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EXHIBIT 10(r)
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MARSH SUPERMARKETS, INC. (an Indiana corporation),
MARSH DRUGS, INC. (an Indiana corporation),
MARSH VILLAGE PANTRIES, INC. (an Indiana corporation),
MUNDY REALTY, INC. (an Indiana corporation),
MAR PROPERTIES, INC. (an Indiana corporation),
MARLEASE, INC. (an Indiana corporation),
MARSH INTERNATIONAL, INC. (an Indiana corporation),
MARAINES GREENERY, INC. (an Indiana corporation),
LIMITED HOLDINGS, INC. (an Indiana corporation),
CONVENIENCE STORE DISTRIBUTING COMPANY (an Ohio partnership),
MARSH P.Q., INC. (an Indiana corporation),
S.C.T., INC. (an Indiana corporation),
NORTH MARION DEVELOPMENT CORPORATION (an Indiana corporation),
CONTRACT TRANSPORT, INC. (an Indiana corporation),
CRYSTAL FOOD SERVICES, LLC (an Indiana limited liability company),
LOBILL FOODS, LLC (an Indiana limited liability company),
CONTRACT TRANSPORT, LLC (an Indiana limited liability company),
MARSH SUPERMARKETS, LLC (an Indiana limited liability company),
VILLAGE PANTRY, LLC (an Indiana limited liability company),
MARSH DRUGS, LLC (an Indiana limited liability company),
TRADEMARK HOLDINGS, INC. (a Delaware corporation) and
MARSH CLEARING HOUSE, LLC (an Indiana limited liability company)
$150,000,000
8 7/8% Senior Subordinated Notes due 2007
PURCHASE AGREEMENT
Dated: July 29, 1997
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TABLE OF CONTENTS
PURCHASE AGREEMENT................................................................................................1
SECTION 1. Representations and Warranties.......................................................3
(a) Representations and Warranties by the Company and the
Guarantors...........................................................................3
(i) Similar Offerings.........................................................3
(ii) Offering Memorandum.......................................................3
(iii) Independent Accountants...................................................4
(iv) Financial Statements......................................................4
(v) No Material Adverse Change in Business....................................4
(vi) Good Standing of the Company..............................................4
(vii) Good Standing of Subsidiaries.............................................5
(viii) Capitalization............................................................5
(ix) Authorization of Agreements...............................................6
(x) Authorization of the Indenture............................................6
(xi) Authorization of the Securities and the Guarantees........................6
(xii) Description of the Securities, the Guarantees and
the Indenture.............................................................7
(xiii) Absence of Defaults and Conflicts.........................................7
(xiv) Absence of Labor Disputes.................................................8
(xv) Absence of Proceedings....................................................8
(xvi) Possession of Intellectual Property.......................................9
(xvii) Absence of Further Requirements...........................................9
(xviii) Possession of Licenses and Permits.......................................10
(xix) Title to Property........................................................10
(xx) Tax Returns..............................................................11
(xxi) Insurance................................................................11
(xxii) Solvency.................................................................11
(xxiii) Stabilization or Manipulation............................................12
(xxiv) Related Party Transactions...............................................12
(xxv) Suppliers................................................................12
(xxvi) Environmental Laws.......................................................12
(xxvii) Registration Rights......................................................13
(xxviii) Accounting Controls......................................................13
(xxix) Investment Company Act...................................................13
(xxx) Rule 144A Eligibility....................................................14
(xxxi) No General Solicitation..................................................14
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(xxxii) No Registration Required.................................................14
(xxxiii) No Directed Selling Efforts..............................................14
(xxxiv) PORTAL...................................................................14
(xxxv) Authorization of the Credit Agreement....................................15
(b) Officer's Certificates..............................................................15
SECTION 2. Sale and Delivery to Initial Purchasers; Closing...................................15
(a) Securities and Guarantees...........................................................15
(b) Payment.............................................................................15
(c) Qualified Institutional Buyer.......................................................16
(d) Denominations; Registration........................................................16
SECTION 3. Covenants of the Company and the Guarantors.........................................16
(a) Offering Memorandum.................................................................16
(b) Notice and Effect of Material Events................................................16
(c) Amendment to Offering Memorandum and Supplements....................................17
(d) Qualification of Securities and Guarantees for Offer and Sale.......................17
(e) Integration.........................................................................17
(f) Rating of Securities................................................................18
(g) Rule 144A Information...............................................................18
(h) Restriction on Resales..............................................................18
(i) Use of Proceeds.....................................................................18
(j) Restriction on Sale of Securities...................................................18
(k) DTC Clearance.......................................................................19
(l) Legends.............................................................................19
(m) Interim Financial Statements........................................................19
(n) Periodic Reports....................................................................19
SECTION 4. Payment of Expenses.................................................................19
(a) Expenses............................................................................19
(b) Termination of Agreement............................................................20
SECTION 5. Conditions of Initial Purchasers' Obligations.......................................20
(a) Opinion of Counsel for the Company and the Guarantors...............................20
(b) Opinion of Counsel for the Initial Purchasers.......................................20
(c) Officers' Certificate...............................................................21
(d) Accountant's Comfort Letter and Consent.............................................21
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(e) Bring-down Comfort Letter...........................................................21
(f) Maintenance of Rating...............................................................22
(g) PORTAL..............................................................................22
(h) Chief Financial Officer's Certificate...............................................22
(i) Registration Rights Agreement and Indenture.........................................22
(j) Credit Agreements...................................................................22
(k) Debt Prepayment Arrangements........................................................23
(l) Additional Documents................................................................23
(m) Termination of Agreement............................................................23
SECTION 6. Indemnification.....................................................................23
(a) Indemnification of Initial Purchasers...............................................23
(b) Indemnification of Company, Guarantors and Directors................................24
(c) Actions against Parties; Notification..............................................25
(d) Settlement without Consent if Failure to Reimburse..................................25
SECTION 7. Contribution........................................................................26
SECTION 8. Representations, Warranties and Agreements to Survive
Delivery............................................................................27
SECTION 9. Termination of Agreement............................................................27
(a) Termination; General...............................................................27
(b) Liabilities.........................................................................28
SECTION 10. Default by One or More of the Initial Purchasers....................................28
SECTION 11. Notices.............................................................................29
SECTION 12. Parties.............................................................................29
SECTION 13. Governing Law and Time..............................................................29
SECTION 14. Effect of Headings..................................................................30
Schedule A--Initial Purchasers
Schedule B--Guarantors
Schedule C--Securities
Exhibit A-1--Form of Opinion of Bass, Berry & Sims
Exhibit A-2--Form of Opinion of P. Lawrence Butt
Exhibit B--Form of Comfort Letter
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$150,000,000
MARSH SUPERMARKETS, INC.
(an Indiana corporation)
PURCHASE AGREEMENT
July 29, 1997
MERRILL LYNCH & CO.
Merrill Lynch, Pierce, Fenner & Smith
Incorporated
McDonald & Company Securities, Inc.
c/o Merrill Lynch & Co.
Merrill Lynch, Pierce, Fenner & Smith
Incorporated
North Tower
World Financial Center
New York, New York 10281-1209
Ladies and Gentlemen:
Marsh Supermarkets, Inc., an Indiana corporation (the "Company"), and
each of the Guarantors listed on Schedule B hereto (the "Guarantors") confirm
their respective agreements with Merrill Lynch & Co., Merrill Lynch, Pierce,
Fenner & Smith Incorporated ("Merrill Lynch") and each of the other Initial
Purchasers named in Schedule A hereto (collectively, the "Initial Purchasers",
which term shall also include any initial purchaser substituted as hereinafter
provided in Section 10 hereof), for whom Merrill Lynch is acting as
representative (in such capacity, the "Representative"), with respect to (i)
the issue and sale by the Company and the purchase by the Initial Purchasers,
acting severally and not jointly, of the respective principal amounts set forth
in said Schedule A of $150,000,000 aggregate principal amount of the Company's
Senior Subordinated Notes due 2007 (the "Securities") and (ii) the issue and
sale by the Guarantors and the purchase by the Initial Purchasers, acting
severally and not jointly, of the senior subordinated guarantees (the
"Guarantees") of the Company's obligations under the Securities. The Securities
and the Guarantees are to be issued pursuant to an
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indenture dated as of August 5, 1997 (the "Indenture") among the Company, the
Guarantors and State Street Bank and Trust Company, as trustee (the "Trustee").
Securities and Guarantees issued in book-entry form will be issued to Cede &
Co. as nominee of The Depository Trust Company ("DTC") pursuant to a letter
agreement, to be dated as of the Closing Time (as defined in Section 2(b)) (the
"DTC Agreement"), among the Company, the Guarantors, the Trustee and DTC.
The Company and the Guarantors understand that the Initial Purchasers
propose to make an offering of the Securities and the Guarantees on the terms
and in the manner set forth herein and agree that the Initial Purchasers may
resell, subject to the conditions set forth herein, all or a portion of the
Securities and the Guarantees to purchasers ("Subsequent Purchasers") at any
time after the date of this Agreement. The Securities and the Guarantees are to
be offered and sold through the Initial Purchasers without being registered
under the Securities Act of 1933, as amended (the "1933 Act"), in reliance upon
exemptions therefrom. Pursuant to the terms of the Securities, the Guarantees
and the Indenture, investors that acquire Securities and Guarantees may only
resell or otherwise transfer such Securities and Guarantees if such Securities
and Guarantees are hereafter registered under the 1933 Act or if an exemption
from the registration requirements of the 1933 Act is available (including the
exemption afforded by Rule 144A ("Rule 144A") or Regulation S ("Regulation S")
of the rules and regulations promulgated under the 1933 Act by the Securities
and Exchange Commission (the "Commission")).
The Company and the Guarantors have prepared and delivered to each
Initial Purchaser copies of a preliminary offering memorandum dated July 16,
1997 (the "Preliminary Offering Memorandum") and have prepared and will deliver
to each Initial Purchaser, on the date hereof or the next succeeding day,
copies of a final offering memorandum dated July 29, 1997 (the "Final Offering
Memorandum"), each to be used by such Initial Purchaser in connection with its
solicitation of, purchases of, or offering of, the Securities and the
Guarantees. "Offering Memorandum" means, with respect to any date or time
referred to in this Agreement, the most recent offering memorandum (whether the
Preliminary Offering Memorandum or the Final Offering Memorandum, or any
amendment or supplement to either such document), including exhibits thereto
and any documents incorporated therein by reference, which has been prepared
and delivered by the Company and the Guarantors to the Initial Purchasers in
connection with their solicitation of purchases of, or offering of, the
Securities and the Guarantees.
All references in this Agreement to financial statements and schedules
and other information which is "contained," "included" or "stated" in the
Offering Memorandum (or other references of like import) shall be deemed to
mean and include all such financial statements and schedules and other
information which is incorporated by reference in the
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Offering Memorandum; and all references in this Agreement to amendments or
supplements to the Offering Memorandum shall be deemed to mean and include the
filing of any document under the Securities Exchange Act of 1934 (the "1934
Act") which is incorporated by reference in the Offering Memorandum.
The holders of the Securities and the Guarantees will be entitled to
the benefits of the registration rights agreement to be dated as of the Closing
Time (the "Registration Rights Agreement"), among the Company, the Guarantors
and the Initial Purchasers, pursuant to which the Company will agree to file,
as soon as practicable after the Closing Time but in any event within 30 days
of the Closing Time, a registration statement with the Commission registering
the Exchange Securities (as defined in the Registration Rights Agreement) under
the 1933 Act.
SECTION 1. Representations and Warranties.
(a) Representations and Warranties by the Company and the Guarantors.
The Company and each of the Guarantors, jointly and severally, represent and
warrant to each Initial Purchaser as of the date hereof and as of the Closing
Time referred to in Section 2(b) hereof, and agree with each Initial Purchaser
as follows:
(i) Similar Offerings. The Company and the Guarantors have
not, directly or indirectly, solicited any offer to buy or offered to
sell, and will not, directly or indirectly, solicit any offer to buy
or offer to sell, in the United States or to any United States citizen
or resident, any security which is or would be integrated with the
sale of the Securities and the Guarantees in a manner that would
require the Securities or the Guarantees to be registered under the
1933 Act.
(ii) Offering Memorandum. The Offering Memorandum does not,
and at the Closing Time will not, include an untrue statement of a
material fact or omit to state a material fact necessary in order to
make the statements therein, in the light of the circumstances under
which they were made, not misleading; provided, that this
representation, warranty and agreement shall not apply to statements
in or omissions from the Offering Memorandum made in reliance upon and
in conformity with information furnished to the Company and the
Guarantors in writing by any Initial Purchaser through Merrill Lynch
expressly for use in the Offering Memorandum. The documents
incorporated by reference or deemed to be incorporated by reference in
the Offering Memorandum at the time they were or hereafter are filed
with the Commission complied and will comply in all material respects
with the applicable requirements of the 1934 Act and the applicable
rules and regulations of the Commission thereunder and, when read
together with the other information in the Offering Memorandum, at the
date of the Offering
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Memorandum and at the Closing Time, did not and will not include an
untrue statement of a material fact or omit to state a material fact
required to be stated therein or necessary to make the statements
therein, in the light of the circumstances under which they were made,
not misleading.
(iii) Independent Accountants. The accountants who certified
the financial statements and supporting schedules included or
incorporated by reference in the Offering Memorandum are independent
certified public accountants with respect to the Company, the
Guarantors and their respective subsidiaries within the meaning of
Regulation S-X under the 1933 Act.
(iv) Financial Statements. The financial statements, together
with the related schedules and notes, included in the Offering
Memorandum and the documents incorporated by reference therein present
fairly the financial position of the Company and its consolidated
Subsidiaries at the dates indicated and the statements of income,
changes in shareholders' equity and cash flows of the Company and its
consolidated Subsidiaries for the periods specified; said financial
statements have been prepared in conformity with United States
generally accepted accounting principles ("GAAP") applied on a
consistent basis throughout the periods involved. The selected
financial data and the summary financial information included in the
Offering Memorandum and the documents incorporated by reference
therein present fairly the information shown therein and have been
compiled on a basis consistent with that of the audited financial
statements included in the Offering Memorandum and the documents
incorporated by reference therein.
(v) No Material Adverse Change in Business. Since the
respective dates as of which information is given in the Offering
Memorandum, except as otherwise stated therein or contemplated
thereby, (A) there has been no material adverse change in the
condition (financial or otherwise), earnings, business affairs or
business prospects of the Company and its Subsidiaries considered as
one enterprise, whether or not arising in the ordinary course of
business (a "Material Adverse Effect"), (B) there have been no
transactions entered into by the Company or any of its Subsidiaries,
other than those in the ordinary course of business, which are
material with respect to the Company and its Subsidiaries considered
as one enterprise, and (C) there has been no dividend or distribution
of any kind declared, paid or made by the Company on any class of its
capital stock.
(vi) Good Standing of the Company. The Company has been duly
organized and is validly existing as a corporation under the laws of
the State of Indiana and has corporate power and authority to own,
lease and operate its
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properties and to conduct its business as described in the Offering
Memorandum and to enter into and perform its obligations under this
Agreement, the Registration Rights Agreement, the Indenture, the
Securities, the Exchange Securities, and the DTC Agreement and to
enter into and consummate all the transactions in connection therewith
as contemplated in the Offering Memorandum; and the Company is duly
qualified as a foreign corporation to transact business in each other
jurisdiction in which such qualification is required, whether by
reason of the ownership or leasing of property or the conduct of
business, except where the failure so to qualify or to be in good
standing would not result in a Material Adverse Effect.
(vii) Good Standing of Subsidiaries. Each subsidiary of the
Company (each a "Subsidiary" and collectively the "Subsidiaries") has
been duly organized and is validly existing as a corporation, limited
liability corporation or partnership under the laws of the
jurisdiction of its incorporation or existence, has corporate or
partnership power and authority to own, lease and operate its
properties and to conduct its business as described in the Offering
Memorandum and is duly qualified as a foreign corporation, limited
liability company or partnership to transact business in each
jurisdiction in which such qualification is required, whether by
reason of the ownership or leasing of property or the conduct of
business, except where the failure so to qualify would not result in a
Material Adverse Effect; except as otherwise disclosed in the Offering
Memorandum, all of the issued and outstanding capital stock or
partnership interests of each Subsidiary has been duly authorized and
validly issued, is fully paid and non-assessable and except as
disclosed in the Offering Memorandum is owned by the Company, directly
or through the Subsidiaries, free and clear of any security interest,
mortgage, pledge, lien, encumbrance, claim or equity; none of the
outstanding shares of capital stock or partnership interests of the
Subsidiaries was issued in violation of any preemptive or similar
rights arising by operation of law, or under the charter, by-laws or
other charter documents of any Subsidiary or under any agreement to
which the Company or any Subsidiary is a party. All of the
Subsidiaries of the Company are listed on Schedule B attached hereto.
During the fiscal year ended March 29, 1997, C.E. Publishing, Inc.,
Decatur Plaza Associates and Walnut Hills Associates reported, on a
collective basis, revenues of $475,888 and net income of $65,901 and
as of March 19, 1997 had, on a collective basis, total assets of
$2,718,146.
(viii) Capitalization. The authorized, issued and outstanding
capital stock of the Company was at the date indicated in the Offering
Memorandum as set forth in the financial statements, including the
schedules and notes, included in the Offering Memorandum (except for
subsequent issuances, if any, pursuant to
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employee benefit plans referred to in the Offering Memorandum or
pursuant to the exercise of convertible securities or options referred
to in the Offering Memorandum). The shares of issued and outstanding
capital stock of the Company have been duly authorized and validly
issued and are fully paid and non-assessable; and none of the
outstanding shares of capital stock of the Company was issued in
violation of the preemptive or other similar rights of any
securityholder of the Company arising by operation of law, under the
charter or by-laws of the Company, under any agreement to which the
Company or any of the Subsidiaries is a party or otherwise.
(ix) Authorization of Agreements. This Agreement, the
Registration Rights Agreement and the DTC Agreement have each been
duly authorized by the Company and each of the Guarantors. This
Agreement has been, and as of the Closing Time the Registration Rights
Agreement and the DTC Agreement each will have been, duly executed and
delivered by the Company and each of the Guarantors. Upon the
execution and delivery thereof by the Company and each of the
Guarantors, the Registration Rights Agreement and the DTC Agreement
will constitute valid and binding obligations of the Company and each
of the Guarantors, enforceable against the Company and each of the
Guarantors in accordance with their terms.
(x) Authorization of the Indenture. The Indenture has been
duly authorized by the Company and each of the Guarantors and, at the
Closing Time, will have been duly executed and delivered by the
Company and each of the Guarantors and will constitute a valid and
binding agreement of the Company and each of the Guarantors,
enforceable against the Company and each of the Guarantors in
accordance with its terms.
(xi) Authorization of the Securities and the Guarantees. The
Securities have been duly authorized by the Company and, at the
Closing Time, will have been duly executed by the Company and, when
authenticated in the manner provided for in the Indenture and
delivered against payment of the purchase price therefor, will
constitute valid and binding obligations of the Company, enforceable
against the Company in accordance with their terms, and will be in the
form contemplated by, and entitled to the benefits of, the Indenture.
The Guarantees have been duly authorized by the Guarantors and, at the
Closing Time, will have been duly executed by the Guarantors and, when
authenticated in the manner provided for in the Indenture and
delivered against payment of the purchase price therefor, will
constitute valid and binding obligations of the Guarantors,
enforceable against the Guarantors in accordance with their terms, and
will be in the form contemplated by, and entitled to the benefits of,
the Indenture. The
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Exchange Securities have been duly authorized by the Company and each
of the Guarantors and, when executed and authenticated and issued and
delivered by the Company and each of the Guarantors in exchange for
the Securities and the Guarantees pursuant to the Exchange Offer (as
defined in the Registration Rights Agreement), will constitute valid
and binding obligations of the Company and each of the Guarantors,
enforceable against the Company and each of the Guarantors in
accordance with their terms.
(xii) Description of the Securities, the Guarantees and the
Indenture. The Securities, the Guarantees, the Indenture and the
Registration Rights Agreement will conform in all material respects to
the respective statements relating thereto contained in the Offering
Memorandum and will be in substantially the respective forms
previously delivered to the Initial Purchasers. The Exchange
Securities will conform in all material respects to the statements
relating thereto contained in the Offering Memorandum and the
Registration Statement at the time it becomes effective. There are no
contracts or documents which are required to be described in a
registration statement on Form S-1 under the 1933 Act which have not
been described in the Offering Memorandum.
(xiii) Absence of Defaults and Conflicts. Neither the Company
nor any of the Subsidiaries is in violation of its charter or by-laws
or in default in the performance or observance of any obligation,
agreement, covenant or condition contained in any contract, indenture,
mortgage, deed of trust, loan or credit agreement, note, lease or
other agreement or instrument to which the Company or any of the
Subsidiaries is a party or by which any of them may be bound, or to
which any of the property or assets of the Company or any of the
Subsidiaries is subject (collectively, "Agreements and Instruments")
or has violated or is in violation of any applicable law, statute,
rule, regulation, judgment, order, writ or decree of any government,
government instrumentality or court, domestic or foreign, having
jurisdiction over the Company or any of the Subsidiaries or any of
their assets or properties, except in each case for such defaults or
violations that would not result in a Material Adverse Effect; and the
execution, delivery and performance of this Agreement, the
Registration Rights Agreement, the Indenture, the DTC Agreement, the
Securities, the Guarantees, the Exchange Securities and any other
agreement or instrument entered into or issued or to be entered into
or issued by the Company or any of the Guarantors in connection with
the transactions contemplated hereby or thereby or in the Offering
Memorandum or in connection with the consummation of the transactions
contemplated herein and in the Offering Memorandum (including the
issuance and sale of the Securities and the Guarantees and the use of
the proceeds from the sale of the Securities and the Guarantees as
described in the Offering Memorandum under the caption "Use of
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Proceeds") and compliance by the Company and the Guarantors with their
respective obligations hereunder have been duly authorized by all
necessary corporate or partnership action and do not and will not,
whether with or without the giving of notice or passage of time or
both, conflict with or constitute a breach of, or default or a
Repayment Event (as defined below) under, or result in the creation or
imposition of any lien, charge or encumbrance upon any property or
assets of the Company or any of the Subsidiaries pursuant to, the
Agreements and Instruments, nor will such action result in any
violation of the provisions of the charter or by-laws of the Company
or any of the Subsidiaries or any applicable law, statute, rule,
regulation, judgment, order, writ or decree of any government,
government instrumentality or court, domestic or foreign, having
jurisdiction over the Company or any of the Subsidiaries or any of
their assets or properties. As used herein, a "Repayment Event" means
any event or condition which gives the holder of any note, debenture
or other evidence of indebtedness (or any person acting on such
holder's behalf) the right to require the repurchase, redemption or
repayment of all or a portion of such indebtedness by the Company or
any of the Subsidiaries which has not been repurchased, redeemed or
repaid.
(xiv) Absence of Labor Disputes. No labor dispute with the
employees of the Company or any of the Subsidiaries exists or, to the
knowledge of the Company and the Guarantors, is imminent, and the
Company and the Guarantors are not aware of any existing or imminent
labor disturbance by the employees of any of their or any of the
Subsidiaries' principal suppliers, manufacturers, customers or
contractors, which, in any case, may reasonably be expected to result
in a Material Adverse Effect.
(xv) Absence of Proceedings. Except as disclosed in the
Offering Memorandum, there is no action, suit, proceeding, inquiry or
investigation, in each case before or by any court or governmental
agency or body, domestic or foreign, now pending, or, to the knowledge
of the Company or any Guarantor, threatened, against or affecting the
Company or any Subsidiary thereof which, singly or in the aggregate,
might reasonably be expected to result in a Material Adverse Effect,
or which, singly or in the aggregate, might reasonably be expected to
materially and adversely affect the consummation of this Agreement or
the performance by the Company and the Guarantors of their respective
obligations hereunder or under the Securities, the Guarantees or the
Exchange Securities. The aggregate of all pending legal or
governmental proceedings to which the Company or any Subsidiary
thereof is a party or of which any of their respective property or
assets is the subject which are not described in the Offering
Memorandum, including ordinary routine litigation incidental to the
business, could not reasonably be expected to result in a Material
Adverse Effect. The indemnification agreement
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between the Company and certain parties in connection with a certain
Indiana lawsuit brought against the Company has been authorized,
executed and delivered by the Company and constitutes the valid and
binding obligation of the parties thereto, enforceable in accordance
with its terms, and provides the Company with full and complete
indemnification (without deductibles) for all costs, liabilities and
expenses in connection with such lawsuit and the claims related
thereto. Other than such Indiana lawsuit and other than as disclosed
to the Initial Purchasers in writing, there is no other action, suit,
proceeding, inquiry or investigation, in each case before or by any
court or governmental agency or body, domestic or foreign, now pending
or, to the knowledge of the Company or any Guarantor, threatened
against the Company or any Subsidiary thereof, in connection with or
related to the sale by the Company or any Subsidiary thereof of
tobacco-related products.
(xvi) Possession of Intellectual Property. The Company and
the Subsidiaries own, possess or license, or can acquire on reasonable
terms, adequate patents, patent rights, licenses, inventions,
copyrights, know-how (including trade secrets and other unpatented
and/or unpatentable proprietary or confidential information, systems
or procedures), trademarks, service marks, trade names or other
intellectual property (collectively, "Intellectual Property")
necessary to carry on the business now operated by them, and neither
the Company nor any of the Subsidiaries has received any notice or is
otherwise aware of any infringement of or conflict with asserted
rights of others with respect to any Intellectual Property (including
Intellectual Property which is licensed) or of any facts or
circumstances which would render any Intellectual Property invalid or
inadequate to protect the interest of the Company or any of the
Subsidiaries therein, and which infringement or conflict (if the
subject of any unfavorable decision, ruling or finding) or invalidity
or inadequacy, singly or in the aggregate, would reasonably be
expected to result in a Material Adverse Effect.
(xvii) Absence of Further Requirements. Except as disclosed
in the Offering Memorandum, no filing with, or authorization,
approval, consent, license, order, registration, qualification or
decree of, any court or governmental authority or agency is necessary
or required for the performance by the Company or any of the
Guarantors of their respective obligations hereunder, in connection
with the offering, issuance or sale of the Securities and the
Guarantees hereunder or the consummation of the transactions
contemplated by or for the due execution, delivery or performance of
this Agreement, the Registration Rights Agreement, the Indenture, the
DTC Agreement, the Securities, the Guarantees, the Exchange Securities
or any other agreement or instrument entered into or issued or to be
entered into or issued by the Company or any of the Subsidiaries in
connection with the consummation of the transactions contemplated
herein and in the Offering
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Memorandum (including the issuance and sale of the Securities and the
Guarantees and the use of the proceeds from the sale of the Securities
and the Guarantees as described in the Offering Memorandum under the
caption "Use of Proceeds").
(xviii) Possession of Licenses and Permits. The Company and
the Subsidiaries possess all governmental permits, licenses,
approvals, consents, certificates and other authorizations
(collectively, "Governmental Licenses") which are material to the
Company issued by the appropriate federal, state, local or foreign
regulatory agencies or bodies necessary to conduct the business now
operated by them respectively; the Company and the Subsidiaries are in
compliance with the terms and conditions of all such Governmental
Licenses and with the rules and regulations of the regulatory
authorities and governing bodies having jurisdiction with respect
thereto, except where the failure so to comply would not, singly or in
the aggregate, have a Material Adverse Effect; all of the Governmental
Licenses are valid and in full force and effect, except when the
invalidity of such Governmental Licenses or the failure of such
Governmental Licenses to be in full force and effect would not have a
Material Adverse Effect; and neither the Company nor any of the
Subsidiaries has received any notice of proceedings relating to the
revocation or modification of any such Governmental Licenses, nor are
there, to the knowledge of the Company or any Guarantor, pending or
threatened actions, suits, claims or proceedings against the Company
or any Subsidiary before any court, governmental agency or body or
otherwise that, if successful, would limit, revoke, cancel, suspend or
cause not to be renewed any Governmental License, in each case, which,
singly or in the aggregate, if the subject of an unfavorable decision,
ruling or finding, would result in a Material Adverse Effect.
(xix) Title to Property. The Company and the Subsidiaries
have good and marketable title to all real property owned by the
Company and the Subsidiaries and good title to all other properties
owned by them, in each case, free and clear of all mortgages, pledges,
liens, security interests, claims, restrictions or encumbrances of any
kind except such as (a) are described in the Offering Memorandum or
(b) do not, singly or in the aggregate, materially affect the value of
such property and do not materially interfere with the use made and
proposed to be made of such property by the Company or any of the
Subsidiaries; and all of the leases and subleases material to the
business of the Company and the Subsidiaries, considered as one
enterprise, and under which the Company or any of the Subsidiaries
holds properties described in the Offering Memorandum, are in full
force and effect, and neither the Company nor any of the Subsidiaries
has any notice of any material claim of any sort that has been
asserted by anyone adverse to the rights of the Company or any of the
Subsidiaries under any of the leases or
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subleases mentioned above, or affecting or questioning the rights of
the Company or any Subsidiary to the continued possession of the
leased or subleased premises under any such lease or sublease.
(xx) Tax Returns. All United States federal income tax
returns of the Company and the Subsidiaries required by law to be
filed have been filed and all taxes shown by such returns or otherwise
assessed, which are due and payable, have been paid, except
assessments against which appeals have been or will be promptly taken
and as to which adequate reserves have been provided. The Company and
the Subsidiaries have filed all other tax returns that are required to
have been filed by them pursuant to applicable foreign, federal,
state, local or other law except insofar as the failure to file such
returns would not result in a Material Adverse Effect, and have paid
all taxes due pursuant to such returns or pursuant to any assessment
received by the Company and the Subsidiaries, except for such taxes,
if any, as are being contested in good faith and by appropriate
proceedings and as to which adequate reserves have been provided. The
charges, accruals and reserves on the books of the Company in respect
of all federal, state, local and foreign tax liabilities of the
Company and each Subsidiary for any years not finally determined are
adequate to meet any assessments or re-assessments for additional
income tax for any years not finally determined, except to the extent
of any inadequacy that would not result in a Material Adverse Effect.
(xxi) Insurance. The Company and the Subsidiaries carry or
are entitled to the benefits of insurance, with financially sound and
reputable insurers, in such amounts and covering such risks as is
generally maintained by companies of established repute engaged in the
same or similar business, and all such insurance is in full force and
effect.
(xxii) Solvency. The Company and each of the Guarantors is,
and immediately after the Closing will be, Solvent. As used herein,
the term "Solvent" means, with respect to the Company and each
Guarantor, as the case may be, on a particular date, that on such date
(A) the fair market value of the assets of the Company or such
Guarantor is greater than the total amount of liabilities (including
contingent liabilities) of the Company or such Guarantor, (B) the
present fair salable value of the assets of the Company or such
Guarantor is greater than the amount that will be required to pay the
probable liabilities of the Company or such Guarantor on its debts as
they become absolute and mature, (C) the Company or such Guarantor is
able to realize upon its assets and pay its debts and other
liabilities, including contingent obligations, as they mature, and (D)
the Company or such Guarantor does not have unreasonably small
capital.
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(xxiii) Stabilization or Manipulation. Neither the Company
nor any Guarantor nor any of their respective officers, directors or
controlling persons has taken, directly or indirectly, any action
designed to cause or to result in, or that has constituted or which
might reasonably be expected to constitute, the stabilization or
manipulation of the price of any security of the Company or any
Guarantor in order to facilitate the sale or resale of the Securities
or the Guarantees. The Company and the Guarantors have not distributed
and, prior to the later to occur of (i) the Closing Time and (ii)
completion of the distribution of the Securities and the Guarantees,
will not distribute any offering material in connection with the
offering and sale of the Securities and the Guarantees other than the
Offering Memorandum or other materials, if any, permitted by the 1933
Act and approved by the Representative.
(xxiv) Related Party Transactions. No relationship, direct or
indirect, exists between or among any of the Company, the Guarantors
or any affiliate of the Company or any Guarantor, on the one hand, and
any director, officer, stockholder, customer or supplier of any of
them, on the other hand, which is required by the 1933 Act or by the
rules and regulations enacted thereunder to be described in a
registration statement on Form S-1 which is not so described or is not
described as required in the Offering Memorandum.
(xxv) Suppliers. No supplier of merchandise to the Company or
any of the Subsidiaries has ceased shipments of merchandise to the
Company or any of the Subsidiaries, other than in the normal and
ordinary course of business consistent with past practices, which
cessation would not result in a Material Adverse Effect.
(xxvi) Environmental Laws. Except as described in the
Offering Memorandum and except such matters as would not, singly or in
the aggregate, result in a Material Adverse Effect, (A) neither the
Company nor any of the Subsidiaries is in violation of any federal,
state, local or foreign statute, law, rule, regulation, ordinance,
code, policy or rule of common law or any judicial or administrative
interpretation thereof, including any judicial or administrative
order, consent, decree or judgment, relating to pollution or
protection of human health, the environment (including, without
limitation, ambient air, surface water, groundwater, land surface or
subsurface strata) or wildlife, including, without limitation, laws
and regulations relating to the release or threatened release of
chemicals, pollutants, contaminants, wastes, toxic substances,
hazardous substances, petroleum or petroleum products or nuclear or
radioactive material (collectively, "Hazardous Materials") or to the
manufacture, processing, distribution, use, treatment, storage,
disposal, transport or handling of Hazardous
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Materials (collectively, "Environmental Laws"), (B) the Company and
the Subsidiaries have all permits, licenses, authorizations and
approvals currently required for their respective businesses under any
applicable Environmental Laws and are each in compliance with their
requirements, (C) there are no pending or threatened administrative,
regulatory or judicial actions, suits, demands, demand letters,
claims, liens, notices of noncompliance or violation, investigation or
proceedings relating to any Environmental Law against the Company or
any of the Subsidiaries and (D) there are no events, facts or
circumstances that might reasonably be expected to form the basis of
any liability or obligation of the Company or any of the Subsidiaries,
including, without limitation, any order, decree, plan or agreement
requiring clean-up or remediation, or any action, suit or proceeding
by any private party or governmental body or agency, against or
affecting the Company or any of the Subsidiaries relating to any
Hazardous Materials or Environmental Laws.
(xxvii) Registration Rights. There are no holders of
securities (debt or equity) of the Company or any Guarantor, or
holders of rights (including, without limitation, preemptive rights),
warrants or options to obtain securities of the Company or any
Guarantor, who in connection with the issuance, sale and delivery of
the Securities, the Guarantees and the Exchange Securities, if any,
and the execution, delivery and performance of this Agreement and the
Registration Rights Agreement, have the right to request the Company
or any Guarantor to register securities held by them under the 1933
Act.
(xxviii) Accounting Controls. The Company and its
consolidated Subsidiaries maintain a system of internal accounting
controls sufficient to provide reasonable assurances that (A)
transactions are executed in accordance with management's general or
specific authorization; (B) transactions are recorded as necessary to
permit preparation of financial statements in conformity with
generally accepted accounting principles and to maintain
accountability for assets; (C) access to assets is permitted only in
accordance with management's general or specific authorization; and
(D) the recorded accountability for assets is compared with the
existing assets at reasonable intervals and appropriate action is
taken with respect to any differences.
(xxix) Investment Company Act. The Company and each of the
Guarantors is not, and upon the issuance and sale of the Securities
and the Guarantees as herein contemplated and the application of the
net proceeds therefrom as described in the Offering Memorandum will
not be, an "investment company" or an entity "controlled" by an
"investment company" as such terms are defined in the Investment
Company Act of 1940, as amended (the "1940 Act").
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(xxx) Rule 144A Eligibility. The Securities and the
Guarantees are eligible for resale pursuant to Rule 144A and will not
be, at the Closing Time, of the same class as securities listed on a
national securities exchange registered under Section 6 of the 1934
Act, or quoted in a U.S. automated interdealer quotation system.
(xxxi) No General Solicitation. None of the Company, the
Guarantors, any of their respective affiliates, as such term is
defined in Rule 501(b) under the 1933 Act ("Affiliates"), or any
person acting on any of their behalf (other than the Initial
Purchasers, as to whom the Company and the Guarantors make no
representation) has engaged or will engage, in connection with the
offering of the Securities and the Guarantees, in any form of general
solicitation or general advertising within the meaning of Rule 502(c)
under the 1933 Act.
(xxxii) No Registration Required. Subject to compliance by
the Initial Purchasers with the representations and warranties set
forth in Section 2, it is not necessary in connection with the offer,
sale and delivery of the Securities and the Guarantees to the Initial
Purchasers and to each Subsequent Purchaser in the manner contemplated
by this Agreement and the Offering Memorandum to register the
Securities and the Guarantees under the 1933 Act or to qualify the
Indenture under the Trust Indenture Act of 1939, as amended (the "1939
Act").
(xxxiii) No Directed Selling Efforts. With respect to those
Securities and Guarantees sold in reliance on Regulation S, (A) none
of the Company, the Guarantors, any of their respective Affiliates or
any person acting on their behalf (other than the Initial Purchasers,
as to whom the Company and the Guarantors make no representation) has
engaged or will engage in any directed selling efforts within the
meaning of Regulation S and (B) each of the Company, the Guarantors,
any of their respective Affiliates and any person acting on their
behalf (other than the Initial Purchasers, as to whom the Company and
the Guarantors make no representation) has complied and will comply
with the offering restrictions requirement of Regulation S.
(xxxiv) PORTAL. There are no securities of the Company or any
of the Guarantors which are of the same class as the Securities or the
Guarantees that are listed on a national securities exchange
registered under Section 6 of the 1934 Act, or quoted in a United
States automated inter dealer quotation system. The Company and the
Guarantors have been advised by the National Association of Securities
Dealers, Inc. PORTAL Market that the Securities and the Guarantees
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will be designated PORTAL eligible securities in accordance with the
rules and regulations of the National Association of Securities
Dealers, Inc.
(xxxv) Authorization of the Credit Agreement. The $30 million
credit agreement among the Company, Marsh Supermarkets, LLC ("LLC"),
the other guarantors named therein and Harris Bank, dated as of July
25, 1997 (the "Harris Credit Agreement"), has been duly authorized,
executed and delivered by the Company and LLC and constitutes a valid
and binding obligation of the Company and LLC, enforceable against the
Company and LLC in accordance with its terms.
(b) Officer's Certificates. Any certificate signed by any officer of
the Company or any of the Subsidiaries delivered to the Initial Purchasers or
to counsel for the Initial Purchasers pursuant to the terms of this Agreement
shall be deemed a representation and warranty by the Company or any of the
Subsidiaries to each Initial Purchaser as to the matters covered thereby.
SECTION 2. Sale and Delivery to Initial Purchasers; Closing.
(a) Securities and Guarantees. On the basis of the representations and
warranties herein contained and subject to the terms and conditions herein set
forth, the Company and the Guarantors agree to sell to each Initial Purchaser,
severally and not jointly, and each Initial Purchaser, severally and not
jointly, agrees to purchase from the Company and the Guarantors, at the price
set forth in Schedule C, the aggregate principal amount of Securities
(including the Guarantees) set forth in Schedule A opposite the name of such
Initial Purchaser, plus any additional principal amount of Securities
(including the Guarantees) which such Initial Purchaser may become obligated to
purchase pursuant to the provisions of Section 10 hereof.
(b) Payment. Payment of the purchase price for, and delivery of
certificates for, the Securities and the Guarantees shall be made at the office
of Fried, Frank, Harris, Shriver & Jacobson, or at such other place as shall be
agreed upon by the Representative, the Company and the Guarantors at 9:00 A.M.
(New York Time) on the fifth business day after the date hereof (unless
postponed in accordance with the provisions of Section 10), or such other time
not later than ten business days after such date as shall be agreed upon by the
Representative, the Company and the Guarantors (such time and date of payment
and delivery being herein called the "Closing Time").
Payment shall be made to the Company and the Guarantors by wire
transfer of immediately available funds to a bank account designated by the
Company and the Guarantors, against delivery to the respective accounts of the
Initial Purchasers of certificates for the Securities and the Guarantees to be
purchased by them. It is
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understood that each Initial Purchaser has authorized the Representative, for
its account, to accept delivery of, receipt for, and make payment of the
purchase price for, the Securities and the Guarantees which it has agreed to
purchase. Merrill Lynch, individually and not as representative of the Initial
Purchasers, may (but shall not be obligated to) make payment of the purchase
price for the Securities and the Guarantees to be purchased by any Initial
Purchaser whose funds have not been received by the Closing Time, but such
payment shall not relieve such Initial Purchaser from its obligations
hereunder. The certificates representing the Securities and the Guarantees
shall be registered in the name of Cede & Co. pursuant to the DTC Agreement, or
physical certificates representing the Securities and the Guarantees shall be
registered in the names and denominations requested by the Initial Purchasers,
and in either case shall be made available for examination and packaging by the
Initial Purchasers in The City of New York not later than 9:00 A.M. on the last
business day prior to the Closing Time.
(c) Qualified Institutional Buyer. Each Initial Purchaser severally
and not jointly represents and warrants to, and agrees with, the Company and
each of the Guarantors that it is a "qualified institutional buyer" within the
meaning of Rule 144A under the 1933 Act (a "Qualified Institutional Buyer") and
an "accredited investor" within the meaning of Rule 501(a) under the 1933 Act
(an "Accredited Investor").
(d) Denominations; Registration. Certificates for the Securities
(including the Guarantees) shall be in such denominations ($1,000 or integral
multiples thereof) and registered in such names as the Representative may
request in writing at least one full business day before the Closing Time.
SECTION 3. Covenants of the Company and the Guarantors. The Company
and the Guarantors, jointly and severally, covenant with each Initial Purchaser
as follows:
(a) Offering Memorandum. The Company and the Guarantors, as promptly
as possible, will furnish to each Initial Purchaser, without charge, such
number of copies of the Preliminary Offering Memorandum, the Final Offering
Memorandum and any amendments and supplements thereto and documents
incorporated by reference therein as such Initial Purchaser may reasonably
request.
(b) Notice and Effect of Material Events. The Company and the
Guarantors will immediately notify each Initial Purchaser, and confirm such
notice in writing, of (x) any filing made by the Company or any Guarantor of
information relating to the offering of the Securities and the Guarantees with
any securities exchange or any other regulatory body in the United States or
any other jurisdiction, and (y) prior to the completion of the placement of the
Securities and the Guarantees by the Initial Purchasers as evidenced by a
notice in writing from the Initial Purchasers to the Company, any material
changes in or
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affecting the earnings, business affairs or business prospects of the Company
and the Subsidiaries which (i) make any statement in the Offering Memorandum or
any document incorporated by reference in the Offering Memorandum false or
misleading or (ii) are not disclosed in the Offering Memorandum. In such event
or if during such time any event shall occur or condition shall exist as a
result of which it is necessary, in the opinion of the Company and the
Guarantors, their counsel, the Initial Purchasers or counsel for the Initial
Purchasers, to amend or supplement the Final Offering Memorandum in order that
the Final Offering Memorandum not include any untrue statement of a material
fact or omit to state a material fact necessary in order to make the statements
therein not misleading in the light of the circumstances then existing, the
Company and the Guarantors will forthwith amend or supplement the Final
Offering Memorandum by preparing and furnishing to each Initial Purchaser an
amendment or amendments of, or a supplement or supplements to, the Final
Offering Memorandum (in form and substance satisfactory in the reasonable
opinion of counsel for the Initial Purchasers) so that, as so amended or
supplemented, the Final Offering Memorandum will not include an untrue
statement of a material fact or omit to state a material fact necessary in
order to make the statements therein, in the light of the circumstances
existing at the time it is delivered to a Subsequent Purchaser, not misleading.
(c) Amendment to Offering Memorandum and Supplements. The Company and
the Guarantors will advise each Initial Purchaser promptly of any proposal to
amend or supplement the Offering Memorandum and will not effect such amendment
or supplement without the consent of the Initial Purchasers, which shall not be
unreasonably withheld. Neither the consent of the Initial Purchasers to, nor
the Initial Purchaser's delivery of, any such amendment or supplement, shall
constitute a waiver of any of the conditions set forth in Section 5 hereof.
(d) Qualification of Securities and Guarantees for Offer and Sale. The
Company and the Guarantors will use their best efforts to register or qualify
the Securities and the Guarantees for offering and sale under the applicable
securities laws of such jurisdictions as the Representative may designate and
will maintain such qualifications in effect as long as required for the sale of
the Securities and the Guarantees; provided, however, that the Company and the
Guarantors shall not be obligated to file any general consent to service of
process or to qualify as a foreign corporation or as a dealer in securities in
any jurisdiction in which it is not so qualified or to subject itself to
taxation in respect of doing business in any jurisdiction in which it is not
otherwise so subject.
(e) Integration. The Company and the Guarantors agree that they will
not and will cause their affiliates not to make any offer or sale of securities
of the Company or any Guarantor of any class if, as a result of the doctrine of
"integration" referred to in Rule 502 under the 1933 Act, such offer or sale
could be deemed to render invalid (for the
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purpose of (i) the sale of the Securities and the Guarantees by the Company and
the Guarantors to the Initial Purchasers, (ii) the resale of the Securities and
the Guarantees by the Initial Purchasers to Subsequent Purchasers or (iii) the
resale of the Securities and the Guarantees by such Subsequent Purchasers to
others) the exemption from the registration requirements of the 1933 Act
provided by Section 4(2) thereof or by Rule 144A or by Regulation S thereunder
or otherwise.
(f) Rating of Securities. The Company and the Guarantors shall take
all reasonable action necessary to enable Standard & Poor's Corporation
("S&P"), and Moody's Investors Service, Inc. ("Moody's"), to provide their
respective credit ratings of the Securities and the Guarantees.
(g) Rule 144A Information. The Company and the Guarantors agree that,
in order to render the Securities and the Guarantees eligible for resale
pursuant to Rule 144A under the 1933 Act, while any of the Securities and the
Guarantees remain outstanding, it will make available, upon request, to any
holder of Securities and Guarantees or prospective purchasers of Securities and
Guarantees the information specified in Rule 144A(d)(4), unless the Company and
the Guarantors furnish information to the Commission pursuant to Section 13 or
15(d) of the 1934 Act (such information, whether made available to holders or
prospective purchasers or furnished to the Commission, is hereinafter referred
to as "Additional Information").
(h) Restriction on Resales. Until the expiration of two years after
the original issuance of the Securities and the Guarantees, the Company and the
Guarantors will not, and will cause their "affiliates" (as such term is defined
in Rule 144(a)(1) under the 1933 Act) not to, resell any Securities and
Guarantees which are "restricted securities" (as such term is defined under
Rule 144(a)(3) under the 1933 Act) that have been reacquired by any of them and
shall immediately upon any purchase of any such Securities and Guarantees
submit such Securities and Guarantees to the Trustee for cancellation.
(i) Use of Proceeds. The Company and the Guarantors will use the net
proceeds received by them from the sale of the Securities and the Guarantees in
the manner specified in the Offering Memorandum under "Use of Proceeds." The
Company will send a notice of redemption to Holders of the Senior Notes (as
defined in the Offering Memorandum) no later than the Closing Time.
(j) Restriction on Sale of Securities. During a period of 90 days from
the date of the Offering Memorandum, the Company and the Guarantors will not,
without the prior written consent of Merrill Lynch, directly or indirectly,
issue, sell, offer to sell, grant any option for the sale of, or otherwise
dispose of, any debt securities or guarantees of
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debt securities of the Company (other than borrowings under the Company's bank
credit agreements, the Securities, the Guarantees and the Exchange Securities).
(k) DTC Clearance. The Company and the Guarantors will use all
reasonable efforts in cooperation with the Initial Purchasers to permit the
Securities and the Guarantees to be eligible for clearance and settlement
through DTC.
(l) Legends. Each certificate for a Security (including the Guarantee)
will bear the legend contained in "Notice to Investors" in the Offering
Memorandum for the time period and upon the other terms stated in the Offering
Memorandum.
(m) Interim Financial Statements. Prior to the Closing Time, the
Company shall furnish to the Initial Purchasers copies of any budgets or
revised budgets for fiscal 1997 and any unaudited interim financial statements
of the Company, promptly after they have been completed, for any periods
subsequent to the periods covered by the financial statements appearing in the
Offering Memorandum.
(n) Periodic Reports. For a period of three years after the Closing
Time, the Company and the Guarantors will furnish to the Initial Purchasers
copies of all annual reports, quarterly reports and current reports filed with
the Commission on Forms 10-K, 10-Q and 8-K, or such other similar forms as may
be designated by the Commission, and such other documents, reports and
information as shall be furnished by the Company and the Guarantors generally
to the holders of the Securities and the Guarantees or to security holders of
its publicly issued securities generally.
SECTION 4. Payment of Expenses.
(a) Expenses. The Company and the Guarantors, jointly and severally,
will pay all expenses incident to the performance of their respective
obligations under this Agreement, including (i) the preparation, printing and
any filing of the Offering Memorandum and the Registration Statement (including
financial statements and any schedules or exhibits) and of each amendment or
supplement thereto, including the preliminary prospectuses and the prospectus
to be contained in the Registration Statement, (ii) the preparation, printing
and delivery to the Initial Purchasers of this Agreement, the Registration
Rights Agreement, the Indenture and such other documents as may be required in
connection with the offering, purchase, sale and delivery of the Securities and
the Guarantees, (iii) the preparation, issuance and delivery of the
certificates for the Securities and the Guarantees to the Initial Purchasers,
including any charges of DTC in connection therewith, (iv) the fees and
disbursements of the Company's and the Guarantors' counsel, accountants and
other advisors, (v) the qualification of the Securities and the Guarantees
under securities laws in accordance
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with the provisions of Section 3(d) hereof, including filing fees and the
reasonable fees and disbursements of counsel for the Initial Purchasers in
connection therewith and in connection with the preparation of the Blue Sky
Survey, any supplement thereto and any Legal Investment Survey, (vi) the fees
and expenses of the Trustee, including the fees and disbursements of counsel
for the Trustee in connection with the Indenture, the Securities and the
Guarantees, (vii) any fees payable in connection with the rating of the
Securities and the Guarantees and the listing of the Securities and the
Guarantees with the Private Offerings, Resales and Trading Through Automated
Linkages ("PORTAL") market, and (viii) any filing fees incident to, and any
reasonable fees and disbursements of counsel to the Initial Purchasers in
connection with, the review by the National Association of Securities Dealers,
Inc. of the terms of the sale of the Securities and the Guarantees.
(b) Termination of Agreement. If this Agreement is terminated by the
Representative in accordance with the provisions of Section 5 or Section
9(a)(i) or 9(a)(ii) hereof, the Company and the Guarantors, jointly and
severally, shall reimburse the Initial Purchasers for all of their
out-of-pocket expenses, including the reasonable fees and disbursements of
counsel for the Initial Purchasers.
SECTION 5. Conditions of Initial Purchasers' Obligations. The
obligations of the several Initial Purchasers hereunder are subject to the
accuracy of the representations and warranties of the Company and the
Guarantors contained in Section 1 hereof or in certificates of any officer of
the Company or any of the Subsidiaries delivered pursuant to the provisions
hereof, to the performance by the Company and the Guarantors of their covenants
and other obligations hereunder, and to the following further conditions:
(a) Opinion of Counsel for the Company and the Guarantors. At the
Closing Time, the Initial Purchasers shall have received the favorable
opinions, dated as of the Closing Time, of each of Bass, Berry & Sims PLC,
counsel for the Company and the Guarantors, and P. Lawrence Butt, Vice
President, Counsel and Secretary of the Company, in each case in form and
substance satisfactory to counsel for the Initial Purchasers, together with
signed or reproduced copies of such letters for each of the other Initial
Purchasers to the effect set forth in Exhibits A-1 and A-2, respectively,
hereto and to such further effect as counsel to the Initial Purchasers may
reasonably request.
(b) Opinion of Counsel for the Initial Purchasers. At the Closing
Time, the Initial Purchasers shall have received the favorable opinion, dated
as of the Closing Time, of Fried, Frank, Harris, Shriver & Jacobson, counsel
for the Initial Purchasers, together with signed or reproduced copies of such
letter for each of the other Initial Purchasers, with respect to certain
matters set forth in paragraphs (1) through (5), inclusive, (8) (solely as to
the information in the Offering Memorandum under "Description of the Notes")
and the penultimate paragraph of Exhibit A-1 hereto and paragraphs (1) and (2)
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of Exhibit A-2 hereto. In giving such opinion such counsel may rely, as to all
matters governed by the laws of jurisdictions other than the law of the State
of New York and the federal law of the United States and the General
Corporation Law of the State of Delaware, upon the opinions of counsel
satisfactory to the Representative, including internal counsel of the Company.
Such counsel may also state that, insofar as such opinion involves factual
matters, they have relied, to the extent they deem proper, upon certificates of
officers of the Company, the Guarantors and the Subsidiaries and certificates
of public officials.
(c) Officers' Certificate. At the Closing Time, (i) the Offering
Memorandum, as it may then be amended or supplemented, including the documents
incorporated by reference therein, shall not contain an untrue statement of a
material fact or omit to state a material fact required to be stated therein or
necessary to make the statements therein not misleading; (ii) there shall not
have been, since the respective dates as of which information is given in the
Offering Memorandum, any material adverse change in the condition (financial or
otherwise), earnings, business affairs or business prospects of the Company and
of the Subsidiaries, considered as one enterprise, whether or not arising in
the ordinary course of business; (iii) the Company and the Guarantors shall
have complied with all agreements and satisfied all conditions on their part to
be performed or satisfied at or prior to the Closing Time; and (iv) the
representations and warranties of the Company and the Guarantors in Section 1
shall be accurate and true and correct as though expressly made at and as of
the Closing Time. At the Closing Time, the Initial Purchasers shall have
received a certificate of the Chief Executive Officer of the Company and the
Chief Financial Officer of the Company, and equivalent officials of each
Guarantor, dated as of the Closing Time, to such effect.
(d) Accountant's Comfort Letter and Consent. At the time of the
execution of this Agreement, the Initial Purchasers shall have received from
Ernst & Young LLP a letter dated such date, in form and substance satisfactory
to the Representative or to counsel for the Initial Purchasers, together with
signed or reproduced copies of such letter for each of the other Initial
Purchasers, containing statements and information of the type ordinarily
included in accountants' "comfort letters" to Initial Purchasers with respect
to the financial statements and certain financial information contained in the
Offering Memorandum and in the form of Exhibit B attached hereto. Ernst & Young
LLP shall provide in a separate writing a consent to the inclusion of its
report in the Offering Memorandum and to the reference to it under the caption
"Independent Auditors" in the Offering Memorandum.
(e) Bring-down Comfort Letter. At the Closing Time, the Initial
Purchasers shall have received from Ernst & Young LLP a letter, dated as of the
Closing Time, to the effect that they reaffirm the statements made in the
letter furnished pursuant to
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subsection (d) of this Section, except that the specified date referred to
shall be a date not more than three business days prior to the Closing Time.
(f) Maintenance of Rating. At the Closing Time, the Securities and the
Guarantees shall be rated at least B2 by Moody's and B+ by S&P, and the Company
and the Guarantors shall have delivered to the Representative a letter dated
the Closing Time, from each such rating agency, or other evidence satisfactory
to the Representative, confirming that the Securities and the Guarantees have
such ratings; and since the date of this Agreement, there shall not have
occurred a downgrading in the rating assigned to the Securities and the
Guarantees or any of the Company's and the Guarantor's other debt securities by
any nationally recognized securities rating agency, and no such securities
rating agency shall have publicly announced that it has under surveillance or
review, with possible negative implications, its rating of the Securities and
the Guarantees or any of the Company's and the Guarantor's other debt
securities.
(g) PORTAL. At the Closing Time, the Securities and the Guarantees
shall have been designated for
trading on PORTAL.
(h) Chief Financial Officer's Certificate. At the Closing Time, the
Initial Purchasers shall have received a certificate of the principal financial
officer of the Company and the Guarantors as to certain agreed
upon accounting matters.
(i) Registration Rights Agreement and Indenture. The Company and each
of the Guarantors shall have duly authorized, executed and delivered the
Registration Rights Agreement and the Indenture to the Initial Purchasers in a
form and substance satisfactory to the Representative and counsel to the
Initial Purchasers.
(j) Credit Agreements. At the Closing Time and upon consummation of
the transactions contemplated hereby, (i) the Company and LLC shall have either
amended the credit agreement, dated as of August 1, 1992, with National City
Bank, Indiana, as amended, and the credit agreement, dated as of May 23, 1997,
with Keybank National Association (collectively, the "Revolving Credit
Agreements"), so that such Revolving Credit Agreements permit and a default or
event of default under such Revolving Credit Agreements is not caused by the
issuance of the Notes and the Guarantees and the use of the estimated net
proceeds thereof, or alternatively shall have terminated the Revolving Credit
Agreements and (ii) the Company and the Guarantors shall have received all
consents, including consents under any credit agreements, necessary to the
issuance and sale of the Securities and the Guarantees and the consummation of
the transactions contemplated hereby, or shall have amended any agreements so
as to obviate the necessity of such consents, in each case in a form and
substance satisfactory to the Representative and counsel for the Initial
Purchasers.
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(k) Debt Prepayment Arrangements. At or prior to the Closing Time, the
Company shall have entered into escrow arrangements, in form and substance
satisfactory to the Representative or to counsel for the Initial Purchasers,
for the prepayment of the Senior Notes as described in the section entitled
"Use of Proceeds" in the Offering Memorandum
(l) Additional Documents. At the Closing Time, counsel for the Initial
Purchasers shall have been furnished with such documents and opinions as they
may require (including any consents under any agreements to which the Company
or any Guarantor is a party) for the purpose of enabling them to pass upon the
issuance and sale of the Securities and the Guarantees as herein contemplated,
or in order to evidence the accuracy of any of the representations or
warranties, or the fulfillment of any of the conditions, herein contained; and
all proceedings taken by the Company and the Guarantors in connection with the
issuance and sale of the Securities and the Guarantees as herein contemplated
shall be satisfactory in form and substance to the Initial Purchasers and
counsel for the Initial Purchasers.
(m) Termination of Agreement. If any condition specified in this
Section shall not have been fulfilled when and as required to be fulfilled,
this Agreement may be terminated by the Representative by notice to the Company
at any time at or prior to the Closing Time, and such termination shall be
without liability of any party to any other party except as provided in Section
4 and except that Sections 1, 6 and 7 shall survive any such termination and
remain in full force and effect.
SECTION 6. Indemnification.
(a) Indemnification of Initial Purchasers. The Company and each of the
Guarantors, jointly and severally, agree to indemnify and hold harmless each
Initial Purchaser and each person, if any, who controls any Initial Purchaser
within the meaning of Section 15 of the 1933 Act or Section 20 of the 1934 Act
as follows:
(i) against any and all loss, liability, claim, damage and
expense whatsoever, as incurred, arising out of any untrue statement
or alleged untrue statement of a material fact contained in any
Preliminary Offering Memorandum or the Final Offering Memorandum (or
any amendment or supplement thereto (including any document
incorporated by reference into the Preliminary Offering Memorandum or
Final Offering Memorandum)), or the omission or alleged omission
therefrom of a material fact necessary in order to make the statements
therein, in the light of the circumstances under which they were made,
not misleading;
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(ii) against any and all loss, liability, claim, damage and
expense whatsoever, as incurred, to the extent of the aggregate amount
paid in settlement of any litigation, or any investigation or
proceeding by any governmental agency or body, commenced or
threatened, or of any claim whatsoever based upon any such untrue
statement or omission, or any such alleged untrue statement or
omission; provided that (subject to Section 6(d) below) any such
settlement is effected with the written consent of the Company; and
(iii) against any and all expense whatsoever, as incurred
(including the fees and disbursements of counsel chosen by Merrill
Lynch), reasonably incurred in investigating, preparing or defending
against any litigation, or any investigation or proceeding by any
governmental agency or body, commenced or threatened, or any claim
whatsoever based upon any such untrue statement or omission, or any
such alleged untrue statement or omission, to the extent that any such
expense is not paid under (i) or (ii) above;
provided, however, that this indemnity agreement shall not apply to any loss,
liability, claim, damage or expense to the extent arising out of any untrue
statement or omission or alleged untrue statement or omission made in reliance
upon and in conformity with written information furnished to the Company or the
Guarantors by any Initial Purchaser through Merrill Lynch expressly for use in
the Offering Memorandum (or any amendment thereto); provided, further, that the
Company and the Guarantors will not be liable to the Initial Purchasers or any
person controlling such Initial Purchasers with respect to any such untrue
statement or alleged untrue statement or omission or alleged omission made in
any Preliminary Offering Memorandum to the extent that the Company and the
Guarantors shall sustain the burden of proving that any such loss, liability,
claim, damage or expense resulted from the fact that the Initial Purchaser sold
securities to a person to whom such Initial Purchaser failed to send or give,
at or prior to the written confirmation of the sale of such Securities, a copy
of the Final Offering Memorandum (as amended or supplemented) if the Company
and the Guarantors have previously furnished copies thereof to the Initial
Purchasers (sufficiently in advance of the Closing Time to allow for
distribution of the Final Offering Memorandum in a timely manner) and complied
with their obligations under Sections 3(b) and 3(c) hereof and the loss,
liability, claim, damage or expense of the Initial Purchasers resulted from an
untrue statement or omission or alleged untrue statement or omission of a
material fact contained in or omitted from such Preliminary Offering Memorandum
(as amended or supplemented) which was corrected in the Final Offering
Memorandum (as amended or supplemented).
(b) Indemnification of Company, Guarantors, and Directors. Each
Initial Purchaser severally agrees to indemnify and hold harmless the Company,
the Guarantors
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and their directors, and each person, if any, who controls the Company or the
Guarantors within the meaning of Section 15 of the 1933 Act or Section 20 of
the 1934 Act against any and all loss, liability, claim, damage and expense
described in the indemnity contained in subsection (a) of this Section, as
incurred, but only with respect to untrue statements or omissions, or alleged
untrue statements or omissions, made in the Offering Memorandum in reliance
upon and in conformity with written information furnished to the Company or the
Guarantors by such Initial Purchaser through Merrill Lynch expressly for use in
the Offering Memorandum.
(c) Actions against Parties; Notification. Each indemnified party
shall give notice as promptly as reasonably practicable to each indemnifying
party of any action commenced against it in respect of which indemnity may be
sought hereunder, but failure to so notify an indemnifying party shall not
relieve such indemnifying party from any liability hereunder to the extent it
is not materially prejudiced as a result thereof and in any event shall not
relieve it from any liability which it may have otherwise than on account of
this indemnity agreement. In the case of parties indemnified pursuant to
Section 6(a) above, counsel to the indemnified parties shall be selected by
Merrill Lynch, and, in the case of parties indemnified pursuant to Section 6(b)
above, counsel to the indemnified parties shall be selected by the Company. An
indemnifying party may participate at its own expense in the defense of any
such action; provided, however, that counsel to the indemnifying party shall
not (except with the consent of the indemnified party) also be counsel to the
indemnified party. In no event shall the indemnifying parties be liable for
fees and expenses of more than one counsel (in addition to any local counsel)
separate from their own counsel for all indemnified parties in connection with
any one action or separate but similar or related actions in the same
jurisdiction arising out of the same general allegations or circumstances. No
indemnifying party shall, without the prior written consent of the indemnified
parties, settle or compromise or consent to the entry of any judgment with
respect to any litigation, or any investigation or proceeding by any
governmental agency or body, commenced or threatened, or any claim whatsoever
in respect of which indemnification or contribution could be sought under this
Section 6 or Section 7 hereof (whether or not the indemnified parties are
actual or potential parties thereto), unless such settlement, compromise or
consent (i) includes an unconditional release of each indemnified party from
all liability arising out of such litigation, investigation, proceeding or
claim and (ii) does not include a statement as to or an admission of fault,
culpability or a failure to act by or on behalf of any indemnified party.
(d) Settlement without Consent if Failure to Reimburse. If at any time
an indemnified party shall have requested an indemnifying party to reimburse
the indemnified party for fees and expenses of counsel, such indemnifying party
agrees that it shall be liable for any settlement of the nature contemplated by
Section 6(a)(ii) effected without its written consent if (i) such settlement is
entered into more than 45 days after
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receipt by such indemnifying party of the aforesaid request, (ii) such
indemnifying party shall have received notice of the terms of such settlement
at least 30 days prior to such settlement being entered into and (iii) such
indemnifying party shall not have reimbursed such indemnified party in
accordance with such request prior to the date of such settlement.
SECTION 7. Contribution. If the indemnification provided for in
Section 6 hereof is for any reason unavailable to or insufficient to hold
harmless an indemnified party in respect of any losses, liabilities, claims,
damages or expenses referred to therein, then each indemnifying party shall
contribute to the aggregate amount of such losses, liabilities, claims, damages
and expenses incurred by such indemnified party, as incurred, (i) in such
proportion as is appropriate to reflect the relative benefits received by the
Company and the Guarantors on the one hand and the Initial Purchasers on the
other hand from the offering of the Securities and the Guarantees pursuant to
this Agreement or (ii) if the allocation provided by clause (i) is not
permitted by applicable law, in such proportion as is appropriate to reflect
not only the relative benefits referred to in clause (i) above but also the
relative fault of the Company and the Guarantors on the one hand and of the
Initial Purchasers on the other hand in connection with the statements or
omissions which resulted in such losses, liabilities, claims, damages or
expenses, as well as any other relevant equitable considerations.
The relative benefits received by the Company and the Guarantors on
the one hand and the Initial Purchasers on the other hand in connection with
the offering of the Securities and the Guarantees pursuant to this Agreement
shall be deemed to be in the same respective proportions as the total net
proceeds from the offering of the Securities and the Guarantees pursuant to
this Agreement (before deducting expenses) received by the Company and the
Guarantors and the total underwriting discount received by the Initial
Purchasers, bear to the aggregate initial offering price of the Securities and
the Guarantees.
The relative fault of the Company and the Guarantors on the one hand
and the Initial Purchasers on the other hand shall be determined by reference
to, among other things, whether any such untrue or alleged untrue statement of
a material fact or omission or alleged omission to state a material fact
relates to information supplied by the Company or the Guarantors, or by the
Initial Purchasers, and the parties' relative intent, knowledge, access to
information and opportunity to correct or prevent such statement or omission.
The Company, the Guarantors and the Initial Purchasers agree that it
would not be just and equitable if contribution pursuant to this Section 7 were
determined by pro rata allocation (even if the Initial Purchasers were treated
as one entity for such purpose) or by
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any other method of allocation which does not take account of the equitable
considerations referred to above in this Section 7. The aggregate amount of
losses, liabilities, claims, damages and expenses incurred by an indemnified
party and referred to above in this Section 7 shall be deemed to include any
legal or other expenses reasonably incurred by such indemnified party in
investigating, preparing or defending against any litigation, or any
investigation or proceeding by any governmental agency or body, commenced or
threatened, or any claim whatsoever based upon any such untrue or alleged
untrue statement or omission or alleged omission.
Notwithstanding the provisions of this Section 7, no Initial Purchaser
shall be required to contribute any amount in excess of the amount by which the
total price at which the Securities (including the Guarantees) underwritten by
it and distributed to the public were offered to the public exceeds the amount
of any damages which such Initial Purchaser has otherwise been required to pay
by reason of such untrue or alleged untrue statement or omission or alleged
omission.
No person guilty of fraudulent misrepresentation (within the meaning
of Section 11(f) of the 1933 Act) shall be entitled to contribution from any
person who was not guilty of such fraudulent misrepresentation.
For purposes of this Section 7, each person, if any, who controls an
Initial Purchaser within the meaning of Section 15 of the 1933 Act or Section
20 of the 1934 Act shall have the same rights to contribution as such Initial
Purchaser, and each director of the Company and each Guarantor, and each
person, if any, who controls the Company and each Guarantor within the meaning
of Section 15 of the 1933 Act or Section 20 of the 1934 Act shall have the same
rights to contribution as the Company and each Guarantor. The Initial
Purchasers' respective obligations to contribute pursuant to this Section 7 are
several in proportion to the principal amount of Securities (including the
Guarantees) set forth opposite their respective names in Schedule A hereto and
not joint.
SECTION 8. Representations, Warranties and Agreements to Survive
Delivery. All representations, warranties and agreements contained in this
Agreement or in certificates of officers of the Company or any of the
Subsidiaries submitted pursuant hereto, shall remain operative and in full
force and effect, regardless of any investigation made by or on behalf of any
Initial Purchaser or controlling person, or by or on behalf of the Company or
any Guarantor, and shall survive delivery of the Securities (including the
Guarantees) to the Initial Purchasers.
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SECTION 9. Termination of Agreement.
(a) Termination; General. The Representative may terminate this
Agreement, by notice to the Company and the Guarantors, at any time at or prior
to the Closing Time (i) if there has been, since the time of execution of this
Agreement or since the respective dates as of which information is given in the
Offering Memorandum, any material adverse change in the condition (financial or
otherwise), earnings, business affairs or business prospects of the Company and
the Subsidiaries considered as one enterprise, whether or not arising in the
ordinary course of business, or (ii) if there shall have occurred a downgrading
in the rating assigned to the Securities or the Guarantees or any of the
Company's or any Guarantor's other debt securities by any nationally recognized
securities rating agency, or if such securities rating agency shall have
publicly announced that it has under surveillance or review, with possible
negative implications, its rating of the Securities, the Guarantees or any of
the Company's or Guarantor's other debt securities or guarantees of debt
securities, or (iii) if there has occurred any material adverse change in the
financial markets in the United States or the international financial markets,
any outbreak of hostilities or escalation thereof or other calamity or crisis
or any change or development involving a prospective change in national or
international political, financial or economic conditions, in each case the
effect of which is such as to make it, in the judgment of the Representative,
impracticable to market the Securities or the Guarantees or to enforce
contracts for the sale of the Securities or the Guarantees, or (iv) if trading
in any securities of the Company or any Guarantor has been suspended or limited
by the Commission or the NASDAQ National Market System, or if trading generally
on the American Stock Exchange or the New York Stock Exchange or in the NASDAQ
National Market System has been suspended or limited, or minimum or maximum
prices for trading have been fixed, or maximum ranges for prices have been
required, by any of said exchanges or by such system or by order of the
Commission, the National Association of Securities Dealers, Inc. or any other
governmental authority, or (v) if a banking moratorium has been declared by
either Federal or New York authorities.
(b) Liabilities. If this Agreement is terminated pursuant to this
Section, such termination shall be without liability of any party to any other
party except as provided in Section 4 hereof, and provided further that
Sections 1, 6 and 7 shall survive such termination and remain in full force and
effect.
SECTION 10. Default by One or More of the Initial Purchasers. If one
or both of the Initial Purchasers shall fail at Closing Time to purchase the
Securities which it or they are obligated to purchase under this Agreement (the
"Defaulted Securities"), the Representative shall have the right, but not the
obligation, within 24 hours thereafter, to make arrangements for the
non-defaulting Initial Purchaser, or any other initial purchaser, to purchase
all, but not less than all, of the Defaulted Securities in such amounts as may
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33
be agreed upon and upon the terms herein set forth; if, however, the
Representative shall not have completed such arrangements within such 24-hour
period, then this Agreement shall terminate without liability on the part of
any non-defaulting Initial Purchaser.
No action taken pursuant to this Section shall relieve any defaulting
Initial Purchaser from liability in respect of its default.
In the event of any such default which does not result in a
termination of this Agreement, either the Representative, the Company or the
Guarantors shall have the right to postpone the Closing Time for a period not
exceeding seven days in order to effect any required changes in the Offering
Memorandum or in any other documents or arrangements. As used herein, the term
"Initial Purchaser" includes any person substituted for an Initial Purchaser
under this Section 10.
SECTION 11. Notices. All notices and other communications hereunder
shall be in writing and shall be deemed to have been duly given if mailed or
transmitted by any standard form of telecommunication. Notices to the Initial
Purchasers shall be directed to the Representatives at North Tower, World
Financial Center, New York, New York 10281-1201, attention of Cara I. Londin,
Esq., with a copy to Fried, Frank, Harris, Shriver & Jacobson, 1 New York
Plaza, New York, New York 10004, attention of Valerie Ford Jacob, Esq.; notices
to the Company or the Guarantors shall be directed to them at 9800 Crosspoint
Boulevard, Indianapolis, Indiana 46256-3350, attention of P. Lawrence Butt,
Esq., with a copy to Bass, Berry & Sims PLC, 2700 First American Center,
Nashville, Tennessee, 37238, attention of J. Page Davidson, Esq.
SECTION 12. Parties. This Agreement shall each inure to the benefit of
and be binding upon the Initial Purchasers, the Company and the Guarantors and
their respective successors. Nothing expressed or mentioned in this Agreement
is intended or shall be construed to give any person, firm or corporation,
other than the Initial Purchasers, the Company and the Guarantors and their
respective successors and the controlling persons and officers and directors
referred to in Sections 6 and 7 and their heirs and legal representatives, any
legal or equitable right, remedy or claim under or in respect of this Agreement
or any provision herein contained. This Agreement and all conditions and
provisions hereof are intended to be for the sole and exclusive benefit of the
Initial Purchasers, the Company and the Guarantors and their respective
successors, and said controlling persons and officers and directors and their
heirs and legal representatives, and for the benefit of no other person, firm
or corporation. No purchaser of Securities and Guarantees from any Initial
Purchaser shall be deemed to be a successor by reason merely of such purchase.
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SECTION 13. Governing Law And Time. THIS AGREEMENT SHALL BE GOVERNED
BY AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK.
SPECIFIED TIMES OF DAY HEREIN REFER TO NEW YORK CITY TIME.
SECTION 14. Effect of Headings. The Article and Section headings
herein and the Table of Contents are for convenience only and shall not affect
the construction hereof.
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If the foregoing is in accordance with your understanding of our
agreement, please sign and return to the Company and the Guarantors a
counterpart hereof, whereupon this instrument, along with all counterparts,
will become a binding agreement among the Initial Purchasers, the Company and
the Guarantors in accordance with its terms.
Very truly yours,
MARSH SUPERMARKETS, INC.
CRYSTAL FOOD SERVICES, LLC
By: Marsh Supermarkets, Inc., its
Chief Operating Officer
LOBILL FOODS, LLC
By: Marsh Supermarkets, Inc., its
Chief Operating Officer
CONTRACT TRANSPORT, LLC
By: Marsh Supermarkets, Inc., its
Chief Operating Officer
MARSH SUPERMARKETS, LLC
By: Marsh Supermarkets, Inc.. its
Chief Operating Officer
VILLAGE PANTRY, LLC
By: Marsh Supermarkets, Inc., its
Chief Operating Officer
MARSH DRUGS, LLC
By: Marsh Supermarkets, Inc., its
Chief Operating Officer
MARSH CLEARING HOUSE, LLC
By: Marsh Supermarkets, Inc., its
Chief Operating Officer
By: /s/ Don E. Marsh
-----------------------------
Name: Don E. Marsh
Title: President and Chief
Executive Officer
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MARSH DRUGS, INC.
MUNDY REALTY, INC.
MAR PROPERTIES, INC.
MARLEASE, INC.
MARSH INTERNATIONAL, INC.
MARAINES GREENERY, INC.
LIMITED HOLDINGS, INC.
MARSH P.Q., INC.
S.C.T., INC.
NORTH MARION DEVELOPMENT
CORPORATION
CONTRACT TRANSPORT, INC.
TRADEMARK HOLDINGS, INC.
By: /s/ Don E. Marsh
-------------------------------
Name: Don E. Marsh
Title: President
MARSH VILLAGE PANTRIES, INC.
CONVENIENCE STORE DISTRIBUTING
COMPANY
By: Marsh Village Pantries, Inc.,
its General Partner
By: /s/ Don E. Marsh
------------------------
Name: Don E. Marsh
Title: Chief Executive
Officer
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CONFIRMED AND ACCEPTED,
as of the date first above written:
MERRILL LYNCH, PIERCE, FENNER & SMITH
INCORPORATED
MCDONALD & COMPANY SECURITIES, INC.
By: MERRILL LYNCH, PIERCE, FENNER & SMITH
INCORPORATED
By /s/
-------------------------------------------
Authorized Signatory
For itself and the other Initial Purchasers
named in Schedule A hereto.
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SCHEDULE A
Principal
Amount of
Name of Initial Purchaser Securities
------------------------- ----------
Merrill Lynch, Pierce, Fenner & Smith
Incorporated................................................................. $120,000,000
McDonald & Company Securities, Inc........................................................... 30,000,000
------------
Total $150,000,000
============
39
SCHEDULE B
Guarantors
MARSH DRUGS, INC. (an Indiana corporation),
MARSH VILLAGE PANTRIES, INC. (an Indiana corporation),
MUNDY REALTY, INC. (an Indiana corporation),
MAR PROPERTIES, INC. (an Indiana corporation),
MARLEASE, INC. (an Indiana corporation),
MARSH INTERNATIONAL, INC. (an Indiana corporation),
MARAINES GREENERY, INC. (an Indiana corporation),
LIMITED HOLDINGS, INC. (an Indiana corporation),
CONVENIENCE STORE DISTRIBUTING COMPANY (an Ohio partnership),
MARSH P.Q., INC. (an Indiana corporation),
S.C.T., INC. (an Indiana corporation),
NORTH MARION DEVELOPMENT CORPORATION (an Indiana corporation),
CONTRACT TRANSPORT, INC. (an Indiana corporation),
CRYSTAL FOOD SERVICES, LLC (an Indiana limited liability company),
LOBILL FOODS, LLC (an Indiana limited liability company),
CONTRACT TRANSPORT, LLC (an Indiana limited liability company),
MARSH SUPERMARKETS, LLC (an Indiana limited liability company),
VILLAGE PANTRY, LLC (an Indiana limited liability company),
MARSH DRUGS, LLC (an Indiana limited liability company),
TRADEMARK HOLDINGS, INC. (a Delaware corporation),
MARSH CLEARING HOUSE, LLC (an Indiana limited liability company),
Other Subsidiaries
C.E. PUBLISHING, INC. (an Indiana corporation)
WALNUT HILL ASSOCIATES (an Indiana partnership)
DECATUR PLAZA ASSOCIATES (an Indiana partnership)
40
SCHEDULE C
MARSH SUPERMARKETS, INC.
$150,000,000 Senior Subordinated Notes due 2007
1. The initial offering price of the Securities (including the
Guarantees) shall be 99.185% of the principal amount thereof, plus accrued
interest, if any, from the date of issuance.
2. The purchase price to be paid by the Initial Purchasers for the
Securities and the Guarantees shall be 96.56% of the principal amount thereof.
3. The interest rate on the Securities shall be 8 7/8% per annum.
4. The interest payment dates of the Securities shall be February 1
and August 1 of each year, commencing February 1, 1998.
5. The Securities and the Guarantees will be subject to redemption at
any time on or after August 1, 2002, at the option of the Company and the
Guarantors, at the following redemption prices (expressed as percentages of the
principal amount), if redeemed during the 12-month period beginning August 1 of
the years indicated below:
Redemption
Year Price
---- -----------
2002 104.438%
2003 102.958%
2004 101.479%
and thereafter at 100% of the principal amount, in each case, together with
accrued and unpaid interest, if any, to the redemption date (subject to the
rights of holders of record on relevant record dates to receive interest due on
an interest payment date).
41
Exhibit A-1
_____, 1997
MERRILL LYNCH & CO.
Merrill Lynch, Pierce, Fenner & Smith
Incorporated
McDonald & Company Securities, Inc.
c/o Merrill Lynch & Co.
Merrill Lynch, Pierce, Fenner & Smith
Incorporated
North Tower
World Financial Center
New York, NY 10281-1209
Ladies and Gentlemen:
We have acted as counsel to Marsh Supermarkets, Inc., an Indiana
corporation (the "Company"), and the Guarantors (as defined below) in
connection with the sale of $150,000,000 in principal amount of the Company's
___% Senior Subordinated Notes due 2007 to Merrill Lynch, Pierce, Fenner &
Smith, Incorporated and McDonald & Company Securities, Inc. (the "Initial
Purchasers"), pursuant to the Purchase Agreement, dated as of _____, by and
among the Company, the guarantors listed on Schedule B thereto (the
"Guarantors") and the Initial Purchasers (the "Purchase Agreement"). We have
been requested by the Company and the Guarantors to render this opinion
pursuant to Section 5(a) of the Purchase Agreement. The terms used in this
opinion that are defined in the Purchase Agreement shall have the same
definitions when used herein, unless otherwise defined herein.
In connection with this opinion, we have reviewed, among other
matters, the following agreements and instruments:
1. the Purchase Agreement;
2. the Registration Rights Agreement;
3. the DTC Agreement;
4. the Guarantees;
5. the Indenture
6. the Global Note; and
7. the form of Exchange Securities
We have also reviewed such other corporate documents and records of
the Company and the Guarantors, such
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42
other certificates of public officials and such other matter as we have deemed
necessary or appropriate for purposes of this opinion. As to various issues of
fact, we have relied upon the representations and warranties of the Company and
the Guarantors contained in the Purchase Agreement and upon statements and
certificates of officers of the Company and the Guarantors, without independent
verification or investigation.
We have assumed regarding documents executed by parties other than the
Company and the Guarantors that such documents are the valid and binding
obligations of and enforceable against such parties. We have also assumed the
authenticity of all documents submitted to us as originals, the genuineness of
all signatures, the conformity to authentic original documents of all documents
submitted to us as certified, conformed or photostatic copies and the legal
capacity of all natural persons.
Based on the foregoing, and subject to the assumptions, limitations
and qualifications set forth herein, we are of the opinion that:
1. The Purchase Agreement has been duly authorized by all necessary
corporate or partnership action on the part of the Company and each of the
Guarantors and has been duly executed and delivered by the Company and by each
of the Guarantors.
2. The Registration Rights Agreement and the DTC Agreement have each
been duly authorized by all necessary corporate or partnership action on the
part of the Company and, in the case of the Registration Rights Agreement, each
of the Guarantors and have been duly executed and delivered by the Company and,
in the case of the Registration Rights Agreement, each of the Guarantors and
constitute valid and binding obligations of the Company and, in the case of the
Registration Rights Agreement, each of the Guarantors, enforceable against the
Company and, in the case of the Registration Rights Agreement, each of the
Guarantors in accordance with their terms, subject to (a) the effect of
bankruptcy, insolvency, reorganization, arrangement, moratorium, fraudulent
conveyance, fraudulent transfer and other similar laws relating to or affecting
the rights of creditors and (b) general principles of equity (including,
without limitation, concepts of materiality, reasonableness, good faith and
fair dealing and the possible unavailability of specific performance,
injunctive relief and other equitable remedies), regardless of whether
considered in a proceeding at law or in equity.
3. The Indenture has been duly authorized by all necessary corporate
or partnership action on the part of the Company and each of the Guarantors and
has been duly executed and delivered by the Company and each of the Guarantors
and
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43
constitutes a valid and binding agreement of the Company and each of the
Guarantors, enforceable against the Company and each of the Guarantors in
accordance with its terms, subject to (a) the effect of bankruptcy, insolvency,
reorganization, arrangement, moratorium, fraudulent conveyance, fraudulent
transfer and other similar laws relating to or affecting the rights of
creditors and (b) general principles of equity (including, without limitation,
concepts of materiality, reasonableness, good faith and fair dealing and the
possible unavailability of specific performance, injunctive relief and other
equitable remedies), regardless of whether considered in a proceeding at law or
in equity.
4. The Securities and Guarantees are in the form contemplated by the
Indenture, have been duly authorized by all necessary corporate or partnership
action on the part of the Company and each of the Guarantors and, when executed
by the Company and each of the Guarantors and authenticated by the Trustee in
the manner provided in the Indenture (assuming the due authorization, execution
and delivery of the Indenture by the Trustee) and delivered against payment of
the purchase price therefor will constitute valid and binding obligations of
the Company and each of the Guarantors, enforceable against the Company and
each of the Guarantors in accordance with their terms, subject to (a) the
effect of bankruptcy, insolvency, reorganization, arrangement, moratorium,
fraudulent conveyance, fraudulent transfer and other similar laws relating to
or affecting the rights of creditors and (b) general principles of equity
(including, without limitation, concepts of materiality, reasonableness, good
faith and fair dealing and the possible unavailability of specific performance,
injunctive relief and other equitable remedies), regardless of whether
considered in a proceeding at law or in equity.
5. The Exchange Securities have been duly authorized by all necessary
corporate or partnership action on the part of the Company and each of the
Guarantors and, when executed and authenticated and issued and delivered by the
Company and each of the Guarantors in exchange for the Securities and the
Guarantees pursuant to the Exchange Offer, will constitute valid and binding
obligations of the Company and each of the Guarantors, enforceable against the
Company and each of the Guarantors in accordance with their terms, subject to
(a) the effect of bankruptcy, insolvency, reorganization, arrangement,
moratorium, fraudulent conveyance, fraudulent transfer and other similar laws
relating to or affecting the rights of creditors and (b) general principles of
equity (including, without limitation, concepts of materiality, reasonableness,
good faith and fair dealing and the possible unavailability of specific
performance, injunctive relief and other equitable remedies), regardless of
whether considered in a proceeding at law or in equity.
A-1-3
44
6. The Securities, the Guarantees and the Indenture conform in all
material respects to the descriptions thereof contained in the Offering
Memorandum.
7. The documents incorporated by reference in the Offering Memorandum
(other than the financial statements and notes and supporting schedules
thereto, or other statistical data derived from the financial statements and
notes and supporting schedules thereto, contained or required to be contained
in the Offering Memorandum, as to which we express no opinion), when they were
filed with the Commission, or, in the case of the Company's Annual Report on
Form 10-K for the year ended March 29, 1997, at the time of its amendment filed
with the Commission on July 15, 1997, complied as to form in all material
respects with the requirements of the 1934 Act and the rules and regulations of
the Commission thereunder.
8. The information in the Offering Memorandum under "Exchange Offer;
Registration Rights," "Description of the Notes" and "Description of Certain
Indebtedness," to the extent that it constitutes matters of law, summaries of
legal matters, the Company's charter and bylaws or legal proceedings, or legal
conclusions, has been reviewed and is correct in all material respects.
9. No authorization, approval, consent, license, order, registration,
qualification or decree of any court or governmental authority or agency is
necessary or required in connection with the due authorization, execution and
delivery of the Purchase Agreement or the due execution, delivery or
performance of the Indenture by the Company or any of the Guarantors or for the
offering, issuance, sale or delivery of the Securities and the Guarantees to
the Initial Purchasers or the resale by the Initial Purchasers in accordance
with the Purchase Agreement or for the performance by the Company or any of the
Guarantors of their respective obligations thereunder, in connection with the
offering, issuance or sale of the Securities and Guarantees under the Purchase
Agreement or for the consummation of the transaction contemplated by the
Purchase Agreement, the Registration Rights Agreement, the Indenture, the DTC
Agreement, the Securities, the Guarantees and the Exchange Securities
(including the issuance and sale of the Securities and Guarantees as described
in the Offering Memorandum under the caption "Use of Proceeds"), except such as
have been obtained and such as may be required under the 1933 Act, the Trust
Indenture Act or under applicable securities laws of the various jurisdictions
in which the Securities, Guarantees and Exchange Securities will be offered or
sold.
10. Assuming the truthfulness of the representations and warranties of
the Initial Purchasers contained in the Purchase Agreement, it is not necessary
in
A-1-4
45
connection with the offer, sale and delivery of the Securities and
Guarantees to the Initial Purchasers and to each Subsequent Purchaser in the
manner contemplated by the Purchase Agreement and the Offering Memorandum to
register the Securities and Guarantees under the 1933 Act or to qualify the
Indenture under the Trust Indenture Act except as contemplated by the Offering
Memorandum, the Purchase Agreement and the Registration Rights Agreement.
11. Except as described in the Offering Memorandum, the execution,
delivery and performance of the Purchase Agreement, the Registration Rights
Agreement, the Indenture, the DTC Agreement, the Securities, the Guarantees and
the Exchange Securities, the consummation of the transactions contemplated in
the Purchase Agreement and in the Offering Memorandum (including the issuance
and sale of the Securities and the Guarantees and the use of proceeds from the
sale of the Securities and the Guarantees as described in the Offering
Memorandum under the caption "Use of Proceeds"), and compliance by the Company
and the Guarantors with their respective obligations under the Purchase
Agreement, the Registration Rights Agreement, the Indenture, the DTC Agreement,
the Securities, the Guarantees and the Exchange Securities do not and will not,
whether with or without the giving of notice or passage of time or both,
conflict with or constitute a breach of, or default or a Repayment Event (as
defined below; except to the extent that such breach, default or Repayment
Event relates to the incurrence of indebtedness which has been previously
provided for pursuant to the Escrow Agreement dated August __, 1997 between the
Company and State Street Bank and Trust Company of Connecticut, N.A.) under, or
result in the creation or imposition of any lien, charge or encumbrance upon
any property or assets of the Company or any Guarantor or any of their
respective subsidiaries pursuant to, any contract, indenture, mortgage, deed of
trust, loan or credit agreement, note, lease, or any other agreement or
instrument, limited in each case to those related to the incurrence of
indebtedness or filed as an exhibit to the Company's Annual Report on Form 10-K
for the fiscal year ended March 29, 1997, to which the Company or any Guarantor
or any of their respective subsidiaries is a party, nor will such action result
in any violation of (i) the provisions of the charter or bylaws or other
constituent documents of the Company; (ii) any applicable law, statute, rule or
regulation, in each case of the United States; or (iii) any judgment, order,
writ or decree, in each case in the clause (iii) listed on a schedule attached
hereto, of any government, government instrumentality or court having
jurisdiction over the Company. As used herein, a "Repayment Event" means any
event or condition which gives the holder of any note, debenture or other
evidence of indebtedness (or any person acting on such holder's behalf) the
right to require the repurchase, redemption or repayment of all or a portion of
such indebtedness by the Company or any of the Guarantors.
A-1-5
46
12. Neither the Company nor any of the Guarantors is an "investment
company" or an entity "controlled" by an "investment company," as such terms
are defined in the 1940 Act.
The limitations inherent in the independent verification of factual
matters and the character of determinations involved in the offering process
are such that we have not verified and, except as to the description in the
Offering Memorandum of statutes, regulations, legal proceedings and contracts
and other instruments, are not passing upon and do not assume any
responsibility for, the accuracy, completeness or fairness of the statements
contained in the Offering Memorandum.
We have participated in conferences with representatives of the
Initial Purchasers, officers and other representatives of the Company and
representatives of Ernst & Young LLP, independent certified public accountants
of the Company, however, at which conferences the contents of the Offering
Memorandum and related matters were discussed, and although we do not pass upon
and do not assume any responsibility for the accuracy, completeness or fairness
of the statements contained in the Offering Memorandum, on the basis of the
foregoing, no facts have come to our attention which lead us to believe that
the Offering Memorandum at the time of issuance contained an untrue statement
of a material fact or omitted to state a material fact required to be stated
therein or necessary to make the statements therein not misleading or that the
Offering Memorandum, as amended or supplemented at the Closing Time, contained
or contains an untrue statement of material fact or omitted or omits to state a
material fact required to be stated therein or necessary in order to make the
statements therein, in light of the circumstances under which they were made,
not misleading; except that in each case, we express no opinion with respect to
the financial statements and notes and supporting schedules thereto, or other
statistical data derived from the financial statements and notes and supporting
schedules thereto, contained or required to be contained in the Offering
Memorandum.
We express no opinion herein other than as to the law of the State of
Tennessee, the federal law of the United States and the Delaware General
Corporation Law. With respect to the opinions set forth in paragraphs 2, 3, 4
and 5 to the extent they are governed by New York law, we have relied solely
upon the opinion of Fried, Fried, Harris, Shriver & Jacobson addressed to you
of even date herewith and we have made on independent examination of the law of
such jurisdiction. With respect to matters of Indiana and Ohio law, we have
relied solely on the opinion of P. Lawrence Butt, Vice President, Counsel and
Secretary of the Company, addressed to you of even date herewith and we have
made no independent examination of the law of such jurisdiction.
A-1-6
47
Our opinion is rendered as of the date hereof and we assume no
obligation to advice you of changes in law or fact (or the effect thereof on
the opinions expressed herein) that hereafter may come to our attention.
Subject to the foregoing, this opinion is rendered solely for your
information in connection with the above-referenced transaction and may not be
delivered or quoted to any other person or relied upon for any other purpose
without our prior written consent.
Very truly yours,
A-1-7
48
Exhibit A-2
August 5, 1997
MERRILL LYNCH & CO.
Merrill Lynch, Pierce, Fenner & Smith
Incorporated
McDonald & Company Securities, Inc.
c/o Merrill Lynch & Co.
North Tower
World Financial Center
New York, NY 10281-1209
Re: Marsh Supermarkets, Inc.
$150,000,000 % Senior Subordinated Securities
Due 2007
Ladies and Gentlemen:
I have acted as counsel for Marsh Supermarkets, Inc., an Indiana
corporation (the "Company"), and the Guarantors (as defined below) in
connection with the sale of an aggregate of $150,000,000 principal amount of
the Company's % Senior Subordinated Notes, due 2007 (the "Securities"), to
Merrill Lynch & Co. and McDonald Securities, Inc. (the "Initial Purchasers"),
pursuant to that certain Purchase Agreement, dated July 29, 1997 among the
Company, the guarantors listed on Schedule B thereto (the "Guarantors") and the
Initial Purchasers (the "Purchase Agreement"). I have been requested by the
Company and the Guarantors to render this opinion pursuant to Section 5(a) of
the Purchase Agreement. The terms used herein that are defined in the Purchase
Agreement shall have the same meaning when used herein, unless otherwise
defined herein.
In connection with the opinion below, I have reviewed, among other
matters the following agreement and instruments (hereinafter referred to
collectively as the "Documents"):
1. Purchase Agreement;
2. Registration Rights Agreement;
3. DTC Agreement;
4. Guarantees;
5. Indenture;
6. The Global Note; and
7. The form of Exchange Securities.
A-2-1
49
I have also reviewed such corporate documents and records of the
Company and the Guarantors, certificates of public officials and such other
matters as I have deemed necessary for purposes of the opinions expressed
below. As to various issues of fact, I have relied upon the representations and
warranties of the Company and the Guarantors contained in the Purchase
Agreement and upon statements and certificates of officers of the Company and
the Guarantors, without independent verification or investigation.
I have assumed regarding the execution of the Documents by parties
other than the Company and the Guarantors that each such party has the
requisite power, capacity and authority to execute and deliver the Documents to
which they are a party and to perform their respective obligations thereunder,
and that the Documents are valid and binding obligations of and enforceable
against such parties. I have also assumed the authenticity of all Documents
submitted to me as originals, the genuineness of all signatures, and the
conformity to authentic original Documents of all Documents submitted to me as
certified, conformed or photostatic copies and the legal capacity of all
natural persons.
Whenever my opinion herein with respect to the existence of absence of
facts is qualified b the phrase "to the best of my knowledge" or "of which I
have knowledge", it is intended to indicate that, during the course of my
representation of the Company, no information has come to my attention which
would give me actual knowledge of the existence or absence of such fact, as
appropriate. Moreover, with the exception of reasonable inquiries I have made
of the officers of the Company, I have not undertaken any independent
investigation to determine the existence or absence of such facts and any
limited inquiries made by me during the preparation of this opinion should not
be regarded as such an investigation.
It should be expressly understood that I am licensed to practice law
only in the State of Indiana. Accordingly, except as expressly set forth
therein, this opinion is limited to the laws of the State of Indiana, the
General Corporation Law of the State of Delaware and the general partnership of
the State of Ohio, and I express no opinion with respect to the effect upon the
Documents of any laws other than the laws of the State of Indiana, the General
Corporation Law of the State of Delaware and the general partnership law of the
State of Ohio.
Based on and subject to the assumptions, limitations ands
qualifications set forth herein, I am of the opinion that as of the date
hereof;
1. The Company is a corporation duly incorporated and validly existing
under the laws of the State of Indiana.
A-2-2
50
2. The Company has the corporate power and authority to own, lease and
operate its properties and to conduct the business as described in the Offering
Memorandum and to enter into and perform its obligations under the Documents.
3. The Company is duly qualified as a foreign corporation to transact
business in each jurisdiction in which such qualification is required, whether
by reason of the ownership or leasing of property or the conduct of business,
except where the failure so to qualify would not result in a Material Adverse
Effect.
4. The authorized, issued and outstanding capital stock of the Company
is as set forth in the financial statements, including the schedules and notes,
included in the Offering Memorandum (except for subsequent issuances, if any,
pursuant to reservations, agreements, employee benefit plans or the exercise of
convertible securities or options referred to in the Offering Memorandum); the
shares of issued and outstanding capital stock of the Company have been duly
authorized and validly issued and are fully paid and non-assessable; and none
of the outstanding shares of the capital stock of the Company was issued in
violation of the preemptive or other similar rights of any securityholder of
the Company.
5. Each of the Guarantors has been duly incorporated (if it is a
corporation) and is validly existing as a corporation, limited liability
company or partnership, as the case may be, under the laws of the jurisdiction
of its incorporation, organization or existence, has corporate, limited
liability company or partnership power and authority to own, lease and operate
its properties and to conduct its business as described in the Offering
Memorandum and is duly qualified as a foreign corporation, limited liability
company or partnership to transact business in each jurisdiction in which such
qualification is required, whether by reason of the ownership or leasing of
property or the conduct of business, except where the failure so to qualify
would not result in a Material Adverse Effect; all of the issued and
outstanding capital stock or limited liability company or partnership interests
of each Guarantor has been duly authorized and validly issued, is fully paid
and non-assessable and, to the best of my knowledge and information, is owned
by the Company either directly or through one or more of the Guarantors, free
and clear of any security interest, mortgage, pledge, lien, encumbrance or
claim.
6. There is not pending or, to the best of my knowledge, threatened,
any action, suit, proceeding, inquiry or investigation, to which the Company or
any Guarantor is a party, or to which the property of the Company or of any
Guarantor is subject, before or brought by any court or governmental agency or
body, which might reasonably be expected to result in a Material Adverse Effect
or might reasonably be expected to materially and adversely affect the
properties or assets thereof or the consummation of the transactions
contemplated in the Purchase Agreement or the performance by the
A-2-3
51
Company or any Guarantor of their respective obligations under the Purchase
Agreement, Securities, Guarantees or Exchange Securities.
7. The information in the Offering Memorandum under "Risk Factors-Risk
of Environmental Liabilities", "Business-Legal Proceedings" and "Business
Regulatory Matters", to the extent that it constitutes matters of law,
summaries of legal matters, the Company's Restated Articles of Incorporation
and Bylaws or legal proceedings, or legal conclusion, has been reviewed and is
correct in all material respects.
8. All descriptions in the Offering Memorandum and in the documents
incorporated by reference therein of contracts and other documents to which the
Company or any Guarantor is a party are accurate in all material respects; to
the best of my knowledge, there are no franchises, contracts, indentures, loan
agreements, notes, leases or other instruments that would be required to be
described in the Offering Memorandum and in the documents incorporated by
reference therein that are not described or referred to in the Offering
Memorandum or the documents incorporated by reference therein other than those
described or referred to therein, and the descriptions thereof or references
thereto are correct in all material respects.
9. Neither the Company nor any of the Guarantors is in violation of
its Articles of Incorporation and By laws or, if not a corporation, equivalent
constituent documents, and to the best of my knowledge, no default by the
Company or any Guarantor exists in the due performance or observance of any
obligation, agreement, covenant or condition contained in any contract,
indenture, mortgage, loan agreement, note, lease or other agreement or
instrument that is described in or referred to in the Offering Memorandum or
filed or incorporated by reference as an exhibit to the Offering Memorandum or
to any document incorporated by reference therein which default, singly or in
the aggregate, would have a Material Adverse Effect.
10. The execution, delivery and performance of the Documents, the
consummation of the transactions contemplated in the Purchase Agreement and in
the Offering Memorandum (including the issuance and sale of the Securities and
the Guarantees and the use of the proceeds from the sale of the Securities and
Guarantees as described in the Offering Memorandum under the caption "Use of
Proceeds"), and compliance by the Company and the Guarantors with their
respective obligations under the Documents do not and will not, whether with or
without the giving of notice or the passage of time, or both, conflict with or
constitute a breach of, or default or a Repayment Event (as defined below;
except to the extent that such breach, default or Repayment Event relates to
the incurrence of indebtedness which has been previously provided for pursuant
to the Escrow Agreement, dated August _, 1997, between the Company and State
Street Bank and Trust Company of Connecticut, N.A.) under, or result in the
creation or imposition of any lien, charge or encumbrance upon any property or
assets of
A-2-4
52
the Company or any Guarantor pursuant to, any contract, indenture, mortgage,
deed of trust, loan or credit agreement, note, lease, or any other agreement or
instrument to which the Company or any Guarantor is a party, nor will such
action result in any violation of (i) the provisions of the Article of
Incorporation or Bylaws of the Company or other constituent document of any
Guarantor or (ii) any applicable law, statute, rule or regulation, judgment,
order, writ or decree of any government, government instrumentality or court
having jurisdiction over the Company or any Guarantor or any of their assets or
properties. As used herein, a "Repayment Event" means any event or condition
which gives the holder of any note, debenture or other evidence of indebtedness
(or any person acting on such holder's behalf) the right to require the
repurchase, redemption or repayment of all or a portion of such indebtedness by
the Company or any Guarantor.
This opinion is rendered solely as to the matters set forth herein
based on the laws in effect on the date hereof, except as otherwise noted
herein, and no other opinion should be inferred therefrom. I assume no
obligation to advise you of changes of law or fact (or the effect thereof on
the opinions expressed herein) that hereafter may come to my attention. I have
furnished this opinion to you solely for your information in connection with
the above referenced transaction and this opinion may not be delivered or
quoted to any other person or relied upon by any other person other than
yourself or for any other purpose without the prior written consent of the
undersigned, except that Bass, Berry & Sims and Fried, Frank, Harris, Shriver &
Jacobson may rely on this opinion as if it were addressed to them.
A-2-5
53
Exhibit B
[FORM OF ACCOUNTANTS' COMFORT LETTER PURSUANT TO SECTION 5(d)]
(1) We are independent public accountants with respect to the Company
and the Guarantors within the meaning of the Securities Act of 1933, as amended
(the "1933 Act") and the published rules and regulations thereunder.
(2) In our opinion, the audited financial statements included or
incorporated by reference in the Offering Memorandum comply as to form in all
material respects with the applicable accounting requirements of the 1933 Act
and the published rules and regulations thereunder.
(3) On the basis of procedures (but not an examination in accordance
with generally accepted auditing standards) consisting of a reading of the
unaudited interim consolidated financial statements of the Company for the
12-week periods ended June 21, 1997 and June 22, 1996 (the "12-week
financials"), a reading of the latest available interim consolidated financial
statements of the Company, a reading of the minutes of all meetings of the
stockholders and board of directors and committees of the board of directors of
the Company and the Guarantors and their subsidiaries since January 1, 1996,
inquiries of certain officials of the Company and the Guarantors and their
subsidiaries responsible for financial and accounting matters, a review of the
12-week financials in accordance with standards established by the American
Institute of Certified Public Accountants in Statement on Auditing Standards
No. 71, Interim Financial Information ("SAS 71"), and such other inquiries and
procedures as may be specified in such letter, nothing came to our attention
that caused us to believe that:
(A) the 12-week financials were not determined on a
basis substantially consistent with that of the corresponding
amounts in the audited consolidated financial statements;
(B) at July 19, 1997 there was any change in the
capital stock of the Company and its subsidiaries or any decrease
in the total assets, working capital or total shareholders' equity
of the Company and its subsidiaries on a consolidated basis or any
increase in the long-term liabilities of the Company and its
subsidiaries on a consolidated basis, in each case as compared
with amounts shown in the latest consolidated balance sheet
included in the Offering Memorandum, except in each case for
changes, decreases or increases that the Offering Memorandum
discloses have occurred or may occur, or that at a specified date
not more
-1-
54
than three business days prior to the date of this Agreement there
was any change in the capital stock of the Company and its
subsidiaries or any increase in the long-term liabilities of the
Company and its subsidiaries on a consolidated basis, in each case
as compared with amounts shown in the latest consolidated balance
sheet included in the Offering Memorandum, except in each case for
changes, decreases or increases that the Offering Memorandum
discloses have occurred or may occur; or
(C) for the period from March 30, 1997 to July 19,
1997 there was any decrease in sales and other revenues, gross
profit, operating profit, income before income taxes or net
income, in each case as compared with the comparable period in the
preceding year, except in each case for any decreases that the
Offering Memorandum discloses have occurred or may occur, or for
the period from June 22, 1997 to a specified date not more than
three business days prior to the date of this Agreement, there was
any decrease in sales and other revenues, as compared with the
comparable period in the preceding year, except in each case for
any decreases that the Offering Memorandum discloses have occurred
or may occur.
(4) Based upon the procedures set forth in clauses (2) and (3) above
and a reading of the Selected Financial Data included in the Offering
Memorandum and a reading of the financial statements from which such data were
derived, nothing came to our attention that caused us to believe that the
Selected Financial Data included in the Offering Memorandum do not conform in
all material respects with the disclosure requirements of Item 301 of
Regulation S-K of the 1933.
(5) We have compared the information in the Offering Memorandum under
selected captions with the disclosure requirements of Regulation S-K of the
1933 Act and on the basis of limited procedures specified herein, nothing came
to our attention that caused us to believe that this information does not
conform in all material respects with the disclosure requirements of Items 302,
402 and 503(d), respectively, of Regulation S-K.
(6) In addition to the procedures referred to in clause (2) above, we
have performed other procedures, not constituting an audit, with respect to
certain amounts, percentages, numerical data and financial information
appearing in the Offering Memorandum and in documents incorporated by reference
therein, which are specified herein, and have compared certain of such items
with, and have found such items to be in agreement with, the accounting and
financial records of the Company.
-2-
55
THE SECURITIES HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF
1933, AS AMENDED (THE "SECURITIES ACT"), OR ANY STATE SECURITIES
LAWS. NEITHER THIS SECURITY NOR ANY INTEREST OR PARTICIPATION HEREIN
MAY BE REOFFERED, SOLD, ASSIGNED, TRANSFERRED, PLEDGED, ENCUMBERED
OR OTHERWISE DISPOSED OF IN THE ABSENCE OF SUCH REGISTRATION OR
UNLESS SUCH TRANSACTION IS EXEMPT FROM, OR NOT SUBJECT TO,
REGISTRATION AS SET FORTH BELOW.
BY ITS ACQUISITION HEREOF, THE HOLDER (1) REPRESENTS THAT (A) IT IS
A "QUALIFIED INSTITUTIONAL BUYER" (AS DEFINED IN RULE 144A UNDER THE
SECURITIES ACT ("RULE 144A")) OR (B) IT IS AN INSTITUTIONAL
"ACCREDITED INVESTOR" (AS DEFINED IN RULE 501(A)(1), (2), (3) OR (7)
UNDER THE SECURITIES ACT) (AN "ACCREDITED INVESTOR") OR (C) IT IS
NOT A U.S. PERSON AND IS ACQUIRING THIS SECURITY IN AN OFFSHORE
TRANSACTION, (2) AGREES TO OFFER, SELL OR OTHERWISE TRANSFER SUCH
SECURITY, PRIOR TO THE DATE WHICH IS TWO YEARS AFTER THE LATER OF
THE ORIGINAL ISSUE DATE HEREOF AND THE LAST DATE ON WHICH THE
COMPANY OR ANY AFFILIATE OF THE COMPANY WAS THE OWNER OF THIS
SECURITY (OR ANY PREDECESSOR OF THIS SECURITY) ONLY (A) TO THE
COMPANY, (B) PURSUANT TO A REGISTRATION STATEMENT WHICH HAS BEEN
DECLARED EFFECTIVE UNDER THE SECURITIES ACT, (C) FOR SO LONG AS THE
SECURITIES ARE ELIGIBLE FOR RESALE PURSUANT TO RULE 144A INSIDE THE
UNITED STATES, TO A PERSON IT REASONABLY BELIEVES IS A "QUALIFIED
INSTITUTIONAL BUYER" AS DEFINED IN RULE 144A THAT PURCHASES FOR ITS
OWN ACCOUNT OR FOR THE ACCOUNT OF A QUALIFIED INSTITUTIONAL BUYER TO
WHOM NOTICE IS GIVEN THAT THE TRANSFER IS BEING MADE IN RELIANCE ON
RULE 144A, (D) OUTSIDE THE UNITED STATES PURSUANT TO OFFERS AND
SALES TO NON-U.S. PERSONS IN AN
56
OFFSHORE TRANSACTION WITHIN THE MEANING OF REGULATION S UNDER THE
SECURITIES ACT, (E) INSIDE THE UNITED STATES TO AN INSTITUTIONAL
"ACCREDITED INVESTOR" THAT IS ACQUIRING THE SECURITY FOR ITS OWN
ACCOUNT, OR FOR THE ACCOUNT OF SUCH AN INSTITUTIONAL "ACCREDITED
INVESTOR," FOR INVESTMENT PURPOSES AND NOT WITH A VIEW TO, OR FOR
OFFER OR SALE IN CONNECTION WITH, ANY DISTRIBUTION IN VIOLATION OF
THE SECURITIES ACT, OR (F) PURSUANT TO ANOTHER AVAILABLE EXEMPTION
FROM THE REGISTRATION REQUIREMENTS OF THE SECURITIES ACT, SUBJECT TO
THE COMPANY'S AND THE TRUSTEE'S RIGHT PRIOR TO ANY SUCH OFFER, SALE
OR TRANSFER (I) PURSUANT TO CLAUSES (D), (E) OR (F) TO REQUIRE THE
DELIVERY OF AN OPINION OF COUNSEL, CERTIFICATION AND/OR OTHER
INFORMATION SATISFACTORY TO EACH OF THEM, AND (II) IN EACH OF THE
FOREGOING CASES, TO REQUIRE THAT A CERTIFICATE OF TRANSFER IN THE
FORM APPEARING ON THE OTHER SIDE OF THIS SECURITY IS COMPLETED AND
DELIVERED BY THE TRANSFEROR TO THE TRUSTEE. AS USED HEREIN, THE
TERMS "UNITED STATES," "OFFSHORE TRANSACTION," AND "U.S. PERSON"
HAVE THE RESPECTIVE MEANINGS GIVEN TO THEM BY REGULATION S UNDER THE
SECURITIES ACT.
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 OF A DEPOSITARY OR A SUCCESSOR DEPOSITARY.
TRANSFERS OF THIS GLOBAL SECURITY SHALL BE LIMITED TO TRANSFERS IN
WHOLE, BUT NOT IN PART, TO NOMINEES OF CEDE & CO. OR TO A SUCCESSOR
THEREOF OR SUCH SUCCESSOR'S NOMINEE AND TRANSFERS OF PORTIONS OF
THIS GLOBAL SECURITY SHALL BE LIMITED TO TRANSFERS MADE IN
ACCORDANCE WITH THE RESTRICTIONS SET FORTH IN SECTIONS 306 AND 307
OF THE INDENTURE.
2
57
UNLESS THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE
OF THE DEPOSITORY TRUST COMPANY, A NEW YORK CORPORATION ("DTC"), TO
THE COMPANY OR ITS AGENT FOR REGISTRATION OF TRANSFER, EXCHANGE, OR
PAYMENT AND ANY SUCH CERTIFICATE ISSUED IS REGISTERED IN THE NAME OF
CEDE & CO. OR IN SUCH OTHER NAME AS IS REQUESTED BY AN AUTHORIZED
REPRESENTATIVE OF DTC (AND ANY PAYMENT IS MADE TO CEDE & CO. OR TO
SUCH OTHER ENTITY AS IS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF
DTC), ANY TRANSFER, PLEDGE, OR OTHER USE HEREOF FOR VALUE OR
OTHERWISE BY OR TO ANY PERSON IS WRONGFUL INASMUCH AS THE REGISTERED
OWNER HEREOF, CEDE & CO., HAS AN INTEREST HEREIN.
3
58
MARSH SUPERMARKETS, INC.
------------------
8 7/8% SENIOR SUBORDINATED NOTE DUE 2007, SERIES A
CUSIP NO. 571783 AC 3
No. 1 $150,000,000
-----------
Marsh Supermarkets, Inc., an Indiana corporation (herein
called the "Company," which term includes any successor Person under the
Indenture hereinafter referred to), for value received, hereby promises to pay
to Cede & Co. or registered assigns, the principal sum of $150,000,000 United
States dollars on August 1, 2007, at the office or agency of the Company
referred to below, and to pay interest thereon from August 5, 1997, or from the
most recent Interest Payment Date to which interest has been paid or duly
provided for, semiannually on February 1 and August 1 in each year, commencing
February 1, 1998 at the rate of 8 7/8% per annum, subject to adjustments as
described in the second following paragraph, in United States dollars, until
the principal hereof is paid or duly provided for. Interest shall be computed
on the basis of a 360-day year comprised of twelve 30-day months.
The Holder of this Series A Security is entitled to the
benefits of the Registration Rights Agreement among the Company, the Guarantors
and the Initial Purchasers, dated August 5, 1997, pursuant to which, subject to
the terms and conditions thereof, the Company and the Guarantors are obligated
to consummate the Exchange Offer pursuant to which the Holder of this Security
(and the related Guarantees) shall have the right to exchange this Security
(and the related Guarantees) for 8 7/8% Senior Subordinated Notes due 2007,
Series B and related guarantees (herein called the "Series B Securities") in
like principal amount as provided therein. The Series A Securities and the
Series B Securities are together (including related Guarantees) referred to as
the "Securities." The Series A Securities rank pari passu in right of payment
with the Series B Securities.
In the event that either (a) the Exchange Offer Registration
Statement is not filed with the Commission on or prior to the 30th calendar day
following the date of original issue of the Series A Securities, (b) the
Exchange Offer Registration Statement has not been declared effective on or
prior to the 90th calendar day following the date of original issue of the
Series A Securities or (c) the Exchange Offer is not consummated on or prior to
the 120th calendar day following the date of original issue of the Series A
Securities or a Shelf Registration Statement is not declared effective on or
prior to the 120th calendar day following the date of original issue of the
Series A Securities (each
4
59
such event referred to in clauses (a) through (c) above, a "Registration
Default"), the interest rate borne by the Series A Securities shall be
increased by one-quarter of one percent per annum upon the occurrence of each
Registration Default, which rate (as increased as aforesaid) will increase by
one quarter of one percent each 90-day period that such additional interest
continues to accrue under any such circumstance, with an aggregate maximum
increase in the interest rate equal to one percent (1%) per annum. Following
the cure of all Registration Defaults the accrual of additional interest will
cease and the interest rate will revert to the original rate.
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 any Predecessor Security) is
registered at the close of business on the Regular Record Date for such
interest, which shall be the January 15 or July 15 (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, and interest on such
defaulted interest at the interest rate borne by the Series A Securities, to
the extent lawful, shall 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 any Predecessor Security) 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 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 may be listed, and upon such notice as may be
required by such exchange, all as more fully provided in this Indenture.
Payment of the principal of, premium, if any, and interest
on, this Security, and exchange or transfer of the Security, will be made at
the office or agency of the Company in The City of New York maintained for that
purpose, or at such other office or agency as may be maintained for such
purpose, 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;
provided, however, that payment of interest may be made at the option of the
Company by check mailed to the address of the Person entitled thereto as such
address shall appear on 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.
This Security is entitled to the benefits of Guarantees by
each of the Guarantors of the punctual payment when due of the Indenture
Obligations made in favor of the Trustee for the benefit of the Holders.
Reference is hereby made to Article
5
60
Fourteen of the Indenture for a statement of the respective rights, limitations
of rights, duties and obligations under the Guarantees of each of the
Guarantors.
Unless the certificate of authentication hereon has been duly
executed by the Trustee referred to on the reverse hereof or by the
authenticating agent appointed as provided in the Indenture by manual signature
of an authorized signer, this Security shall not be entitled to any benefit
under the Indenture, or be valid or obligatory for any purpose.
6
61
IN WITNESS WHEREOF, the Company has caused this instrument to
be duly executed by the manual or facsimile signature of its authorized
officers and its corporate seal to be affixed or reproduced hereon.
Dated: MARSH SUPERMARKETS, INC.
By:
-------------------------------------
Name: Don E. Marsh
Title: President and Chief Executive
Officer
Attest:
- ----------------------------
Authorized Officer
7
62
TRUSTEE'S CERTIFICATE OF AUTHENTICATION.
This is one of the 8 7/8% Senior Subordinated Notes due 2007,
Series A referred to in the within-mentioned Indenture.
STATE STREET BANK AND TRUST COMPANY, as Trustee
By:
------------------------------------
Authorized Signer
8
63
MARSH SUPERMARKETS, INC.
8 7/8% Senior Subordinated Note due 2007, Series A
This Security is one of a duly authorized issue of Securities
of the Company designated as its 8 7/8% Senior Subordinated Notes due 2007,
Series A (herein called the "Securities"), limited (except as otherwise
provided in the Indenture referred to below) in aggregate principal amount to
$150,000,000, issued under and subject to the terms of an indenture (herein
called the "Indenture") dated as of August 5, 1997, among the Company, the
Guarantors and State Street Bank and Trust Company, as trustee (herein called
the "Trustee," which term includes any successor trustee under the Indenture),
to which Indenture and all indentures supplemental thereto reference is hereby
made for a statement of the respective rights, limitations of rights, duties,
obligations and immunities thereunder of the Company, the Guarantors, the
Trustee and the Holders of the Securities, and of the terms upon which the
Securities are, and are to be, authenticated and delivered.
The Indenture contains provisions for defeasance at any time
of (a) the entire Indebtedness on the Securities and (b) certain restrictive
covenants and related Defaults and Events of Default, in each case upon
compliance with certain conditions set forth therein.
The Securities are subject to redemption at any time on or
after August 1, 2002, at the option of the Company, in whole or in part, on not
less than 30 nor more than 60 days' prior notice to the Holders by first-class
mail, in amounts of $1,000 or an integral multiple thereof, at the following
redemption prices (expressed as percentages of the principal amount), if
redeemed during the 12-month period beginning August 1 of the years indicated
below:
Redemption
Year Price
---- ----------
2002...................................... 104.438%
2003...................................... 102.958%
2004...................................... 101.479%
and thereafter at 100% of the principal amount, in each case, together with
accrued and unpaid interest, if any, to the Redemption Date (subject to the
rights of Holders of record on relevant Regular Record Dates or Special Record
Dates to receive interest due on an Interest Payment Date).
If less than all of the Securities are to be redeemed, the
Trustee shall select the Securities or portions thereof to be redeemed pro
rata, by lot or by any other method the Trustee shall deem fair and reasonable.
9
64
Upon the occurrence of a Change of Control, each Holder may
require the Company to purchase such Holder's Securities in whole or in part in
integral multiples of $1,000, at a purchase price in cash in an amount equal to
101% of the principal amount thereof, plus accrued and unpaid interest, if any,
to the date of purchase, pursuant to a Change of Control Offer in accordance
with the procedures set forth in the Indenture.
Under certain circumstances, in the event the Net Cash
Proceeds received by the Company from any Asset Sale, which proceeds are not
used to repay Senior Indebtedness or invested in capital expenditures,
properties or other assets or inventories that replace the properties and
assets that were the subject of the Asset Sale or which will be used in the
business of the Company or its Subsidiaries existing on the date of the
Indenture or in businesses reasonably related thereto, exceeds a specified
amount the Company will be required to apply such proceeds to the repayment of
the Securities and certain Indebtedness ranking pari passu in right of payment
to the Securities which Securities and Indebtedness are purchased at the option
of the Holder as described in the Indenture.
In the case of any redemption or repurchase of Securities in
accordance with the Indenture, interest installments whose Stated Maturity is
on or prior to the Redemption Date will be payable to the Holders of such
Securities of record as of the close of business on the relevant Regular Record
Date or Special Record Date referred to on the face hereof. Securities (or
portions thereof) for whose redemption and payment provision is made in
accordance with the Indenture shall cease to bear interest from and after the
Redemption Date.
In the event of redemption or repurchase of this Security in
accordance with the Indenture in part only, a new Security or Securities for
the unredeemed portion hereof shall be issued in the name of the Holder hereof
upon the cancellation hereof.
If an Event of Default shall occur and be continuing, the
principal amount of all the Securities may be declared due and payable in the
manner and with the effect provided in the Indenture.
The Indenture permits, with certain exceptions (including
certain amendments permitted without the consent of any Holders) as therein
provided, the amendment thereof and the modification of the rights and
obligations of the Company and the Guarantors and the rights of the Holders
under the Indenture and the Securities and the Guarantees at any time by the
Company and the Trustee with the consent of the Holders of a specified
percentage in aggregate principal amount of the Securities at the time
Outstanding. The Indenture also contains provisions permitting the Holders of
specified percentages in aggregate principal amount of the Securities at the
time Outstanding, on behalf of the Holders of all the Securities, to waive
compliance by the
10
65
Company and the Guarantors with certain provisions of the Indenture and the
Securities and the Guarantees and certain past Defaults under the Indenture and
the Securities and the Guarantees and their consequences. Any such consent or
waiver by or on behalf of 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.
The Series A Securities are, to the extent and manner
provided in Article Thirteen of the Indenture, subordinated and subject in
right of payment to the prior payment in full of all Senior Indebtedness.
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, any Guarantor or any other obligor on the Securities (in the event
such Guarantor or such other obligor is obligated to make payments in respect
of the Securities), which is absolute and unconditional, to pay the principal
of, premium, if any, and interest on, this Security at the times, place, and
rate, and in the coin or currency, herein prescribed, subject to the
subordination provisions of the Indenture.
If this Series A Security is in certificated form, then as
provided in the Indenture and subject to certain limitations therein set forth,
the transfer of this Security is registrable on the Security Register of the
Company, upon surrender of this Security for registration of transfer at the
office or agency of the Company maintained for such purpose in The City of New
York or at such other office or agency of the Company as may be maintained for
such purpose, 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 its attorney duly authorized in writing, and
thereupon one or more new Securities, of authorized denominations and for the
same aggregate principal amount, will be issued to the designated transferee or
transferees.
If this Series A Security is in certificated form, then as
provided in the Indenture and subject to certain limitations therein set forth,
the Holder, provided it is a Qualified Institutional Buyer, may exchange this
Series A Security for a Book-Entry Security by instructing the Trustee (by
completing the Transferee Certificate in the form in Appendix I) to arrange for
such Series A Security to be represented by a beneficial interest in a Global
Security in accordance with the customary procedures of the Depository, unless
the Company has elected not to issue a Global Security.
If this Series A Security is a U.S. Global Security, it is
exchangeable for a Series A Security in certificated form as provided in the
Indenture and in accordance with the rules and procedures of the Trustee and
the Depositary. In addition, certificated
11
66
securities shall be transferred to all beneficial holders in exchange for their
beneficial interests in the U.S. Global Securities if (x) the Depositary
notifies the Company that it is unwilling or unable to continue as depository
for the U.S. Global Security and a successor depositary is not appointed by the
Company within 90 days or (y) there shall have occurred and be continuing an
Event of Default and the Security Registrar has received a request from the
Depositary. Upon any such issuance, the Trustee is required to register such
certificated Series A Securities in the name of, and cause the same to be
delivered to, such Person or Persons (or the nominee of any thereof). All such
certificated Series A Securities would be required to include the Private
Placement Legend.
Series A Securities in certificated form are issuable only in
registered form without coupons in denominations of $1,000 and any integral
multiple thereof. As provided in the Indenture and subject to certain
limitations therein set forth, the Series A Securities are exchangeable for a
like aggregate principal amount of Securities of a differing authorized
denomination, as requested by the Holder surrendering the same.
At any time when the Company is not subject to Sections 13 or
15(d) of the Exchange Act, upon the written request of a Holder of a Series A
Security, the Company will promptly furnish or cause to be furnished such
information as is specified pursuant to Rule 144A(d)(4) under the Securities
Act (or any successor provision thereto) to such Holder or to a prospective
purchaser of such Series A Security who such Holder informs the Company is
reasonably believed to be a "Qualified Institutional Buyer" within the meaning
of Rule 144A under the Securities Act, as the case may be, in order to permit
compliance by such Holder with Rule 144A under the Securities Act.
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 payable in
connection therewith.
Prior to due presentment of this Security for registration of
transfer, the Company, any Guarantor, the Trustee and any agent of the Company,
any Guarantor 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 is overdue, and neither the Company, any Guarantor, the Trustee nor
any such agent shall be affected by notice to the contrary.
THIS SECURITY SHALL BE GOVERNED BY AND CONSTRUED IN
ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK, WITHOUT REGARD TO CONFLICTS
OF LAWS PRINCIPLES THEREOF.
All terms used in this Security which are defined in the
Indenture and not otherwise defined herein shall have the meanings assigned to
them in the Indenture.
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67
OPTION OF HOLDER TO ELECT PURCHASE
If you wish to have this Security purchased by the Company
pursuant to Section 1013 or Section 1016, as applicable, of the Indenture,
check the Box: [ ].
If you wish to have a portion of this Security purchased by
the Company pursuant to Section 1013 or Section 1016 as applicable, of the
Indenture, state the amount (in original principal amount):
$ .
---------------
Date: Your Signature:
------------------- ---------------------
(Sign exactly as your name appears on the other side of this Security)
Signature Guarantee:
----------------------------------
[Signature must be guaranteed by an eligible Guarantor Institution (banks,
stock brokers, savings and loan associations and credit unions) with membership
in an approved guarantee medallion program pursuant to Securities and Exchange
Commission Rule 17Ad-15]
13
68
TRANSFER NOTICE
FOR VALUE RECEIVED the undersigned registered holder hereby sell(s),
assign(s) and transfer(s) unto
Insert Taxpayer Identification No.
- -----------------------------------
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
(Please print or typewrite name and address including zip code of assignee)
- -------------------------------------------------------------------------------
the within Security and all rights thereunder, hereby irrevocably constituting
and appointing
- -------------------------------------------------------------------------------
attorney to transfer such Security on the books of the Company with full power
of substitution in the premises.
In connection with any transfer of this Security occurring prior to
the date which is the earlier of the date of an effective Registration
Statement or August 5, 1999, the undersigned confirms that without utilizing
any general solicitation or general advertising that:
[Check One]
[ ] (a) this Security is being transferred in compliance with the exemption
from registration under the Securities Act of 1933, as amended,
provided by Rule 144A thereunder.
or
--
[ ] (b) this Security is being transferred other than in accordance with (a)
above and documents are being furnished which comply with the
conditions of transfer set forth in this Security and the Indenture.
14
69
If none of the foregoing boxes is checked, the Trustee or other Security
Registrar shall not be obligated to register this Security in the name of any
Person other than the Holder hereof unless and until the conditions to any such
transfer of registration set forth herein and in Section 307 of the Indenture
shall have been satisfied.
Date:
----------------------- -----------------------------------
NOTICE: The signature to this
assignment must correspond with the
name as written upon the face of
the within-mentioned instrument in
every particular, without
alteration or any change
whatsoever.
Signature Guarantee:
-----------------------------
[Signature must be guaranteed by an eligible Guarantor Institution (banks,
stock brokers, savings and loan associations and credit unions) with membership
in an approved guarantee medallion program pursuant to Securities and Exchange
Commission Rule 17Ad-15]
TO BE COMPLETED BY PURCHASER IF (a) ABOVE IS CHECKED.
The undersigned represents and warrants that it is purchasing this
Security for its own account or an account with respect to which it exercises
sole investment discretion and that it and any such account is a "qualified
institutional buyer" within the meaning of Rule 144A under the Securities Act
of 1933, as amended, and is aware that the sale to it is being made in reliance
on Rule 144A and acknowledges that it has received such information regarding
the Company as the undersigned has requested pursuant to Rule 144A or has
determined not to request such information and that it is aware that the
transferor is relying upon the undersigned's foregoing representations in order
to claim the exemption from registration provided by Rule 144A.
Dated:
------------------ ----------------------------------------------------
NOTICE: To be executed by an authorized signatory
15
70
GUARANTEES
For value received, each of the undersigned hereby absolutely,
unconditionally and irrevocably guarantees, jointly and severally, to the
holder of this Security the payment of principal of, premium, if any, and
interest on this Security upon which these Guarantees are endorsed in the
amounts and at the time when due and payable whether by declaration thereof, or
otherwise, and interest on the overdue principal and interest, if any, of this
Security, if lawful, and the payment or performance of all other obligations of
the Company under the Indenture or the Securities, to the holder of this
Security and the Trustee, all in accordance with and subject to the terms and
limitations of this Security and Article Fourteen of the Indenture. These
Guarantees will not become effective until the Trustee duly executes the
certificate of authentication on this Security. This Guarantee shall be
governed by and construed in accordance with the laws of the State of New York,
without regard to conflict of law principles thereof. The Indebtedness
evidenced by these Guarantees are, to the extent and in the manner provided in
the Indenture, subordinate and subject in right of payment to the prior payment
in full of all Guarantor Senior Indebtedness (as defined in the Indenture),
whether outstanding on the date of the Indenture or thereafter, and the
Guarantees are issued subject to such provisions.
Dated:
MARSH DRUGS, INC.
MUNDY REALTY, INC.
MAR PROPERTIES, INC.
MARLEASE, INC.
MARSH INTERNATIONAL, INC.
MARAINES GREENERY, INC.
LIMITED HOLDINGS, INC.
MARSH P.Q., INC.
S.C.T., INC.
NORTH MARION DEVELOPMENT
CORPORATION
CONTRACT TRANSPORT, INC.
TRADEMARK HOLDINGS, INC.
By:
------------------------------------------
Name: Don E. Marsh
Title: President
16
71
CRYSTAL FOOD SERVICES, LLC
By: Marsh Supermarkets, Inc., its
Chief Operating Officer
LOBILL FOODS, LLC
By: Marsh Supermarkets, Inc., its
Chief Operating Officer
CONTRACT TRANSPORT, LLC
By: Marsh Supermarkets, Inc., its
Chief Operating Officer
MARSH SUPERMARKETS, LLC
By: Marsh Supermarkets, Inc.. its
Chief Operating Officer
VILLAGE PANTRY, LLC
By: Marsh Supermarkets, Inc., its
Chief Operating Officer
MARSH DRUGS, LLC
By: Marsh Supermarkets, Inc., its
Chief Operating Officer
MARSH CLEARING HOUSE, LLC
By: Marsh Supermarkets, Inc., its
Chief Operating Officer
By:
---------------------------------
Name: Don E. Marsh
Title: President and Chief
Executive Officer
MARSH VILLAGE PANTRIES, INC.
CONVENIENCE STORE DISTRIBUTING
COMPANY
By: Marsh Village Pantries, Inc., its
General Partner
By:
---------------------------------
Name: Don E. Marsh
Title: Chief Executive Officer
17
72
Attest:
------------------------------------
P. Lawrence Butt, Secretary
Marsh Supermarkets, Inc.
Marsh Drugs, Inc.
Marsh Village Pantries, Inc.
Mundy Realty, Inc.
Mar Properties, Inc.
Marlease, Inc.
Marsh International, Inc.
Maraines Greenery, Inc.
Limited Holdings, Inc.
Marsh Village Pantries, Inc., as
general partner of Convenience
Store Distributing Company
Marsh P.Q., Inc.
S.C.T., Inc.
North Marion Development Corporation
Contract Transport, Inc.
Marsh Supermarkets, Inc.,
as Chief Operating Officer of
Crystal Food Services, LLC
LoBill Foods, LLC
Contract Transport, LLC
Marsh Supermarkets, LLC
Village Pantry, LLC
Marsh Drugs, LLC
Marsh Clearing House, LLC
Attest:
-------------------------------------
P. Lawrence Butt, Assistant Secretary
Trademark Holdings, Inc.
18