THE INTERPUBLIC GROUP OF COMPANIES, INC.
1271 AVENUE OF THE AMERICAS
ROCKEFELLER CENTER
NEW YORK, NEW YORK 10020
as of May 26, 1994
The Prudential Insurance Company
of America
Four Gateway Center
100 Mulberry Street
Newark, NJ 07102
Ladies and Gentlemen:
The undersigned, The Interpublic Group of Companies,
Inc., a Delaware corporation (herein called the "COMPANY"),
hereby agrees with you as follows:
1. AUTHORIZATION OF ISSUE OF NOTES. The Company will
authorize the issue and delivery of its senior promissory notes
(herein, together with any such notes which may be issued
pursuant to any provision of this Agreement, and any such notes
which may be issued hereunder in substitution or exchange
therefor, collectively called the "NOTES" and individually called
a "NOTE") in the aggregate principal amount of $25,000,000, to be
dated the date of issue thereof, to mature May 26, 2004, to bear
interest on the unpaid balance thereof (payable semi-annually on
the twenty-sixth (26th) day of May and November in each year)
from the date thereof until the principal thereof shall have
become due and payable at the rate of 7.91% per annum and on
overdue principal, premium and interest at the rate specified
therein, and to be substantially in the form of Exhibit A
attached hereto.
2. PURCHASE AND SALE OF NOTES. Subject to the terms
and conditions herein set forth, the Company hereby agrees to
sell to you and you agree to purchase from the Company the Notes
in the aggregate principal amount set forth opposite your name in
the Purchaser Schedule attached hereto at 100% of such aggregate
principal amount. The Company will deliver to you, at the
Company's offices at 1271 Avenue of the Americas, Rockefeller
Center, New York, New York 10020, one or more Notes registered in
your name, evidencing the aggregate principal amount of Notes to
be purchased by you and in the denomination or denominations
specified with respect to you in the Purchaser Schedule attached
hereto, against payment of the purchase price thereof by transfer
of immediately available funds for credit to the Company's
account #143-46-358 at Morgan Guaranty Trust Company of New York,
60 Wall Street, New York, New York, ABA #021000238, on the date
of closing, which shall be May 26, 1994 or any other date upon
which the Company and you may mutually agree (herein called the
"CLOSING" or the "DATE OF CLOSING").
3. CONDITIONS OF CLOSING. Your obligation to purchase
and pay for the Notes to be purchased by you hereunder is subject
to the satisfaction, on or before the date of closing, of the
following conditions:
3A. OPINION OF PURCHASER'S SPECIAL COUNSEL. You shall
have received from Sabrina M. Coughlin, Assistant General Counsel
of The Prudential Insurance Company of America ("Prudential"),
who is acting as special counsel for you in connection with this
transaction, a favorable opinion reasonably satisfactory to you
as to such matters incident to the matters herein contemplated as
you may reasonably request.
3B. OPINION OF THE COMPANY'S COUNSEL. You shall have
received from Cleary, Gottlieb, Steen & Hamilton, special counsel
for the Company, and Christopher Rudge, Esq., Senior Vice
President, General Counsel and Secretary of the Company,
favorable opinions reasonably satisfactory to you and
substantially in the forms of Exhibits B-1 and B-2 attached
hereto.
3C. REPRESENTATIONS AND WARRANTIES; NO DEFAULT. The
representations and warranties contained in paragraph 8 shall be
true on and as of the date of closing, except to the extent of
changes caused by the transactions herein contemplated; there
shall exist on the date of closing no Event of Default or
Default; and the Company shall have delivered to you an Officer's
Certificate, dated the date of closing, to both such effects.
3D. PURCHASE PERMITTED BY APPLICABLE LAWS. The
purchase of and payment for the Notes to be purchased by you on
the date of closing on the terms and conditions herein provided
(including the use of the proceeds of such Notes by the Company)
shall not violate any applicable law or governmental regulation
(including, without limitation, section 5 of the Securities Act
or Regulation G, T or X of the Board of Governors of the Federal
Reserve System) and shall not subject you to any tax, penalty or
liability under or pursuant to any applicable law or governmental
regulation relating to the extension of credit or the making of
investments, and you shall have received such certificates or
other evidence as you may reasonably request to establish
compliance with this condition.
3E. PROCEEDINGS. All corporate and other proceedings
taken or to be taken in connection with the transactions
contemplated hereby and all documents incident thereto shall be
reasonably satisfactory in substance and form to you, and you
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shall have received all such counterpart originals or certified
or other copies of such documents as you may reasonably request.
3F. AMENDMENT. Each of Prudential Property and
Casualty Insurance Company ("PruPac") and Prudential shall have
received Amendment No. 4 to the Note Purchase Agreement dated as
of August 20, 1991 among the Company, McCann-Erickson Advertising
of Canada Ltd. ("McCann"), MacLaren Lintas Inc. ("MacLaren
Lintas"), PruPac and Prudential duly executed by each of the
Company, McCann and MacLaren Lintas and in the form attached
hereto as EXHIBIT C.
3G. PAYMENT OF FEES. Prudential shall have received
in immediately available funds a $25,000 structuring fee.
4. PREPAYMENTS. The Notes shall be subject to
optional prepayment as provided in paragraph 4A.
4A. OPTIONAL PREPAYMENT WITH YIELD-MAINTENANCE
PREMIUM. The Notes shall be subject to prepayment, in whole at
any time or from time to time in part (in multiples of $500,000),
at the option of the Company at 100% of the principal amount so
prepaid plus interest thereon to the prepayment date and the
Yield Maintenance Premium, if any, with respect to each such
Note.
4B. NOTICE OF OPTIONAL PREPAYMENT. The Company shall
give each holder of such Notes irrevocable written notice of any
prepayment pursuant to paragraph 4A not less than 10 Business
Days prior to the prepayment date, specifying such prepayment
date and the principal amount of the Notes, and of the Notes held
by such holder, to be prepaid on such date and stating that such
prepayment is to be made pursuant to paragraph 4A. Notice of
prepayment having been given as aforesaid, the principal amount
of the Notes specified in such notice, together with interest
thereon to the prepayment date and together with the premium, if
any, herein provided, shall become due and payable on such
prepayment date.
4C. PARTIAL PAYMENTS PRO RATA. Upon any partial
prepayment of the Notes pursuant to paragraph 4A, the principal
amount so prepaid of the Notes shall be allocated among the Notes
at the time outstanding (including, for the purpose of this
paragraph 4C only, all Notes prepaid or otherwise retired or
purchased or otherwise acquired by the Company or any of its
Subsidiaries or Affiliates other than by prepayment pursuant to
paragraph 4A) in proportion to the respective outstanding
principal amounts thereof.
4D. RETIREMENT OF NOTES. The Company shall not, and
shall not permit any of its Subsidiaries or Affiliates to, prepay
or otherwise retire in whole or in part prior to their stated
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final maturity (other than by prepayment pursuant to paragraph 4A
or upon acceleration of such final maturity pursuant to paragraph
7A), or purchase or otherwise acquire, directly or indirectly,
Notes held by any holder unless the Company, such Subsidiary or
such Affiliate shall have offered to prepay or otherwise retire
or purchase or otherwise acquire, as the case may be, the same
proportion of the aggregate principal amount of Notes held by
each other holder of Notes at the time outstanding upon the same
terms and conditions. Any Notes so prepaid or otherwise retired
or purchased or otherwise acquired by the Company or any of its
Subsidiaries or Affiliates shall not be deemed to be outstanding
for any purpose under this Agreement, except as provided in
paragraph 4C.
5. AFFIRMATIVE COVENANTS.
5A. FINANCIAL STATEMENTS. The Company covenants that
it will deliver to each holder of a Note:
(i) as soon as practicable and in any event within 50
days after the end of each quarterly period (other than the
last quarterly period) in each fiscal year, an unaudited
consolidated statement of income and retained earnings and
statement of cash flows of the Company and its Consolidated
Subsidiaries for the period from the beginning of the
current fiscal year to the end of such quarterly period, and
an unaudited consolidated balance sheet of the Company and
its Consolidated Subsidiaries as at the end of such
quarterly period, setting forth in each case in comparative
form figures for the corresponding period in the preceding
fiscal year, all in reasonable detail and certified, subject
to changes resulting from year-end adjustments, as to
fairness of presentation, generally accepted accounting
principles (other than as to footnotes) and consistency by
the chief financial officer or chief accounting officer of
the Company (except to the extent of any change described
therein and permitted by generally accepted accounting
principles);
(ii) as soon as practicable and in any event within 95
days after the end of each fiscal year, a consolidated
statement of income and retained earnings and statement of
cash flows of the Company and its Consolidated Subsidiaries
for such year, and a consolidated balance sheet of the
Company and its Consolidated Subsidiaries as at the end of
such year, setting forth in each case in comparative form
corresponding consolidated figures from the preceding annual
audit, and all reported on by Price Waterhouse or other
independent public accountants of recognized Standing
selected by the Company whose report shall state that such
audit shall have been conducted by them in accordance with
generally accepted auditing standards;
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(iii) promptly upon distribution thereof to
shareholders of the Company, copies of all such financial
statements, proxy statements, notices and reports so
distributed, and promptly upon filing thereof, copies of all
registration statements (other than exhibits or any
registration statement on Form S-8, or other equivalent
substitute form, under the Securities Act) and all reports
which it files with the Securities and Exchange Commission
(or any governmental body or agency succeeding to the
functions of the Securities and Exchange Commission);
(iv) with reasonable promptness, such other
information with respect to the business and consolidated
financial position of the Company and its Consolidated
Subsidiaries as such holder may reasonably request;
(v) within five (5) days of the chief executive
officer, chief operating officer, principal financial
officer or principal accounting officer of the Company
obtaining knowledge of any condition or event known by such
person to constitute a continuing Default, an Officer's
Certificate specifying the nature thereof and, within five
(5) days thereafter, an Officer's Certificate specifying
what action the Company proposes to take with respect
thereto; and
(vi) promptly following the chief executive officer,
chief operating officer, principal financial officer or
principal accounting officer of the Company obtaining
knowledge that any member of the Controlled Group (a) has
given or is required to give notice to the PBGC of any
"reportable event" (as defined in Section 4043 of ERISA)
with respect to any Plan which might constitute grounds for
a termination of such Plan under Title IV of ERISA, or that
the plan administrator of any Plan has given or is required
to give notice of any such reportable event, a copy of the
notice of such reportable event given or required to be
given to the PBGC, (b) has received notice of complete or
partial withdrawal liability under Title IV of ERISA, a copy
of such notice, or (c) has received notice from the PBGC
under Title IV of ERISA of an intent to terminate or appoint
a trustee to administer any Plan, a copy of such notice;
PROVIDED, HOWEVER, that the Company shall be deemed to have
satisfied its obligations under clauses (i) and (ii) above if and
to the extent that the Company has provided to each holder of a
Note pursuant to clause (iii) periodic reports (on Forms 10-Q and
10-K) required to be filed by the Company with the Securities and
Exchange Commission pursuant to the Securities Exchange Act of
1934 for the quarterly and annual periods described in such
clauses (i) and (ii).
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Together with each delivery of financial statements required by
clauses (i) and (ii) above, the Company will deliver an Officer's
Certificate with computations in reasonable detail to establish
whether the Company was in compliance on the date of such
financial statements with the provisions of paragraphs 6A through
6C and stating whether, to the knowledge of the individual
signing such Certificate after having exercised reasonable
diligence to ascertain the relevant facts, there exists a
continuing Default, and, if any Default exists, specifying the
nature thereof and what action the Company proposes to take with
respect thereto.
5B. BOOKS AND RECORDS; INSPECTION OF PROPERTY.
(i) The Company will maintain or cause to be maintained
the books of record and account of the Company and each
Consolidated Subsidiary, in good order in accordance with sound
business practice so as to permit its financial statements to be
prepared in accordance with generally accepted accounting
principles.
(ii) The Company will permit any Person designated by
any holder of Notes in writing, at such holder's expense, to
visit and inspect any of the properties of and to examine the
corporate books and financial records of the Company and make
copies thereof or extracts therefrom and to discuss the affairs,
finances and accounts of the Company with its principal officers
and its independent public accountants, all at such reasonable
times and as often as such holder may reasonably request.
(iii) With the consent of the Company (which consent
will not be unreasonably withheld) or, if an Event of Default has
occurred and is continuing, without the requirement of any such
consent, the Company will permit any Person designated by any
holder of Notes in writing, at such holder's expense, to visit
and inspect any of the properties of and to examine the corporate
books and financial records of any Consolidated Subsidiary and
make copies thereof or extracts therefrom and to discuss the
affairs, finances and accounts of such Consolidated Subsidiary
with its and the Company's principal officers and the Company's
independent public accountants, all at such reasonable times and
as often as such holder may reasonably request.
5C. MAINTENANCE OF PROPERTY; INSURANCE. The Company
will maintain or cause to be maintained in good repair, working
order and condition all properties used and useful in the
business of the Company and each Consolidated Subsidiary and from
time to time will make or cause to be made all appropriate
repairs, renewals and replacement thereof, except where the
failure to do so would not have a material adverse effect on the
Company and its Consolidated Subsidiaries taken as a whole.
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The Company will maintain or cause to be maintained,
for itself and its Consolidated Subsidiaries, all to the extent
material to the Company and its Consolidated Subsidiaries taken
as a whole, physical damage insurance on all real and personal
property on an all risks basis, covering the repair and
replacement cost of all such property and consequential loss
coverage for business interruption and extra expense, public
liability insurance in an amount not less than $10,000,000 and
such other insurance of the kinds customarily insured against by
corporations of established reputation engaged in the same or
similar business and similarly situated, of such type and in such
amounts as are customarily carried under similar circumstances.
5D. CONDUCT OF BUSINESS AND MAINTENANCE OF EXISTENCE.
The Company and its Consolidated Subsidiaries will continue to be
predominantly engaged in business of the same general type as is
now conducted by the Company and its Consolidated Subsidiaries.
Except as otherwise permitted by paragraph 6E, the Company will
at all times preserve and keep in full force and effect its
corporate existence, and rights and franchises material to its
business, and (to the extent material to the Company and its
Consolidated Subsidiaries taken as a whole) those of each of its
Consolidated Subsidiaries, and will qualify, and cause each
Consolidated Subsidiary to qualify, to do business in any
jurisdiction where the failure to do so would have a material
adverse effect on the Company and its Consolidated Subsidiaries
taken as a whole.
5E. COMPLIANCE WITH LAWS. The Company will comply,
and cause each Consolidated Subsidiary to comply, in all material
respects, with the requirements of all applicable laws,
ordinances, rules, regulations, and requirements of any
governmental authority (including, without limitation, ERISA and
the rules and regulations thereunder), except where the necessity
of compliance therewith is contested in good faith by appropriate
proceedings or where the failure to comply would not have a
material adverse effect upon the Company and its Consolidated
Subsidiaries taken as a whole.
5F. INFORMATION REQUIRED BY RULE 144A. The Company
covenants that it will, upon the request of the holder of any
Note, provide such holder, and any qualified institutional buyer
designated by such holder, such financial and other information
as such holder may reasonably determine to be necessary in order
to permit compliance with the information requirements of Rule
144A under the Securities Act in connection with the resale of
Notes, except at such times as the Company is subject to the
reporting requirements of section 13 or 15(d) of the Exchange
Act. For the purpose of this paragraph 5F, the term "QUALIFIED
INSTITUTIONAL BUYER" shall have the meaning specified in Rule
144A under the Securities Act.
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5G. RANK OF NOTES. The Company agrees that its
obligations under this Agreement and the Notes shall rank at
least PARI PASSU with all other unsecured senior obligations of
the Company now or hereafter existing.
6. NEGATIVE COVENANTS.
6A. CASH FLOW TO TOTAL BORROWED FUNDS. The Company
will not permit the ratio of Cash Flow to Total Borrowed Funds to
be less than 0.25 for any consecutive four quarters, such ratio
to be calculated at the end of each fiscal quarter, on a trailing
four quarter basis.
6B. TOTAL BORROWED FUNDS TO CONSOLIDATED NET WORTH.
The Company will not permit Total Borrowed Funds to exceed 85% of
Consolidated Net Worth at the end of any quarter.
6C. MINIMUM CONSOLIDATED NET WORTH. The Company will
not permit Consolidated Net Worth at any time to be less than the
sum of (i) $250,000,000 and (ii) 25% of the consolidated net
income of the Company for all fiscal quarters ending on or after
December 31, 1990 in which consolidated net income is a positive
number.
6D. NEGATIVE PLEDGE. The Company covenants that
neither it nor any Consolidated Subsidiary will create, assume or
suffer to exist any Lien upon any of its property or assets,
whether now owned or hereafter acquired; PROVIDED, HOWEVER, that
the foregoing restriction and limitation shall not apply to the
following Liens:
(i) Liens existing on the date hereof;
(ii) any Lien existing on any asset of any
corporation at the time such corporation becomes a
Consolidated Subsidiary and not created in
contemplation of such event;
(iii) any Lien on any asset securing Debt
incurred or assumed for the purpose of financing all or
any part of the cost of acquiring such asset, PROVIDED
that such Lien attached to such asset concurrently with
or within 90 days after the acquisition thereof;
(iv) any Lien on any asset of any corporation
existing at the time such corporation is merged or
consolidated with the Company or a Consolidated
Subsidiary and not created in contemplation of such
event;
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(v) any Lien existing on any asset prior to the
acquisition thereof by the Company or a Consolidated
Subsidiary and not created in contemplation of such
acquisition;
(vi) Liens created in connection with Capitalized
Lease Obligations, but only to the extent that such
Liens encumber property financed by such Capitalized
Lease Obligation and the principal component of such
Capitalized Lease Obligation is not increased;
(vii) Liens arising in the ordinary course of its
business which (i) do not secure Debt and (ii) do not
in the aggregate materially impair the operation of the
business of the Company and its Consolidated
Subsidiaries taken as a whole;
(viii) any Lien arising out of the refinancing,
extension, renewal or refunding of any Debt secured by
any Lien permitted by any of the foregoing clauses of
this Section, PROVIDED that such Debt is not increased
and is not secured by any additional assets;
(ix) Liens securing taxes, assessments, fees or
other governmental charges or levies, Liens securing
the claims of materialmen, mechanics, carriers,
landlords, warehousemen and similar Persons, Liens
incurred in the ordinary course of business in
connection with workmen's compensation, unemployment
insurance and other similar laws, Liens to secure
surety, appeal and performance bonds and other similar
obligations not incurred in connection with the
borrowing of money, and attachment, judgment and other
similar Liens arising in connection with court
proceedings so long as the enforcement of such Liens is
effectively stayed and the claims secured thereby are
being contested in good faith by appropriate
proceedings;
(x) any Lien on property arising in connection
with, and which is the subject of, a securities
repurchase transaction; and
(xi) Liens not otherwise permitted by the
foregoing clauses of this paragraph 6D securing Debt in
an aggregate principal amount at any time outstanding
not to exceed 10% of Consolidated Net Worth.
6E. CONSOLIDATIONS, MERGERS AND SALES OF ASSETS. The
Company covenants that it will not, and will not permit any
Consolidated Subsidiary to, be a party to any merger or
consolidate with any other corporation or sell, lease or transfer
or otherwise dispose of all or substantially all of its assets
except that
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(i) any Consolidated Subsidiary may merge or
consolidate with, or sell, lease, transfer or otherwise
dispose of all or substantially all of its assets to,
any other Consolidated Subsidiary; and
(ii) any Consolidated Subsidiary may merge or
consolidate with, or sell, lease, transfer or otherwise
dispose of all or substantially all of its assets to,
the Company; and
(iii) the Company and any Consolidated Subsidiary
may merge or consolidate with or sell, lease, transfer
or otherwise dispose of all or substantially all of its
assets to, any other Person (a "TRANSACTION");
PROVIDED, HOWEVER, that (a) in the case of a
Transaction involving the Company, either (x) the
Company shall be the continuing or surviving
corporation or (y) the continuing or surviving
corporation or the transferee of such assets shall be a
corporation organized under the laws of the United
States or Canada and such continuing or surviving
corporation or transferee shall expressly assume in a
writing (in a form reasonably satisfactory to the
Required Holder(s)) all of the Company's obligations
under this Agreement and the Notes, and (b) immediately
after such merger, consolidation or transfer no Default
or Event of Default shall exist.
7. EVENTS OF DEFAULT.
7A. ACCELERATION. If any of the following events
shall occur and be continuing for any reason whatsoever (and
whether such occurrence shall be voluntary or involuntary or come
about or be effected by operation of law or otherwise):
(i) the Company defaults in the payment of any
principal of or premium on any Note when the same shall
become due, either by the terms thereof or otherwise as
herein provided; or
(ii) the Company defaults in the payment of any
interest on any Note for more than five (5) days after
the date due; or
(iii) the Company or any Significant Subsidiary
or Significant Group of Subsidiaries defaults in any
payment of principal of or interest on any other
obligation for money borrowed (or any Capitalized Lease
Obligation, any obligation under a purchase money
mortgage, conditional sale or other title retention
agreement or any obligation under notes payable or
drafts accepted representing extensions of credit)
beyond any period of grace provided with respect
thereto, or the Company or any Significant
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Subsidiary or Significant Group of Subsidiaries fails
to perform or observe any other agreement, term or
condition contained in any agreement under which any
such obligation is created (or if any other event
thereunder or under any such agreement shall occur and
be continuing), and the effect of such payment default,
failure or other event is to cause, or to permit the
holder or holders of such obligation (or a trustee on
behalf of such holder or holders) to cause, such
obligation to become due or to require the purchase
thereof prior to any stated maturity, provided that the
aggregate amount of all obligations as to which such a
payment default shall occur and be continuing or such a
failure or other event causing or permitting
acceleration shall occur and be continuing exceeds
$10,000,000; or
(iv) any representation or warranty made by the
Company herein or in any certificate furnished pursuant
to this Agreement shall be false in any material
respect on the date as of which made; or
(v) the Company fails to perform or observe any
agreement contained in paragraph 6A, 6B, 6C or 6E; or
(vi) the Company fails to perform or observe any
other agreement, term or condition contained herein and
such failure shall not be remedied within 30 days after
the Company shall have received notice thereof; or
(vii) the Company or any Significant Subsidiary or
Significant Group of Subsidiaries makes a general
assignment for the benefit of creditors or is generally
not paying its debts as such debts become due; or
(viii) the Company or any Significant Subsidiary
or Significant Group of Subsidiaries shall commence a
voluntary case or other proceeding seeking liquidation,
reorganization or other relief with respect to itself
or its debts under any bankruptcy, insolvency or other
similar law now or hereafter in effect or seeking the
appointment of a trustee, receiver, liquidator,
custodian or other similar official of it or any
substantial part of its property, or shall consent to
any such relief or to the appointment of or taking
possession by any such official in an involuntary case
or other proceeding commenced against it; or
(ix) an involuntary case or other proceeding
shall be commenced against the Company or any
Significant Subsidiary or Significant Group of
Subsidiaries seeking liquidation, reorganization or
other relief with respect to it or its debts under any
bankruptcy, insolvency or other similar law now or
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hereafter in effect or seeking the appointment of a
trustee, receiver, liquidator, custodian or other
similar official of it or any substantial part of its
property, and such involuntary case or other proceeding
shall remain undismissed and unstayed for a period of
60 days; or
(x) an order for relief shall be entered against
the Company or any Significant Subsidiary or
Significant Group of Subsidiaries under the federal
bankruptcy laws as now or hereafter in effect; or
(xi) any order, judgment or decree is entered in
any proceedings against the Company in a court of
competent jurisdiction of the United States (or a State
or other jurisdiction thereof) or Canada (or a Province
or other jurisdiction thereof) decreeing the
dissolution of the Company and such order, judgment or
decree remains unstayed and in effect for more than 60
days; or
(xii) the Company or any other member of the
Controlled Group shall fail to pay when due any amount
or amounts aggregating in excess of $1,000,000 which it
shall have become liable to pay to the PBGC or to a
Plan under Title IV of ERISA (except where such
liability is contested in good faith by appropriate
proceedings as permitted under paragraph 5E); or notice
of intent to terminate a Plan or Plans (other than any
multi-employer plan or multiple employer plan, within
the meaning of Section 4001(a)(3) or 4063,
respectively, of ERISA) having unfunded benefit
liabilities (within the meaning of Section 4001(a)(18)
of ERISA) in excess of $25,000,000 shall be filed under
Title IV of ERISA by any member of the Controlled
Group, any plan administrator or any combination of the
foregoing; or the PBGC shall institute proceedings
under Title IV of ERISA to terminate or to cause a
trustee to be appointed to administer any such Plan; or
(xiii) final judgment in an amount in excess of
$10,000,000 is rendered against the Company or any
Significant Subsidiary or Significant Group of
Subsidiaries and, within 90 days after entry thereof,
such judgment is not discharged or satisfied or
execution thereof stayed pending appeal, or within 90
days after the expiration of any such stay, such
judgment is not discharged or satisfied;
then (a) if such event is an Event of Default specified in clause
(viii), (ix) or (x) of this paragraph 7A with respect to the
Company, all of the Notes at the time outstanding shall
automatically become immediately due and payable at par together
with interest accrued thereon, without presentment, demand,
protest or notice of any kind, all of which are hereby waived by
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the Company and (b) if such event is any other Event of Default,
the Required Holder(s) may at its or their option, by notice in
writing to the Company, declare all of the Notes to be, and all
of the Notes shall thereupon be and become, immediately due and
payable together with interest accrued thereon and together with
the Yield-Maintenance Premium, if any, with respect to each Note
without presentment, demand, protest or other notice of any kind,
all of which are hereby waived by the Company; provided that the
Yield-Maintenance Premium, if any, with respect to each such Note
shall be due and payable upon such declaration only if (x) such
event is an Event of Default specified in any of clauses (i) to
(vi), inclusive, or clause (xii) or (xiii) of this paragraph 7A,
(y) the Required Holders shall have given to the Company at least
10 Business Days before such declaration written notice stating
their intention so to declare such Notes to be due and payable
and identifying one or more such Events of Default the occurrence
of which on or before the date of such notice permits such
declaration and (z) one or more of the Events of Default so
identified shall be continuing at the time of such declaration.
It is agreed that Repurchase Transactions are not deemed to
create obligations which may give rise to an Event of Default
under clause (iii) of this paragraph 7A, provided that the
aggregate face amount of all Treasury securities involved in all
such Repurchase Transactions at no time exceeds 15% of the
Company's consolidated total assets (as reported on the audited
statement of financial condition of the Company most recently
filed with the Securities and Exchange Commission by the Company
prior to the inception of such a Repurchase Transaction) after
giving effect to such proposed Repurchase Transaction.
7B. OTHER REMEDIES. If any Event of Default or
Default shall occur and be continuing, the holder of any Note may
proceed to protect and enforce its rights under this Agreement
and such Note by exercising such remedies as are available to
such holder in respect thereof under applicable law, either by
suit in equity or by action at law, or both, whether for specific
performance of any covenant or other agreement contained in this
Agreement or in aid of the exercise of any power granted in this
Agreement. No remedy conferred in this Agreement upon the holder
of any Note is intended to be exclusive of any other remedy, and
each and every such remedy shall be cumulative and shall be in
addition to every other remedy conferred herein or now or
hereafter existing at law or in equity or by statute or
otherwise.
7C. RESCISSION OF ACCELERATION. At any time after any
declaration of acceleration of any of the Notes shall have been
made pursuant to paragraph 7A by any holder or holders of such
Notes, and before a judgment or decree for the payment of money
due has been obtained by such holder or holders, the Required
Holder(s) may, by written notice to the Company and to the other
holders of such Notes, rescind and annul such declaration and its
PAGE
consequences, PROVIDED that (i) the principal of and interest on
the Notes which shall have become due otherwise than by such
declaration of acceleration shall have been duly paid, and (ii)
all Events of Default other than the nonpayment of principal of
and interest on the Notes which have become due solely by such
declaration of acceleration, shall have been cured or waived by
the Required Holder(s). No rescission or annulment referred to
above shall affect any subsequent Default or any right, power or
remedy arising out of such subsequent Default.
8. REPRESENTATIONS, COVENANTS AND WARRANTIES. The
Company represents, covenants and warrants:
8A. ORGANIZATION. The Company is a corporation duly
organized and existing in good standing under the laws of the
State of Delaware, and has the corporate power and all material
governmental licenses, authorizations, consents and approvals
required to own its property and to carry on its business as now
being conducted.
8B. CORPORATE AUTHORIZATION; GOVERNMENTAL
AUTHORIZATION; CONTRAVENTION. (i) The Company has the corporate
power and authority to execute, deliver and perform this
Agreement and has taken all necessary corporate action to
authorize the execution, delivery and performance of this
Agreement. The Company has the corporate authority to issue and
sell the Notes and has taken all necessary corporate action to
authorize the issuance of and sale of the Notes on the terms and
conditions of this Agreement.
(ii) None of the offering, issuance, sale and
delivery of the Notes, and fulfillment of or compliance
with the terms and provisions hereof or of the Notes,
by the Company requires any authorization, consent,
approval, exemption or other action by or notice to or
filing with any court or administrative or governmental
body (other than routine filings after the date of
closing with the Securities and Exchange Commission
and/or state Blue Sky authorities).
(iii) Neither the execution, delivery or
performance of this Agreement and the Notes nor the
offering, issuance and sale of the Notes, nor
fulfillment or any compliance with the terms and
provisions hereof and thereof, will conflict with, or
result in a breach of the terms, conditions or
provisions of, or constitute a default under, or result
in any violation of, or result in the creation of any
Lien upon any of the properties or assets of the
Company or any Consolidated Subsidiary pursuant to, the
charter or by-laws of the Company or any Consolidated
Subsidiary, any award of any arbitrator or any material
agreement (including any agreement with stockholders),
instrument, order, judgment, decree, statute, law, rule
or
PAGE
regulation to which the Company or any Consolidated
Subsidiary is subject.
8C. BINDING EFFECT. Each of the Agreement and the
Notes constitutes, or when executed and delivered will
constitute, a legal, valid and binding obligation of the Company
in accordance with its terms, subject to applicable bankruptcy,
insolvency, reorganization, moratorium and other similar laws
affecting creditors' rights generally, and subject to general
principles of equity (regardless of whether enforceability is
considered in a proceeding in equity or at law).
8D. BUSINESS; FINANCIAL STATEMENTS. The Company has
furnished you with the following documents and financial
statements:
(i) The following financial statements of the
Company: the audited consolidated balance sheets of
the Company and its Consolidated Subsidiaries as of
December 31, 1993, 1992 and 1991 and the related
consolidated statements of earnings and retained
earnings and statement of cash flows for the three year
period ended December 31, 1993, reported on by Price
Waterhouse. The financial statements referred to in
this subparagraph (i) are herein collectively referred
to as the "HISTORICAL FINANCIAL STATEMENTS."
(ii) The Company's Annual Report on Form 10-K for
the year ended December 31, 1993, 1992 and 1991 and its
Quarterly Report on form 10-Q for the quarter ended
March 31, 1994, in each case as filed with the
Securities and Exchange Commission. The reports
referred to in this subparagraph (ii) are herein
collectively referred to as the PUBLIC DOCUMENTS."
The Historical Financial Statements (including any related
schedules and/or notes) fairly present the consolidated financial
position and the consolidated results of operations and
consolidated cash flows of the corporations described therein at
the dates and for the periods shown, all in conformity with
generally accepted accounting principles applied on a consistent
basis (except as otherwise therein or in the notes thereto
stated) throughout the periods involved. There has been no
material adverse change in the business, condition (financial or
otherwise) or operations of the Company and its Consolidated
Subsidiaries taken as a whole since December 31, 1993 other than
as the result of the recognition of post-employment benefit
costs. The Public Documents have been prepared in all material
respects in conformity with the rules and regulations of the
Securities and Exchange Commission applicable thereto and set
forth an accurate description in all material respects of the
business conducted by the Company and its Consolidated
PAGE
Subsidiaries and the properties owned and operated in connection
therewith.
8E. ACTIONS PENDING. There is no action, suit or
proceeding pending or, to the knowledge of the Company,
threatened against the Company or any of its Consolidated
Subsidiaries by or before any court, arbitrator or administrative
or governmental body in which there is a significant probability
of an adverse decision which, if adversely decided, would result
in any material adverse change in the business, condition
(financial or otherwise) or operations of the Company and its
Consolidated Subsidiaries taken as a whole or which in any manner
draws into question the validity of this Agreement or any Note.
8F. COMPLIANCE WITH ERISA. Each member of the
Controlled Group has fulfilled its obligations under the minimum
funding standards of ERISA and the Code with respect to each Plan
and is in compliance in all material respects with the presently
applicable provisions of ERISA and the Code except where the
failure to comply would not have a material adverse effect on the
Company and its Consolidated Subsidiaries taken as a whole, and
has not incurred any unsatisfied material liability to the PBGC
or a Plan under Title IV of ERISA other than a liability to the
PBGC for premiums under Section 4007 of ERISA.
8G. TAXES. United States Federal income tax returns
of the Company and its Consolidated Subsidiaries have been
examined and closed through the fiscal year ended December 31,
1985. The Company has and each of its Consolidated Subsidiaries
has filed all Federal and other material income tax returns
which, to the best knowledge of the officers of the Company, are
required to be filed, and each has paid all taxes as shown on
such returns and on all assessments received by it to the extent
that such taxes have become due except for those which are being
contested in good faith by the Company or the Consolidated
Subsidiary, as the case may be. The charges and accruals and
reserves on the books of the Company and its Consolidated
Subsidiaries in respect of taxes or other governmental charges
are, in the opinion of the Company, adequate.
8H. SUBSIDIARIES; QUALIFICATIONS. Each of the
Company's Consolidated Subsidiaries is a corporation duly
organized and existing in good standing under the laws of its
jurisdiction of incorporation, and the Company and its
Consolidated Subsidiaries have such corporate powers and all such
governmental licenses, authorizations, consents and approvals
required to own their respective properties and to carry on their
respective business as now being conducted, all to the extent
material to the Company and its Consolidated Subsidiaries taken
as a whole.
8I. OFFERING OF NOTES. Neither the Company nor any
agent authorized to act on its behalf has, directly or
PAGE
indirectly offered the Notes, or any similar security of the
Company for sale to, or solicited any offers to buy the Notes or
any similar security of the Company from, or otherwise approached
or negotiated with respect thereto with, any Person other than
not more than 10 institutional investors, and neither the Company
nor any agent authorized to act on its behalf has taken or will
take any action which would subject the issuance or sale of the
Notes to the provisions of section 5 of the Securities Act or to
the provisions of any securities or Blue Sky law of any
applicable jurisdiction.
8J. REGULATION G, ETC. The proceeds of sale of the
Notes will be used to refinance a portion of the Company's short-
term borrowings. None of such proceeds will be used, directly or
indirectly, for the purpose, whether immediate, incidental or
ultimate, of purchasing or carrying any "margin stock" as defined
in Regulation G (12 CFR Part 207) of the Board of Governors of
the Federal Reserve System (herein called "margin stock") or for
the purpose of maintaining, reducing or retiring any indebtedness
which was originally incurred to purchase or carry any stock that
is then currently a margin stock or for any other purpose which
might constitute this transaction a "purpose credit" within the
meaning of such Regulation G. Neither the Company nor any agent
acting on its behalf has taken or will take any action which
might cause this Agreement or the Notes to violate Regulation G,
Regulation T or any other regulation of the Board of Governors of
the Federal Reserve System or to violate the Securities Exchange
Act of 1934, as amended, in each case as in effect now or as the
same may hereafter be in effect.
8K. DISCLOSURE. The Historical Financial Statements
and the Public Documents (as of the respective dates thereof and
when taken as a whole) do not contain any untrue statement of a
material fact and do not omit to state a material fact necessary
in order to make the statements contained therein not misleading.
8L. TITLE TO PROPERTIES. The Company has and each of
its Consolidated Subsidiaries has good and marketable title to
its respective real properties (other than properties which it
leases) and good title to all of its other respective properties
and assets, except where the failure to have such title would not
have a material adverse effect on the Company and its
Consolidated Subsidiaries taken as a whole, subject to no Lien of
any kind except Liens permitted by paragraph 6D. All leases
necessary in any material respect for the conduct of the
respective businesses of the Company and its Consolidated
Subsidiaries are valid and subsisting and are in full force and
effect, except where the failure to be so in effect would not
have a material adverse effect on the Company and its
Consolidated Subsidiaries taken as a whole.
PAGE
9. REPRESENTATIONS OF THE PURCHASER. By acceptance of
the Notes, you hereby acknowledge that the Notes have not been
registered under the Securities Act and may not be sold, offered
for sale or otherwise transferred except pursuant to an exemption
from such registration requirements. You represent, and in
making this sale to you it is specifically understood and agreed,
that you are not acquiring the Notes to be purchased by you
hereunder with a view to or for sale in connection with any
distribution thereof within the meaning of the Securities Act,
provided that the disposition of your property shall at all times
be and remain within your control. You further acknowledge that
you are a "qualified institutional buyer" as that term is defined
in Rule 144A under the Securities Act. You also represent that
no part of the funds being used by you to pay the purchase price
of the Notes being purchased by you hereunder constitutes assets
allocated to any separate account maintained by you in which any
employee benefit plan participates. For the purpose of this
paragraph 9, the terms "separate account" and "employee benefit
plan" shall have the respective meanings specified in section 3
of ERISA.
10. DEFINITIONS. The following terms shall have the
meanings specified with respect thereto below:
10A. YIELD-MAINTENANCE TERMS.
"CALLED PRINCIPAL" shall mean, with respect to any
Note, the principal of such Note that is to be prepaid pursuant
to paragraph 4A (any partial prepayment being applied in
satisfaction of required payments of principal in inverse order
of their scheduled due dates) or is declared to be immediately
due and payable pursuant to paragraph 7A, as the context
requires.
"DISCOUNTED VALUE" shall mean, with respect to the
Called Principal of any Note, the amount obtained by discounting
all Remaining Scheduled Payments with respect to such Called
Principal from their respective scheduled due dates to the
Settlement Date with respect to such Called Principal, in
accordance with accepted financial practice and at a discount
factor (applied on a semiannual basis) equal to the Reinvestment
Yield with respect to such Called Principal.
"REINVESTMENT YIELD" shall mean, with respect to the
Called Principal of any Note, the yield to maturity implied by
(i) the yields reported, as of 10:00 A.M. (New York City time)
on the Business Day next preceding the Settlement Date with
respect to such Called Principal, on the display designated as
"Page 678" on the Telerate Service (or such other display as may
replace Page 678 on the Telerate Service) for actively traded
U.S. Treasury securities having a maturity equal to the Remaining
Average Life of such Called Principal as of such Settlement Date,
or if such
PAGE
yields shall not be reported as of such time or the yields
reported as of such time shall not be ascertainable, (ii) the
Treasury Constant Maturity Series yields reported, for the latest
day for which such yields shall have been so reported as of the
Business Day next preceding the Settlement Date with respect to
such Called Principal, in Federal Reserve Statistical Release
H.15 (519) (or any comparable successor publication) for actively
traded U.S. Treasury securities having a constant maturity equal
to the Remaining Average Life of such Called Principal as of such
Settlement Date. Such implied yield shall be determined, if
necessary, by (a) converting U.S. Treasury bill quotations to
bond-equivalent yields in accordance with accepted financial
practice and (b) interpolating linearly between reported yields.
"REMAINING AVERAGE LIFE" shall mean, with respect to
the Called Principal of any Note, the number of years (calculated
to the nearest one-twelfth year) obtained by dividing (i) such
Called Principal into (ii) the sum of the products obtained by
multiplying (a) each Remaining Scheduled Payment of such Called
Principal (but not of interest thereon) by (b) the number of
years (calculated to the nearest one-twelfth year) which will
elapse between the Settlement Date with respect to such Called
Principal and the scheduled due date of such Remaining Scheduled
Payment.
"REMAINING SCHEDULED PAYMENTS" shall mean, with respect
to the Called Principal of any Note, all payments of such Called
Principal and interest thereon that would be due on or after the
Settlement Date with respect to such Called Principal if no
payment of such Called Principal were made prior to its scheduled
due date.
"SETTLEMENT DATE" shall mean, with respect to the
Called Principal of any Note, the date on which such Called
Principal is to be prepaid pursuant to paragraph 4A or is
declared to be immediately due and payable pursuant to paragraph
7A, as the context requires.
"YIELD-MAINTENANCE PREMIUM" shall mean, with respect to
any Note, a premium equal to the excess, if any, of the
Discounted Value of the Called Principal of such Note over the
sum of (i) such Called Principal plus (ii) interest accrued
thereon as of (including interest due on) the Settlement Date
with respect to such Called Principal. The Yield-Maintenance
Premium shall in no event be less than zero.
10B. OTHER TERMS.
"AFFILIATE" shall mean any Person directly or
indirectly controlling, controlled by, or under direct or
indirect common control with, the Company, except a Subsidiary.
A Person shall be deemed to control a corporation if such Person
PAGE
possesses, directly or indirectly, the power to direct or cause
the direction of the management and policies of such corporation,
whether through the ownership of voting securities, by contract
or otherwise.
"BUSINESS DAY" shall mean any day other than a
Saturday, a Sunday or a day on which commercial banks in New York
City are required or authorized to be closed.
"CAPITALIZED LEASE OBLIGATION" shall mean, as to any
Person, any rental obligation which, under generally accepted
accounting principles, is or will be required to be capitalized
on the books of such Person, taken at the amount thereof
accounted for as indebtedness (net of interest expense) in
accordance with such principles.
"CASH FLOW" shall mean the sum of net income (plus any
amount by which net income has been reduced by reason of the
recognition of post-retirement and post-employment benefit costs
prior to the period in which such benefits are paid),
depreciation expenses, amortization costs and changes in deferred
taxes.
"CODE" shall mean the Internal Revenue Code of 1986, as
amended, and any successor statute thereto.
"COMPANY" shall have the meaning specified in the
introductory paragraph.
"CONSOLIDATED NET WORTH" shall mean, at any date, the
consolidated stockholders' equity of the Company and its
Consolidated Subsidiaries as such appear on the financial
statements of the Company determined in accordance with generally
accepted accounting principles ((i) plus any amount by which
retained earnings has been reduced by reason of the recognition
of post-retirement and post-employment benefit costs prior to the
period in which such benefits are paid and (ii) without taking
into account the effect of cumulative translation adjustments).
"CONSOLIDATED SUBSIDIARY" shall mean at any date any
Subsidiary or other entity the accounts of which would be
consolidated with those of the Company in its consolidated
financial statements as of such date.
"CONTROLLED GROUP" shall mean all members of a
controlled group of corporations and all trades or businesses
(whether or not incorporated) under common control which,
together with the Company, are treated as a single employer under
Section 414(b) or 414(c) of the Code.
"DEBT" shall mean, as to any Person, without
duplication, (i) all obligations of such Person for borrowed
PAGE
money, including reimbursement obligations for letters of credit,
(ii) all obligations of such Person evidenced by bonds,
debentures, notes or other similar instruments, (iii) all
obligations of such Person to pay the deferred purchase price of
property or services, except trade accounts payable arising in
the ordinary course of business, (iv) all Capitalized Lease
Obligations of such Person, (v) all Debt of others secured by a
Lien on any asset of such Person, whether or not such Debt is
assumed by such Person and (vi) all Debt of others Guaranteed by
such Person; provided, however, that the obligations specified in
(i) through (vi) shall not include obligations arising in
connection with securities repurchase transactions.
"ERISA" shall mean the Employee Retirement Income
Security Act of 1974, as amended.
"EVENT OF DEFAULT" shall mean any of the events
specified in paragraph 7A, provided that there has been satisfied
any requirement in connection with such event for the giving of
notice, or the lapse of time, or both, and "DEFAULT" shall mean
any of such events, whether or not any such requirement has been
satisfied.
"GUARANTEE" shall mean, as to any Person, any
obligation, contingent or otherwise, of such Person directly or
indirectly guaranteeing any Debt or other obligation of any other
Person and, without limiting the generality of the foregoing, any
obligation, direct or indirect, contingent or otherwise, of such
Person (i) to purchase or pay (or advance or supply funds for the
purchase or payment of) such Debt or other obligation (whether
arising by virtue of partnership arrangements, by agreement to
keep-well, take-or-pay, to maintain financial statement
conditions or otherwise) or (ii) entered into for the purpose of
assuring in any other manner the obligee of such Debt or other
obligation of the payment thereof or to protect such obligee
against loss in respect thereof (in whole or in part), provided
that the term Guarantee shall not include endorsements for
collection or deposit in the ordinary course of business. The
term "Guarantee" used as a verb shall have a corresponding
meaning.
HISTORICAL FINANCIAL STATEMENTS" shall have the meaning
specified in clause (i) of paragraph 8D.
"LIEN" shall mean, with respect to any asset, any
mortgage, pledge, security interest, encumbrance, lien or charge
of any kind in respect of such asset (including as a result of
any conditional sale or other title retention agreement and any
lease in the nature thereof).
"NOTE(S)" shall have the meaning specified in paragraph
1.
PAGE
"OFFICER'S CERTIFICATE" shall mean a certificate signed
in the name of the Company by its President, one of its Vice
Presidents or its Treasurer.
"PBGC" shall mean the Pension Benefit Guaranty
Corporation or any entity succeeding to any or all of its
functions under ERISA.
"PERSON" shall mean and include an individual, a
partnership, a joint venture, a corporation, a trust, an
unincorporated organization and a government or any department or
agency thereof.
"PLAN" shall mean, at a particular time, any defined
benefit pension plan which is covered by Title IV of ERISA or
subject to the minimum funding standards under Section 412 of the
Code and is either (i) maintained by a member of the Controlled
Group for employees of a member of the Controlled Group or (ii)
maintained pursuant to a collective bargaining agreement or any
other arrangement under which more than one employer makes
contributions and to which a member of the Controlled Group is
then making or accruing an obligation to make contributions or
has within the preceding five plan years made contributions.
"PUBLIC DOCUMENTS" shall have the meaning specified in
clause (ii) of paragraph 8D.
"REPURCHASE TRANSACTION" shall mean one or more
transactions in which the Company purchases United States
Treasury securities with a remaining term to maturity of 90 days
or less and simultaneously enters into a repurchase transaction
with respect to such securities with a securities broker/dealer,
where (a) all or substantially all of the initial purchase price
for the Treasury securities is paid directly from the proceeds of
the repurchase transaction and (b) the Treasury securities would
not be included in a balance sheet of the Company prepared in
accordance with generally accepted accounting principles.
"REQUIRED HOLDER(S)" shall mean the holder or holders
of at least 66-2/3% of the aggregate principal amount of the
Notes from time to time outstanding.
"SECURITIES ACT" shall mean the Securities Act of 1933,
as amended.
"SIGNIFICANT SUBSIDIARY OR SIGNIFICANT GROUP OF
SUBSIDIARIES" at any time of determination means any Consolidated
Subsidiary or group of Consolidated Subsidiaries which,
individually or in the aggregate, together with its or their
Subsidiaries, accounts or account for more than 10% of the
consolidated gross revenues of the Company and its Consolidated
Subsidiaries for the most recently ended fiscal year or for more
PAGE
than 10% of the total assets of the Company and its Consolidated
Subsidiaries as of the end of such fiscal year; PROVIDED that in
connection with any determination under (x) paragraph 7A(iii)
there shall be a payment default, failure or other event (of the
type specified in that paragraph) with respect to an obligation
(of the type specified in that paragraph but without regard to
the principal amount of such obligation) of each Consolidated
Subsidiary included in such group, (y) paragraph 7A (vii),
(viii), (ix) or (x) the condition or event described therein
shall exist with respect to each Consolidated Subsidiary included
in such group or (z) paragraph 7A(xiii) there shall be a final
judgment (of the type specified in that paragraph but without
regard to the amount of such judgment) rendered against each
Consolidated Subsidiary included in such group.
"SUBSIDIARY" shall mean any corporation or other entity
of which securities or other ownership interests having ordinary
voting power to elect a majority of the board of directors or
other persons performing similar functions is at the time
directly or indirectly owned by the Company.
"TOTAL BORROWED FUNDS" shall mean at any date, without
duplication, (i) all outstanding obligations of the Company and
its Consolidated Subsidiaries for borrowed money, (ii) all
outstanding obligations of the Company and its Consolidated
Subsidiaries evidenced by bonds, debentures, notes or similar
instruments and (iii) any outstanding obligations of the type set
forth in (i) or (ii) of any other Person Guaranteed by the
Company or a Consolidated Subsidiary; PROVIDED, HOWEVER, that
Total Borrowed Funds shall not include any obligation to
repurchase securities under a securities repurchase transaction.
"TRANSFEREE" shall mean any direct or indirect
transferee of all or any part of any Note purchased by you under
this Agreement.
10C. ACCOUNTING TERMS AND DETERMINATIONS. All
references in this Agreement to "generally accepted accounting
principles" shall mean generally accepted accounting principles
in effect in the United States of America at the time of
application thereof. Unless otherwise specified herein, all
accounting terms used herein shall be interpreted, all
determinations with respect to accounting matters hereunder shall
be made, and all financial statements and certificates and
reports as to financial matters required to be furnished
hereunder shall be prepared, in accordance with generally
accepted accounting principles, applied on a basis consistent
(except for changes concurred in by the Company's independent
public accountants) with the most recent audited consolidated
financial statements of the Company and its Consolidated
Subsidiaries delivered pursuant to paragraph 5A(ii).
PAGE
11. MISCELLANEOUS.
11A. NOTE PAYMENTS. The Company agrees that, so long
as you shall hold any Note, it will make payments of principal
thereof and premium, if any, and interest thereon, which comply
with the terms of this Agreement, by wire transfer of immediately
available funds for credit to your account or accounts as
specified in the Purchaser Schedule attached hereto, or such
other account or accounts in the United States as you may
designate in writing not less than 5 Business Days prior to any
payment date, notwithstanding any contrary provision herein or in
any Note with respect to the place of payment. Any payment under
this Agreement or any Note due on a day that is not a Business
Day may be made on the next succeeding day which is a Business
Day without penalty or additional interest. You agree that,
before disposing of any Note, you will make a notation thereon
(or on a schedule attached thereto) of all principal payments
previously made thereon and of the date to which interest thereon
has been paid. The Company agrees to afford the benefits of this
paragraph 11A to any Transferee which shall have made the same
agreement as you have made in this paragraph 11A.
11B. EXPENSES. The Company agrees to pay, and save
you and any Transferee harmless against liability for the payment
of, all out-of-pocket expenses arising in connection with (i) all
document production and duplication charges and the fees and
expenses of one special counsel (and any local counsel) engaged
in connection with any subsequent proposed modification of, or
proposed consent under, this Agreement or the Notes, whether or
not such proposed modification shall be effected or proposed
consent granted (but in either event only if requested by the
Company), and (ii) the costs and expenses, including attorneys'
fees, incurred by you or any Transferee in enforcing any rights
under this Agreement or the Notes. In addition, with respect to
you only, the Company agrees to pay, and save you harmless
against liability for the payment of, all out-of-pocket expenses
incurred by you in connection with your responding to any
subpoena or other legal process or informal investigative demand
issued in connection with and arising pursuant to this Agreement
or the transactions contemplated hereby or by reason of your
having acquired any Note (but not including any general
investigation or proceeding involving your investments or
activities generally), including without limitation costs and
expenses incurred in any bankruptcy case. The obligations of the
Company under this paragraph 11B shall survive the transfer of
any Note or portion thereof or interest therein and the payment
of any Note.
11C. CONSENT TO AMENDMENTS. This Agreement may be
amended, and the Company may take any action herein prohibited,
or omit to perform any act herein required to be performed by it,
if the Company shall obtain the written consent to such
PAGE
amendment, action or omission to act, of the Required Holder(s),
except that, without the written consent of the holder or holders
of all the Notes at the time outstanding, no amendment to this
Agreement shall change the maturity of any Note, or change the
principal of, or the rate or time of payment of interest or any
premium payable with respect to any Note, or affect the time,
amount or allocation of any required prepayments, or reduce the
proportion of the principal amount of the Notes required with
respect to any consent, amendment or waiver or to accelerate the
Notes. Each holder of any Note at the time or thereafter
outstanding shall be bound by any consent authorized by this
paragraph 11C, whether or not such Note shall have been marked to
indicate such consent, but any such Notes issued thereafter may
bear a notation referring to any such consent. The Company will
not, directly or indirectly, pay or cause to be paid any
remuneration, whether by way of supplemental or additional
interest, fee or otherwise, to any holder of Notes as
consideration for or as an inducement to the entering into by
such holder of Notes of any waiver or amendment of, or giving a
consent in respect of, any of the terms and provisions of this
Agreement or any Note unless such remuneration is concurrently
paid, on the same terms, ratably to all holders of Notes. The
Company will give prompt written notice of the receipt and effect
of each such waiver, amendment or consent to all holders of the
Notes. No course of dealing between the Company and the holder
of any Note, nor any delay in exercising any rights hereunder or
under any Note, shall operate as a waiver of any rights of any
holder of any Note. As used herein and in the Notes, the term
"this Agreement" and references thereto shall mean this Agreement
as it may from time to time be amended or supplemented.
11D. FORM, REGISTRATION, TRANSFER AND EXCHANGE OF
NOTES; LOST NOTES. The Notes are issuable as registered notes
without coupons in denominations of at least $5,000,000, except
in connection with the transfer of Notes issued by the Company in
smaller denominations in which case and with respect to those
Notes only, the minimum denomination will be such smaller amount.
The Company shall keep at its principal office a register in
which the Company shall provide for the registration of Notes and
of transfers of Notes. Upon surrender for registration of
transfer of any Note at the principal office of the Company, the
Company shall, at its expense, execute and deliver one or more
new Notes of like tenor and of a like aggregate principal amount,
registered in the name of such transferee or transferees. At the
option of the holder of any Note, such Note may be exchanged for
other Notes of like tenor and of any authorized denominations, of
a like aggregate principal amount, upon surrender of the Note to
be exchanged at the principal office of the Company. Whenever
any Notes are so surrendered for exchange, the Company shall, at
its expense, execute and deliver the Notes which the holder
making the exchange is entitled to receive. Every Note
surrendered for registration of transfer or exchange shall be
PAGE
duly endorsed, or be accompanied by a written instrument of
transfer duly executed, by the holder of such Note or such
holder's attorney duly authorized in writing. Any Note or Notes
issued in exchange for any Note or upon transfer thereof shall
carry the rights to unpaid interest and interest to accrue which
were carried by the Note so exchanged or transferred, so that
neither gain nor loss of interest shall result from any such
transfer or exchange. Upon receipt of written notice from the
holder of any Note of the loss, theft, destruction or mutilation
of such Note and, in the case of any such loss, theft or
destruction, upon receipt of such holder's unsecured indemnity
agreement (satisfactory in form and substance to the Company), or
in the case of any such mutilation upon surrender and
cancellation of such Note, the Company will make and deliver a
new Note, of like tenor, in lieu of the lost, stolen, destroyed
or mutilated Note.
11E. PERSONS DEEMED OWNERS. Prior to due presentment
for registration of transfer, the Company may treat the Person in
whose name any Note is registered as the owner and holder of such
Note for the purpose of receiving payment of principal of and
premium, if any, and interest on such Note and for all other
purposes whatsoever, whether or not such Note shall be overdue,
and the Company shall not be affected by notice to the contrary.
11F. SURVIVAL OF REPRESENTATIONS AND WARRANTIES;
ENTIRE AGREEMENT. All representations and warranties contained
herein or made in writing by or on behalf of the Company in
connection herewith shall survive the execution and delivery of
this Agreement and the Notes, the transfer by you of any Note or
portion thereof or interest therein and the payment of any Note,
and may be relied upon by any Transferee, regardless of any
investigation made at any time by or on behalf of you or any
Transferee. Subject to the preceding sentence, this Agreement
and the Notes embody the entire agreement and understanding
between you and the Company and supersede all prior agreements
and understandings relating to the subject matter hereof.
11G. SUCCESSORS AND ASSIGNS. All covenants and other
agreements in this Agreement contained by or on behalf of any of
the parties hereto shall bind and inure to the benefit of the
respective successors and assigns of the parties hereto
(including, without limitation, any Transferee) whether so
expressed or not.
11H. DISCLOSURE TO OTHER PERSONS. You agree to use
your best efforts (and each other holder of a Note, by availing
itself of the benefits of paragraph 5A(iv) or 5B, similarly
agrees) to hold in confidence and not disclose any information
(other than information (i) which was publicly known or otherwise
known to you, at the time of disclosure (except pursuant to
disclosure in connection with this Agreement), (ii) which
PAGE
subsequently becomes publicly known through no act or omission by
you, or (iii) which otherwise becomes known to you, other than
through disclosure by the Company or any of its Subsidiaries)
delivered or made available by or on behalf of the Company or any
of its Subsidiaries to you which is proprietary in nature,
PROVIDED that nothing herein shall prevent the holder of any Note
from delivering copies of any financial statements and other
documents delivered to such holder, and disclosing any other
information disclosed to such holder, by or on behalf of the
Company or any Subsidiary in connection with or pursuant to this
Agreement to (i) such holder's directors, officers, employees,
agents and professional consultants (which Persons shall be bound
by the provisions hereof), (ii) any other holder of any Note,
(iii) any Person to which such holder offers to sell such Note or
any part thereof (which Person agrees to be bound by the
provisions of this paragraph 11H), (iv) any federal or state
regulatory authority having jurisdiction over such holder, (v)
the National Association of Insurance Commissioners or any
similar organization or (vi) any other Person to which such
delivery or disclosure may be necessary or appropriate (a) in
compliance with any law, rule, regulation or order applicable to
such holder, (b) in response to any subpoena or other legal
process or informal investigative demand, (c) in connection with
any litigation to which such holder is a party or (d) in order to
protect such holder's investment in such Note.
11I. NOTICES. All written communications provided for
hereunder shall be sent by first class mail or nationwide
overnight delivery service (with charges prepaid) and (i) if to
you, addressed to you at the address specified for such
communications in the Purchaser Schedule attached hereto, or at
such other address as you shall have specified to the Company in
writing, (ii) if to any other holder of any Note, addressed to
such other holder at such address as such other holder shall have
specified to the Company in writing or, if any such other holder
shall not have so specified an address to the Company, then
addressed to such other holder in care of the last holder of such
Note which shall have so specified an address to the Company, and
(iii) if to the Company addressed to it at 1271 Avenue of the
Americas, New York, New York 10020, Attention: Senior Vice
President - Financial Operations (together with a copy similarly
addressed but marked Attention: General Counsel), or at such
other address as the Company shall have specified to the holder
of each Note in writing; provided, however, that any such
communication to the Company may also, at the option of the
holder of any Note, be delivered by any other reasonable means to
the Company at its address specified above.
11J. DESCRIPTIVE HEADINGS. The descriptive headings
of the several paragraphs of this Agreement are inserted for
convenience only and do not constitute a part of this Agreement.
PAGE
11K. SATISFACTION REQUIREMENT. If any agreement,
certificate or other writing, or any action taken or to be taken,
is by the terms of this Agreement required to be satisfactory to
you or to the Required Holder(s), the determination of such
satisfaction shall be made by you or the Required Holder(s), as
the case may be, in the sole and exclusive judgment (exercised in
good faith) of the Person or Persons making such determination.
11L. GOVERNING LAW. This Agreement shall be construed
and enforced in accordance with, and the rights of the parties
shall be governed by, the law of the State of New York applicable
to agreements to be performed wholly therein.
11M. COUNTERPARTS. This Agreement may be executed
simultaneously in two or more counterparts, each of which shall
be deemed an original, and it shall not be necessary in making
proof of this Agreement to produce or account for more than one
such counterpart.
If you are in agreement with the foregoing, please sign
the form of acceptance on the enclosed counterpart of this letter
and return the same to the Company, whereupon this letter shall
become a binding agreement among you and the Company.
Very truly yours,
THE INTERPUBLIC GROUP OF COMPANIES,
INC.
By: ALAN M. FORSTER
ALAN M. FORSTER
Vice President and Treasurer
The foregoing Agreement is
hereby accepted as of the
date first above written.
THE PRUDENTIAL INSURANCE COMPANY
OF AMERICA
By: GAIL McDERMOTT
GAIL McDERMOTT
Vice President
PURCHASER SCHEDULE
Aggregate
Principal
Amount of Note
Notes to be DENOMI-
PURCHASED NATION(S)
THE PRUDENTIAL INSURANCE COMPANY OF $25,000,000 $25,000,000
AMERICA
(1) All payments on account of Notes
held by such purchaser shall be made
by wire transfer of immediately available
funds for credit to:
Account No. 050-54-526
Morgan Guaranty Trust Company of New York
23 Wall Street
New York, New York 10015
(ABA No.: 021-000-238)
Each such wire transfer shall set forth the
name of the Company, the full title (including
the coupon rate and final maturity date) of the
Notes, a reference to "!INV______"
and the due date and application (as among
principal, premium and interest) of the payment
being made.
(2) Address for all notices relating to payments:
The Prudential Insurance Company of America
c/o Prudential Capital Group
Four Gateway Center
100 Mulberry Street
Newark, New Jersey 07102-4007
Attention: Manager, Investment Operations
(3) Address for all other communications and notices:
The Prudential Insurance Company of America
c/o Prudential Capital Group
One Gateway Center, 11th Floor
7-45 Raymond Boulevard West
Newark, New Jersey 07102-5311
Attention: Managing Director
(4) Tax Identification No.: 22-1211670
_________________________________________________________________
_________________________________________________________________
THE INTERPUBLIC GROUP OF COMPANIES, INC.
_______________________________
_______________________________
NOTE PURCHASE AGREEMENT
_______________________________
_______________________________
7.91% Senior Notes due 2004
($25,000,000)
Dated as of May 26, 1994
_________________________________________________________________
_________________________________________________________________
TABLE OF CONTENTS
(Not Part of Agreement)
PAGE
1. AUTHORIZATION OF ISSUE OF NOTES
2. PURCHASE AND SALE OF NOTES
3. CONDITIONS OF CLOSING
4. PREPAYMENTS
5. AFFIRMATIVE COVENANTS
6. NEGATIVE COVENANTS
7. EVENTS OF DEFAULT
8. REPRESENTATIONS, COVENANTS AND WARRANTIES
9. REPRESENTATIONS OF THE PURCHASER
10. DEFINITIONS
11. MISCELLANEOUS
PURCHASER SCHEDULE
EXHIBIT A -- FORM OF COMPANY NOTE
EXHIBIT B-1 -- FORM OF OPINION OF COMPANY'S SPECIAL COUNSEL
EXHIBIT B-2 -- FORM OF OPINION OF COMPANY'S GENERAL COUNSEL
EXHIBIT C -- FORM OF AMENDMENT NO. 4
PAGE