(c) Owned by Tambrands Europe Ltd. and Tambrands AG.
(d) Owned by Tambrands PACE, Inc.
(e) Owned by the Company in part directly and in part
indirectly through Tambrands Brasil Ltd.
(f) Owned by Tambrands Limited.
(g) Owned by Industrial Catenation Services (Pty) Ltd.
(h) Owned by Tambrands Limited and Tambrands PACE, Inc.
(i) Owned by Tambrands Europe Ltd. and Tambrands - St. Petersburg.
<PAGE>
EXHIBIT 23
Independent Auditors' Consent
-----------------------------
The Board of Directors
Tambrands Inc.:
We consent to incorporation by reference in the Registration Statement No.
33-50961 on Form S-3 and Nos. 2-77947, 33-13902, 33-36746, 33-40161, 33-43713
and 33-50398 on Form S-8 of Tambrands Inc. of our reports dated January 25,
1994, relating to the consolidated balance sheets of Tambrands Inc. and
subsidiaries as of December 31, 1993 and 1992, and the related consolidated
statements of earnings, retained earnings, and cash flows and related schedules
for each of the years in the three-year period ended December 31, 1993, which
reports appear in the December 31, 1993 annual report on Form 10-K of Tambrands
Inc. Our reports refer to a change in accounting for postemployment benefits in
1993 and for postretirement benefits in 1992.
KPMG PEAT MARWICK
Stamford, Connecticut
March 30, 1994
<PAGE>
EXHIBIT 24
POWER OF ATTORNEY
-----------------
KNOW ALL MEN BY THESE PRESENTS, that the undersigned does hereby make,
constitute and appoint Howard B. Wentz, Jr. and Raymond F. Wright, and each of
them, with full power to act without the other, the true and lawful attorney of
the undersigned, in the name, place and stead of the undersigned to execute on
behalf of the undersigned, as Director of Tambrands Inc., the Annual Report on
Form 10-K for the year ended December 31, 1993 of Tambrands Inc., and any and
all amendments thereto, to be filed with the Securities and Exchange Commission
("SEC") pursuant to the Securities Exchange Act of 1934, as amended ("Act"), and
any and all other instruments which either of said attorneys deems necessary or
advisable to enable Tambrands Inc. to comply with the Act, the rules,
regulations and requirements of the SEC in respect thereof, and the securities
or Blue Sky laws of any State or other governmental subdivision, giving and
granting to each of said attorneys full power and authority to do and perform
each and every act and thing whatsoever necessary or appropriate to be done in
and about the premises as fully to all intents as the undersigned might or would
do if personally present at the doing thereof, with full power of substitution
and revocation, thereby ratifying and confirming all that said attorneys or
substitutes may or shall lawfully do or cause to be done by virtue hereof.
IN WITNESS WHEREOF, the undersigned has hereunto executed this power of
attorney on the date indicated below.
/s/LILYAN H. AFFINITO
------------------------------
Lilyan H. Affinito
Dated: March 14, 1994
<PAGE>
POWER OF ATTORNEY
-----------------
KNOW ALL MEN BY THESE PRESENTS, that the undersigned does hereby make,
constitute and appoint Howard B. Wentz, Jr. and Raymond F. Wright, and each of
them, with full power to act without the other, the true and lawful attorney of
the undersigned, in the name, place and stead of the undersigned to execute on
behalf of the undersigned, as Director of Tambrands Inc., the Annual Report on
Form 10-K for the year ended December 31, 1993 of Tambrands Inc., and any and
all amendments thereto, to be filed with the Securities and Exchange Commission
("SEC") pursuant to the Securities Exchange Act of 1934, as amended ("Act"), and
any and all other instruments which either of said attorneys deems necessary or
advisable to enable Tambrands Inc. to comply with the Act, the rules,
regulations and requirements of the SEC in respect thereof, and the securities
or Blue Sky laws of any State or other governmental subdivision, giving and
granting to each of said attorneys full power and authority to do and perform
each and every act and thing whatsoever necessary or appropriate to be done in
and about the premises as fully to all intents as the undersigned might or would
do if personally present at the doing thereof, with full power of substitution
and revocation, thereby ratifying and confirming all that said attorneys or
substitutes may or shall lawfully do or cause to be done by virtue hereof.
IN WITNESS WHEREOF, the undersigned has hereunto executed this power of
attorney on the date indicated below.
/s/PAUL S. DOHERTY
------------------------------
Paul S. Doherty
Dated: March 14, 1994
<PAGE>
POWER OF ATTORNEY
-----------------
KNOW ALL MEN BY THESE PRESENTS, that the undersigned does hereby make,
constitute and appoint Howard B. Wentz, Jr. and Raymond F. Wright, and each of
them, with full power to act without the other, the true and lawful attorney of
the undersigned, in the name, place and stead of the undersigned to execute on
behalf of the undersigned, as Director of Tambrands Inc., the Annual Report on
Form 10-K for the year ended December 31, 1993 of Tambrands Inc., and any and
all amendments thereto, to be filed with the Securities and Exchange Commission
("SEC") pursuant to the Securities Exchange Act of 1934, as amended ("Act"), and
any and all other instruments which either of said attorneys deems necessary or
advisable to enable Tambrands Inc. to comply with the Act, the rules,
regulations and requirements of the SEC in respect thereof, and the securities
or Blue Sky laws of any State or other governmental subdivision, giving and
granting to each of said attorneys full power and authority to do and perform
each and every act and thing whatsoever necessary or appropriate to be done in
and about the premises as fully to all intents as the undersigned might or would
do if personally present at the doing thereof, with full power of substitution
and revocation, thereby ratifying and confirming all that said attorneys or
substitutes may or shall lawfully do or cause to be done by virtue hereof.
IN WITNESS WHEREOF, the undersigned has hereunto executed this power of
attorney on the date indicated below.
/s/FLOYD HALL
------------------------------
Floyd Hall
Dated: March 14, 1994
<PAGE>
POWER OF ATTORNEY
-----------------
KNOW ALL MEN BY THESE PRESENTS, that the undersigned does hereby make,
constitute and appoint Howard B. Wentz, Jr. and Raymond F. Wright, and each of
them, with full power to act without the other, the true and lawful attorney of
the undersigned, in the name, place and stead of the undersigned to execute on
behalf of the undersigned, as Director of Tambrands Inc., the Annual Report on
Form 10-K for the year ended December 31, 1993 of Tambrands Inc., and any and
all amendments thereto, to be filed with the Securities and Exchange Commission
("SEC") pursuant to the Securities Exchange Act of 1934, as amended ("Act"), and
any and all other instruments which either of said attorneys deems necessary or
advisable to enable Tambrands Inc. to comply with the Act, the rules,
regulations and requirements of the SEC in respect thereof, and the securities
or Blue Sky laws of any State or other governmental subdivision, giving and
granting to each of said attorneys full power and authority to do and perform
each and every act and thing whatsoever necessary or appropriate to be done in
and about the premises as fully to all intents as the undersigned might or would
do if personally present at the doing thereof, with full power of substitution
and revocation, thereby ratifying and confirming all that said attorneys or
substitutes may or shall lawfully do or cause to be done by virtue hereof.
IN WITNESS WHEREOF, the undersigned has hereunto executed this power of
attorney on the date indicated below.
/s/BRIAN HEALEY
------------------------------
Brian Healey
Dated: March 14, 1994
<PAGE>
POWER OF ATTORNEY
-----------------
KNOW ALL MEN BY THESE PRESENTS, that the undersigned does hereby make,
constitute and appoint Howard B. Wentz, Jr. and Raymond F. Wright, and each of
them, with full power to act without the other, the true and lawful attorney of
the undersigned, in the name, place and stead of the undersigned to execute on
behalf of the undersigned, as Director of Tambrands Inc., the Annual Report on
Form 10-K for the year ended December 31, 1993 of Tambrands Inc., and any and
all amendments thereto, to be filed with the Securities and Exchange Commission
("SEC") pursuant to the Securities Exchange Act of 1934, as amended ("Act"), and
any and all other instruments which either of said attorneys deems necessary or
advisable to enable Tambrands Inc. to comply with the Act, the rules,
regulations and requirements of the SEC in respect thereof, and the securities
or Blue Sky laws of any State or other governmental subdivision, giving and
granting to each of said attorneys full power and authority to do and perform
each and every act and thing whatsoever necessary or appropriate to be done in
and about the premises as fully to all intents as the undersigned might or would
do if personally present at the doing thereof, with full power of substitution
and revocation, thereby ratifying and confirming all that said attorneys or
substitutes may or shall lawfully do or cause to be done by virtue hereof.
IN WITNESS WHEREOF, the undersigned has hereunto executed this power of
attorney on the date indicated below.
/s/ROBERT P. KILEY
------------------------------
Robert P. Kiley
Dated: March 14, 1994
<PAGE>
POWER OF ATTORNEY
-----------------
KNOW ALL MEN BY THESE PRESENTS, that the undersigned does hereby make,
constitute and appoint Howard B. Wentz, Jr. and Raymond F. Wright, and each of
them, with full power to act without the other, the true and lawful attorney of
the undersigned, in the name, place and stead of the undersigned to execute on
behalf of the undersigned, as Director of Tambrands Inc., the Annual Report on
Form 10-K for the year ended December 31, 1993 of Tambrands Inc., and any and
all amendments thereto, to be filed with the Securities and Exchange Commission
("SEC") pursuant to the Securities Exchange Act of 1934, as amended ("Act"), and
any and all other instruments which either of said attorneys deems necessary or
advisable to enable Tambrands Inc. to comply with the Act, the rules,
regulations and requirements of the SEC in respect thereof, and the securities
or Blue Sky laws of any State or other governmental subdivision, giving and
granting to each of said attorneys full power and authority to do and perform
each and every act and thing whatsoever necessary or appropriate to be done in
and about the premises as fully to all intents as the undersigned might or would
do if personally present at the doing thereof, with full power of substitution
and revocation, thereby ratifying and confirming all that said attorneys or
substitutes may or shall lawfully do or cause to be done by virtue hereof.
IN WITNESS WHEREOF, the undersigned has hereunto executed this power of
attorney on the date indicated below.
/s/JOHN LOUDON
------------------------------
John Loudon
Dated: March 14, 1994
<PAGE>
POWER OF ATTORNEY
-----------------
KNOW ALL MEN BY THESE PRESENTS, that the undersigned does hereby make,
constitute and appoint Howard B. Wentz, Jr. and Raymond F. Wright, and each of
them, with full power to act without the other, the true and lawful attorney of
the undersigned, in the name, place and stead of the undersigned to execute on
behalf of the undersigned, as Director of Tambrands Inc., the Annual Report on
Form 10-K for the year ended December 31, 1993 of Tambrands Inc., and any and
all amendments thereto, to be filed with the Securities and Exchange Commission
("SEC") pursuant to the Securities Exchange Act of 1934, as amended ("Act"), and
any and all other instruments which either of said attorneys deems necessary or
advisable to enable Tambrands Inc. to comply with the Act, the rules,
regulations and requirements of the SEC in respect thereof, and the securities
or Blue Sky laws of any State or other governmental subdivision, giving and
granting to each of said attorneys full power and authority to do and perform
each and every act and thing whatsoever necessary or appropriate to be done in
and about the premises as fully to all intents as the undersigned might or would
do if personally present at the doing thereof, with full power of substitution
and revocation, thereby ratifying and confirming all that said attorneys or
substitutes may or shall lawfully do or cause to be done by virtue hereof.
IN WITNESS WHEREOF, the undersigned has hereunto executed this power of
attorney on the date indicated below.
/s/RUTH M. MANTON
------------------------------
Ruth M. Manton
Dated: March 14, 1994
<PAGE>
POWER OF ATTORNEY
-----------------
KNOW ALL MEN BY THESE PRESENTS, that the undersigned does hereby make,
constitute and appoint Howard B. Wentz, Jr. and Raymond F. Wright, and each of
them, with full power to act without the other, the true and lawful attorney of
the undersigned, in the name, place and stead of the undersigned to execute on
behalf of the undersigned, as Director of Tambrands Inc., the Annual Report on
Form 10-K for the year ended December 31, 1993 of Tambrands Inc., and any and
all amendments thereto, to be filed with the Securities and Exchange Commission
("SEC") pursuant to the Securities Exchange Act of 1934, as amended ("Act"), and
any and all other instruments which either of said attorneys deems necessary or
advisable to enable Tambrands Inc. to comply with the Act, the rules,
regulations and requirements of the SEC in respect thereof, and the securities
or Blue Sky laws of any State or other governmental subdivision, giving and
granting to each of said attorneys full power and authority to do and perform
each and every act and thing whatsoever necessary or appropriate to be done in
and about the premises as fully to all intents as the undersigned might or would
do if personally present at the doing thereof, with full power of substitution
and revocation, thereby ratifying and confirming all that said attorneys or
substitutes may or shall lawfully do or cause to be done by virtue hereof.
IN WITNESS WHEREOF, the undersigned has hereunto executed this power of
attorney on the date indicated below.
/s/JOHN A. MEYERS
------------------------------
John A. Meyers
Dated: March 14, 1994
<PAGE>
POWER OF ATTORNEY
-----------------
KNOW ALL MEN BY THESE PRESENTS, that the undersigned does hereby make,
constitute and appoint Howard B. Wentz, Jr. and Raymond F. Wright, and each of
them, with full power to act without the other, the true and lawful attorney of
the undersigned, in the name, place and stead of the undersigned to execute on
behalf of the undersigned, as Director of Tambrands Inc., the Annual Report on
Form 10-K for the year ended December 31, 1993 of Tambrands Inc., and any and
all amendments thereto, to be filed with the Securities and Exchange Commission
("SEC") pursuant to the Securities Exchange Act of 1934, as amended ("Act"), and
any and all other instruments which either of said attorneys deems necessary or
advisable to enable Tambrands Inc. to comply with the Act, the rules,
regulations and requirements of the SEC in respect thereof, and the securities
or Blue Sky laws of any State or other governmental subdivision, giving and
granting to each of said attorneys full power and authority to do and perform
each and every act and thing whatsoever necessary or appropriate to be done in
and about the premises as fully to all intents as the undersigned might or would
do if personally present at the doing thereof, with full power of substitution
and revocation, thereby ratifying and confirming all that said attorneys or
substitutes may or shall lawfully do or cause to be done by virtue hereof.
IN WITNESS WHEREOF, the undersigned has hereunto executed this power of
attorney on the date indicated below.
/s/H. L. TOWER
------------------------------
H. L. Tower
Dated: March 14, 1994
<PAGE>
POWER OF ATTORNEY
-----------------
KNOW ALL MEN BY THESE PRESENTS, that the undersigned does hereby make,
constitute and appoint Howard B. Wentz, Jr. and Raymond F. Wright, and each of
them, with full power to act without the other, the true and lawful attorney of
the undersigned, in the name, place and stead of the undersigned to execute on
behalf of the undersigned, as Director of Tambrands Inc., the Annual Report on
Form 10-K for the year ended December 31, 1993 of Tambrands Inc., and any and
all amendments thereto, to be filed with the Securities and Exchange Commission
("SEC") pursuant to the Securities Exchange Act of 1934, as amended ("Act"), and
any and all other instruments which either of said attorneys deems necessary or
advisable to enable Tambrands Inc. to comply with the Act, the rules,
regulations and requirements of the SEC in respect thereof, and the securities
or Blue Sky laws of any State or other governmental subdivision, giving and
granting to each of said attorneys full power and authority to do and perform
each and every act and thing whatsoever necessary or appropriate to be done in
and about the premises as fully to all intents as the undersigned might or would
do if personally present at the doing thereof, with full power of substitution
and revocation, thereby ratifying and confirming all that said attorneys or
substitutes may or shall lawfully do or cause to be done by virtue hereof.
IN WITNESS WHEREOF, the undersigned has hereunto executed this power of
attorney on the date indicated below.
/s/ROBERT M. WILLIAMS
------------------------------
Robert M. Williams
Dated: March 14, 1994
