-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: keymaster@town.hall.org Originator-Key-Asymmetric: MFkwCgYEVQgBAQICAgADSwAwSAJBALeWW4xDV4i7+b6+UyPn5RtObb1cJ7VkACDq pKb9/DClgTKIm08lCfoilvi9Wl4SODbR1+1waHhiGmeZO8OdgLUCAwEAAQ== MIC-Info: RSA-MD5,RSA, I8XdY0uKoJIwDRVoHG7ccyM0GNWQJilH4I//lcX6SwaWsOZp46lFeUjs3S0FWLtK SbvFc30+gqNXfEFOT2vWPA== 0000950135-95-001290.txt : 19950531 0000950135-95-001290.hdr.sgml : 19950531 ACCESSION NUMBER: 0000950135-95-001290 CONFORMED SUBMISSION TYPE: S-3 PUBLIC DOCUMENT COUNT: 8 FILED AS OF DATE: 19950530 SROS: NYSE FILER: COMPANY DATA: COMPANY CONFORMED NAME: EG&G INC CENTRAL INDEX KEY: 0000031791 STANDARD INDUSTRIAL CLASSIFICATION: SERVICES-ENGINEERING SERVICES [8711] IRS NUMBER: 042052042 STATE OF INCORPORATION: MA FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: S-3 SEC ACT: 1933 Act SEC FILE NUMBER: 033-59675 FILM NUMBER: 95543311 BUSINESS ADDRESS: STREET 1: 45 WILLIAM ST CITY: WELLESLEY STATE: MA ZIP: 02181-4078 BUSINESS PHONE: 6172375100 MAIL ADDRESS: STREET 1: 45 WILLIAM ST CITY: WELLESLEY STATE: MA ZIP: 02181 FORMER COMPANY: FORMER CONFORMED NAME: EDGERTON GERMESHAUSEN & GRIER INC DATE OF NAME CHANGE: 19670626 S-3 1 EG&G, INC. 1 AS FILED WITH THE SECURITIES AND EXCHANGE COMMISSION ON MAY 30, 1995 REGISTRATION NO. 33- ================================================================================ SECURITIES AND EXCHANGE COMMISSION WASHINGTON, D.C. 20549 ------------------------ FORM S-3 REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933 ------------------------ EG&G, INC. (EXACT NAME OF REGISTRANT AS SPECIFIED IN ITS CHARTER) MASSACHUSETTS 04-2052042 (STATE OR OTHER JURISDICTION OF (I.R.S. EMPLOYER INCORPORATION OR ORGANIZATION) IDENTIFICATION NO.)
45 WILLIAM STREET WELLESLEY, MASSACHUSETTS 02181 (617) 237-5100 (ADDRESS, INCLUDING ZIP CODE, AND TELEPHONE NUMBER, INCLUDING AREA CODE, OF REGISTRANT'S PRINCIPAL EXECUTIVE OFFICES) MURRAY GROSS, ESQ. EG&G, INC. 45 WILLIAM STREET WELLESLEY, MASSACHUSETTS 02181 (617) 237-5100 (NAME, ADDRESS, INCLUDING ZIP CODE, AND TELEPHONE NUMBER, INCLUDING AREA CODE, OF AGENT FOR SERVICE) ------------------------ COPIES TO: DAVID E. REDLICK, ESQ. DAVID C. CHAPIN, ESQ. HALE AND DORR ROPES & GRAY 60 STATE STREET ONE INTERNATIONAL PLACE BOSTON, MASSACHUSETTS 02109 BOSTON, MASSACHUSETTS 02110 (617) 526-6000 (617) 951-7000
APPROXIMATE DATE OF COMMENCEMENT OF PROPOSED SALE TO THE PUBLIC: From time to time after the effective date of this Registration Statement, as determined by market conditions and other factors. If the only securities being registered on this form are to be offered pursuant to dividend or interest reinvestment plans, please check the following box / / If any of the securities being registered on this form are to be offered on a delayed or continuous basis pursuant to Rule 415 under the Securities Act of 1933, other than securities offered only in connection with dividend or interest reinvestment plans, check the following box. /X/ CALCULATION OF REGISTRATION FEE ========================================================================================================= PROPOSED MAXIMUM PROPOSED MAXIMUM AMOUNT TO OFFERING PRICE AGGREGATE AMOUNT OF BE REGISTERED PER UNIT(1) OFFERING PRICE(1) REGISTRATION FEE - --------------------------------------------------------------------------------------------------------- Debt Securities.............. $150,000,000(2) 100% $150,000,000 $51,725 ========================================================================================================= (1) Estimated solely for the purpose of computing the registration fee. (2) Indicates issue price in the case of Debt Securities sold with original issue discount. Principal amount at maturity may be greater.
------------------------ THE REGISTRANT HEREBY AMENDS THIS REGISTRATION STATEMENT ON SUCH DATE OR DATES AS MAY BE NECESSARY TO DELAY ITS EFFECTIVE DATE UNTIL THE REGISTRANT SHALL FILE A FURTHER AMENDMENT WHICH SPECIFICALLY STATES THAT THIS REGISTRATION STATEMENT SHALL THEREAFTER BECOME EFFECTIVE IN ACCORDANCE WITH SECTION 8(A) OF THE SECURITIES ACT OF 1933 OR UNTIL THIS REGISTRATION STATEMENT SHALL BECOME EFFECTIVE ON SUCH DATE AS THE COMMISSION, ACTING PURSUANT TO SAID SECTION 8(A), MAY DETERMINE. ================================================================================ 2 INFORMATION CONTAINED HEREIN IS SUBJECT TO COMPLETION OR AMENDMENT. A REGISTRATION STATEMENT RELATING TO THESE SECURITIES HAS BEEN FILED WITH THE SECURITIES AND EXCHANGE COMMISSION. THESE SECURITIES MAY NOT BE SOLD NOR MAY OFFERS TO BUY BE ACCEPTED PRIOR TO THE TIME THE REGISTRATION STATEMENT BECOMES EFFECTIVE. THIS PROSPECTUS SHALL NOT CONSTITUTE AN OFFER TO SELL OR THE SOLICITATION OF AN OFFER TO BUY NOR SHALL THERE BE ANY SALE OF THESE SECURITIES IN ANY STATE IN WHICH SUCH OFFER, SOLICITATION OR SALE WOULD BE UNLAWFUL PRIOR TO REGISTRATION OR QUALIFICATION UNDER THE SECURITIES LAWS OF ANY SUCH STATE. SUBJECT TO COMPLETION; DATED MAY 30, 1995 PROSPECTUS SUPPLEMENT TO PROSPECTUS DATED , 1995 $ [LOGO EG&G INC.] % NOTES DUE ------------------------ Interest on the Notes is payable on and of each year, commencing , 199 . The Notes are not redeemable prior to maturity and will not be entitled to any sinking fund. The Notes will be represented by one or more global Notes registered in the name of the nominee of The Depository Trust Company (the "Depositary"). Beneficial interests in the global Notes will be shown on, and transfers thereof will be effected only through, records maintained by the Depositary and its participants. Except as described herein, Notes in definitive form will not be issued. The Notes will be issued only in denominations of $1,000 and integral multiples thereof. The Notes will trade in the Depositary's Same-Day Funds Settlement System until maturity, and secondary market trading activity for the Notes will therefore settle in immediately available funds. All payments of principal and interest will be made by EG&G, Inc. (the "Company") in immediately available funds. See "Description of Notes". ------------------------ THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE SECURITIES AND EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION NOR HAS THE SECURITIES AND EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION PASSED UPON THE ACCURACY OR ADEQUACY OF THIS PROSPECTUS SUPPLEMENT OR THE PROSPECTUS. ANY REPRESENTATION TO THE CONTRARY IS A CRIMINAL OFFENSE. ------------------------
INITIAL PUBLIC UNDERWRITING PROCEEDS TO OFFERING PRICE(1) DISCOUNT(2) COMPANY(1)(3) --------------------- --------------------- --------------------- Per Note........................ % % % Total........................... $ $ $ - --------------- (1) Plus accrued interest, if any, from , 1995. (2) The Company has agreed to indemnify the Underwriters against certain liabilities, including liabilities under the Securities Act of 1933. See "Underwriting". (3) Before deducting estimated expenses of $ payable by the Company.
------------------------ The Notes offered hereby are offered severally by the Underwriters, as specified herein, subject to receipt and acceptance by them and subject to their right to reject any order in whole or in part. It is expected that the Notes will be ready for delivery in book-entry form only through the facilities of the Depositary in New York, New York, on or about , 1995 against payment therefor in immediately available funds. GOLDMAN, SACHS & CO. MERRILL LYNCH & CO. ------------------------ The date of this Prospectus Supplement is , 1995. 3 ------------------------ IN CONNECTION WITH THIS OFFERING, THE UNDERWRITERS MAY OVER-ALLOT OR EFFECT TRANSACTIONS WHICH STABILIZE OR MAINTAIN THE MARKET PRICE OF THE SECURITIES OFFERED HEREBY AT LEVELS ABOVE THOSE WHICH MIGHT OTHERWISE PREVAIL IN THE OPEN MARKET. SUCH STABILIZING, IF COMMENCED, MAY BE DISCONTINUED AT ANY TIME. S-2 4 USE OF PROCEEDS The net proceeds from the sale of the Notes offered hereby are estimated to be approximately $ . The Company intends to use up to $ of the net proceeds to repay certain short-term indebtedness in an aggregate principal amount of $ , which was incurred by the Company for general corporate purposes, including the financing of open market repurchases, between , 1995 and , 1995, of shares of its Common Stock. Such indebtedness bears interest at rates ranging from % to % per annum, and has maturity dates ranging from to . The Company intends to use the remaining portion of the net proceeds for the repurchase of additional shares of Common Stock and for other general corporate purposes. Pending such uses, the net proceeds will be invested in short-term investment-grade securities. 1995 FIRST QUARTER RESULTS SELECTED CONSOLIDATED FINANCIAL DATA The following table sets forth selected consolidated financial data of the Company for the quarters ended April 3, 1994 and April 2, 1995. These financial data were prepared by management from the Company's unaudited financial statements and include all adjustments, consisting only of normal recurring accruals, necessary for a fair presentation of the results of operations, financial position and cash flows of the Company for the periods and as of the dates indicated. The results for the quarter ended April 2, 1995 are not necessarily indicative of results to be expected for the entire year. These financial data should be read in conjunction with, and are qualified by reference to, the consolidated financial statements and the related notes contained in documents incorporated by reference in the accompanying Prospectus and "Management's Discussion and Analysis of Financial Condition and Results of Operations" included therein and herein.
QUARTERS ENDED ----------------------- APRIL 3, APRIL 2, 1994 1995 -------- -------- (IN THOUSANDS WHERE APPLICABLE) (UNAUDITED) OPERATIONS: Sales (from continuing operations)...................................................... $325,747 $338,230 Operating income from continuing operations............................................. 12,675 15,673(a) Income from continuing operations....................................................... 7,813 9,352(a) Income from discontinued operations, net of income taxes................................ 6,540 4,337 Net income.............................................................................. 14,353 13,689(a) Per share: Income from continuing operations..................................................... .14 .17 Income from discontinued operations, net of income taxes.............................. .12 .08 Net income............................................................................ .26 .25(a) FINANCIAL POSITION: Working capital......................................................................... $210,601 $178,115 Total assets............................................................................ 767,781 809,814 Total debt.............................................................................. 54,759 85,253 Total long-term liabilities............................................................. 55,839 69,050 Stockholders' equity.................................................................... 471,950 436,928 Stockholders' equity per share.......................................................... 8.56 8.22 Debt/total capital...................................................................... 10.4% 16.3% OTHER DATA: Cash flows from (used in) continuing operations......................................... $(13,815) $ 13,918 Cash flows from discontinued operations................................................. 10,311 15,151 Cash flows from (used in) operating activities.......................................... (3,504) 29,069 Capital expenditures.................................................................... 6,977 9,217 Depreciation and amortization........................................................... 8,815 8,727 Cash dividends per common share......................................................... .14 .14 Weighted average common shares outstanding.............................................. 55,721 54,413 Ratio of earnings to fixed charges(b)................................................... 6.09x 5.65x
- --------------- (a) Effective January 2, 1995, the Company changed its depreciation methods from accelerated to straight-line and half-year convention to actual month placed in service. The effect of applying these new methods in the first quarter of 1995 was to reduce depreciation expense by $1.7 million and to increase income from continuing operations and net income by $1.0 million and net income per share by $.02. (b) Computed by dividing income from continuing operations before income taxes and fixed charges and as adjusted for certain equity method investments, by fixed charges. Fixed charges consist of interest on all indebtedness (including capital lease obligations), amortization of debt expenses, and the percentage of rental expense of operating leases which is deemed representative of the interest factor. S-3 5 MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS Results of Operations The following industry segment information is presented as an aid to a better understanding of the Company's operating results:
QUARTERS ENDED --------------------------- APRIL 3, APRIL 2, 1994 1995 --------- --------- (IN THOUSANDS) (UNAUDITED) SALES FROM CONTINUING OPERATIONS: Technical Services....................................... $156,421 $149,165 Instruments.............................................. 62,855 69,842 Mechanical Components.................................... 56,039 59,790 Optoelectronics.......................................... 50,432 59,433 --------- --------- $325,747 $338,230 ========== ========== OPERATING INCOME (LOSS) FROM CONTINUING OPERATIONS: Technical Services....................................... $ 12,299 $ 11,110 Instruments.............................................. 534 3,244 Mechanical Components.................................... 3,507 6,019 Optoelectronics.......................................... 3,550 2,320 General Corporate Expenses............................... (7,215) (7,020) --------- --------- $ 12,675 $ 15,673 ========== ==========
The discussion that follows is a summary analysis of the major changes in operating results by industry segment that occurred for the quarter ended April 2, 1995 compared to the quarter ended April 3, 1994. Sales From Continuing Operations Sales from continuing operations were $338 million in the first quarter of 1995, a 4% increase over the 1994 level. In Technical Services, the $7.3 million decrease was primarily due to reduced government contract funding, including the phase down of the Superconducting Super Collider Laboratory contract, during 1995. Partially offsetting this decrease were increased billings from the chemical weapons disposal contract at Tooele, which is now in its testing phase. Instruments sales increased $7 million primarily due to higher security instruments sales ($3.9 million) and the effects of changes in foreign exchange rates, offset partially by a $2 million decrease due to the divestiture of a product line under the 1994 repositioning plan. Higher demand for products in the transportation, industrial sealing and card guide businesses resulted in the $3.8 million increase in Mechanical Components sales. In Optoelectronics, the $9 million increase was due primarily to $6.4 million of sales of IC Sensors, acquired at the end of the third quarter of 1994, and higher shipments of flash products. These increases were partially offset by decreases due to the completion of a government contract in September 1994 and lower sales of power supplies. Operating Income From Continuing Operations Operating income from continuing operations was $15.7 million in the first quarter of 1995, a 24% increase over 1994. In Technical Services, the $1.2 million decrease resulted primarily from an estimated provision for a legal judgment and start-up costs for the environmental services and systems business. These decreases were partially offset by the effect of a contract adjustment relating to work performed in 1994. The Instruments $2.7 million increase was primarily due to cost reductions of $2.3 million, with $1.5 million attributable to the 1994 repositioning plan. The profit on increased sales in this segment was partially offset by the effects of changes in foreign exchange rates. The Mechanical Components increase of $2.5 million resulted primarily from higher sales, lower receivable and inventory provisions and $0.4 million of cost reductions resulting from the 1994 repositioning plan. The $1.2 million decrease in Optoelectronics resulted primarily from increased research and development expenses for the amorphous silicon program, completion of a govern- S-4 6 ment contract in 1994 and lower sales of power supplies. These decreases were partially offset by cost reductions of $0.4 million resulting from the 1994 repositioning plan. IC Sensors' operations resulted in a small loss in 1995 primarily due to manufacturing delays and planned significant investment in research and development. The $0.2 million decrease in general corporate expenses was the result of cost reductions under the 1994 repositioning plan. The net change in other income (expense) was due to higher foreign exchange transaction losses partially offset by investment gains. DEPRECIATION CHANGE: The Company changed its method of depreciation for certain classes of plant and equipment purchased after January 1, 1995, from an accelerated method to the straight-line method for financial reporting purposes. The Company believes that the straight-line method more appropriately reflects the timing of the economic benefits to be received from these assets, which consist mainly of manufacturing equipment. The Company also changed its convention for calculating depreciation expense during the year in which an asset is acquired. Previously, the Company used the half-year convention; starting in 1995, the Company commences depreciation in the month the asset is placed in service. The effect of applying these new methods in the first quarter of 1995 was to reduce depreciation expense by $1.7 million and to increase income from continuing operations and net income by $1.0 million and net income per share by $.02. The $1.7 million represents the difference between current quarter depreciation expense under the old and new methods. Most of this difference occurred in the Optoelectronics segment. Depreciation and amortization for the first quarter of 1995 was approximately the same as in the first quarter of 1994 because the effect of the changes in methods was offset by the effect of higher capital expenditures and the inclusion of IC Sensors' depreciation in 1995. DISCONTINUED OPERATIONS: Income from discontinued operations, net of income taxes, was $2.2 million below the 1994 level. The decrease reflected the expiration of the Idaho contract in September 1994 and the absence in 1995 of a cost/productivity improvement fee at Rocky Flats. The Department of Energy (the "DOE") has notified the Company of its intention to expedite the procurement and award of the Rocky Flats contract, which is expected to result in termination of the Company's contract on or about June 30, 1995. Future sales and income from discontinued operations will continue to decrease as the remaining DOE contracts expire in 1995 and 1996. Such sales and income are dependent upon work scopes and fee pools that are negotiated annually with the DOE. LIQUIDITY AND CAPITAL RESOURCES The Company's cash and cash equivalents increased $10.2 million in the first quarter of 1995 while commercial paper borrowings, used primarily to finance the common stock repurchases described below, increased $21.8 million. Net cash provided by continuing operations was $13.9 million in the first quarter of 1995 compared to a use of $13.8 million in the first quarter of 1994. In the first quarter of 1995, accounts receivable were reduced by $12.7 million and inventories were reduced by $2.5 million, reflecting the results of the aggressive working capital reduction program. These reductions were partially offset by $4.2 million in payments under the 1994 repositioning plan. In addition, the Company's prepaid funding of its pension plan, which the Company elected in both 1994 and 1995 to effect in the first quarter for the entire year, was $5.3 million lower in the first quarter 1995 as compared to 1994. The net cash provided by discontinued operations in the first quarter of 1995 was greater than in 1994 due to a reduction in receivables. Under the 1994 repositioning plan, cash outlays for the first quarter of 1995 were $4.2 million, mainly for employee termination costs, bringing the total spent under the plan to slightly over $8 million. Future cash outlays of $17.3 million are expected to be incurred, mainly in 1995. During the first quarter of 1995, the net work force reduction was 150 employees, bringing the total reduction to 350 employees to date. The repositioning plan calls for a net work force reduction of approximately 800 employees in continuing operations. The actions taken resulted in pre-tax savings of $2.5 million during the first quarter of 1995. S-5 7 Capital expenditures during the first quarter of 1995 were $9.2 million, an increase of $2.2 million over the 1994 level. Capital expenditures in 1995 are expected to exceed $80 million, more than twice the 1994 level. These increases support new product development initiatives, primarily in the Optoelectronics segment. Depreciation expense in 1995 is projected to be higher than in 1994 due to the higher level of capital expenditures. During the first quarter of 1995, the Company repurchased approximately two million shares of Common Stock at a cost of $28.6 million under a stock repurchase program. As of April 2, 1995, the Company had authorization to purchase approximately 11.3 million additional shares. DESCRIPTION OF NOTES GENERAL The following description of the particular terms of the Notes offered hereby (referred to in the accompanying Prospectus as the "Offered Debt Securities") supplements, and to the extent inconsistent therewith replaces, the description of the general terms and provisions of the Debt Securities set forth in the accompanying Prospectus, to which description reference is hereby made. Capitalized terms not defined herein have the meanings assigned to such terms in the accompanying Prospectus. The summary contained in this Prospectus Supplement of certain provisions of the Indenture dated as of , 1995 (the "Indenture") between the Company and The First National Bank of Boston, as trustee (the "Trustee"), does not purport to be complete and is subject to and qualified in its entirety by reference to the Indenture and the Notes. The Notes are unsecured obligations of the Company and will be limited to $ million aggregate principal amount and will mature on . The Notes will bear interest from , 1995 at the rate per annum set forth on the cover page hereof, payable semi-annually on and of each year, commencing , to the persons in whose names such Notes are registered, subject to certain exceptions, at the close of business on the or , as the case may be, next preceding such interest payment date. Principal and interest will be payable, and transfer of the Notes will be registrable, at the office of the Trustee, but payment of interest may be made at the option of the Company by check mailed to the address of the person entitled thereto as shown on the register of the Notes maintained by the Registrar (the "Note Register"). The Notes will be issuable in denominations of $1,000 and integral multiples thereof. The Notes are not redeemable prior to maturity and will not be entitled to any sinking fund. The discharge and defeasance provisions and the covenant provisions described in the accompanying Prospectus under "Description of Debt Securities" will apply to the Notes. The Notes will be issued in the form of one or more fully registered global Notes which will be deposited with, or on behalf of, the Depositary, located in the Borough of Manhattan, The City of New York, and will be registered in the name of the Depositary or a nominee of the Depositary. Ownership of beneficial interests in a global Note will be limited to participants and to persons that may hold interests through institutions that have accounts with the Depositary ("participants"). Ownership of beneficial interests by participants in a global Note will be shown on, and the transfer of that ownership interest will be effected only through, records maintained by the Depositary for such global Note. Ownership of beneficial interests in such global Note by persons that hold through participants will be shown on, and the transfer of that ownership interest within each participant will be effected only through, records maintained by such participants. Payment of principal of and interest on the Notes represented by any such global Note will be made to the Depositary or its nominee, as the case may be, as the sole registered owner and the sole holder of the Notes represented thereby for all purposes under the Indenture. None of the Company, the Trustee or any agent of the Company or the Trustee will have any responsibility or liability for any aspect of the Depositary's records relating to or payments made on account of beneficial ownership interests in a global Note representing any Notes, any other aspect of the relationship between the Depositary and its participants, the relationship between such participants and the owners of beneficial interests in a global Note owning through such participants, or for S-6 8 maintaining, supervising or reviewing any of the Depositary's records relating to such beneficial ownership interests. The Company has been advised by the Depositary that upon receipt of any payment of principal of or interest on any such global Note, the Depositary will credit, on its book-entry registration and transfer system, the accounts of participants with payments in amounts proportionate to their respective beneficial interests in the principal amount of such global Note as shown on the records of the Depositary. The accounts to be credited shall be designated by the Underwriters. Payments by participants to owners of beneficial interests in a global Note held through such participants will be governed by standing instructions and customary practices, as is now the case with securities held for customer accounts registered in "street name," and will be the sole responsibility of such participants. No global Note may be transferred except as a whole by the Depositary to a nominee of the Depositary, by a nominee of the Depositary to the Depositary or another nominee of the Depositary, or by the Depositary or any such nominee to a successor of the Depositary or a nominee of such successor. A global Note representing Notes is exchangeable for definitive Notes in registered form, only if (i) the Depositary notifies the Company that it is unwilling or unable to continue as Depositary for such global Note or if at any time the Depositary ceases to be a clearing agency registered under the Securities Exchange Act of 1934 (the "Exchange Act") and the Company does not appoint a successor Depositary, or (ii) the Company in its sole discretion determines that such global Note shall be exchangeable for definitive Notes in registered form and notifies the Trustee thereof. Any global Note that is exchangeable pursuant to the preceding sentence shall be exchangeable for definitive Notes issuable in authorized denominations in registered form, aggregating a like amount. Such definitive Notes shall be registered in the names of the owners of the beneficial interests in such global Note as the Depositary shall direct. Except as provided above, owners of beneficial interests in such a global Note will not be entitled to receive physical delivery of Notes in definitive form and will not be considered the holders thereof for any purpose under the Indenture, and no global Note representing Notes shall be exchangeable. Accordingly, each person owning a beneficial interest in such a global Note must rely on the procedures of the Depositary and, if such person is not a participant, on the procedures of the participant through which such person owns its interest, to exercise any rights of a holder under the Indenture or such global Note. The laws of some jurisdictions require that certain purchasers of securities take physical delivery of such securities in definitive form. Such limits and such laws may impair the ability to transfer beneficial interests in a global Note. The Depositary may grant proxies and otherwise authorize participants to give or take any request, demand, authorization, direction, notice, consent, waiver or other action which a holder is entitled to give or take under the Indenture or a global Note. The Company understands that under existing industry practices, in the event that the Company requests any action of holders or that an owner of a beneficial interest in such a global Note desires to give or take any action which a holder is entitled to give or take under the Indenture, the Depositary would authorize the participants holding the relevant beneficial interests to give or take such action, and such participants would authorize beneficial owners owning through such participants to give or take such action or would otherwise act upon the instructions of beneficial owners owning through them. The Depositary has advised the Company that the Depositary is a limited-purpose trust company organized under the laws of the State of New York, a member of the Federal Reserve System, a "clearing corporation" within the meaning of the New York Uniform Commercial Code, and a "clearing agency" registered under the Exchange Act. The Depositary was created to hold the securities of its participants and to facilitate the clearance and settlement of securities transactions among its participants in such securities through electronic book-entry changes in accounts of the participants, thereby eliminating the need for physical movement of securities certificates. The Depositary's participants include securities brokers and dealers (including the Underwriters), S-7 9 banks, trust companies, clearing corporations, and certain other organizations, some of whom (and/or their representatives) own the Depositary. Access to the Depositary's book-entry system is also available to others, such as banks, brokers, dealers and trust companies that clear through or maintain a custodial relationship with a participant, either directly or indirectly. Settlement for the Notes will be made in immediately available funds. The Notes will trade in the Depositary's Same-Day Funds Settlement System until maturity, and therefore the Depositary will require secondary trading activity in the Notes to be settled in immediately available funds. Secondary trading in long-term notes and debentures of corporate issuers is generally settled in clearing-house or next-day funds. No assurance can be given as to the effect, if any, of settlement in immediately available funds on trading activity in the Notes. UNDERWRITING Subject to the terms and conditions set forth in the Underwriting Agreement and the Pricing Agreement, the Company has agreed to sell to each of the Underwriters named below, and each of the Underwriters has severally agreed to purchase, the principal amount of the Notes set forth opposite its name below.
PRINCIPAL AMOUNT UNDERWRITER OF NOTES ----------- ---------------- Goldman, Sachs & Co. ........................................ $ Merrill Lynch, Pierce, Fenner & Smith Incorporated.................................... ------------ Total........................................................ $ ============
Under the terms and conditions of the Underwriting Agreement and the Pricing Agreement, the Underwriters are committed to take and pay for all of the Notes, if any are taken. The Underwriters propose to offer the Notes in part directly to the public at the initial public offering price set forth on the cover page of this Prospectus Supplement and in part to certain securities dealers at such price less a concession of % of the principal amount of the Notes. The Underwriters may allow, and such dealers may reallow, a concession not to exceed % of the principal amount of the Notes to certain brokers and dealers. After the Notes are released for sale to the public, the offering price and other selling terms may from time to time be varied by the Underwriters. The Notes are a new issue of securities with no established trading market. The Company has been advised by the Underwriters that they intend to make a market in the Notes, but the Underwriters are not obligated to do so and may discontinue market making at any time without notice. No assurance can be given as to the liquidity of the trading market for the Notes. The Company has agreed to indemnify the several Underwriters against certain liabilities, including liabilities under the Securities Act of 1933. The Underwriters have in the past provided, and may in the future provide, investment banking and other related services to the Company and its affiliates. LEGAL MATTERS The legality of the Notes offered hereby will be passed upon for the Company by Murray Gross, Esq., Vice President, General Counsel and Clerk of the Company. In addition, certain legal matters relating to the offering of the Notes will be passed upon for the Company by Hale and Dorr, Boston, Massachusetts. Certain legal matters will be passed upon for the Underwriters by Ropes & Gray, Boston, Massachusetts. As of April 2, 1995, Mr. Gross beneficially owned 77,844 shares (including options to acquire 50,600 shares) of Common Stock of the Company. S-8 10 INFORMATION CONTAINED HEREIN IS SUBJECT TO COMPLETION OR AMENDMENT. A REGISTRATION STATEMENT RELATING TO THESE SECURITIES HAS BEEN FILED WITH THE SECURITIES AND EXCHANGE COMMISSION. THESE SECURITIES MAY NOT BE SOLD NOR MAY OFFERS TO BUY BE ACCEPTED PRIOR TO THE TIME THE REGISTRATION STATEMENT BECOMES EFFECTIVE. THIS PROSPECTUS SHALL NOT CONSTITUTE AN OFFER TO SELL OR THE SOLICITATION OF AN OFFER TO BUY NOR SHALL THERE BE ANY SALE OF THESE SECURITIES IN ANY STATE IN WHICH SUCH OFFER, SOLICITATION OR SALE WOULD BE UNLAWFUL PRIOR TO REGISTRATION OR QUALIFICATION UNDER THE SECURITIES LAWS OF ANY SUCH STATE. SUBJECT TO COMPLETION; DATED MAY 30, 1995 PROSPECTUS $150,000,000 [LOGO EG&G INC.] DEBT SECURITIES ------------------------ EG&G, Inc. (the "Company" or "EG&G") may offer from time to time unsecured debt securities ("Debt Securities") consisting of debentures, notes and/or other evidences of unsecured indebtedness in one or more series, or any combination of the foregoing, at an aggregate initial public offering price not to exceed $150,000,000 (or its equivalent if some or all of the Debt Securities are denominated in one or more foreign currencies or composite currencies), at prices and on terms to be determined at or prior to the time of sale in light of market conditions at the time of sale. Specific terms of the particular series of Debt Securities in respect of which this Prospectus is being delivered will be set forth in an accompanying Prospectus Supplement, together with the terms of the offering of the Debt Securities and the initial price and the net proceeds to the Company from the sale thereof. The Prospectus Supplement will set forth with regard to the particular series of Debt Securities, without limitation, the following: the title, aggregate principal amount, ranking, if any, as senior debt or subordinated debt, authorized denominations (which may be in United States dollars, in any other currency or in a composite currency), maturity, rate, if any (which may be fixed or variable), or method of calculation of interest and dates for payment thereof, any exchangeability, conversion, redemption, prepayment or sinking fund provisions, the currency or currencies or currency unit or currency units in which principal, premium, if any, or interest, if any, is payable, any listing on a securities exchange, any modifications of or additions to the covenants described in this Prospectus and any other specific terms in connection with the offering and sale of such series of Debt Securities. The amounts payable by the Company in respect of Debt Securities may be calculated by reference to the value, rate or price of one or more specified commodities, currencies or indices to the extent set forth in the Prospectus Supplement. The Prospectus Supplement will also contain information, where applicable, about certain United States federal income tax considerations relating to the Debt Securities covered by the Prospectus Supplement. The Company may sell the Debt Securities directly, through agents designated from time to time, or through underwriters or dealers. Such underwriters may include Goldman, Sachs & Co. and Merrill Lynch & Co., or may be a group of underwriters represented by firms including Goldman, Sachs & Co. and Merrill Lynch & Co. Goldman, Sachs & Co. and Merrill Lynch & Co. may also act as agents. If any agents of the Company or any underwriters or dealers are involved in the sale of the Debt Securities in respect of which this Prospectus is being delivered, the names of such agents, underwriters or dealers, the principal amounts, if any, to be purchased by them, any applicable commissions and discounts, and the net proceeds to the Company will be set forth in the Prospectus Supplement. See "Plan of Distribution" for a discussion of indemnification arrangements with any such agents, underwriters and dealers. ------------------------ THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE SECURITIES AND EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION NOR HAS THE SECURITIES AND EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION PASSED UPON THE ACCURACY OR ADEQUACY OF THIS PROSPECTUS. ANY REPRESENTATION TO THE CONTRARY IS A CRIMINAL OFFENSE. ------------------------ The date of this Prospectus is , 1995. 11 AVAILABLE INFORMATION The Company is subject to the informational requirements of the Securities Exchange Act of 1934, as amended (the "Exchange Act"), and in accordance therewith files reports and other information with the Securities and Exchange Commission (the "Commission"). Reports, proxy and information statements and other information filed by the Company can be inspected and copied at the public reference facilities maintained by the Commission at 450 Fifth Street, N.W., Washington, D.C. 20549, and at the following Regional Offices of the Commission: Midwest Regional Office, Citicorp Center, 500 West Madison Street, Suite 1400, Chicago, Illinois 60661 and Northeast Regional Office, 7 World Trade Center, Suite 1300, New York, New York 10048. Copies of such material may also be obtained from the Public Reference Section of the Commission at 450 Fifth Street, N.W., Washington, D.C. 20549 at prescribed rates. The Company's Common Stock is listed on the New York Stock Exchange, and reports, proxy and information statements and other information concerning the Company may also be inspected at the offices of the New York Stock Exchange, Inc., 20 Broad Street, New York, New York 10005. The Company has filed with the Commission a Registration Statement on Form S-3 under the Securities Act of 1933, as amended (the "Securities Act"), with respect to the Debt Securities offered hereby (the "Registration Statement"). This Prospectus does not contain all of the information set forth in the Registration Statement and the exhibits thereto, as certain parts are omitted in accordance with the rules and regulations of the Commission. Reference is made to the Registration Statement and to the exhibits relating thereto, which may be inspected, without charge, at the office of the Commission at 450 Fifth Street, N.W., Washington, D.C. 20549, and copies of which may be obtained from the Commission at prescribed rates. Statements contained herein concerning the provisions of any document are not necessarily complete and, in each instance, reference is made to the copy of such document filed as an exhibit to the Registration Statement or otherwise filed with the Commission. Each such statement is qualified in its entirety by such reference. INCORPORATION OF CERTAIN DOCUMENTS BY REFERENCE The following documents filed by the Company with the Commission are incorporated herein by reference: (1) the Company's Annual Report on Form 10-K for the fiscal year ended January 1, 1995; (2) the Company's Quarterly Report on Form 10-Q for the quarter ended April 2, 1995; and (3) the Company's two Current Reports on Form 8-K, each dated January 25, 1995. All documents filed by the Company with the Commission pursuant to Sections 13(a), 13(c), 14 or 15(d) of the Exchange Act subsequent to May 30, 1995 and prior to the termination of the offering of the Debt Securities shall be deemed to be incorporated by reference into this Prospectus and to be a part hereof from the date of filing of such documents. Any statement contained in a document incorporated or deemed to be incorporated by reference herein shall be deemed to be modified or superseded for purposes of this Prospectus to the extent that a statement contained herein or in any other subsequently filed document which also is or is deemed to be incorporated by reference herein modifies or supersedes such statement. Any statement so modified or superseded shall not be deemed, except as so modified or superseded, to constitute a part of this Prospectus. The Company will provide without charge to each person to whom this Prospectus is delivered, upon the written or oral request of such person, a copy of any or all of the foregoing documents incorporated by reference into this Prospectus (without exhibits to such documents other than exhibits specifically incorporated by reference into such documents). Requests for such copies should be directed to the Vice President of Investor Relations of the Company, 45 William Street, Wellesley, Massachusetts 02181 (telephone: (617) 237-5100). ------------------------ IN CONNECTION WITH THIS OFFERING, THE UNDERWRITERS MAY OVER-ALLOT OR EFFECT TRANSACTIONS WHICH STABILIZE OR MAINTAIN THE MARKET PRICE OF THE SECURITIES OFFERED HEREBY AT LEVELS ABOVE THOSE WHICH MIGHT OTHERWISE PREVAIL IN THE OPEN MARKET. SUCH STABILIZING, IF COMMENCED, MAY BE DISCONTINUED AT ANY TIME. 2 12 THE COMPANY As used herein, the "Company" means EG&G, Inc. and its subsidiaries, unless the context otherwise requires. The principal executive offices of the Company are located at 45 William Street, Wellesley, Massachusetts 02181 and its telephone number is (617) 237-5100. INTRODUCTION EG&G is a global technology company that produces instruments and optoelectronic and mechanical components for manufacturers and end users in the automotive, medical and aerospace industries. The Company also provides engineering, scientific, environmental and management support services to a broad range of government and industrial customers. Over the past ten years, EG&G has undertaken a program to strengthen its products businesses which serve commercial markets. Important steps in achieving this goal have been (i) instituting cost reductions, (ii) improving manufacturing processes and (iii) reengineering sales and distribution systems. During this period, the Company also has divested certain nonstrategic operations and has acquired businesses that bring desired technologies, skills or market access. In 1994, the Company determined not to continue to bid for management and operations contracts with the U.S. Department of Energy (the "DOE"). The Company's existing management and operations contracts with the DOE expire in 1995 and 1996. EG&G conducts operations in four industry segments: Technical Services, Instruments, Mechanical Components and Optoelectronics. The Company's sales and operating income (loss) from continuing operations for each industry segment and its general corporate expenses for the last five fiscal years were as follows:
FISCAL YEARS ENDED ------------------------------------------------------------------ DECEMBER 30, DECEMBER 29, JANUARY 3, JANUARY 2, JANUARY 1, 1990 1991 1993 1994 1995 ------------ ------------ ---------- ---------- ---------- (IN THOUSANDS) SALES FROM CONTINUING OPERATIONS: Technical Services............. $ 522,724 $ 586,537 $ 608,864 $ 636,041 $ 613,588 Instruments.................... 208,263 230,196 226,900 237,223 273,088 Mechanical Components.......... 295,052 295,519 274,199 244,878 232,500 Optoelectronics................ 129,920 146,274 210,118 201,274 213,380 ---------- ---------- ---------- ---------- ---------- $1,155,959 $1,258,526 $1,320,081 $1,319,416 $1,332,556 ========== ========== ========== ========== ========== OPERATING INCOME (LOSS) FROM CONTINUING OPERATIONS: Technical Services............. $ 46,981 $ 55,601 $ 56,924 $ 68,762 $ 46,075 Instruments.................... 5,756 21,954 16,016 10,413 (49,580) Mechanical Components.......... 27,175 28,426 21,835 24,408 18,766 Optoelectronics................ 11,116 7,140 3,905 11,474 8,674 General Corporate Expenses..... (23,491) (27,456) (29,895) (27,573) (34,882) ---------- ---------- ---------- ---------- ---------- $ 67,537 $ 85,665 $ 68,785 $ 87,484 $ (10,947) ========== ========== ========== ========== ==========
The operating loss from continuing operations for the fiscal year ended January 1, 1995 included a goodwill write-down of $40.3 million and restructuring charges of $30.4 million. The impact of these nonrecurring charges on the operating income (loss) of each industry segment and on its general corporate expenses was as follows: Technical Services -- $1.6 million; Instruments -- $55.7 million; Mechanical Components -- $2.7 million; Optoelectronics -- $9.7 million; and General Corporate Expenses -- $1 million. 3 13 Set forth below is a brief summary of each of the Company's four industry segments together with a description of certain of the more significant or recently introduced products, services or operations. TECHNICAL SERVICES Through its Technical Services segment, EG&G supplies engineering, scientific, environmental, management and technical support services to a broad range of government and industry customers. These services include: analysis and testing services for the automotive industry; base operations for the National Aeronautics and Space Administration ("NASA") at the Kennedy Space Center ("KSC"); chemical weapons disposal and classified projects in aviation and target detection for the U.S. Department of Defense ("DoD"); seized-property administration for the U.S. Customs Service; technical support for the National Science Foundation in Antarctica; consulting services in transportation; physical security services for government agencies; and services and products for the environmental market. The Company offers services in this segment under trade names which include Automotive Research, Dynatrend, Structural Kinematics and Washington Analytical Services Center. In fiscal 1994, this segment represented 46% of the Company's total sales from continuing operations. For the automobile, chemical additive and petroleum industries, EG&G provides automobile durability, performance and emissions testing, and tests fuels, lubricants and chemical additives. The Company performs automobile durability and performance testing for all major U.S. and a number of foreign automobile manufacturers. As base operations contractor for the KSC, the Company provides institutional, technical and maintenance support services. In particular, EG&G manages KSC's 600 buildings, structures and facilities; tests new astronaut rescue procedures and escape systems; fields a force of 200 uniformed security personnel and a SWAT team; provides fire protection and medical services; handles all propellant substances; and manages the shuttle landing facility. The Company has been the base operations contractor at KSC since 1983 and is currently in the second year of a four-year contract that has two three-year renewal options at the discretion of the government. EG&G's contracts with the DoD fall into two general categories: (i) traditional defense activities, and (ii) decommissioning. EG&G's traditional defense activities focus on such strategic areas as research and engineering analyses in support of DoD advanced development programs. An example of a decommissioning project is the operation of the U.S. Army's facility for the disposal of lethal chemical agents and munitions in Tooele, Utah. The Company also provides engineering and management services in a variety of fields, including transportation, physical security and property management for several government agencies. Government clients include the U.S. Departments of Transportation, State and Treasury, the U.S. Customs Service and the Environmental Protection Agency. In 1994, the Company formed EG&G Environmental, Inc., a technology-based systems integration company, to strengthen EG&G's presence in the environmental services and systems market. INSTRUMENTS EG&G develops and manufactures instruments and systems for applications in medical and clinical diagnostics; biochemical, medical and life science research; industrial and pharmaceutical process measurement; environmental monitoring; gas and oil field applications; airport and industrial security; and food inspection. Many of these products feature the accurate generation, detection and measurement of various segments of the electromagnetic spectrum. EG&G's instruments provide a wide range of measurement capabilities and options through the use of high-speed signal processing, image enhancement and a broad utilization of detector technologies. The Company offers products in this segment under trade names which include Astrophysics, Berthold, 4 14 Ortec and Wallac. In fiscal 1994, this segment represented 21% of the Company's total sales from continuing operations. EG&G high performance bioanalytic and diagnostic instruments are used in hospitals, clinics and pharmaceutical and medical research facilities. These instruments are generally based on time-resolved fluorescence and chemoluminescence technologies that use light measurement to analyze samples. Because these light measurement technologies do not involve the use of radioactive material, concerns about sample transport and waste disposal are not present. Among other things, these instruments are used to screen blood for thyroid dysfunction, fertility-related disorders, fetal defects and diseases in newborns, and to detect relapse in patients who have been treated for cancer. EG&G recently introduced AutoDelfia(R), an automated immunoassay fluorescence diagnostic system. The Company also sells reagents for use in connection with certain of these instruments. Through its Instruments segment, EG&G also produces security screening systems that employ x-ray technology and various supporting image-enhancing techniques for non-intrusive inspection of baggage and packages at airport portals, baggage processing areas, mail rooms, courthouses, schools and buildings in general. In 1994, EG&G introduced two new security screening products: the Z-ScanTM and a portable large cargo x-ray screening system. The Z-Scan uses color images, x-rays and proprietary software to detect explosives, narcotics or contraband in packages and luggage. The Z-Scan can process up to 1,200 bags an hour. The United Kingdom Department of Transport recently certified the Z-Scan for detection of drugs and contraband in checked cargo. The large cargo x-ray screening system allows non-intrusive inspection of boxes, crates and containers in search of contraband, weapons and explosives. The Company expects that this system will have applications at border crossings, ports of entry, warehouses and airports. EG&G instruments also include process inspection systems that combine x-ray technology from the Company's Instruments segment and optical components from the Company's Optoelectronics segment. These systems are used in food processing and packaging plants to monitor, detect and remove foreign objects from raw and processed food at various points on the production line. Such systems are also used to check intravenous-medicine bags and automobile oil filters for leaks, measure the fat content of meat and detect and separate nonbiodegradable PVCs from recyclable plastics. Based on its expertise in nuclear measurements, EG&G produces instruments to detect, characterize and measure radiation, including a complete line of radiation-protection measuring systems for laboratories, nuclear facilities and environmental monitoring. The Company also offers industrial on-line level and density measuring instruments for process control and measurement of liquids, slurries or solids in containers, tanks and pipes. MECHANICAL COMPONENTS Through its Mechanical Components segment, EG&G produces advanced seals and bellows products, valves, nozzles, metal ducting, motors and heat management devices for the petrochemical and chemical processing, transportation, defense and aerospace markets. The Company offers these products under trade names which include Pressure Science, Rotron and Sealol. In fiscal 1994, this segment represented 17% of the Company's total sales from continuing operations. Products sold in this segment include blower systems, power-conversion devices and other components for locomotives, transit cars and buses and defense product applications. Many of these products were first developed by EG&G for defense-related purposes and are now marketed and sold for commercial applications. EG&G also produces mechanical sealing components and systems, which use welded metal bellows devices pioneered by the Company, for the process industries. Such industries include pharmaceuticals, food processing, oil refining and chemical and petrochemical processing. The 5 15 Company expects that the market for the Company's advanced zero leakage gas seals will grow as a result of environmental legislation which requires manufacturers to significantly reduce emissions. For aerospace applications, EG&G produces valves, advanced sealing components, aircraft exhaust components and ducting. OPTOELECTRONICS Through its Optoelectronics segment, EG&G offers a broad variety of components that emit and detect light in the spectrum from ultraviolet through visible to the far infrared. These components range from simple photocells to sophisticated imaging systems, light sources that include various types of flashtubes and laser diodes, field instruments for fiber-optics and complex devices for weapons' trigger systems. Applications include light sensors used in automotive and commercial electronics, sensors used in smoke detectors and medical imaging systems, and sophisticated arrays for communications and remote sensing of the earth. The Company expects to make significant research and development and capital expenditures in this segment over the next several years. The Company offers products in this segment under trade names which include Heimann Optoelectronics, IC Sensors, Reticon and Vactec. In fiscal 1994, this segment represented 16% of the Company's total sales from continuing operations. Products of this segment include detectors of visible and non-visible light, including high performance silicon photodiodes to detect and measure light and other optical radiation for space, military, analytical and scientific instrumentation. Light detectors are also used by the Company to produce a family of products for fiber-optic cable manufacturing and field installation and inspection. The Company also makes a wide variety of flashlamps for use in photocopy and reprographic equipment, photo-typesetting systems, beacons, indicators and laser systems and accessories. In addition, EG&G manufactures power supplies for military high frequency electronic applications that are used primarily for precision controlled switching of electric current in electronic equipment. In cooperation with the General Electric Company, EG&G is participating in development of new technology for x-ray imaging. This technology is intended to be commercialized for a new generation of electronic x-ray imaging detectors. The technology is in the early stages of feasibility testing. Through this segment, EG&G also produces micromachined sensors, which are small silicon-wafer-based devices that combine a sensing function with intelligent signal processing. The Company mass produces these micromachined infrared sensors for consumer, medical and automotive applications and manufactures high performance micromachined silicon sensors for missile-guidance systems. In a joint venture, the Company is developing micromachined electronic accelerometers for consumer and industrial applications. DISCONTINUED OPERATIONS Since its founding, the Company has provided services to the DOE and its predecessor organizations. These services related primarily to nuclear energy research and nuclear weapons production and testing. As a result of changing procurement and administrative priorities at the DOE, to continue to provide these services the Company would have been required to invest significant levels of capital and accept broader liabilities and lower fees. In view of these changes, the Company determined that it would not seek renewal of its four contracts with the DOE and would not seek management and operations contracts at other DOE sites. Accordingly, the Company is reporting its former DOE Support segment as discontinued operations. Sales from discontinued operations were $1.47 billion, $1.38 billion and $1.30 billion in fiscal 1992, fiscal 1993 and fiscal 1994, respectively, and income from discontinued operations, net of income taxes, was $39.0 million, $24.9 million and $26.5 million in fiscal 1992, fiscal 1993 and fiscal 1994, respectively. Sales and income from these discontinued operations will continue to decrease as the four remaining DOE contracts expire in 1995 and 1996. 6 16 USE OF PROCEEDS The Company intends to use the net proceeds from the sale of the Debt Securities for general corporate purposes, which may include the purchase of shares of its Common Stock in open market or negotiated transactions and the repayment of outstanding indebtedness. More detailed information concerning the use of the proceeds from any particular offering of the Debt Securities will be contained in the Prospectus Supplement relating to such offering. SUMMARIZED CONSOLIDATED FINANCIAL DATA The following table sets forth summarized consolidated financial data of the Company for its three most recent fiscal years. The financial data set forth below have been derived from the financial statements of the Company, which have been audited by Arthur Andersen LLP, independent public accountants, as set forth in their reports with respect thereto. These financial data should be read in conjunction with, and are qualified by reference to, the consolidated financial statements and the related notes contained in documents incorporated by reference in this Prospectus and "Management's Discussion and Analysis of Financial Condition and Results of Operations" included herein.
FISCAL YEARS ENDED ---------------------------------------- JANUARY 3, JANUARY 2, JANUARY 1, 1993 1994 1995 ---------- ---------- ---------- (IN THOUSANDS WHERE APPLICABLE) OPERATIONS: Sales (from continuing operations)............................................. $1,320,081 $1,319,416 $1,332,556 Operating income (loss) from continuing operations............................. 68,785 87,484 (10,947) (a) Income (loss) from continuing operations....................................... 48,765 54,622 (32,107) Income from discontinued operations, net of income taxes....................... 39,014 24,949 26,452 Income (loss) before cumulative effect of accounting changes................... 87,779 79,571 (5,655) Net income (loss).............................................................. 87,779 59,071(b) (5,655) (d) Per share: Income (loss) from continuing operations..................................... .87 .97 (.58) Income from discontinued operations, net of income taxes..................... .69 .44 .48 Income (loss) before cumulative effect of accounting changes................. 1.56 1.41 (.10) Net income (loss)............................................................ 1.56 1.05(b) (.10) (d) FINANCIAL POSITION: Working capital................................................................ $ 247,518 $ 227,935 $ 199,656 Total assets................................................................... 746,577 764,887 793,129 Total debt..................................................................... 42,223 45,039 60,800 Total long-term liabilities.................................................... 40,827 54,177 65,941 Stockholders' equity........................................................... 473,636 477,534 445,366 Stockholders' equity per share................................................. 8.34 8.51 8.08 Debt/total capital............................................................. 8% 9% 12% OTHER DATA: Cash flows from continuing operations.......................................... $ 94,554 $ 76,217 $ 70,341 Cash flows from discontinued operations........................................ 33,253 35,920 25,542 Cash flows from operating activities........................................... 127,807 112,137 95,883 Capital expenditures........................................................... 22,446 27,860 37,277 Depreciation and amortization.................................................. 36,292 37,842 36,790 Cash dividends per common share................................................ .49 .52 .56 Weighted average common shares outstanding..................................... 56,385 56,504 55,271 Ratio of earnings to fixed charges(c).......................................... 5.71x 8.05x --(e) - --------------- (a) Includes a goodwill write-down of $40.3 million and restructuring charges of $30.4 million. (b) Includes one-time after-tax charges of $20.5 million, or $.36 per share, due to the Company's adoption of SFAS Nos. 106 and 109. (c) Computed by dividing income from continuing operations before income taxes and fixed charges and as adjusted for certain equity method investments, by fixed charges. Fixed charges consist of interest on all indebtedness (including capital lease obligations), amortization of debt expenses, and the percentage of rental expense of operating leases which is deemed representative of the interest factor. The ratio of earnings to fixed charges for the fiscal years ended December 30, 1990 and December 29, 1991 was 5.06x and 6.45x, respectively. (d) Excluding the effect of the nonrecurring items described in (a), net income would have been $58.3 million, or $1.06 per share. (e) The deficiency of earnings to cover fixed charges for the fiscal year ended January 1, 1995 was $17.4 million. Excluding the effect of the nonrecurring items described in (a), the ratio of earnings to fixed charges would have been 5.50x.
7 17 MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS RESULTS OF OPERATIONS The discussion that follows is a summary analysis of the major changes by industry segment. 1994 COMPARED TO 1993 During the third quarter of 1994, three significant events occurred that have a material effect on both the current financial results and the expected future performance of the Company. First, the Company decided not to seek renewal of its remaining four DOE contracts, although it intends to continue to meet its obligations under the terms and conditions of the present contracts. The Company will not compete for management and operations contracts at other DOE facilities. Accordingly, the Company is reporting the former DOE Support segment as discontinued operations for all periods presented in the Consolidated Financial Statements incorporated herein by reference. Second, management completed its review of the remaining operating segments' performance and developed a plan to reposition these businesses to attain the Company's business goals. The plan resulted in restructuring charges of $30.4 million in the third quarter. Finally, the decline in the financial results of certain operating elements within the Instruments segment, together with a strategic and operational review of these operations, resulted in an evaluation of the related goodwill for possible impairment. This evaluation resulted in a write-down of goodwill of $39.2 million and a reduction in the estimated remaining useful life of unamortized goodwill from 36 to 16 years. The Company also wrote off $1.1 million of a small Optoelectronics unit's goodwill. Additional information related to these events is discussed below and in Notes 5, 8, and 10 to the Consolidated Financial Statements incorporated herein by reference. SALES FROM CONTINUING OPERATIONS Sales from continuing operations for 1994 were $1,333 million, $13 million higher than 1993 sales. Technical Services: The $22 million decline resulted primarily from the $32 million reduction in program expenditures under the new base operations contract at the KSC. In addition, automotive testing sales declined $8 million to more normal levels following increases in 1993 caused by the introduction of new testing protocols. Partially offsetting these decreases were increased billings of $21 million from the DoD chemical weapons disposal contract as it moves into its testing phase. Instruments: The $36 million increase resulted primarily from $31 million of sales of Wallac, acquired late in the second quarter of 1993, and a $12 million increase in airport security product sales. These increases were partially offset by a $4 million sales decrease in other businesses. These businesses are to be sold under the repositioning plan and contributed sales of $16 million in 1994. Mechanical Components: The $12 million decrease was primarily due to the absence of sales of an operation divested late in 1993. Optoelectronics: The $12 million increase was due primarily to higher shipments of flash products of $20 million, and $5 million of sales of IC Sensors, acquired at the end of the third quarter. Partially offsetting the increases was the absence of $5 million of sales from an operation divested late in 1993 and a $4 million decrease in sales on a government contract that ended in September 1994. OPERATING INCOME (LOSS) FROM CONTINUING OPERATIONS The operating loss from continuing operations in 1994 was $10.9 million, compared to income of $87.5 million in 1993. The loss from continuing operations included the $40.3 million write-down 8 18 of goodwill and restructuring charges of $30.4 million resulting from management's repositioning plan. The Wallac and IC Sensors acquisitions were the main contributors to the $3.9 million increase in research and development expenses. The $13.4 million increase in selling, general and administrative expenses resulted mainly from Wallac and increased corporate expenses, offset by cost reductions in the Instruments segment and the absence of expenses of operations divested in 1993. Restructuring Charges: During the third quarter of 1994, management completed its review of the operating segments and developed a plan to reposition these businesses to attain the Company's business goals. The plan resulted in pre-tax restructuring charges of $30.4 million. The principal actions in the repositioning plan include reduction of excess manufacturing capacity, changes in distribution channels, consolidation and re-engineering of support infrastructure, disposal of under-utilized assets, withdrawal from certain unprofitable product lines, disposal of excess property and general cost reductions. The repositioning plan will result in the termination of the jobs of approximately 1,000 non-DOE employees; the net workforce reduction will be approximately 800 non-DOE employees. The reduction through January 1, 1995 was 200 employees. These combined actions are expected to result in pre-tax savings of approximately $17 million in 1995 and annualized pre-tax savings of approximately $30 million starting in 1996. The major components of the restructuring charges were $21 million of employee separation costs, $4.9 million of noncash charges to dispose of certain product lines and assets through sale or abandonment and $4.5 million of charges to terminate lease and other contractual obligations no longer required as a result of the repositioning plan. The charges do not include additional costs associated with the repositioning plan, such as voluntary early retirement programs, training, consulting, purchases of equipment and relocation of employees and equipment. These costs will be charged to operations or capitalized, as appropriate, when incurred. The implementation of this plan commenced during the second half of 1994 with a cash outlay of $4 million for termination costs; $21.5 million of additional cash outlays will occur, mainly in 1995. Technical Services: The $22.7 million decrease resulted primarily from reductions in the automotive testing business due to the $4.7 million impact of lower sales and, to a lesser extent, from increased costs. A reduction at the KSC of $5.1 million was due to the lower fee on the new base operations contract. In addition, a $3.3 million decrease resulted from unfavorable 1994 contract adjustments compared to favorable 1993 contract settlements. Restructuring charges of $1.6 million and early retirement costs also contributed to the decrease. The repositioning plan is not expected to have a significant direct impact on future results in this segment since cost reductions primarily relate to operations with cost reimbursable contracts. However, the Company does expect to be more competitive in bidding for future procurements as a result of cost reductions. Instruments: The Instruments loss of $49.6 million resulted primarily from a goodwill write-down of $39.2 million related to the Berthold business acquired in 1989, and restructuring charges of $16.5 million. The remainder of the decrease resulted from costs associated with delays in the introduction of new diagnostic products, the impact that the strengthening of the Finnish markka had on Wallac's results, higher royalty expense and expenses related to the closedown of a research and development project. Partially offsetting these decreases were $2.5 million of cost reductions in the nuclear business. The repositioning plan is expected to result in annualized cost reductions of approximately $13 million starting in 1996. Mechanical Components: The decrease of $5.6 million resulted from $2.7 million of restructuring charges, a provision for environmental remediation costs of $1.3 million and increased start-up costs for the transportation element of the electromechanical business. The repositioning plan is expected to result in annualized cost savings of approximately $3 million starting in 1996. Optoelectronics: Profits resulting from higher flash product shipments and the continued benefit of cost reductions implemented in 1993 were offset by $8.6 million of restructuring charges and, to a lesser extent, the impact of lower sales on a government contract. In addition, the results reflected a $1.1 million write-off of a small unit's goodwill. The repositioning plan is expected to 9 19 result in annual cost savings of approximately $7 million starting in 1996. However, the Company anticipates future increases in research and development expenses and capital expenditures to support product development initiatives in this segment. General Corporate Expenses: The increase was due to $1 million of restructuring charges, $1 million of consulting costs that were associated with the repositioning plan, $1 million of separation costs incurred during the first six months of the year plus general cost increases. The repositioning plan is expected to result in annual savings of $7 million in Corporate and other expenses starting in 1996. Other: The net change in other income (expense) was due to the write-down in the third quarter of certain investments by $1.8 million to their realizable value as the result of the decision to restructure associated operations and to liquidate the Company's position in investments no longer consistent with its strategic direction. During the fourth quarter, the Company wrote down certain investments by $2.7 million due to a reduction in their expected realizable value based upon the deterioration in the financial condition of the company/partnership. The 1994 tax provision and effective rate for continuing operations were significantly impacted by the goodwill write-down and the restructuring charges. The Company has not recorded any tax benefit from the goodwill write-down and approximately $11 million of the restructuring charges because these charges, while tax deductible, will be incurred in tax jurisdictions where the Company has existing operating loss carryforwards. At the present time, the Company believes that it is more likely than not that these benefits will not be realized. In 1994, the Company increased its discount rates for employee benefit plans as a result of the increase in long-term interest rates. The effects of the higher discount rates were partially offset by an increase in the assumption for compensation increases. The net result of these changes will not materially affect the Company's results of operations. Effective January 2, 1995, the Company will change its method of depreciation for certain classes of plant and equipment from an accelerated method to the straight-line method. The Company believes that the straight-line method will more appropriately reflect the timing of the future economic benefits to be received from these assets, which consist mainly of manufacturing equipment. Discontinued Operations: During the third quarter of 1994, the Company announced a plan to exit the DOE business and decided not to seek renewal of its remaining four DOE contracts, although it intends to continue to meet its obligations under the terms and conditions of the present contracts. The Company will not compete for management and operations contracts at other DOE facilities. Accordingly, the Company is reporting the former DOE Support segment as discontinued operations for all periods presented in the Consolidated Financial Statements incorporated herein by reference. The Company's contract to manage the Idaho National Engineering Laboratory expired September 30, 1994 and contributed $240 million of sales and $7.3 million of operating income to discontinued operations in 1994. The Company's remaining management and operations contracts with the DOE have terms expiring as follows: Reynolds Electrical and Engineering Co., Inc. -- December 31, 1995 EG&G Energy Measurements, Inc. -- December 31, 1995 EG&G Rocky Flats, Inc. -- December 31, 1995 EG&G Mound Applied Technologies, Inc. -- September 30, 1996 Expiration dates may be modified by the DOE in accordance with contract terms. The DOE has notified the Company of its intention to expedite the procurement and award of the Rocky Flats contract, which is expected to result in termination of the Company's contract on or about June 30, 1995. 10 20 Income from discontinued operations, net of income taxes, was $1.5 million above the 1993 level. The increase resulted from a cost/productivity improvement fee of $7.3 million earned at Rocky Flats offset partially by a fee reduction reflecting the expiration of the Idaho contract in September 1994. Future sales and income from discontinued operations will decrease as the remaining DOE contracts expire in 1995 and 1996 and are dependent upon work scopes and fee pools negotiated annually that are currently under review by the DOE. Environmental: The Company is conducting a number of environmental investigations and remedial actions at current and former Company locations and, along with other companies, has been named a potentially responsible party for certain waste disposal sites. The Company accrues for environmental issues in the accounting period that the Company's responsibility is established and when the cost can be reasonably estimated. As of January 1, 1995, the Company had an accrual of $2.4 million to reflect its estimated liability for environmental remediation. As assessments and remediation activities progress at each individual site, these liabilities are reviewed to reflect additional information as it becomes available. There have been no environmental problems to date that had or are expected to have a material effect on the Company's financial position or results of operations. While it is reasonably possible that a material loss exceeding the amounts recorded may have been incurred, the preliminary stages of the investigations make it impossible for the Company to reasonably estimate the range of potential exposure. 1993 COMPARED TO 1992 SALES FROM CONTINUING OPERATIONS Sales of $1,319 million for 1993 were level with 1992 sales. Technical Services: The $27 million increase resulted from an increase of $24 million in automotive testing services caused primarily by the introduction of new industry testing protocols, partially offset by a $10 million reduction in contract billings at the KSC. Instruments: The $10 million increase resulted from the $43 million of sales of Wallac, acquired in June 1993, partially offset by reduced scientific, industrial and security instruments sales reflecting sluggish market conditions, lower foreign exchange rates and large orders shipped in 1992. Mechanical Components: The $29 million decrease was attributable to a $21 million reduction in aerospace sales due primarily to continued softness in this market and, to a lesser extent, the divestiture of two operations. Optoelectronics: The $9 million decrease was due mainly to the completion of several programs in 1992, partially offset by the sales of Heimann Optoelectronics, which was acquired early in the second quarter of 1992. OPERATING INCOME FROM CONTINUING OPERATIONS Operating income from continuing operations was $87.5 million in 1993, a 27% increase over 1992. Technical Services: The $11.8 million increase was due primarily to higher sales and improved margins in the automotive testing services business. In October 1993, the Company was selected by NASA to continue as the base operations contractor at the KSC. The contract has a potential term of 10 years, including options, contains reductions in contract value and has resulted in reductions in the annual fee. Instruments: The $5.6 million decrease resulted from lower sales of scientific, industrial and security instruments partially offset by the income associated with the Wallac acquisition. 11 21 Mechanical Components: Improved profitability resulting from cost reduction programs in the industrial sealing and electromechanical businesses more than offset the impact of lower aerospace sales, generating a $2.6 million increase. Optoelectronics: The $7.6 million increase was due to improved profitability as a result of cost reductions at Heimann Optoelectronics. The 1992 results included a charge of $6.3 million for the write-down of the net assets of two businesses to their estimated disposal value. General Corporate Expenses: The $2.3 million decrease was due to the absence of corporate management incentives in 1993. Other: The net change in other income (expense) was an increase in income of $3.1 million. This was primarily due to gains on investments. The 1993 effective tax rate of 38.3% for continuing operations was higher than the 26.9% in 1992 primarily because the 1992 rate reflected a favorable adjustment of prior estimated tax liabilities and the tax benefit resulting from the sale of an investment in a hydroelectric power plant. The Company reduced its discount rate for employee benefit plans in 1993 as a result of the decrease in long-term interest rates. The effects of the lower discount rates were partially offset by corresponding reductions in assumptions for compensation increases and health care cost trend rates. Discontinued Operations: The $14.1 million decrease in income from discontinued operations, net of income taxes, was primarily attributable to Rocky Flat's lower grades and a reduction of available fee pool. In addition, 1992 results included a favorable profit adjustment due to higher than anticipated performance grades at year-end 1991. Lower grades on the Idaho contract also contributed, to a lesser extent, to the decrease. Accounting Changes: During the first quarter of 1993, the Company adopted Statement of Financial Accounting Standards (SFAS) No. 106 on accounting for post-retirement benefits other than pensions for its U.S. retiree health benefits and SFAS No. 109 on accounting for income taxes. The adoption of SFAS No. 106 resulted in an after-tax charge of $13.2 million ($.23 per share) while the charge for SFAS No. 109 was $7.3 million ($.13 per share). See Notes 12 and 13 to the Consolidated Financial Statements incorporated herein by reference for additional disclosures. FINANCIAL CONDITION The Company's cash and cash equivalents decreased $5.8 million in 1994 while commercial paper borrowings increased $14.9 million. Net cash provided by operating activities was $95.9 million in 1994, $112.1 million in 1993 and $127.8 million in 1992. The net cash provided by discontinued operations in 1994 was lower than in 1993 due to a $10.1 million reduction in receivables in 1993, which did not occur in 1994. The net cash provided by continuing operations was lower in 1994 reflecting lower earnings, partially offset by a net reduction in working capital. The net cash provided was principally used for capital expenditures, acquisitions, cash dividends and in 1994 and 1993, for stock repurchases in excess of proceeds from issuing stock. In 1994, lower purchases of common stock and proceeds from issuing common stock were due to the termination of an employee stock purchase plan in 1993. The implementation of the repositioning plan commenced during 1994 with a cash outlay of $4 million for termination costs with future cash outlays of $21.5 million, mainly in 1995. Additional cash outlays of approximately $10 million will be required to support the repositioning plan in 1995. Proceeds from asset dispositions, the liquidation of certain investments and pre-tax repositioning savings in 1995 are anticipated to result in neutral or slightly positive net cash flows from the repositioning plan by the end of 1995. The repositioning plan is expected to improve annual cash flow by an estimated $20 million starting in 1996. In addition, the Company has implemented an aggressive working capital reduction program. 12 22 Discontinued operations generated cash of $25.5 million in 1994. Future cash flows from discontinued operations will decrease due to the expiration of the Idaho contract in 1994 and the expiration of the remaining DOE contracts in 1995 and 1996. Capital expenditures were $37.3 million in 1994, an increase of $9.4 million over the 1993 level, and are expected to exceed $80 million in 1995. These increases support new product development initiatives, primarily in the Optoelectronics segment. In the fourth quarter of 1993, the Board of Directors authorized the purchase of up to a total of 5.5 million shares of the Company's common stock through periodic purchases on the open market. The Company has purchased 2.2 million shares under this program as of January 1, 1995, including 1.1 million shares purchased in the first quarter of 1994 at a cost of $19.1 million. No shares were purchased under the program during the last nine months of 1994. On January 25, 1995, the Board of Directors authorized the purchase of an additional 10 million shares. As a result, the Company had authorization as of January 25, 1995 to purchase a total of 13.3 million shares. The Company will finance these activities with a combination of short-term and long-term debt and cash flows from operations. The Company believes it can take these actions and maintain its product development and growth strategies. The Company's credit facilities consist of a $175 million, 364-day facility, which expires in March 1996, and a $75 million, three-year facility which expires in March 1998. These agreements serve as backup facilities for commercial paper borrowing by the Company, which has been its principal source of debt financing. The Company did not draw down either of these credit facilities during 1994. The Company has only limited involvement with derivative financial instruments and does not use them for trading purposes. The Company uses forward exchange contracts to hedge certain foreign commitments and transactions denominated in foreign currencies. The contract amount of forward exchange contracts was $24.5 million as of January 1, 1995. The terms range from one to three months, corresponding with expected collections or payments. There are no cash requirements until maturity. Credit risk is minimal as the contracts are with very large banks; any market risk is offset by the exposure on the underlying hedged items. Gains and losses on forward contracts are deferred and offset against foreign exchange gains and losses on the underlying hedged items. DIVIDENDS In January 1995, the Board of Directors declared a regular quarterly cash dividend of 14 cents per share, resulting in an annual rate of 56 cents per share for 1995. EG&G has paid cash dividends, without interruption, for 30 years and continues to retain what management believes to be sufficient earnings to support the funding requirements of its planned growth. DESCRIPTION OF DEBT SECURITIES The following description of the Debt Securities sets forth certain general terms and provisions of the Debt Securities to which any Prospectus Supplement may relate. The particular terms of the Debt Securities offered by any Prospectus Supplement (the "Offered Debt Securities") and the extent, if any, to which such general provisions may apply to the Debt Securities so offered will be described in the Prospectus Supplement or Prospectus Supplements relating to such Offered Debt Securities. The Offered Debt Securities are to be issued under an Indenture dated as of , 1995, as amended and supplemented form time to time (collectively, the "Indenture"), between the Company and The First National Bank of Boston, as Trustee (the "Trustee"). A copy of the Indenture is filed as an exhibit to the Registration Statement. The following summaries of certain provisions of the Debt Securities and the Indenture do not purport to be complete and are subject to, 13 23 and are qualified in their entirety by reference to, all the provisions of the Indenture, including the definition therein of certain terms. Section numbers below refer to provisions of the Indenture. GENERAL The Debt Securities will be unsecured obligations of the Company. The Indenture provides that the Company may establish the following terms with respect to a particular series of Offered Debt Securities: (i) the title of the Offered Debt Securities; (ii) any limit on the aggregate principal amount of the Offered Debt Securities; (iii) the Person to whom any interest on an Offered Debt Security shall be payable, if other than the registered holder; (iv) the date or dates on which principal of the Offered Debt Securities is payable; (v) the price (expressed as a percentage of the aggregate principal amount thereof) at which the Offered Debt Securities will be issued; (vi) the date or dates on which the Offered Debt Securities will mature; (vii) the rate or rates (which may be fixed or variable) at which the Offered Debt Securities will bear interest, if any; (viii) the date from which such interest, if any, will be payable, the date on which payment of such interest, if any, will commence and the Regular Record Dates for such Interest Payment Dates, if any; (ix) the place or places where the principal of and any premium or interest on the Offered Debt Securities shall be payable; (x) the dates, if any, on which the price or prices at which the Offered Debt Securities will, pursuant to any mandatory sinking fund provisions, or may, pursuant to any optional sinking fund provisions, be redeemed by the Company, and the other detailed terms and provisions of any such sinking fund; (xi) the date, if any, after which the price or prices at which the Offered Debt Securities may, pursuant to any optional redemption provisions, be redeemed at the option of the Company or of the Holder thereof and the other detailed terms and provisions of such optional redemption; (xii) the denominations if other than denominations of $1,000 and integral multiples thereof in which the Offered Debt Securities shall be issuable; (xiii) the currency or currencies of denomination and payment and the manner for determining the outstanding amount of such Offered Debt Securities; (xiv) if the currency or currencies of payment are at the Company's or Holder's election, the manner in which such election may be made; (xv) if the amount of payments of principal or any premium or interest on the Offered Debt Securities may be determined with reference to an index, the manner in which such amounts shall be determined; (xvi) if other than the principal amount thereof, the portion of the principal amount of the Offered Debt Securities which shall be payable upon acceleration of the maturity of such Offered Debt Securities; (xvii) the application of defeasance provisions to the Offered Debt Securities and the terms and provisions under which the Company may substitute money or U.S. Government Obligations previously deposited pursuant to the terms of the Indenture; (xviii) any additional restrictive covenants included for the benefit of Holders of the Offered Debt Securities and any deletions or other changes to the provisions of sections 801, 1006, 1007 and 1008 of the Indenture; (xix) any additional Events of Default provided with respect to the Offered Debt Securities and any deletions or other changes to the Events of Default contained in the Indenture; (xx) whether the Offered Debt Securities will be issued in whole or in part in the form of one or more Global Securities and, if so, the Depositary for such Global Securities; and (xxi) any other terms of the Offered Debt Securities. (Section 301) Principal, premium, if any, and interest, if any, will be payable, and the Debt Securities will be transferable, at the Place of Payment designated for such Debt Securities, provided that payment of interest may, at the option of the Company, be made by check mailed to the address of the Person entitled thereto as it appears in the Security Register. (Section 1001, 1002) The Debt Securities will be issued only in fully registered form, without coupons, and, unless otherwise indicated in the Prospectus Supplement or Prospectus Supplements relating thereto, in denominations of $1,000 or any integral multiple thereof. (Section 302) No service charge will be made for any registration of transfer or exchange of the Offered Debt Securities, but the Company may require payment of a sum sufficient to cover any tax or other governmental charge payable in connection therewith. (Section 305) 14 24 Debt Securities may be issued under the Indenture as Original Issue Discount Securities to be offered and sold at a discount below their stated principal amount. Federal income tax consequences and other special considerations applicable to any such Original Issue Discount Securities will be described in the Prospectus Supplement or Prospectus Supplements relating thereto. "Original Issue Discount Security" means any security which provides for an amount less than the principal amount thereof to be due and payable upon a declaration of acceleration of the Maturity thereof. (Section 101) The Debt Securities are obligations exclusively of the Company. Because the operations of the Company are currently conducted primarily through subsidiaries, the cash flow and the consequent ability to service debt of the Company, including the Debt Securities, are dependent upon the earnings of its subsidiaries and the distribution of those earnings to the Company or upon loans or other payments of funds by those subsidiaries to the Company. Although the Company exerts control over its subsidiaries as the ultimate parent entity of each subsidiary, there can be no assurance that legal constraints or other considerations will permit the Company's subsidiaries to make available to the Company sufficient funds to satisfy the Company's payment obligations on the Debt Securities. In addition, the Debt Securities will be effectively subordinated to all liabilities, including trade payables, of the Company's subsidiaries. Any right of the Company to receive assets of any of its subsidiaries upon the liquidation or reorganization of the subsidiary (and the consequent right of the holders of the Debt Securities to participate in those assets) will be effectively subordinated to the claims of that subsidiary's creditors (including trade creditors), except to the extent that the Company is itself recognized as a creditor of such subsidiary. Unless otherwise indicated in the Prospectus Supplement relating to the Offered Debt Securities, the covenants contained in the Indenture and the Offered Debt Securities would not necessarily afford Holders of the Offered Debt Securities protection in the event of a highly leveraged or other transaction involving the Company that may adversely affect Holders. RESTRICTED AND UNRESTRICTED SUBSIDIARIES The various restrictive provisions of the Indenture applicable to the Company and its Restricted Subsidiaries do not apply to Unrestricted Subsidiaries. The assets and indebtedness of Unrestricted Subsidiaries are not consolidated with those of the Company and its Restricted Subsidiaries in calculating Consolidated Net Tangible Assets under the Indenture and investments by the Company or by its Restricted Subsidiaries in Unrestricted Subsidiaries are excluded in computing Consolidated Net Tangible Assets. "Unrestricted Subsidiaries" are those Subsidiaries which are designated as Unrestricted Subsidiaries by the Board of Directors from time to time pursuant to the Indenture (in each case, unless and until designated as Restricted Subsidiaries by the Board of Directors pursuant to the Indenture) and any Subsidiary a majority of the voting stock of which is owned by Unrestricted Subsidiaries. "Restricted Subsidiaries" are all Subsidiaries other than Unrestricted Subsidiaries. A "Wholly-owned Restricted Subsidiary" is a Restricted Subsidiary all of the capital stock of which (except directors' qualifying shares) is owned by the Company and its other Wholly-owned Restricted Subsidiaries. (Section 101) An Unrestricted Subsidiary may not be designated a Restricted Subsidiary unless the Company would be permitted immediately thereafter to incur additional Secured Funded Debt under the terms of the Indenture. (Section 1008) RESTRICTIONS ON SECURED FUNDED DEBT The Company may not, and may not permit any Restricted Subsidiary to, issue, assume, guarantee, incur or create any Secured Funded Debt without first making effective provision whereby the Debt Securities having the benefit of the restrictions on Secured Funded Debt shall be secured equally and ratably with (or prior to) such Secured Funded Debt. The foregoing restriction does not prevent (i) Secured Funded Debt of the Company or of a Restricted Subsidiary owing to the Company or another Restricted Subsidiary, (ii) Secured Funded Debt resulting from a Lien on 15 25 property of the Company or any Restricted Subsidiary in favor of the United States or any state or any instrumentality thereof to secure partial, progress, advance or other payments, (iii) Secured Funded Debt secured by a Lien on property of, or on any shares of stock or indebtedness of, any Person at the time it becomes a Restricted Subsidiary, (iv) Secured Funded Debt secured by a Lien on property, shares of stock or indebtedness existing at or incurred within 120 days of the time of acquisition (including acquisition through merger or consolidation) or lease thereof, (v) Secured Funded Debt secured by a Lien incurred or assumed in connection with an issuance of revenue bonds the interest on which is exempt from federal income tax pursuant to Section 103(a) and related sections of the Internal Revenue Code of 1986, as amended, (vi) as to any series of Offered Debt Securities, any Secured Funded Debt existing on the date of issuance of the series, (vii) Secured Funded Debt secured by a Lien on property of a corporation existing at the time such corporation is merged or consolidated with the Company or a Restricted Subsidiary or at the time of a sale, lease or other disposition of the properties of a corporation as an entirety or substantially as an entirety to the Company or a Restricted Subsidiary, (viii) Secured Funded Debt incurred to purchase inventory, equipment or other property acquired or held by the Company or any Restricted Subsidiary that is secured by a lien on the property so acquired or to construct or improve any property of the Company or any Restricted Subsidiary, (ix) Secured Funded Debt if immediately after its incurrence the sum of the aggregate amount of all outstanding Secured Funded Debt of the Company and its Restricted Subsidiaries incurred under this clause (ix) together with all Attributable Debt of the Company and its Restricted Subsidiaries in respect of Sale and Leaseback Transactions does not exceed 10% of Consolidated Net Tangible Assets, and (x) any extension, renewal or replacement (or successive extensions, renewals or replacements) in whole or in part of any Secured Funded Debt described above. (Section 1006) "Secured Funded Debt" means Funded Debt which is secured by a Lien upon any assets of the Company or a Restricted Subsidiary. (Section 101) "Funded Debt" means indebtedness of the Company or any Restricted Subsidiary for borrowed money maturing more than 12 months after the time of computation thereof, guaranties of indebtedness for borrowed money maturing more than 12 months after the time of computation thereof of any other Person (except guaranties in connection with the sale or discount of accounts receivable, trade acceptances and other instruments arising in the ordinary course of business) and indebtedness for borrowed money maturing more than 12 months after the time of computation thereof secured by a Lien on property of the Company or any Restricted Subsidiary, whether or not assumed by the Company or such Restricted Subsidiary. Funded Debt does not include any amount in respect of obligations under leases (or guaranties thereof), including Attributable Debt, or any accrued liabilities with respect to any pension plans or post-retirement medical plans, whether or not any such obligations would be included as liabilities on a consolidated balance sheet of the Company and its Restricted Subsidiaries. (Section 101) "Attributable Debt" means, with respect to any Sale and Leaseback Transaction (as defined below), (i) the balance sheet liability amount of any capital lease entered into pursuant to such Sale and Leaseback Transaction determined under generally accepted accounting principles, plus (ii) the present value at the time of determination of (a) the amount of future minimum lease payments under any operating lease entered into pursuant to such Sale and Leaseback Transaction required to be disclosed by generally accepted accounting principles, less (b) any amounts required to be paid on account of maintenance and repairs, insurance, taxes, assessments, water rates and similar charges, calculated using a discount rate equivalent to the Company's weighted average cost of funds for borrowed money at the time of the commencement of each such operating lease. (Section 101) "Consolidated Net Tangible Assets" means the total amount of assets on a consolidated balance sheet of the Company and its Restricted Subsidiaries (less applicable reserves and other properly deductible items and after excluding any investments made in Unrestricted Subsidiaries) after deducting (i) all liabilities, including Attributable Debt and including all other amounts in 16 26 respect of obligations under leases (or guaranties thereof), which under generally accepted accounting principles would be included on such balance sheet, but excluding Funded Debt, accrued long-term liabilities with respect to any pension plans or post-retirement medical plans, capital stock and surplus, surplus reserves and provisions for deferred income taxes, and (ii) goodwill, tradenames, trademarks, patents, unamortized debt discount and expense and other intangible items. (Section 101) "Lien" means any mortgage, pledge, lien, encumbrance, charge or security agreement. RESTRICTIONS ON SALE AND LEASEBACK TRANSACTIONS Neither the Company nor any Restricted Subsidiary may enter into any Sale and Leaseback Transaction involving any Principal Property unless (a) the Company or such Restricted Subsidiary could create Secured Funded Debt on such property pursuant to Section 1006 (see "Restriction on Secured Funded Debt" above) in an amount at least equal to the Attributable Debt with respect to the Sale and Leaseback Transaction without equally and ratably securing the Debt Securities or (b) the Company, within 120 days, applies to the retirement of its Secured Funded Debt an amount equal to the greater of (i) the net proceeds of the sale of the Principal Property leased pursuant to such arrangement or (ii) the fair value, as determined by the Company, of the Principal Property at the time of the Sale and Leaseback Transaction. "Sale and Leaseback Transaction" means any arrangement with any Person pursuant to which the Company or any Restricted Subsidiary sells or transfers any Principal Property more than 120 days after the acquisition thereof or, if later, the completion of construction and commencement of full operations thereof, to such Person and leases from such Person the Principal Property so sold or transferred, other than a transaction (a) between the Company and a Restricted Subsidiary or between Restricted Subsidiaries, or (b) involving the taking back of a lease for a period for three years or less. (Section 101) "Principal Property" is defined as any real property of the Company or any Restricted Subsidiary, and any equipment located at or comprising a part of any such property, having a net book value, as of the date of determination, in excess of the greater of $20,000,000 and 5% of Consolidated Net Tangible Assets of the Company. (Section 101) RESTRICTIONS ON MERGER AND SALE OF ASSETS The Company may not consolidate with or merge into any other Person, or transfer all or substantially all of its properties and assets to another Person or group of affiliated Persons, unless (i) either the Company shall be the continuing corporation or the Person formed by or resulting from any such consolidation or into which the Company is merged or which shall have received the transfer of such properties and assets) shall be a corporation, partnership or trust organized and validly existing under the laws of the United States or any state thereof or the District of Columbia, and shall expressly assume all obligations of the Company under the Indenture and the Debt Securities and the performance and observance of the covenants of the Indenture, (ii) immediately after giving effect to such transaction and the assumption of the Debt Securities, no Event of Default and no event which, after notice or lapse of time or both, would become an Event of Default, shall have occurred and be continuing, and (iii) except in the case of a merger or consolidation of the Company and a Restricted Subsidiary, either (a) the Holders of a majority in aggregate principal amount of the Outstanding Debt Securities of each series shall have consented thereto or (b) immediately thereafter, under the terms of Section 1006(9) of the Indenture, the successor corporation would be permitted to incur at least $1.00 of Secured Funded Debt without first making effective provision whereby the Debt Securities shall be secured equally and ratably with (or prior to) such Secured Funded Debt. (Section 801) The Holders of at least a majority in principal amount of the Outstanding Debt Securities of any series may on behalf of the Holders of the Debt Securities of that series waive, insofar as that series is concerned, compliance by the Company with certain restrictive provisions of the Indenture. (Section 1009) 17 27 EVENTS OF DEFAULT The Indenture defines an Event of Default with respect to any series of Debt Securities as being any one of the following events: (i) default in any payment of interest on such series, and the continuance of such default for a period of 30 days; (ii) default in any payment of principal of (or premium, if any, on) such series when due; (iii) default in the deposit of any sinking fund payment with respect to such series when due; (iv) default for 90 days after appropriate notice in performance, or breach, of any other covenant or warranty in the Indenture (other than a covenant or warranty included in the Indenture solely for the benefit of a series of Debt Securities other than that series); (v) default under any bond, debenture, note or other evidence of indebtedness for money borrowed by the Company (including a default with respect to Debt Securities other than that series) or under any mortgage, indenture or instrument under which any such indebtedness is issued or secured (including the Indenture), which default results in indebtedness in excess of $15,000,000 in aggregate principal amount becoming or being declared due and payable prior to the date on which it would otherwise have become due and payable, without such acceleration having been annulled or rescinded (or if such indebtedness is not discharged) within 20 days after written notice as provided in the Indenture; (vi) certain events of bankruptcy, insolvency or reorganization; or (vii) any other Event of Default provided with respect to Debt Securities of that series. (Section 501) In case an Event of Default shall occur and be continuing with respect to any series of Debt Securities, the Trustee or the Holders of not less than 25% in principal amount of the Outstanding Debt Securities of that series may declare the principal amount of such series (or, if the Debt Securities of that series are Original Issue Discount Securities, such portion of the principal amount as may be specified in the terms of that series) to be due and payable. (Section 502) Any Event of Default with respect to a particular series of Debt Securities may be waived by the Holders of a majority in principal amount of the Outstanding Debt Securities of such series, except (a) in each case a failure to pay principal of, premium, if any, or interest on such Debt Security or (b) in respect of a covenant or provision which under the Indenture cannot be modified or amended without the consent of the Holder of each Outstanding Debt Security of that series affected. (Section 513) Reference is made to the Prospectus Supplement or Prospectus Supplements relating to each series of Offered Debt Securities which are Original Issue Discount Securities for the particular provisions relating to acceleration of the Maturity of a portion of the principal amount of such Original Issue Discount Securities upon the occurrence of an Event of Default and the continuation thereof. The Indenture requires the Company to file annually with the Trustee an Officers' Certificate as to the absence of certain defaults under the terms of the Indenture. (Section 1004) The Indenture provides that the Trustee may withhold notice to the Holders of the Debt Securities of any default (except in payment of principal, premium, if any, or interest or any sinking fund installment) if it considers it in the interest of the Holders of the Debt Securities to do so. (Section 602) Subject to the provisions of the Indenture relating to the duties of the Trustee in case an Event of Default shall occur and be continuing, the Indenture provides that the Trustee shall be under no obligation to exercise any of its rights or powers under the Indenture at the request, order or direction of the Holders of the Debt Securities unless such Holders shall have offered to the Trustee reasonable indemnity. (Section 603) Subject to such provisions for indemnification and certain other rights of the Trustee, the Indenture provides that the Holders of a majority in principal amount of the Outstanding Debt Securities of any series affected shall have the right to direct the time, method and place of conducting any proceeding for any remedy available to the Trustee or exercising any trust or power conferred on the Trustee with respect to the Debt Securities of such series. (Section 512) No Holder of any Debt Security of any series will have any right to institute any proceedings with respect to the Indenture or for the appointment of a receiver or for any remedy thereunder, unless such Holder shall have previously given to the Trustee written notice of a continuing Event of Default 18 28 with respect to Debt Securities of that series and unless also the Holders of at least 25% in aggregate principal amount of the Outstanding Debt Securities of that series shall have made written request, and offered reasonable indemnity, to the Trustee to institute such proceedings as trustee, the Trustee shall have failed to institute such proceedings within 60 days thereafter and the Trustee shall not have received during such 60-day period from the Holders of a majority in principal amount of the Outstanding Debt Securities of that series a direction inconsistent with such request. (Section 507) However, the Holder of any Debt Security will have an absolute right to receive payment of the principal of, premium, if any, and interest on such Debt Security on or after the due dates expressed in such Debt Security and to institute suit for the enforcement of any such payment. (Section 508) DEFEASANCE AND DISCHARGE Defeasance of Certain Covenants and Certain Events of Default. Unless the terms of the Debt Securities of any series provide to the contrary, the Company may omit to comply with certain restrictive covenants in Section 801 (Consolidation, Merger, Conveyance, Transfer or Lease), Section 1006 (Limitation on Secured Funded Debt), Section 1007 (Limitation on Sale and Leasebacks), Section 1008 (Limitation on Designation of Unrestricted Subsidiary as Restricted Subsidiary), and the events described in clauses (iv) through (vii) under "Events of Default" above shall not be deemed to be Events of Default under the Indenture with respect to such series, if (a) the Company deposits with the Trustee, in trust, money and/or U.S. Government Obligations which through the payment of interest and principal in respect thereof in accordance with their terms will provide money in an amount sufficient to pay and discharge (i) each installment of principal (and premium, if any) and interest on the Outstanding Debt Securities of such series on the Stated Maturity of such installment of principal or interest and (ii) any mandatory (or, if applicable, optional) sinking fund payments applicable to the Offered Debt Securities of such series on the day on which such payments are due and payable, (b) no Event of Default or event (including such deposit) which with notice or lapse of time would become an Event of Default with respect to the Debt Securities of such series shall have occurred and be continuing on the date of such deposit and (c) the Company delivers to the Trustee an Opinion of Counsel, satisfying the requirements of the Indenture, to the effect that the Holders of the Debt Securities of such series will not recognize income, gain or loss for Federal income tax purposes as a result of such defeasance and will be subject to Federal income tax on the same amount, in the same manner and at the same times as would have been the case if such defeasance had not occurred. (Section 403) In such event, the obligations of the Company under the Indenture and the Debt Securities other than with respect to the covenants referred to above and the Events of Default other than the Events of Default referred to above shall remain in full force and effect. In the alternative, upon compliance with the provisions of Section 403 with respect to any series of Debt Securities, the Company may elect to be deemed to have paid and discharged the entire indebtedness represented by the Offered Debt Securities of such series and to have satisfied its obligations under the Indenture, other than the rights of Holders to receive payment from the trust funds held by the Trustee and the Company's obligation to provide for the registration of Offered Debt Securities, to replace mutilated, destroyed, lost and stolen Offered Debt Securities, to apply properly any money held in trust by the Company and to maintain an office where Offered Debt Securities may be presented for payment. In the event the Company exercises its option to omit compliance with certain covenants of the Indenture with respect to the Debt Securities of any series as described above and the Debt Securities of such series are declared due and payable because of the occurrence of any Event of Default other than Events of Default described in clauses (iv) through (vii) under "Events of Default" above, the amount of money and/or U.S. Government Obligations on deposit with the Trustee will be sufficient to pay amounts due on the Debt Securities of such series on their Stated Maturity or Redemption Date, but may not be sufficient to pay amounts due on such Debt Securities at the time of the acceleration resulting from such Event of Default. 19 29 Substitution of Collateral. If the terms of a series of Debt Securities so provide, the Company will be permitted at any time to withdraw any money or U.S. Government Obligations deposited pursuant to the foregoing defeasance provisions, provided that the Company in substitution therefor simultaneously deposits money and/or U.S. Government Obligations which would then be sufficient to satisfy the Company's payment obligations in respect of the Debt Securities in the manner contemplated by such defeasance provisions. PLAN OF DISTRIBUTION The Company may sell the Debt Securities in and/or outside the United States (i) through underwriters, (ii) through dealers acting as principal or as agent, (iii) directly to a limited number of purchasers or to a single purchaser, or (iv) through agents. The applicable Prospectus Supplement with respect to the Offered Debt Securities will set forth the terms of the offering of such Offered Debt Securities, including the name or names of any underwriters, the purchase price of such Offered Debt Securities and the proceeds to the Company from such sale, any delayed delivery arrangements, any underwriting discounts and other items constituting underwriters' compensation, the initial public offering price and any discounts or concessions allowed or reallowed or paid to dealers. The initial public offering price and any discounts or concessions allowed or reallowed or paid to dealers may be changed from time to time. If underwriters are used in the sale, the Offered Debt Securities will be acquired by the underwriters for their own account and may be resold from time to time in one or more transactions, including negotiated transactions, at a fixed public offering price or at varying prices determined at the time of sale. The Offered Debt Securities may be offered to the public either through underwriting syndicates represented by one or more managing underwriters or directly by one or more firms acting as underwriters. The underwriter or underwriters with respect to a particular underwritten offering of Offered Debt Securities will be named in the Prospectus Supplement relating to such offering and, if an underwriting syndicate is used, the names of the managing underwriter or underwriters will be set forth on the cover of such Prospectus Supplement. Unless otherwise set forth in a Prospectus Supplement, the obligations of the underwriters to purchase the Offered Debt Securities covered thereby will be subject to conditions precedent, and the underwriters will be obligated to purchase all such Offered Debt Securities if any are purchased. If dealers are utilized in the sale of the Offered Debt Securities, the Company will sell such Offered Debt Securities to the dealers acting as principals or agents. The dealers may then resell such Offered Debt Securities to the public at varying prices to be determined by such dealers at the time of resale. The terms of the transaction will be set forth in the Prospectus Supplement relating thereto to the extent required by the Securities Act. The Debt Securities may be sold directly by the Company or through agents designated by the Company from time to time. Any agent involved in the offer or sale of the Offered Debt Securities will be named, and any commissions payable by the Company to such agent will be set forth, in the Prospectus Supplement relating thereto to the extent required by the Securities Act. Unless otherwise indicated in the Prospectus Supplement, any such agent will be acting on a best efforts basis for the period of its appointment. The Debt Securities may be sold directly by the Company to institutional investors or others, who may be deemed to be underwriters within the meaning of the Securities Act with respect to any resale thereof. The terms of any such sales, including the terms of any bidding or auction process, will be described in the Prospectus Supplement relating thereto. If so indicated in the applicable Prospectus Supplement, the Company will authorize agents, underwriters or dealers to solicit offers from certain types of institutions to purchase Offered Debt Securities from the Company at the public offering price set forth in the Prospectus Supplement pursuant to delayed delivery contracts providing for payment and delivery on a specific date in the 20 30 future. Such contracts will be subject only to those conditions set forth in the applicable Prospectus Supplement, and the Prospectus Supplement will set forth the commission payable for solicitation of such contracts. Agents, dealers and underwriters may be entitled under agreements entered into with the Company to indemnification by the Company against certain civil liabilities, including liabilities under the Securities Act, or to contribution with respect to payments which such agents, dealers or underwriters may be required to make in respect thereof. Agents, dealers and underwriters may be customers of, engage in transactions with, or perform services for the Company in the ordinary course of business or otherwise. The Debt Securities may or may not be listed on a national securities exchange. No assurances can be given that there will be an active trading market for any of the Debt Securities. EXPERTS The financial statements and schedules of the Company included in the Company's Annual Report on Form 10-K for the year ended January 1, 1995 and incorporated by reference herein have been audited by Arthur Andersen LLP, independent public accountants, as indicated in their reports with respect thereto, and are incorporated by reference herein in reliance upon the authority of said firm as experts in giving said reports. Reference is made to said report with respect to the Company's financial statements, which includes an explanatory paragraph with respect to the change in the methods of accounting for postretirement benefits other than pensions and for income taxes in 1993 and the method of accounting for marketable investments in 1994. Future financial statements of the Company and the reports of Arthur Andersen LLP also will be incorporated by reference in this Prospectus in reliance upon the authority of that firm as experts in giving those reports to the extent said firm has audited those financial statements and consented to the use of their reports thereon. 21 31 ================================================================================ NO PERSON HAS BEEN AUTHORIZED TO GIVE ANY INFORMATION OR TO MAKE ANY REPRESENTATIONS OTHER THAN THOSE CONTAINED IN THIS PROSPECTUS SUPPLEMENT OR THE PROSPECTUS AND, IF GIVEN OR MADE, SUCH INFORMATION AND REPRESENTATIONS MUST NOT BE RELIED UPON AS HAVING BEEN AUTHORIZED. THIS PROSPECTUS SUPPLEMENT AND THE PROSPECTUS DO NOT CONSTITUTE AN OFFER TO SELL OR A SOLICITATION OF AN OFFER TO BUY ANY SECURITIES OTHER THAN THE SECURITIES DESCRIBED IN THIS PROSPECTUS SUPPLEMENT OR AN OFFER TO SELL OR THE SOLICITATION OF AN OFFER TO BUY SUCH SECURITIES IN ANY CIRCUMSTANCES IN WHICH SUCH OFFER OR SOLICITATION IS UNLAWFUL. NEITHER THE DELIVERY OF THIS PROSPECTUS SUPPLEMENT OR THE PROSPECTUS NOR ANY SALE MADE HEREUNDER SHALL, UNDER ANY CIRCUMSTANCES, CREATE ANY IMPLICATION THAT THERE HAS BEEN NO CHANGE IN THE AFFAIRS OF THE COMPANY SINCE THE DATE HEREOF OR THAT THE INFORMATION CONTAINED HEREIN IS CORRECT AS OF ANY TIME SUBSEQUENT TO THE DATE OF SUCH INFORMATION. ------------------ TABLE OF CONTENTS
PAGE ---- PROSPECTUS SUPPLEMENT Use of Proceeds......................... S-3 1995 First Quarter Results.............. S-3 Description of Notes.................... S-6 Underwriting............................ S-8 Legal Matters........................... S-8 PROSPECTUS Available Information................... 2 Incorporation of Certain Documents by Reference............................. 2 The Company............................. 3 Use of Proceeds......................... 7 Summarized Consolidated Financial Data.. 7 Management's Discussion and Analysis of Financial Condition and Results of Operations............................ 8 Description of Debt Securities.......... 13 Plan of Distribution.................... 20 Experts................................. 21
================================================================================ ================================================================================ $ [LOGO EG&G INC.] % NOTES DUE ----------------------------------------- PROSPECTUS SUPPLEMENT ----------------------------------------- GOLDMAN, SACHS & CO. MERRILL LYNCH & CO. ================================================================================ 32 PART II INFORMATION NOT REQUIRED IN PROSPECTUS ITEM 14. OTHER EXPENSES OF ISSUANCE AND DISTRIBUTION Securities and Exchange Commission registration fee.............. $ 51,725 Blue Sky fees and expenses....................................... 10,000* Printing......................................................... 50,000* Legal fees and expenses.......................................... 125,000* Accounting fees and expenses..................................... 85,000* Rating agencies' fees............................................ 120,000* Trustees' fees and expenses...................................... 5,000* Miscellaneous.................................................... 53,275* -------- Total.................................................. $500,000* =========
- --------------- * Estimated ITEM 15. INDEMNIFICATION OF DIRECTORS AND OFFICERS Section 67, Chapter 156B of the General Laws of the Commonwealth of Massachusetts (the "Massachusetts Business Corporation Law") and Article V, Section 9 of the Registrant's By-Laws, to which reference is hereby made, contain provisions authorizing indemnification by the Registrant of directors, officers, employees or agents against certain liabilities and expenses which they may incur as directors, officers, employees or agents or the Registrant or of certain other entities. Section 67, Chapter 156B of the Massachusetts Business Corporation Law provides that the indemnification of directors, officers, employees and agents of a corporation and persons who serve at the corporation's request as directors, officers, employees and agents of another organization may be provided to whatever extent as shall be specified by (i) the Articles of Organization of the corporation or (ii) a By-law adopted by the stockholders or (iii) a vote adopted by the holders of a majority of the shares of stock entitled to vote on the election of directors. Unless otherwise provided in the Articles of Organization or the By-laws, the indemnification of any persons described above who are not directors of the corporation may be provided by the corporation to the extent authorized by the directors. Such indemnification may include payment by the corporation of expenses incurred in defending a civil or criminal action or proceeding prior to the final disposition of such action or proceeding, upon receipt of an undertaking by the indemnified person to repay such payment if he shall be adjudicated to be not entitled to indemnification under Section 67 of the Massachusetts Business Corporation Law. Any indemnification may be provided although the person to be indemnified is no longer an officer, director, employee or agent of the corporation or of such other organization. Indemnification may not be provided for any person with respect to any matter as to which that person shall have been adjudicated in any proceeding to not have acted in good faith in the reasonable belief that his action was in the best interest of the corporation. Section 65 of the Massachusetts Business Corporation Law provides a limitation on the imposition of liability under other sections of the Massachusetts Business Corporation Law. Under this Section, a director, officer or incorporator of a corporation is to perform his duties in good faith and in a manner he reasonably believes to be in the best interests of the corporation and with such care as an ordinarily prudent person in a like position would use under similar circumstances. Such director, officer or incorporator is entitled to rely on information, opinions, reports or records, including financial statements, books of account and other financial records which are prepared by or presented by or under the supervision of (1) one or more officers or employees of the corporation whom the director, officer or incorporator reasonably believes to be reliable and competent in the matters presented, or (2) counsel, public accountants, or other persons as to II-1 33 matters which the director, officer or incorporator reasonably believes to be within such a person's professional expert competence, or (3) in the case of a director, a duly constituted committee of the board upon which he does not serve, as to matters within its delegated authority, which committee the director reasonably believes to merit confidence. If a director, officer or incorporator performs his duties in the manner that is set forth above, that fact shall be an absolute defense to any claim asserted against him except as expressly provided by statute. Section 13 of the Massachusetts Business Corporation Law provides that the Articles of Organization of a corporation may contain a provision eliminating or limiting the personal liability of a director to the corporation or its stockholders for monetary damages for breach of a fiduciary duty as a director; notwithstanding any provision of law imposing such liability; provided, however, that such provision shall not eliminate or limit the liability of a director (i) for any breach of the director's duty of loyalty to the corporation or its stockholders, (ii) for acts or omissions not in good faith or which involve intentional misconduct or a knowing violation of law, (iii) under Section 61 or 62 of the Massachusetts Business Corporation Law or (iv) for any transaction from which the director derived an improper personal benefit. Article Six of the Restated Articles of Organization of the Registrant contains a provision consistent with Section 13 of the Massachusetts Business Corporation Law and provides that to the fullest extent permitted by the Massachusetts Business Corporation Law, a director of the Registrant shall not be personally liable to the Registrant or its stockholders for monetary damages for breach of fiduciary duty as a director, notwithstanding any provision of law imposing such liability. Section 9 of Article V of the By-laws of the Registrant contains provisions relating to the indemnification of directors and officers of the Registrant which are consistent with Section 67 of the Massachusetts Business Corporation Law. This Section provides that no indemnification will be provided to any person who was or is a director or officer with respect to any matter as to which such person shall have been finally adjudicated in any proceeding not to have acted in good faith in the reasonable belief that his action was in the best interest of the corporation; nor shall indemnification be provided where the corporation is required or has undertaken to submit to a court the question of whether or not indemnification by it is against public policy and it has been finally adjudicated that such indemnification is against public policy; provided, however, that, prior to such final adjudication, the corporation may compromise and settle any such claims and liabilities and pay such expenses, if such settlement or payment, or both, appears, in the judgment of a majority of those members of the Board of Directors who are not directly involved in such matters, to be in the best interest of the corporation as evidenced by a resolution to that effect adopted after receipt by the corporation of a written opinion of counsel, for the corporation that, based upon the facts available to such counsel, such person has not acted in a manner that would prohibit indemnification. Section 67 of the Massachusetts Business Corporation Law also contains provisions authorizing a corporation to obtain insurance on behalf of any director, officer, employee or agent of the corporation against liabilities, whether or not the corporation would have the power to indemnify against such liabilities. The Registrant maintains directors' and officers' liability and company reimbursement liability insurance. Subject to certain deductibles, such insurance will pay up to $50,000,000 per year on claims for errors and omissions against the Registrant's directors and officers and will reimburse the Registrant for amounts paid to indemnify directors and officers against the costs of such claims pursuant to the Registrant's By-Laws. The Underwriting Agreement filed as Exhibit 1.1 to this Registration Statement provides for the indemnification by the Underwriters of directors and officers of the Registrant against certain liabilities. II-2 34 ITEM 16. EXHIBITS
EXHIBIT NO. EXHIBIT ----------- ------- 1.1 Form of Underwriting Agreement 4.1 Form of Indenture 5.1 Opinion of Murray Gross, Esq. 12.1 Computation of Ratio of Earnings to Fixed Charges 23.1 Consent of Arthur Andersen LLP 23.2 Consent of Murray Gross, Esq. (included in Exhibit 5.1) 23.3 Consent of Hale and Dorr 24.1 Powers of Attorney (appears on pages II-5 and II-6) 25.1 Statement on Form T-1 of Eligibility and Qualification of Trustee
ITEM 17. UNDERTAKINGS The Registrant hereby undertakes: (1) To file, during any period in which offers or sales are being made, a post-effective amendment to this Registration Statement: (i) To include any prospectus required by Section 10(a)(3) of the Securities Act of 1933, as amended (the "Securities Act"); (ii) To reflect in the prospectus any facts or events arising after the effective date of this Registration Statement (or the most recent post-effective amendment thereof) which, individually or in the aggregate, represent a fundamental change in the information set forth in this Registration Statement; and (iii) To include any material information with respect to the plan of distribution not previously disclosed in this Registration Statement or any material change to such information in this Registration Statement; provided, however, that paragraphs (1)(i) and (1)(ii) do not apply if the information required to be included in a post-effective amendment by those paragraphs is contained in periodic reports filed by the Registrant pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934, as amended (the "Exchange Act"), that are incorporated by reference in this Registration Statement. (2) That, for the purpose of determining any liability under the Securities Act, each such post-effective amendment shall be deemed to be a new registration statement relating to the securities offered therein, and the offering of such securities at that time shall be deemed to be the initial bona fide offering thereof. (3) To remove from registration by means of a post-effective amendment any of the securities being registered which remain unsold at the termination of the offering. The undersigned Registrant hereby undertakes that, for purposes of determining any liability under the Securities Act, each filing of the Registrant's annual report pursuant to Section 13(a) or Section 15(d) of the Exchange Act (and, where applicable, each filing of an employee benefit plan's annual report pursuant to Section 15(d) of the Exchange Act) that is incorporated by reference in this Registration Statement shall be deemed to be a new registration statement relating to the securities offered herein, and the offering of such securities at that time shall be deemed to be the initial bona fide offering thereof. Insofar as indemnification for liabilities arising under the Securities Act of 1933 may be permitted to directors, officers and controlling persons of the Registrant pursuant to the provisions described in Item 15 above, or otherwise, the Registrant has been advised that in the opinion of the II-3 35 Securities and Exchange Commission such indemnification is against public policy as expressed in the Securities Act and is, therefore, unenforceable. In the event that a claim for indemnification against such liabilities (other than the payment by the Registrant of expenses incurred or paid by a director, officer or controlling person of the Registrant in the successful defense of any action, suit or proceeding) is asserted by such director, officer or controlling person in connection with the securities being registered, the Registrant will, unless in the opinion of its counsel the matter has been settled by controlling precedent, submit to a court of appropriate jurisdiction the question whether such indemnification by it is against public policy as expressed in the Securities Act and will be governed by the final adjudication of such issue. II-4 36 SIGNATURES Pursuant to the requirements of the Securities Act of 1933, as amended, the Registrant certifies that it has reasonable grounds to believe that it meets all of the requirements for filing on Form S-3 and has duly caused this Registration Statement to be signed on its behalf by the undersigned, thereunto duly authorized, in Wellesley, Massachusetts on this 30th day of May, 1995. EG&G, INC. By: ------------------------------------ Murray Gross Vice President, General Counsel and Clerk POWER OF ATTORNEY Each person whose signature appears below constitutes and appoints Murray Gross, David E. Redlick and Patrick J. Rondeau, and each of them, his true and lawful attorneys-in-fact and agents, with full power of substitution and resubstitution in each of them, for him or her and in his or her name, place and stead, and in any and all capacities, to sign any and all amendments (including post-effective amendments) to this Registration Statement on Form S-3 of EG&G, Inc., and to file the same, with all exhibits thereto, and other documents in connection therewith, with the Securities and Exchange Commission, granting unto said attorneys-in-fact and agents, and each of them, full power and authority to do and perform each and every act requisite or necessary to be done in connection therewith, as fully as he or she might or could do in person, hereby ratifying and confirming all that said attorneys-in-fact and agents or any of them or their, his or her substitute or substitutes may lawfully do or cause to be done by virtue hereof. Pursuant to the requirements of the Securities Act of 1933, this Registration Statement has been signed below by the following persons in the capacities indicated on this 30th day of May, 1995.
SIGNATURES TITLE ---------- ----- Chairman of the Board, President - ------------------------------------------ and Chief Executive Officer John M. Kucharski (principal executive officer) Senior Vice President and - ------------------------------------------ Chief Financial Officer Thomas J. Sauser (principal financial officer) Vice President and - ------------------------------------------ Corporate Controller John F. Alexander, II (principal accounting officer) Director - ------------------------------------------ Robert F. Goldhammer
II-5 37
SIGNATURES TITLE - ------------------------------------------ --------------------------------------- Director - ------------------------------------------ John B. Gray Director - ------------------------------------------ Kent F. Hansen Director - ------------------------------------------ Greta Marshall Director - ------------------------------------------ William F. Pounds Director - ------------------------------------------ Samuel Rubinovitz Director - ------------------------------------------ John Larkin Thompson Director - ------------------------------------------ G. Robert Tod Director - ------------------------------------------ Joseph F. Turley
II-6 EX-1.1 2 FORM OF UNDERWRITING AGREEMENT 1 EG&G, INC. % NOTES DUE ----- ---------- ------------------------ UNDERWRITING AGREEMENT Goldman, Sachs & Co. , 1995 Merrill Lynch & Co. c/o Goldman, Sachs & Co. 85 Broad Street New York, New York 10004 Ladies and Gentlemen: EG&G, Inc., a Massachusetts corporation (the "Company"), proposes, to enter into one or more Pricing Agreements (each a "Pricing Agreement") in the form of Annex I hereto, with such additions and deletions as the parties thereto may determine, and, subject to the terms and conditions stated herein and therein, to issue and sell to the firms named in Schedule I to the applicable Pricing Agreement (such firms constituting the "Underwriters" with respect to such Pricing Agreement and the securities specified therein) certain of its debt securities (the "Securities") specified in Schedule II to such Pricing Agreement (with respect to such Pricing Agreement, the "Designated Securities"). The terms and rights of any particular issuance of Designated Securities shall be as specified in the Pricing Agreement relating thereto and in or pursuant to the indenture (the "Indenture") identified in such Pricing Agreement. 1. Particular sales of Designated Securities may be made from time to time to the Underwriters of such Securities, for whom the firms designated as representatives of the Underwriters of such Securities, in the Pricing Agreements relating thereto will act as representatives (the "Representatives"). The term "Representatives" also refers to a single firm acting as sole representative of the Underwriters and to an Underwriter or Underwriters who act without any firm being designated as its or their representatives. This Underwriting Agreement shall not be construed as an obligation of the Company to sell any of the Securities or as an obligation of any of the Underwriters to purchase any of the Securities. The obligation of the Company to issue and sell any of the Securities and the obligation of any of the Underwriters to purchase any of the Securities shall be evidenced by the Pricing Agreement with respect to the Designated Securities specified therein. Each Pricing Agreement shall specify the aggregate principal amount of such Designated Securities, the initial public offering price of such Designated Securities, the purchase price to the Underwriters of such Designated Securities, the names of the Underwriters of such Designated Securities, the names of the Representatives of such Underwriters and the principal amount of such Designated Securities to be purchased by each Underwriter and shall set forth the date, time and manner of delivery of such Designated Securities and payment therefor. The Pricing Agreement shall also specify (to the extent not set forth in the Indenture and the registration statement and prospectus with respect thereto) the terms of such Designated Securities. A Pricing Agreement shall be in the form of an executed writing (which may be in counterparts), and may be evidenced by an exchange of telegraphic communications or any other rapid transmission device designed to produce a written record of communications transmitted. The obligations of the Underwriters under this Agreement and each Pricing Agreement shall be several and not joint. 2 2. The Company represents and warrants to, and agrees with, each of the Underwriters that: (a) A registration statement on Form S-3 in respect of the Securities has been filed with the Securities and Exchange Commission (the "Commission"); such registration statement and any post-effective amendment thereto, each in the form heretofore delivered or to be delivered to the Representatives and, excluding exhibits to such registration statements, but including all documents incorporated by reference contained therein, to the Representatives for each of the other Underwriters, have been declared effective by the Commission in such form; no other document with respect to such registration statement or document incorporated by reference therein has heretofore been filed or transmitted for filing with the Commission (other than prospectuses filed pursuant to Rule 424(b) of the rules and regulations of the Commission under the Securities Act of 1933, as amended (the "Act"), each in the form heretofore delivered to the Representatives); and no stop order suspending the effectiveness of such registration statement has been issued and no proceeding for that purpose has been initiated or threatened by the Commission (any preliminary prospectus included in such registration statement or filed with the Commission pursuant to Rule 424(a) under the Act, is hereinafter called a "Preliminary Prospectus"; the various parts of such registration statement, including all exhibits thereto and the documents incorporated by reference in the prospectus contained in the registration statement at the time such part of the registration statement became effective, but excluding Form T-1, each as amended at the time such part of the registration statement became effective, are hereinafter collectively called the "Registration Statement"; the prospectus relating to the Securities, in the form in which it has most recently been filed, or transmitted for filing, with the Commission on or prior to the date of this Agreement, being hereinafter called the "Prospectus"; any reference herein to any Preliminary Prospectus or the Prospectus shall be deemed to refer to and include the documents incorporated by reference therein pursuant to Item 12 of Form S-3 under the Act, as of the date of such Preliminary Prospectus or Prospectus, as the case may be; any reference to any amendment or supplement to any Preliminary Prospectus or the Prospectus shall be deemed to refer to and include any documents filed after the date of such Preliminary Prospectus or Prospectus, as the case may be, under the Securities Exchange Act of 1934, as amended (the "Exchange Act"), and incorporated by reference in such Preliminary Prospectus or Prospectus, as the case may be; any reference to any amendment to the Registration Statement shall be deemed to refer to and include any annual report of the Company filed pursuant to Sections 13(a) or 15(d) of the Exchange Act after the effective date of the Registration Statement that is incorporated by reference in the Registration Statement; and any reference to the Prospectus as amended or supplemented shall be deemed to refer to the Prospectus as amended or supplemented in relation to the applicable Designated Securities in the form in which it is filed with the Commission pursuant to Rule 424(b) under the Act in accordance with Section 5(a) hereof, including any documents incorporated by reference therein as of the date of such filing); (b) No order preventing or suspending the use of any Preliminary Prospectus has been issued by the Commission, and each Preliminary Prospectus, at the time of filing thereof, conformed in all material respects to the requirements of the Act and the Trust Indenture Act of 1939, as amended (the "Trust Indenture Act"), and the rules and regulations of the Commission thereunder, and did not contain an untrue statement of a material fact or omit to state a material fact required to be stated therein or necessary to make the statements therein, in the light of the circumstances under which they were made, not misleading; provided, however,that this representation and warranty shall not apply to any statements or omissions made in reliance upon and in conformity with information furnished in writing to the Company by either of you expressly for use therein, or to any statement in or omission from the Form T-1; (c) The documents incorporated by reference in the Prospectus, when they were filed with the Commission, conformed in all material respects to the requirements of the Exchange Act and the rules and regulations of the Commission thereunder, and none of such documents 2 3 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; and any further documents so filed and incorporated by reference in the Prospectus or any further amendment or supplement thereto, when such documents are filed with the Commission, will conform in all material respects to the requirements of the Exchange Act and the rules and regulations of the Commission thereunder and will 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; provided, however, that this representation and warranty shall not apply to any statements or omissions made in reliance upon and in conformity with information furnished in writing to the Company by an Underwriter of Designated Securities through the Representatives expressly for use in the Prospectus as amended or supplemented relating to such Securities; (d) The Registration Statement conforms, and the Prospectus and any further amendments or supplements to the Registration Statement or the Prospectus will conform, in all material respects to the requirements of the Act and the Trust Indenture Act and the rules and regulations of the Commission thereunder and do not and will not, as of the applicable effective date as to the Registration Statement and any amendment thereto and as of the applicable filing date as to the Prospectus and any amendment or supplement thereto, 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; provided, however, that this representation and warranty shall not apply to any statements or omissions made in reliance upon and in conformity with information furnished in writing to the Company by an Underwriter of Designated Securities through the Representatives expressly for use in the Prospectus as amended or supplemented relating to such Securities or to any statement in or omission from the Form T-1; (e) Neither the Company nor any of its subsidiaries has sustained since the date of the latest audited financial statements included or incorporated by reference in the Prospectus any loss or interference with its business from fire, explosion, flood or other calamity, whether or not covered by insurance, or from any labor dispute or court or government action, order or decree, otherwise than as set forth or contemplated in the Prospectus which is material to the Company and its subsidiaries, taken as a whole; and, since the respective dates as of which information is given in the Registration Statement and the Prospectus, there has not been any material change in the capital stock (other than pursuant to the Company's employee and director stock and option plans and repurchases of common stock pursuant to the Company's previously announced authorizations to do so) of the Company or any material increase in the long-term debt of the Company and its subsidiaries taken as a whole or any material adverse change, or any development which the Company has reasonable cause to believe would involve a prospective material adverse change, in or affecting the business, financial position, stockholders' equity or results of operations of the Company and its subsidiaries, taken as a whole, otherwise than as set forth or contemplated in the Prospectus; (f) The Company and its Material Subsidiaries (as set forth in Schedule III attached hereto) have good and marketable title to all property that is described in the Prospectus as being owned by them, in each case free and clear of all liens, encumbrances and defects except such as are described in the Prospectus or such as do not materially adversely affect the value of such property or the use made and proposed to be made of such property by the Company and its Material Subsidiaries; and any real property and buildings held under lease by the Company and its Material Subsidiaries that are described in the Prospectus are held by them under valid, subsisting and enforceable leases with such exceptions as are not material or do not materially interfere with the use made and proposed to be made of such property and buildings by the Company and its Material Subsidiaries; (g) The Company has been duly incorporated and is validly existing as a corporation in good standing under the laws of The Commonwealth of Massachusetts, with power and 3 4 authority (corporate and other) to own its properties and conduct its business as described in the Prospectus, and has been duly qualified as a foreign corporation for the transaction of business and is in good standing under the laws of each other jurisdiction in which it owns or leases properties, or conducts any business, so as to require such qualification, or is subject to no material liability or disability by reason of the failure to be so qualified in any such jurisdiction; and each Material Subsidiary of the Company has been duly incorporated and is validly existing as a corporation in good standing under the laws of its jurisdiction of incorporation (except with respect to any subsidiaries incorporated in jurisdictions where the concept of good standing is not recognized), and except for any failure to be so incorporated and existing which would not have a material adverse effect on the business, consolidated financial position, stockholders' equity or results of operations of the Company and its subsidiaries, taken as a whole; (h) The Company has an authorized capitalization as set forth in the Prospectus, and all of the issued shares of capital stock of the Company have been duly and validly authorized and issued and are fully paid and nonassessable; and all of the issued shares of capital stock of each Material Subsidiary of the Company have been duly and validly authorized and issued, are fully paid and non-assessable and (except as disclosed in the Annual Report on Form 10-K for the year ended January 1, 1995, and except for directors' qualifying shares or such shares as may be required by local laws to be owned by residents of the jurisdiction of incorporation) are owned directly or indirectly by the Company, free and clear of all liens, encumbrances, equities or claims; (i) The Securities have been duly authorized and, when Designated Securities are issued and delivered pursuant to this Agreement and the Pricing Agreement with respect to such Designated Securities, such Designated Securities will have been duly executed, authenticated, issued and delivered and will constitute valid and legally binding obligations of the Company entitled to the benefits provided by the Indenture which will be substantially in the form filed as an exhibit to the Registration Statement (except to the extent that the terms of any Designated Securities or Supplemental Indenture render certain provisions of the Indenture inapplicable to such Designated Securities) subject, as to enforcement, to bankruptcy, insolvency, fraudulent transfer, moratorium, reorganization and similar laws of general applicability relating to or affecting creditors' rights and to general equity principles; the Indenture has been duly authorized and duly qualified under the Trust Indenture Act and, at the Time of Delivery for such Designated Securities (as defined in Section 4 hereof), the Indenture will constitute a valid and legally binding instrument enforceable in accordance with its terms, subject, as to enforcement, to bankruptcy, insolvency, fraudulent transfer, moratorium, reorganization and similar laws of general applicability relating to or affecting creditors' rights and to general equity principles; and the Designated Securities and the Indenture will conform to the descriptions thereof in the Prospectus as amended or supplemented with respect to such Designated Securities; (j) The issue and sale of the Securities and the compliance by the Company with all of the provisions of the Securities, the Indenture, this Agreement and any Pricing Agreement and the consummation of the transactions herein and therein contemplated will not conflict with or result in a breach or violation of any of the terms or provisions of, or constitute a default under, any indenture, mortgage, deed of trust, loan agreement or other agreement or instrument to which the Company or any of its subsidiaries is a party or by which the Company or any of its subsidiaries is bound or to which any of the property or assets of the Company or any of its subsidiaries is subject, excluding conflicts, breaches, violations and defaults that, individually or in the aggregate, will not have a material adverse effect on the business, consolidated financial position, stockholders' equity or results of operations of the Company and its subsidiaries, taken as a whole, nor will such action result in any violation of the provisions of the Restated Articles of Organization or By-laws of the Company or any statute or any order, rule or regulation of any court or governmental agency or body having jurisdiction over the Company or any of its subsidiaries or any of their properties; and no consent, approval, authorization, order, 4 5 registration or qualification of or with any such court or governmental agency or body is required for the issue and sale of the Securities or the consummation by the Company of the transactions contemplated by this Agreement or any Pricing Agreement or the Indenture, except such as have been or will have been prior to the Time of Delivery obtained under the Act and the Trust Indenture Act and such consents, approvals, authorizations, registrations or qualifications as may be required under state securities or Blue Sky laws in connection with the purchase and distribution of the Securities by the Underwriters; (k) Other than as set forth in the Prospectus, there are no legal or governmental proceedings pending to which the Company or any of its subsidiaries is a party or of which any property of the Company or any of its subsidiaries is the subject which will, in the Company's reasonable belief, individually or in the aggregate, have a material adverse effect on the business, consolidated financial position, stockholders' equity or results of operations of the Company and its subsidiaries, taken as a whole; and, to the best of the Company's knowledge, no such proceedings are threatened or contemplated by governmental authorities or threatened by others; (l) Neither the Company nor any of its Material Subsidiaries is in violation of, or in default in the performance or observance of, any material obligation, agreement, covenant or condition contained in any indenture, mortgage, deed of trust, loan agreement, loan or other agreement or instrument to which it is a party or by which it or any of its properties may be bound, except for violations or defaults that, individually or in the aggregate, will not have a material adverse effect on the consolidated financial position, stockholders' equity or results of operations of the Company and its subsidiaries, taken as a whole. (m) The Company is not and, after giving effect to the offering and sale of the Securities, 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 "Investment Company Act"); (n) Arthur Andersen LLP, who have certified certain financial statements of the Company and its subsidiaries, are independent public accountants as required by the Act and the rules and regulations of the Commission thereunder; (o) Except as disclosed in or specifically contemplated by the Prospectus, the Company has not been advised, and has no reason to believe, that either the Company or any of its subsidiaries is not conducting business in compliance with all applicable laws, rules and regulations of the jurisdictions in which it is conducting business, including, without limitation, all applicable local, state and federal environmental laws and regulations, except where the failure to be so in compliance would not materially adversely affect the general affairs, financial position, stockholders' equity or results of operations of the Company and its subsidiaries taken as a whole; and (p) The Company and its subsidiaries have filed all necessary federal, state and foreign income and franchise tax returns (or has timely filed for extensions thereof), except in any case in which the failure so to file would not have a material adverse effect on the Company and its subsidiaries, taken as a whole, and have paid all taxes shown as due thereon to the extent such taxes are due and payable, except in all cases for any such tax that is being contested by the Company in good faith; and, except as disclosed in the Prospectus, the Company has no knowledge of any tax deficiency which has been or might be asserted or threatened against the Company or its subsidiaries which could materially and adversely affect the business, operations or properties of the Company and its subsidiaries, taken as a whole. 3. Upon the execution of the Pricing Agreement applicable to any Designated Securities and the authorization by the Representatives of the release of such Designated Securities, the several Underwriters propose to offer such Designated Securities for sale upon the terms and conditions set forth in the Prospectus as amended or supplemented. 5 6 4. Designated Securities to be purchased by each Underwriter pursuant to the Pricing Agreement relating thereto, in the form specified in such Pricing Agreement, and in such authorized denominations and registered in such names as the Representatives may request upon at least forty-eight hours' prior notice to the Company, shall be delivered by or on behalf of the Company to the Representatives for the account of such Underwriter, against payment by such Underwriter or on its behalf of the purchase price therefor by certified or official bank check or checks payable to the order of the Company in the funds specified in such Pricing Agreement, all in the manner and at the place and time and date specified in such Pricing Agreement, or at such other time or place, and on such other date as the Representatives and the Company may agree upon in writing, such time and date being herein called the "Time of Delivery for such Securities." 5. The Company agrees with each of the Underwriters of any Designated Securities: (a) To prepare the Prospectus as amended or supplemented in relation to the applicable Designated Securities in a form approved by the Representatives and to file such Prospectus pursuant to Rule 424(b) under the Act not later than the Commission's close of business on the second business day following execution and delivery of the Pricing Agreement relating to the applicable Designated Securities, or, if applicable, such earlier time as may be required by Rule 424(b) or Rule 430A(a)(3) under the Act; to make no further amendment or any supplement to the Registration Statement or Prospectus as amended or supplemented after the date of the Pricing Agreement relating to such Designated Securities and prior to the Time of Delivery which shall be disapproved by the Representatives promptly after reasonable notice thereof; to advise the Representatives promptly after it receives notice thereof, of the time when the Registration Statement, or any amendment thereto, has been filed or becomes effective or any supplement to the Prospectus or any amended Prospectus has been filed and to furnish the Representatives with copies thereof; to file promptly all reports and any definitive proxy or information statements required to be filed by the Company with the Commission pursuant to Section 13(a), 13(c), 14 or 15(d) of the Exchange Act for so long as the delivery of a prospectus is required in connection with the offering or sale of such Designated Securities; to advise you, promptly after it receives notice thereof, of the issuance by the Commission of any stop order or of any order preventing or suspending the use of any Preliminary Prospectus or Prospectus relating to such Designated Securities, of the suspension of the qualification of such Designated Securities for offering or sale in any jurisdiction, of the initiation or threatening of any proceeding for any such purpose, or of any request by the Commission for the amending or supplementing of the Registration Statement or Prospectus or for additional information; and, in the event of the issuance of any stop order or of any order preventing or suspending the use of the Registration Statement or the Prospectus relating to such Designated Securities or suspending any such qualification, to use promptly its best efforts to obtain the withdrawal of such order; (b) Promptly from time to time to take such action as the Representatives may reasonably request to qualify such Designated Securities for offering and sale under the securities laws of such jurisdictions as the Representatives may request and to comply with such laws so as to permit the continuance of sales and dealings therein in such jurisdictions for as long as may be necessary to complete the distribution of such Designated Securities, provided that in connection therewith the Company shall not be required to qualify as a foreign corporation or to file a general consent to service of process in any jurisdiction; (c) To furnish the Underwriters with copies of the Prospectus as amended or supplemented in such quantities as the Representatives may from time to time reasonably request, and, if the delivery of a prospectus is required at any time in connection with the offering or sale of the Securities and if at such time any event shall have occurred as a result of which the Prospectus as then amended or supplemented would include an untrue statement of a material fact or omit to state any material fact necessary in order to make the statements therein, in light of the circumstances under which they were made when such Prospectus is delivered, not 6 7 misleading, or, if for any other reason it shall be necessary during such same period to amend or supplement the Prospectus or to file under the Exchange Act any document incorporated by reference in the Prospectus in order to comply with the Act, the Exchange Act or the Trust Indenture Act, to notify the Representatives and upon their request to file such document and to prepare and furnish without charge to each Underwriter and to any dealer in securities as many copies as the Representatives may from time to time reasonably request of an amended Prospectus or a supplement to the Prospectus which will correct such statement or omission or effect such compliance; (d) To make generally available to its security holders as soon as practicable, but in any event not later than eighteen months after the effective date of the Registration Statement (as defined in Rule 158(c)), an earning statement of the Company and its subsidiaries (which need not be audited) complying with Section 11(a) of the Act and the rules and regulations of the Commission thereunder (including, at the option of the Company, Rule 158); and (e) During the period beginning from the date of the Pricing Agreement and continuing to and including the later of (i) the termination of trading restrictions for such Designated Securities, as notified to the Company by the Representatives as soon as practicable, but in any event not later than fifteen (15) days after the Time of Delivery, and (ii) the Time of Delivery for such Designated Securities, not to offer, sell, contract to sell or otherwise dispose of any debt securities of the Company which mature more than one year after the Time of Delivery and which are substantially similar to the Designated Securities, without the prior written consent of the Representatives. 6. The Company covenants and agrees with the Underwriters that the Company will pay or cause to be paid the following: (i) the fees, disbursements and expenses of the Company's counsel and accountants in connection with the registration of the Securities under the Act and all other expenses in connection with the preparation, printing and filing of the Registration Statement, any Preliminary Prospectus and the Prospectus and amendments and supplements thereto and the mailing and delivering of copies thereof to the Underwriters and dealers; (ii) the cost of printing or producing any Agreement among Underwriters, this Agreement, any Pricing Agreement, the Indenture, the Blue Sky and Legal Investment Memoranda, closing documents (including any compilations thereof) and any other documents in connection with the offering, purchase, sale and delivery of the Securities; (iii) all expenses in connection with the qualification of the Securities for offering and sale under state securities laws as provided in Section 5(b) hereof, including the fees and disbursements of counsel for the Underwriters in connection with such qualification and in connection with the Blue Sky and legal investment surveys; (iv) any fees charged by securities rating services for rating the Securities; (v) any filing fees incident to any review by the National Association of Securities Dealers, Inc. of the terms of the sale of the Securities; (vi) the cost of preparing the Securities; (vii) the fees and expenses of the Trustee and any agent of the Trustee and the fees and disbursements of counsel for the Trustee in connection with the Indenture and the Securities; and (viii) all other costs and expenses incident to the performance of its obligations hereunder which are not otherwise specifically provided for in this Section. It is understood, however, that, except as provided in this Section, Sections 8 and 11 hereof, the Underwriters will pay all of their own costs and expenses, including the fees of their counsel, transfer taxes on resale of any of the Securities by them, and any advertising expenses connected with any offers they may make. 7. The obligations of the Underwriters of any Designated Securities under the Pricing Agreement relating to such Designated Securities shall be subject, in the discretion of the Representatives, to the condition that all representations and warranties and other statements of the Company in or incorporated by reference in the Pricing Agreement relating to such Designated Securities are, at and as of the Time of Delivery for such Designated Securities, true and correct, the condition that 7 8 the Company shall have performed all of its obligations hereunder theretofore to be performed, and the following additional conditions: (a) The Prospectus as amended or supplemented in relation to the applicable Designated Securities shall have been filed with the Commission pursuant to Rule 424(b) within the applicable time period prescribed for such filing by the rules and regulations under the Act and in accordance with Section 5(a) hereof; no stop order suspending the effectiveness of the Registration Statement or any part thereof shall have been issued and no proceeding for that purpose shall have been initiated or threatened by the Commission; and all requests for additional information on the part of the Commission shall have been complied with to the reasonable satisfaction of the Representatives; (b) Ropes & Gray, counsel for the Underwriters, shall have furnished to the Representatives such opinion or opinions, dated the Time of Delivery, with respect to the matters covered in paragraphs (i), (ii) (iv), and the unnumbered paragraph, of subsection (c) and paragraphs (i), (ii), (v) and (vii) of subsection (d) below as well as such other related matters as the Representatives may reasonably request, and such counsel shall have received such papers and information as they may reasonably request to enable them to pass upon such matters; (c) Hale and Dorr, counsel for the Company, shall have furnished to the Representatives their written opinion, dated the Time of Delivery for such Designated Securities, in form and substance satisfactory to the Representatives, to the effect that: (i) The Designated Securities have been duly authorized, executed, authenticated, issued and delivered by the Company and, when paid for in accordance with the terms thereof, will constitute valid and legally binding obligations of the Company entitled to the benefits provided by the Indenture subject, as to enforcement, to bankruptcy, insolvency, fraudulent transfer, moratorium, reorganization and similar laws of general applicability relating to or affecting creditors' rights and general equity principles; and the Designated Securities and the Indenture conform in all material respects to the descriptions thereof in the Prospectus as amended or supplemented; (ii) The Indenture has been duly authorized, executed and delivered by the Company and, assuming the due authorization, execution and delivery thereof by the Trustee, constitutes a valid and legally binding obligation of the Company, enforceable against the Company in accordance with its terms, subject, as to its binding nature and enforceability, to bankruptcy, insolvency, fraudulent transfer, moratorium, reorganization and similar laws of general applicability relating to or affecting creditors' rights and to general equity principles; and the Indenture has been duly qualified under the Trust Indenture Act; (iii) No consent, approval, authorization, order, registration or qualification of or with any court or governmental agency or body is required for the issue and sale of the Designated Securities or the consummation by the Company of the transactions contemplated by this Agreement, such Pricing Agreement or the Indenture, except such as have been obtained under the Act and the Trust Indenture Act and such consents, approvals, authorizations, registrations or qualifications as may be required under state securities or Blue Sky laws (as to the applicability of which no opinion need be expressed) in connection with the purchase and distribution of the Designated Securities by the Underwriters; (iv) The Registration Statement and the Prospectus as amended or supplemented and any further amendments and supplements thereto made by the Company prior to the Time of Delivery of the Designated Securities (other than the financial statements and financial data and related schedules therein, as to which such counsel need express no 8 9 opinion) comply as to form in all material respects with the requirements of the Act and the Trust Indenture Act and the rules and regulations thereunder; (v) This Agreement and the Pricing Agreement with respect to the Designated Securities have been duly authorized, executed and delivered by the Company. Such counsel shall also state, without passing upon or assuming any responsibility for the accuracy, completeness or fairness of the statements contained in the Registration Statement or the Prospectus, that nothing has come to their attention that would lead them to believe (a) that, as of the effective date of the Registration Statement, the Registration Statement (or as of its date, any amendment or supplement thereto and made by the Company prior to the date of such opinion) contained any untrue statement of a material fact or omitted to state a material fact required to be stated therein or necessary to make the statements therein not misleading or (b) that, as of its date, the Prospectus as amended or supplemented or any further amendment or supplement thereto made by the Company prior to the Time of Delivery contained any untrue statement of a material fact or omits to state a material fact required to be stated therein or necessary in order to make the statements therein, in the light of the circumstances under which they were made, not misleading or (c) that, as of the Time of Delivery, either the Registration Statement or the Prospectus contains any untrue statement of a material fact or omits to state a material fact required to be stated therein or necessary to make the statements therein not misleading. Such counsel need express no belief as to the financial statements, including the notes and schedules thereto, or any financial data set forth or referred to in the Registration Statement or the Prospectus. (d) Murray Gross, Esquire, General Counsel of the Company, shall have furnished to the Representatives his opinion, dated the Time of Delivery for such Designated Securities, in form and substance satisfactory to the Representatives, to the effect that: (i) The Company has been duly incorporated and is validly existing as a corporation in good standing under the laws of The Commonwealth of Massachusetts, with power and authority (corporate and other) to own its properties and conduct its business as described in the Prospectus as amended or supplemented; (ii) The Company has an authorized capitalization as set forth in the Prospectus as amended or supplemented, and all of the issued shares of capital stock of the Company have been duly and validly authorized and issued and are fully paid and non-assessable; (iii) Each Material Subsidiary of the Company has been duly incorporated and is validly existing as a corporation in good standing under the laws of its jurisdiction of incorporation (except with respect to any such subsidiaries incorporated in jurisdictions where the concept of good standing is not recognized, and except for any failure to be so incorporated and existing which would not have a material adverse effect on the business, consolidated financial position, stockholders' equity or results of operations of the Company and its subsidiaries, taken as a whole); and all of the issued shares of capital stock of each such Material Subsidiary have been duly and validly authorized and issued, are fully paid and non-assessable, and (except as disclosed in the Annual Report on Form 10-K for the year ended January 1, 1995, and except for directors' qualifying shares or such shares as may be required by local laws to be owned by residents of the jurisdiction of incorporation) are owned of record directly or indirectly by the Company, to its knowledge free and clear of all liens, encumbrances, equities or claims (such counsel being entitled to rely in respect of the opinion in this clause upon opinions of local counsel and in respect of matters of fact upon certificates of officers of the Company or its subsidiaries, provided that such counsel shall state that they believe that both the Representatives and they are justified in relying upon such opinions and certificates); 9 10 (iv) To the best of such counsel's knowledge and other than as set forth in the Prospectus, there are no legal or governmental proceedings pending to which the Company or any of its subsidiaries is a party or of which any property of the Company or any of its subsidiaries is the subject which will, in such counsel's reasonable belief, individually or in the aggregate, have a material adverse effect on the business, consolidated financial position, stockholders' equity or results of operations of the Company and its subsidiaries taken as a whole; and, to such counsel's knowledge, no such proceedings are threatened by governmental authorities or threatened by others; (v) This Agreement and the Pricing Agreement with respect to the Designated Securities have been duly authorized, executed and delivered by the Company; (vi) The issue and sale of the Designated Securities and the compliance by the Company with all of the provisions of the Designated Securities, the Indenture, this Agreement and the Pricing Agreement with respect to the Designated Securities and the consummation of the transactions herein and therein contemplated will not conflict with or result in a breach or violation of the Restated Articles of Organization or By-laws of the Company, nor will such actions conflict with or result in a breach or violation of any of the terms or provisions of, or constitute a default under, any indenture, mortgage, deed of trust, loan agreement or other agreement or instrument known to such counsel to which the Company is a party or by which the Company is bound or to which any of the properties or assets of the Company is subject, or rule or regulation known to such counsel of any court or governmental agency or body having jurisdiction over the Company or any of its properties (except that such opinion shall not extend to compliance with the anti-fraud provisions of federal or state securities laws); except for such conflicts, breaches, violations and defaults as are not reasonably likely, individually or in the aggregate, to have a material adverse effect on the business, financial position, stockholders' equity, results of operations, business or prospects of the Company and its subsidiaries, taken as a whole; (vii) The documents incorporated by reference in the Prospectus as amended or supplemented (other than the financial statements and financial data and related schedules therein, as to which such counsel need express no opinion), when they were filed with the Commission complied as to form in all material respects with the requirements of the Exchange Act and the rules and regulations of the Commission thereunder; and he does not know of any amendment to the Registration Statement required to be filed or of any contracts or other documents of a character required to be filed as an exhibit to the Registration Statement or required to be incorporated by reference into the Prospectus or required to be described in the Registration Statement or the Prospectus which are not filed or incorporated by reference or described as required. Such counsel shall also state that he has no reason to believe that any of the documents incorporated by reference in the Prospectus as amended or supplemented, when they were so filed contained an untrue statement of a material fact or omitted to state a material fact necessary in order to make the statements therein, in the light of the circumstances under which they were made when such documents were so filed, not misleading. (e) On the date of the Pricing Agreement for such Designated Securities at a time prior to the execution of the Pricing Agreement with respect to such Designated Securities and at the Time of Delivery for such Designated Securities, the independent accountants of the Company who have certified the financial statements of the Company and its subsidiaries included or incorporated by reference in the Registration Statement shall have furnished to the Representatives a letter, dated the effective date of the Registration Statement or the date of the most recent report filed with the Commission containing financial statements and incorporated by reference in the Registration Statement, if the date of such report is later than such effective date, and a letter dated such Time of Delivery, respectively, to the effect set forth in Annex II 10 11 hereto, and with respect to such letter dated such Time of Delivery, as to such other matters as the Representatives may reasonably request in the form and substance satisfactory to the Representatives; (f)(i) The Company and its subsidiaries, taken as a whole, shall not have sustained since the date of the latest audited financial statements included or incorporated by reference in the Prospectus as amended or supplemented prior to the date of the Pricing Agreement relating to the Designated Securities any material loss or interference with their businesses from fire, explosion, flood or other calamity, whether or not covered by insurance, or from any labor dispute or court or governmental action, order or decree, otherwise than as set forth or contemplated in the Prospectus as amended or supplemented prior to the date of the Pricing Agreement relating to the Designated Securities, and (ii) since the respective dates as of which information is given in the Prospectus as amended or supplemented prior to the date of the Pricing Agreement relating to the Designated Securities, there shall not have been any material change in the capital stock (other than pursuant to the Company's employee and director stock and option plans and repurchases of common stock of the Company pursuant to previously announced authorizations to do so) of the Company or any increase in the long-term debt of the Company and its subsidiaries, taken as a whole, in excess of $10,000,000, or any material adverse change, or any development involving a prospective material adverse change, in or affecting the business, financial position, stockholders' equity or results of operations of the Company and its subsidiaries, taken as a whole, otherwise than as set forth or contemplated in the Prospectus as amended or supplemented prior to the date of the Pricing Agreement relating to the Designated Securities, the effect of which, in any such case described in Clause (i) or (ii), is in the judgment of the Representatives so material and adverse as to make it impracticable or inadvisable to proceed with the public offering or the delivery of the Designated Securities on the terms and in the manner contemplated in the Prospectus as amended or supplemented relating to the Designated Securities; (g) On or after the date of the Pricing Agreement relating to the Designated Securities (i) no downgrading shall have occurred in the rating accorded the Company's debt securities by any "nationally recognized statistical rating organization," as that term is defined by the Commission for purposes of Rule 436(g)(2) under the Act and (ii) no such organization shall have publicly announced that it has under surveillance or review, with possible negative implications, its rating of any of the Company's debt securities; (h) On or after the date of the Pricing Agreement relating to the Designated Securities there shall not have occurred any of the following: (i) a suspension or material limitation in trading in securities generally on the New York Stock Exchange; (ii) a suspension of, or a material limitation on, trading in the Company's securities on the New York Stock Exchange; (iii) a general moratorium on commercial banking activities in New York declared by either Federal or New York State authorities; or (iv) the outbreak or escalation of hostilities involving the United States or the declaration by the United States of a national emergency or war, if the effect of any such event specified in this Clause (iv) in the judgment of the Representatives makes it impracticable or inadvisable to proceed with the public offering or the delivery of the Securities on the terms and in the manner contemplated in the Prospectus as first amended or supplemented relating to the Designated Securities; and (i) The Company shall have furnished or caused to be furnished to the Representatives at the Time of Delivery for the Designated Securities certificates of officers of the Company (on behalf of the Company) satisfactory to the Representatives as to the accuracy of the representations and warranties of the Company herein at and as of such Time of Delivery, as to the performance by the Company of all of its obligations hereunder to be performed at or prior to such Time of Delivery, as to the matters set forth in subsections (a) and (f) of this Section and as to such other matters as the Representatives may reasonably request. 11 12 8. (a) The Company will indemnify and hold harmless each Underwriter against any losses, claims, damages or liabilities, joint or several, to which such Underwriter may become subject, under the Act or otherwise, insofar as such losses, claims, damages or liabilities (or actions in respect thereof) arise out of or are based upon an untrue statement or alleged untrue statement of a material fact contained in any Preliminary Prospectus, any preliminary prospectus supplement, the Registration Statement, the Prospectus as amended or supplemented and any other prospectus relating to the Securities, or any amendment or supplement thereto, or arise out of or are based upon the omission or alleged omission to state therein a material fact required to be stated therein or necessary to make the statements therein not misleading, and will reimburse each Underwriter for any legal or other expenses reasonably incurred by such Underwriter in connection with investigating or defending any such action or claim as such expenses are incurred; provided, however, that the Company shall not be liable in any such case to the extent that any such loss, claim, damage or liability arises out of or is based upon an untrue statement or alleged untrue statement or omission or alleged omission made in any Preliminary Prospectus, any preliminary prospectus supplement, the Registration Statement, the Prospectus as amended or supplemented and any other prospectus relating to the Securities, or any such amendment or supplement in reliance upon and in conformity with written information furnished to the Company by any Underwriter of Designated Securities through the Representatives expressly for use therein; and provided further, that the Company shall not be liable to any Underwriter with respect to any Preliminary Prospectus or any preliminary prospectus supplement, to the extent that any such loss, claim, damage or liability of such Underwriter results solely from an untrue statement of a material fact contained in, or the omission of a material fact from, such Preliminary Prospectus, which untrue statement or omission was corrected in the Prospectus, if the Company shall sustain the burden of proving that (i) such Underwriter sold Securities to the person alleging such loss, claim, damage or liability without sending or giving or making available electronically, at or prior to the written confirmation of such sale, a copy of the Prospectus to such person, (ii) delivery of a Prospectus was required under the Act, and (iii) the Company delivered to the Underwriters copies of such Prospectus in such quantities as they shall have reasonably requested. (b) Each Underwriter will indemnify and hold harmless the Company against any losses, claims, damages or liabilities to which the Company may become subject, under the Act or otherwise, insofar as such losses, claims, damages or liabilities (or actions in respect thereof) arise out of or are based upon an untrue statement or alleged untrue statement of a material fact contained in any Preliminary Prospectus, any preliminary prospectus supplement, the Registration Statement, the Prospectus as amended or supplemented and any other prospectus relating to the Securities, or any amendment or supplement thereto, or arise out of or are based upon the omission or alleged omission to state therein a material fact required to be stated therein or necessary to make the statements therein not misleading, in each case to the extent, but only to the extent, that such untrue statement or alleged untrue statement or omission or alleged omission was made in any Preliminary Prospectus, any preliminary prospectus supplement, the Registration Statement, the Prospectus as amended or supplemented and any other prospectus relating to the Securities, or any such amendment or supplement in reliance upon and in conformity with written information furnished to the Company by such Underwriter through the Representatives expressly for use therein; and will reimburse the Company for any legal or other expenses reasonably incurred by the Company in connection with investigating or defending any such action or claim as such expenses are incurred. (c) Promptly after receipt by an indemnified party under subsection (a) or (b) above of notice of the commencement of any action, such indemnified party shall, if a claim in respect thereof is to be made against the indemnifying party under such subsection, notify the indemnifying party in writing of the commencement thereof; but the omission so to notify the indemnifying party shall not relieve it from any liability which it may have to any indemnified party otherwise than under such subsection and shall relieve it from liability under such subsection only to the extent that such omission results in the forfeiture by the indemnifying party of material rights or defenses with 12 13 respect to such action. In case any such action shall be brought against any indemnified party and it shall notify the indemnifying party of the commencement thereof, the indemnifying party shall be entitled to participate therein and, to the extent that it shall wish, jointly with any other indemnifying party similarly notified, to assume the defense thereof, with counsel reasonably satisfactory to such indemnified party, and, after notice from the indemnifying party to such indemnified party of its election so to assume the defense thereof, the indemnifying party shall not be liable to such indemnified party under such subsection for any legal expenses of other counsel or any other expenses, in each case subsequently incurred by such indemnified party, in connection with the defense thereof other than reasonable costs of investigation. No indemnifying party shall, without the written consent of the indemnified party, effect the settlement or compromise of, or consent to the entry of any judgment with respect to, any pending or threatened action or claim in respect of which indemnification or contribution may be sought hereunder (whether or not the indemnified party is an actual or potential party to such action or claim) unless such settlement, compromise or judgement (i) includes an unconditional release of the indemnified party from all liability arising out of such action 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. No indemnifying party shall be liable for any settlement of any claim or action effected without its consent, which consent will not be unreasonably withheld. (d) If the indemnification provided for in this Section 8 is unavailable to or insufficient to hold harmless an indemnified party under subsection (a) or (b) above in respect of any losses, claims, damages or liabilities (or actions in respect thereof) referred to therein, then each indemnifying party shall contribute to the amount paid or payable by such indemnified party as a result of such losses, claims, damages or liabilities (or actions in respect thereof) in such proportion as is appropriate to reflect the relative benefits received by the Company on the one hand and the Underwriters of the Designated Securities on the other from the offering of the Designated Securities to which such loss, claim damage or liability (or action in respect thereof) relates. If, however, the allocation provided by the immediately preceding sentence is not permitted by applicable law or if the indemnified party failed to give the notice required under subsection (c) above, then each indemnifying party shall contribute to such amount paid or payable by such indemnified party in such proportion as is appropriate to reflect not only such relative benefits but also the relative fault of the Company on the one hand and the Underwriters of the Designated Securities on the other in connection with the statements or omissions which resulted in such losses, claims, damages or liabilities (or actions in respect thereof), as well as any other relevant equitable considerations. The relative benefits received by the Company on the one hand and such Underwriters on the other shall be deemed to be in the same proportion as the total net proceeds from the offering (before deducting expenses) received by the Company bear to the total underwriting discounts and commissions received by such Underwriters. The relative fault shall be determined by reference to, among other things, whether the untrue or alleged untrue statement of a material fact or the omission or alleged omission to state a material fact relates to information supplied by the Company on the one hand or such Underwriters on the other and the parties' relative intent, knowledge, access to information and opportunity to correct or prevent such statement or omission. The Company and the Underwriters agree that it would not be just and equitable if contribution pursuant to this subsection (d) were determined by pro rata allocation (even if the Underwriters were treated as one entity for such purpose) or by any other method of allocation which does not take account of the equitable considerations referred to above in this subsection (d). The amount paid or payable by an indemnified party as a result of the losses, claims, damages or liabilities (or actions in respect thereof) referred to above in this subsection (d) shall be deemed to include any legal or other expenses reasonably incurred by such indemnified party in connection with investigating or defending any such action or claim. Notwithstanding the provisions of this subsection (d), no Underwriter shall be required to contribute any amount in excess of the amount by which the total price at which the applicable Designated Securities underwritten by it and distributed to the public were offered to the public exceeds the amount of any 13 14 damages which such Underwriter has otherwise been required to pay by reason of such untrue or alleged untrue statement or omission or alleged omission. No person guilty of fraudulent misrepresentation (within the meaning of Section 11(f) of the Act) shall be entitled to contribution from any person who was not guilty of such fraudulent misrepresentation. The obligations of the Underwriters of Designated Securities in this subsection (d) to contribute are several in proportion to their respective underwriting obligations with respect to such Designated Securities and not joint. (e) The obligations of the Company under this Section 8 shall be in addition to any liability which the Company may otherwise have and shall extend, upon the same terms and conditions, to each person, if any, who controls any Underwriter within the meaning of the Act; and the obligations of the Underwriters under this Section 8 shall be in addition to any liability which the respective Underwriters may otherwise have and shall extend, upon the same terms and conditions, to each officer and director of the Company and to each person, if any, who controls the Company within the meaning of the Act. 9. (a) If any Underwriter shall default in its obligation to purchase the Designated Securities which it has agreed to purchase under the Pricing Agreement relating to such Designated Securities, the Representatives, may in their discretion arrange for themselves or another party or other parties to purchase such Designated Securities on the terms contained in the Pricing Agreement relating to such Designated Securities. If within thirty-six hours after such default by any Underwriter the Representatives do not arrange for the purchase of such Securities, then the Company shall be entitled to a further period of thirty-six hours within which to procure another party or other parties satisfactory to the Representatives to purchase such Designated Securities on such terms. In the event that, within the respective prescribed periods, the Representatives notify the Company that they have so arranged for the purchase of such Designated Securities, or the Company notifies the Representatives that it has so arranged for the purchase of such Designated Securities, the Representatives or the Company shall have the right to postpone the Time of Delivery for such Designated Securities for a period of not more than seven days, in order to effect whatever changes may thereby be made necessary in the Registration Statement or the Prospectus as amended or supplemented, or in any other documents or arrangements, and the Company agrees to file promptly any amendments to the Registration Statement or the Prospectus which in the opinion of the Representatives may thereby be made necessary. The term "Underwriter" as used in the Pricing Agreement shall include any person substituted under this Section with like effect as if such person had originally been a party to this Agreement with respect to such Designated Securities. (b) If, after giving effect to any arrangements for the purchase of the Designated Securities of a defaulting Underwriter or Underwriters by the Representatives and the Company as provided in subsection (a) above, the aggregate principal amount of such Designated Securities which remains unpurchased does not exceed one-eleventh of the aggregate principal amount of the Designated Securities, then the Company shall have the right to require each non-defaulting Underwriter to purchase the principal amount of Designated Securities which such Underwriter agreed to purchase under the Pricing Agreement relating to such Designated Securities and, in addition, to require each non-defaulting Underwriter to purchase its pro rata share (based on the principal amount of Designated Securities which such Underwriter agreed to purchase under such Pricing Agreement) of the Designated Securities of such defaulting Underwriter or Underwriters for which such arrangements have not been made; but nothing herein shall relieve a defaulting Underwriter from liability for its default. (c) If, after giving effect to any arrangements for the purchase of the Designated Securities of a defaulting Underwriter or Underwriters by the Representatives and the Company as provided in subsection (a) above, the aggregate principal amount of Designated Securities which remains unpurchased exceeds one-eleventh of the aggregate principal amount of the Designated Securities, or if the Company shall not exercise the right described in subsection (b) above to require non-defaulting Underwriters to purchase Designated Securities of a defaulting Underwriter or Underwriters, then the Pricing Agreement relating to such Designated Securities shall thereupon terminate, 14 15 without liability on the part of any non-defaulting Underwriter or the Company, except for the expenses to be borne by the Company and the Underwriters as provided in Section 6 hereof and the indemnity and contribution agreements in Section 8 hereof; but nothing herein shall relieve a defaulting Underwriter from liability for its default. 10. The respective indemnities, agreements, representations, warranties and other statements of the Company and the several Underwriters, as set forth in this Agreement or made by or on behalf of them, respectively, pursuant to this Agreement, shall remain in full force and effect, regardless of any investigation (or any statement as to the results thereof) made by or on behalf of any Underwriter or any controlling person of any Underwriter, or the Company, or any officer or director or controlling person of the Company, and shall survive delivery of and payment for the Securities. 11. If any Pricing Agreement shall be terminated pursuant to Section 9 hereof, the Company shall not then be under any liability to any Underwriter with respect to the Designated Securities covered by such Pricing Agreement except as provided in Sections 6 and 8 hereof; but, if for any other reason, the Designated Securities are not delivered by or on behalf of the Company as provided herein, the Company will reimburse the Underwriters for all out-of-pocket expenses approved in writing by the Representatives, including fees and disbursements of counsel, reasonably incurred by the Underwriters in making preparations for the purchase, sale and delivery of the Designated Securities, but the Company shall then be under no further liability to any Underwriter with respect to such Designated Securities except as provided in Section 6 and Section 8 hereof. 12. In all dealings hereunder, the Representatives of the Underwriters of Designated Securities shall act on behalf of each of such Underwriters, and the parties hereto shall be entitled to act and rely upon any statement, request, notice or agreement on behalf of any Underwriter made or given by such Representatives jointly or by such of the Representatives, if any, as may be designated for such purpose in the Pricing Agreement. All statements, requests, notices, and agreements hereunder shall be in writing, and if to the Underwriters shall be delivered or sent by mail, telex or facsimile transmission to the address of the Representatives as set forth in the Pricing Agreement; and if to the Company shall be delivered or sent by mail, telex or facsimile transmission to the address of the Company set forth in the Registration Statement, Attention: Secretary; provided, however, that any notice to an Underwriter pursuant to Section 8(c) hereof shall be delivered to sent by mail, telex or facsimile transmission to such Underwriter at its address set forth in its Underwriters' Questionnaire, or telex constituting such Questionnaire, which address will be supplied to the Company by the Representatives upon request. Any such statements, requests, notices or agreements shall take effect upon receipt thereof. 13. This Agreement and each Pricing Agreement shall be binding upon, and inure solely to the benefit, of, the Underwriters, the Company and, to the extent provided in Sections 8 and 10 hereof, the officers and directors of the Company and each person who controls the Company or any Underwriter, and their respective heirs, executors, administrators, successors and assigns, and no other person shall acquire or have any right under or by virtue of this Agreement or any such Pricing Agreement. No purchaser of any of the Securities from any Underwriter shall be deemed a successor or assign by reason merely of such purchase. 14. Time shall be of the essence of each Pricing Agreement. As used herein, "business day" shall mean any day when the Commission's office in Washington, D.C. is open for business. 15. THIS AGREEMENT AND EACH PRICING AGREEMENT SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK. 16. This Agreement and each Pricing Agreement may be executed by any one or more of the parties hereto and thereto in any number of counterparts, each of which shall be deemed to be an original, but all such respective counterparts shall together constitute one and the same instrument. 15 16 If the foregoing is in accordance with your understanding, please sign and return to us five counterparts hereof. Very truly yours, EG&G, Inc. By: ------------------------------- Name: Title: Accepted as of the date hereof: Goldman, Sachs & Co. Merrill Lynch & Co. By: --------------------------------- (Goldman, Sachs & Co.) 16 17 ANNEX I PRICING AGREEMENT Goldman, Sachs & Co., Merrill Lynch & Co. As Representatives of the several Underwriters named in Schedule I hereto, c/o Goldman, Sachs & Co. 85 Broad Street New York, New York 10004. , 1995 Ladies and Gentlemen: EG&G, Inc. a Massachusetts corporation (the "Company"), proposes, subject to the terms and conditions stated herein and in the Underwriting Agreement, dated , 1995 (the "Underwriting Agreement"), between the Company on the one hand and Goldman, Sachs & Co., and Merrill Lynch & Co. on the other hand, to issue and sell to the Underwriters named in Schedule I hereto (the "Underwriters") the Securities specified in Schedule II hereto (the "Designated Securities"). Each of the provisions of the Underwriting Agreement is incorporated herein by reference in its entirety, and shall be deemed to be a part of this Agreement to the same extent as if such provisions had been set forth in full herein; and each of the representations and warranties set forth therein shall be deemed to have been made at and as of the date of this Pricing Agreement, except that each representation and warranty which refers to the Prospectus in Section 2 of the Underwriting Agreement shall be deemed to be a representation or warranty as of the date of the Underwriting Agreement in relation to the Prospectus (as therein defined), and also a representation and warranty as of the date of this Pricing Agreement in relation to the prospectus as amended or supplemented relating to the Designated Securities which are the subject of this Pricing Agreement. Each reference to the Representatives herein and in the provision of the Underwriting Agreement so incorporated by reference shall be deemed to refer to you. Unless otherwise defined herein, terms defined in the Underwriting Agreement are used herein as therein defined. The Representatives designated to act on behalf of the Representatives and on behalf of each of the Underwriters of the Designated Securities pursuant to Section 12 of the Underwriting Agreement and the adders of the Representatives referred to in such Section 12 are set forth at the end of Schedule II hereto. An amendment to the Registration Statement, or a supplement to the Prospectus, as the case may be, relating to the Designated Securities, in the form heretofore delivered to you is now proposed to be filed with the Commission Subject to the terms and conditions set forth herein and in the Underwriting Agreement incorporated herein by reference, the Company agrees to issue and sell to each of the Underwriters, and each of the Underwriters agrees severally and not jointly, to purchase from the Company, at the time and place and at the purchase price to the Underwriters set forth in Schedule II hereto, the principal amount of Designated Securities set forth opposite the name of such Underwriter in Schedule I hereto. If the foregoing is in accordance with your understanding, please sign and return to us five counterparts hereof, and upon acceptance hereof by you, on behalf of each of the Underwriters, this letter and such acceptance hereof, including the provisions of the Underwriting Agreement incorporated herein by reference, shall constitute a binding agreement between each of the Underwriters and the Company. It is understood that your acceptance of this letter on behalf of each of the I-1 18 Underwriters is or will be pursuant to the authority set forth in a form of Agreement among Underwriters, the form of which shall be submitted to the Company for examination upon request, but without warranty on the part of the Representatives as to the authority of the signers thereof. Very truly yours, EG&G, Inc. By: ------------------------------ Name: Title: Accepted as of the date hereof: Goldman, Sachs & Co. Merrill Lynch & Co. By: ------------------------------------- (Goldman, Sachs & Co.) On behalf of each of the Underwriters I-2 19 SCHEDULE I
PRINCIPAL AMOUNT OF DESIGNATED SECURITIES TO BE UNDERWRITER PURCHASED - ----------- ----------- Goldman, Sachs & Co. ........................................................... $ Merrill Lynch & Co. ............................................................ ----------- Total........................................................................... $ ==========
S-1 20 SCHEDULE II TITLE OF DESIGNATED SECURITIES: __ % Notes due _____________ AGGREGATE PRINCIPAL AMOUNT: $_________ PRICE TO PUBLIC: __ % of the principal amount of the Designated Securities, plus accrued interest, if any, form _________ to __________. PURCHASE PRICE BY UNDERWRITERS: __ % of the principal amount of the Designated Securities, plus accrued interest from _________ to _________ . FORM OF DESIGNATED SECURITIES: Definitive form to be made available for checking and packaging at least twenty-four hours prior to the Time of Delivery at the office of The Depository Trust Company or its designated custodian. SPECIFIED FUNDS FOR PAYMENT OF PURCHASE PRICE: New York Clearing House (next day) funds TIME OF DELIVERY: _____ a.m. (New York City time), _________, 1995 INDENTURE: Indenture dated _________, 1995 between the Company and The First National Bank of Boston, as Trustee MATURITY: INTEREST RATE: [months and dates, commencing _________, 1995] S-2 21 REDEMPTION PROVISIONS: SINKING FUND PROVISION: DEFEASANCE PROVISIONS: CLOSING LOCATION FOR DELIVERY OF DESIGNATED SECURITIES: NAME AND ADDRESS OF REPRESENTATIVES: Designated Representatives: Goldman, Sachs & Co. Address for Notices, etc.: 85 Broad Street New York, NY 10004 Attention: Syndicate Department
S-3 22 SCHEDULE III MATERIAL SUBSIDIARIES
STATE OR JURISDICTION NAME OF INCORPORATION ---- --------------------- EG&G Florida, Inc. ....................................................... EG&G Washington Analytical Services Center, Inc. ......................... EG&G Special Projects, Inc. .............................................. EG&G International, Ltd. ................................................. EG&G Automotive Research, Inc. ........................................... Rotron Incorporated....................................................... EG&G Sealol, Inc. ........................................................ EG&G Dynstrend, Inc. ..................................................... Laboratorium Prof. Dr. Rudolf Berthold GmbH & Co. KG...................... EG&G Ltd. ................................................................ Wallach OY................................................................ EG&G Power Systems, Inc. ................................................. EG&G Canada Ltd. ......................................................... EG&G Structural Kinematics, Inc. ......................................... Heimann Optoelectronics GmbH.............................................. IC Sensors, Inc. .........................................................
S-4 23 ANNEX II Pursuant to Section 7(e) of the Underwriting Agreement, the accountants shall furnish letters to the Underwriters to the effect that: (i) They are independent certified public accountants with respect to the Company and its subsidiaries within the meaning of the Act and the applicable published rules and regulations thereunder; (ii) In their opinion, the financial statements and any supplementary financial information and schedules (and, if applicable, prospective financial statements and/or pro forma financial information) examined by them and included or incorporated by reference in the Registration Statement or the Prospectus comply as to form in all material respects with the applicable accounting requirements of the Act or the Exchange Act, as applicable, and the related published rules and regulations thereunder; and, if applicable, they have made a review in accordance with standards established by the American Institute of Certified Public Accountants of the consolidated interim financial statements, selected financial data, pro forma financial information, prospective financial statements and/or condensed financial statements derived from audited financial statements of the Company for the periods specified in such letter, as indicated in their reports thereon, copies of which have been furnished to the representatives of the Underwriters (the "Representatives"); (iii) They have made a review in accordance with standards established by the American Institute of Certified Public Accountants of the unaudited condensed consolidated statements of income, consolidated balance sheets and consolidated statements of cash flows included in the Prospectus and/or included in the Company's quarterly reports on Form 10-Q incorporated by reference into the Prospectus as indicated in their reports thereon, copies of which have been separately furnished to the Representatives; and on the basis of specified procedures including inquires of officials of the Company who have responsibility for financial and accounting matters regarding whether the unaudited condensed consolidated financial statements referred to in paragraph (vi)(A) below comply as to form in all material respects with the applicable accounting requirements of the Exchange Act and the related published rules and regulations, nothing came to their attention that caused them to believe that the unaudited condensed consolidated financial statements do not comply as to form in all material respects with the applicable accounting requirements of the Exchange Act and the related published rules and regulations; (iv) They have compared the information in the Prospectus under selected captions with the disclosure requirements of Regulation S-K and on the basis of limited procedures specified in such letter nothing came to their attention as a result of the foregoing procedures that caused them to believe that this information does not conform in all material respects with the disclosure requirements of Items 301, 302 and 503(d), respectively, of Regulation S-K; (v) The unaudited selected financial information with respect to the consolidated results of operations and financial position of the Company for the five most recent fiscal years included in the Prospectus and included or incorporated by reference in Item 6 of the Company's Annual Report on Form 10-K for the most recent fiscal year agrees with the corresponding amounts (after restatement where applicable) in the audited consolidated financial statements for such given fiscal years which were included or incorporated by reference in the Company's Annual Reports on Form 10-K for such fiscal years; (vi) On the basis of limited procedures, not constituting an examination in accordance with generally accepting auditing standards, consisting of a reading of the unaudited financial statements and other information referred to below, a reading of the latest available interim financial statements of the Company and its Material Subsidiaries, inspection of the minute II-1 24 books of the Company since the date of the latest audited financial statements included or incorporated by reference in the Prospectus, inquiries of officials of the Company and its Material Subsidiaries responsible for financial and accounting matters and such other inquiries and procedures as may be specified in such letter, nothing came to their attention that caused them to believe that: (A) the unaudited condensed statements of income, consolidated balance sheets and consolidated statements of cash flows included or incorporated by reference in the Company's Quarterly Reports on Form 10-Q incorporated by reference in the Prospectus do not comply as to form in all material respects with the applicable accounting requirements of the Exchange Act as it applies to Form 10-Q and the related published rules and regulations thereunder or are not in conformity with generally accepted accounting principles applied on a consolidated basis substantially consistent with the basis for the audited consolidated statements of income, consolidated balance sheets and consolidated statements of cash flows included or incorporated by reference in the Company's Annual Report on Form 10-K for the most recent fiscal year; (B) any other unaudited income statement data and balance sheet items included in the Prospectus do not agree with the corresponding items in the unaudited consolidated financial statements from which such data and items were derived, and any such unaudited data and items were not determined on a basis substantially consistent with the basis for the corresponding amounts in the audited consolidated financial statements included or incorporated by reference in the Company's Annual Report on Form 10-K for the most recent fiscal year; (C) the unaudited financial statements which were not included in the Prospectus but from which were derived the unaudited condensed financial statements referred to in Clause (A) and any unaudited income statement data and balance sheet items included in the Prospectus and referred to in Clause (B) were not determined on a basis substantially consistent with the basis for the audited financial statements included or incorporated by reference in the Company's Annual Report on Form 10-K for the most recent fiscal year; (D) any unaudited pro forma consolidated condensed financial statements included or incorporated by reference in the Prospectus do not comply as to form in all material respects with the applicable accounting requirements of the Act and the published rules and regulations thereunder or the pro forma adjustments have not been properly applied to the historical amounts in the compilation of those statements; (E) as of a specified date not more than five days prior to the date of such letter, there have been any changes in the consolidated capital stock (other than issuances of capital stock upon exercise of options and stock appreciation rights, upon earn-outs of performance shares and upon conversions of convertible securities, in each case which were outstanding on the date of the latest balance sheet included or incorporated by reference in the Prospectus) or any increase in the consolidated long-term debt of the Company and its subsidiaries, or any decreases in consolidated net current assets or net assets or other items specified by the Representatives, or any increases in any items specified by the Representatives, in each case as compared with amounts shown in the latest balance sheet included or incorporated by reference in the Prospectus, except in each case for changes, increases or decreases which the Prospectus discloses have occurred or may occur or which are described in such letter; and (F) for the period from the date of the latest financial statements included or incorporated by reference in the Prospectus to the specified date referred to in Clause (E) there were any decreases in consolidated net revenues or operating profit or the total or per shares amounts of consolidated net income or other items specified by the Representatives, or any increases in any items specified by the Representatives, in each case as II-2 25 compared with the comparable period of the preceding year and with any other period of corresponding length specified by the Representatives, except in each case for increases or decreases which the Prospectus discloses have occurred or may occur or which are described in such letter; and (vii) In addition to the examination referred to in their report(s) included or incorporated by reference in the Prospectus and the limited procedures, inspection of minute books, inquiries and other procedures referred to in paragraphs (iii) and (iv) above, they have carried out certain specified procedures, not constituting an examination in accordance with generally accepted auditing standards, with respect to certain amounts, percentages and financial information specified by the Representatives which are derived from the general accounting records of the Company and its subsidiaries, which appear in the Prospectus (excluding documents incorporated by reference) or in Part II of, or in exhibits and schedules to, the Registration Statement specified by the Representatives or in documents incorporated by reference in the Prospectus specified by the Representatives, and have compared certain of such amounts, percentages and financial information with the accounting records of the Company and its subsidiaries and have found them to be in agreement. All references in this Annex II to the Prospectus shall be deemed to refer to the Prospectus (including the documents incorporated by reference therein) as defined in the Underwriting Agreement as of the date of the letter and to the Prospectus as amended or supplemented. II-3 EX-4.1 3 FORM OF INDENTURE 1 ================================================================================ EG&G, INC. and THE FIRST NATIONAL BANK OF BOSTON Trustee _______________________ INDENTURE Dated as of May __, 1995 ______________________ Providing for Issuance of Securities in Series ================================================================================ 2 _______________________________________________ Certain Sections of this Indenture relating to Sections 310 through 318, inclusive, of the Trust Indenture Act of 1939:
Trust Indenture Act Section Indenture Section Section 310(a)(1) . . . . . . . . . . . . . . . . . . . . . 609 (a)(2) . . . . . . . . . . . . . . . . . . . . . 609 (a)(3) . . . . . . . . . . . . . . . . . . . . . Not Applicable (a)(4) . . . . . . . . . . . . . . . . . . . . . Not Applicable (b) . . . . . . . . . . . . . . . . . . . . . 608 . . . . . . . . . . . . . . . . . . . . . 610 Section 311(a) . . . . . . . . . . . . . . . . . . . . . 613 (b) . . . . . . . . . . . . . . . . . . . . . 613 Section 312(a) . . . . . . . . . . . . . . . . . . . . . 701 . . . . . . . . . . . . . . . . . . . . . 702(a) (b) . . . . . . . . . . . . . . . . . . . . . 702(b) (c) . . . . . . . . . . . . . . . . . . . . . 702(c) Section 313(a) . . . . . . . . . . . . . . . . . . . . . 703(a) (b) . . . . . . . . . . . . . . . . . . . . . 703(a) (c) . . . . . . . . . . . . . . . . . . . . . 703(a) (d) . . . . . . . . . . . . . . . . . . . . . 703(b) Section 314(a) . . . . . . . . . . . . . . . . . . . . . 704 (a)(4) . . . . . . . . . . . . . . . . . . . . . 101 . . . . . . . . . . . . . . . . . . . . . 1004 (b) . . . . . . . . . . . . . . . . . . . . . Not Applicable (c)(1) . . . . . . . . . . . . . . . . . . . . . 102 (c)(2) . . . . . . . . . . . . . . . . . . . . . 102 (c)(3) . . . . . . . . . . . . . . . . . . . . . Not Applicable (d) . . . . . . . . . . . . . . . . . . . . . Not Applicable (e) . . . . . . . . . . . . . . . . . . . . . 102 Section 315(a) . . . . . . . . . . . . . . . . . . . . . 601 (b) . . . . . . . . . . . . . . . . . . . . . 602 (c) . . . . . . . . . . . . . . . . . . . . . 601 (d) . . . . . . . . . . . . . . . . . . . . . 601 (e) . . . . . . . . . . . . . . . . . . . . . 514 Section 316(a) . . . . . . . . . . . . . . . . . . . . . 101 (a)(1)(A) . . . . . . . . . . . . . . . . . . . 512 (a)(1)(B) . . . . . . . . . . . . . . . . . . . 513 (a)(2) . . . . . . . . . . . . . . . . . . . . . Not Applicable (b) . . . . . . . . . . . . . . . . . . . . . 508 (c) . . . . . . . . . . . . . . . . . . . . . 104(c) Section 317(a)(1) . . . . . . . . . . . . . . . . . . . . . 503 (a)(2) . . . . . . . . . . . . . . . . . . . . . 504
-i- 3 (b) . . . . . . . . . . . . . . . . . . . . . 1003 Section 318(a) . . . . . . . . . . . . . . . . . . . . . 107
________ NOTE: This reconciliation and tie shall not, for any purpose, be deemed to be a part of the Indenture. -ii- 4 TABLE OF CONTENTS ____________
PAGE PARTIES . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . RECITALS OF THE COMPANY . . . . . . . . . . . . . . . . . . . . . . . . . . . . . ARTICLE ONE DEFINITIONS AND OTHER PROVISIONS OF GENERAL APPLICATION SECTION 101. Definitions: Act . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Affiliate; Control . . . . . . . . . . . . . . . . . . . . . . . . Attributable Debt . . . . . . . . . . . . . . . . . . . . . . . . . Authenticating Agent . . . . . . . . . . . . . . . . . . . . . . . Board of Directors . . . . . . . . . . . . . . . . . . . . . . . . Board Resolution . . . . . . . . . . . . . . . . . . . . . . . . . Business Day . . . . . . . . . . . . . . . . . . . . . . . . . . . Commission . . . . . . . . . . . . . . . . . . . . . . . . . . . . Company . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Company Request; Company Order . . . . . . . . . . . . . . . . . . Consolidated Net Tangible Assets . . . . . . . . . . . . . . . . . Corporate Trust Office . . . . . . . . . . . . . . . . . . . . . . Corporation . . . . . . . . . . . . . . . . . . . . . . . . . . . . Defaulted Interest . . . . . . . . . . . . . . . . . . . . . . . . Discharged . . . . . . . . . . . . . . . . . . . . . . . . . . . . Event of Default . . . . . . . . . . . . . . . . . . . . . . . . . Funded Debt . . . . . . . . . . . . . . . . . . . . . . . . . . . . Holder . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Indenture . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Interest . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Interest Payment Date . . . . . . . . . . . . . . . . . . . . . . . Lien . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Maturity . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Officers' Certificate . . . . . . . . . . . . . . . . . . . . . . . Opinion of Counsel . . . . . . . . . . . . . . . . . . . . . . . . Original Issue Discount Security . . . . . . . . . . . . . . . . . Outstanding . . . . . . . . . . . . . . . . . . . . . . . . . . . . Paying Agent . . . . . . . . . . . . . . . . . . . . . . . . . . . Person . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Place of Payment . . . . . . . . . . . . . . . . . . . . . . . . . Predecessor Security . . . . . . . . . . . . . . . . . . . . . . . Principal Property . . . . . . . . . . . . . . . . . . . . . . . . Redemption Date . . . . . . . . . . . . . . . . . . . . . . . . . .
________ NOTE: This table of contents shall not, for any purpose, be deemed to be a part of the Indenture. 5 PAGE Redemption Price . . . . . . . . . . . . . . . . . . . . . . . . . Responsible Officer . . . . . . . . . . . . . . . . . . . . . . . . Restricted Subsidiary . . . . . . . . . . . . . . . . . . . . . . . Sale and Leaseback Transaction . . . . . . . . . . . . . . . . . . Secured Funded Debt . . . . . . . . . . . . . . . . . . . . . . . . Securities . . . . . . . . . . . . . . . . . . . . . . . . . . . . Security Register and Security Registrar . . . . . . . . . . . . . Special Record Date . . . . . . . . . . . . . . . . . . . . . . . . Stated Maturity . . . . . . . . . . . . . . . . . . . . . . . . . . Subsidiary . . . . . . . . . . . . . . . . . . . . . . . . . . . . Trustee . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Trust Indenture Act . . . . . . . . . . . . . . . . . . . . . . . . Unrestricted Subsidiary . . . . . . . . . . . . . . . . . . . . . . U.S. Government Obligation . . . . . . . . . . . . . . . . . . . . Value . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Vice President . . . . . . . . . . . . . . . . . . . . . . . . . . Wholly-owned Subsidiary . . . . . . . . . . . . . . . . . . . . . . SECTION 102. Compliance Certificates and Opinions . . . . . . . . . . . . . . . SECTION 103. Form of Documents Delivered to Trustee . . . . . . . . . . . . . . SECTION 104. Acts of Holders; Record Dates . . . . . . . . . . . . . . . . . . . SECTION 105. Notices, Etc., to Trustee and Company . . . . . . . . . . . . . . . SECTION 106. Notice to Holders; Waiver . . . . . . . . . . . . . . . . . . . . . SECTION 107. Conflict with Trust Indenture Act . . . . . . . . . . . . . . . . . SECTION 108. Effect of Headings and Table of Contents . . . . . . . . . . . . . SECTION 109. Successors and Assigns . . . . . . . . . . . . . . . . . . . . . . SECTION 110. Separability Clause . . . . . . . . . . . . . . . . . . . . . . . . SECTION 111. Benefits of Indenture . . . . . . . . . . . . . . . . . . . . . . . SECTION 112. Governing Law . . . . . . . . . . . . . . . . . . . . . . . . . . . SECTION 113. Legal Holidays . . . . . . . . . . . . . . . . . . . . . . . . . . ARTICLE TWO SECURITY FORMS SECTION 201. Forms Generally . . . . . . . . . . . . . . . . . . . . . . . . . . SECTION 202. Forms of Securities . . . . . . . . . . . . . . . . . . . . . . . . SECTION 203. Form of Trustee's Certificate of Authentication . . . . . . . . . . . . . . . . . . . . . . . . . . SECTION 204. Securities Issuable in the Form of a Global Security . . . . . . . . . . . . . . . . . . . . . . . . . ARTICLE THREE THE SECURITIES SECTION 301. Amount Unlimited, Issuable in Series . . . . . . . . . . . . . . . SECTION 302. Denominations . . . . . . . . . . . . . . . . . . . . . . . . . . .
-ii- 6 PAGE SECTION 303. Execution, Authentication, Delivery and Dating . . . . . . . . . . . . . . . . . . . . . . . . . . . . SECTION 304. Temporary Securities . . . . . . . . . . . . . . . . . . . . . . . SECTION 305. Registration, Registration of Transfer and Exchange . . . . . . . . . . . . . . . . . . . . . . . . . . . SECTION 306. Mutilated, Destroyed, Lost and Stolen Securities . . . . . . . . . . . . . . . . . . . . . . . . . SECTION 307. Payment of Interest; Interest Rights Preserved . . . . . . . . . . . . . . . . . . . . . . . . . . . . . SECTION 308. Persons Deemed Owners . . . . . . . . . . . . . . . . . . . . . . . SECTION 309. Cancellation . . . . . . . . . . . . . . . . . . . . . . . . . . . SECTION 310. Computation of Interest . . . . . . . . . . . . . . . . . . . . . . ARTICLE FOUR SATISFACTION AND DISCHARGE SECTION 401. Satisfaction and Discharge of Indenture . . . . . . . . . . . . . . SECTION 402. Application of Trust Money . . . . . . . . . . . . . . . . . . . . SECTION 403. Defeasance Upon Deposit of Funds or Government Obligations . . . . . . . . . . . . . . . . . . . . . . ARTICLE FIVE REMEDIES SECTION 501. Events of Default . . . . . . . . . . . . . . . . . . . . . . . . . SECTION 502. Acceleration of Maturity; Rescission and Annulment . . . . . . . . . . . . . . . . . . . . . . . . . . . . . SECTION 503. Collection of Indebtedness and Suits for Enforcement by Trustee . . . . . . . . . . . . . . . . . . . . . . SECTION 504. Trustee May File Proofs of Claim . . . . . . . . . . . . . . . . . SECTION 505. Trustee May Enforce Claims Without Possession of Securities . . . . . . . . . . . . . . . . . . . . . SECTION 506. Application of Money Collected . . . . . . . . . . . . . . . . . . SECTION 507. Limitation of Suits . . . . . . . . . . . . . . . . . . . . . . . . SECTION 508. Unconditional Right of Holders to Receive Principal, Premium and Interest . . . . . . . . . . . . . . . . . . SECTION 509. Restoration of Rights and Remedies . . . . . . . . . . . . . . . . SECTION 510. Rights and Remedies Cumulative . . . . . . . . . . . . . . . . . . SECTION 511. Delay or Omission Not Waiver . . . . . . . . . . . . . . . . . . . SECTION 512. Control by Holders . . . . . . . . . . . . . . . . . . . . . . . . SECTION 513. Waiver of Past Defaults . . . . . . . . . . . . . . . . . . . . . . SECTION 514. Undertaking for Costs . . . . . . . . . . . . . . . . . . . . . . . SECTION 515. Waiver of Stay or Extension Laws . . . . . . . . . . . . . . . . .
-iii- 7 ARTICLE SIX THE TRUSTEE PAGE SECTION 601. Certain Duties and Responsibilities . . . . . . . . . . . . . . . . SECTION 602. Notice of Defaults . . . . . . . . . . . . . . . . . . . . . . . . SECTION 603. Certain Rights of Trustee . . . . . . . . . . . . . . . . . . . . . SECTION 604. Not Responsible for Recitals or Issuance of Securities . . . . . . . . . . . . . . . . . . . . . . . . . . . . SECTION 605. May Hold Securities . . . . . . . . . . . . . . . . . . . . . . . . SECTION 606. Money Held in Trust . . . . . . . . . . . . . . . . . . . . . . . . SECTION 607. Compensation and Reimbursement . . . . . . . . . . . . . . . . . . SECTION 608. Disqualification; Conflicting Interests . . . . . . . . . . . . . . SECTION 609. Corporate Trustee Required; Eligibility . . . . . . . . . . . . . . SECTION 610. Resignation and Removal; Appointment of Successor . . . . . . . . . . . . . . . . . . . . . . . . . . . . . SECTION 611. Acceptance of Appointment by Successor . . . . . . . . . . . . . . SECTION 612. Merger, Conversion, Consolidation or Succession to Business . . . . . . . . . . . . . . . . . . . . . . SECTION 613. Preferential Collection of Claims Against Company . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . SECTION 614. Appointment of Authenticating Agent . . . . . . . . . . . . . . . . ARTICLE SEVEN HOLDERS' LISTS AND REPORTS BY TRUSTEE AND COMPANY SECTION 701. Company to Furnish Trustee Names and Addresses of Holders . . . . . . . . . . . . . . . . . . . . . . . SECTION 702. Preservation of Information; Communications to Holders . . . . . . . . . . . . . . . . . . . . . . . . . . . . SECTION 703. Reports by Trustee . . . . . . . . . . . . . . . . . . . . . . . . SECTION 704. Reports by Company . . . . . . . . . . . . . . . . . . . . . . . . ARTICLE EIGHT CONSOLIDATION, MERGER, CONVEYANCE, TRANSFER OR LEASE SECTION 801. Company May Consolidate, Etc., Only on Certain Terms . . . . . . . . . . . . . . . . . . . . . . . . . . . ARTICLE NINE SUPPLEMENTAL INDENTURES SECTION 901. Supplemental Indentures Without Consent of Holders . . . . . . . . . . . . . . . . . . . . . . . . . . . . SECTION 902. Supplemental Indentures with Consent of Holders . . . . . . . . . . . . . . . . . . . . . . . . . . . .
-iv- 8 PAGE SECTION 903. Execution of Supplemental Indentures . . . . . . . . . . . . . . . SECTION 904. Effect of Supplemental Indentures . . . . . . . . . . . . . . . . . SECTION 905. Conformity with Trust Indenture Act . . . . . . . . . . . . . . . . SECTION 906. Reference in Securities to Supplemental Indentures . . . . . . . . . . . . . . . . . . . . . . . . . . . . ARTICLE TEN COVENANTS SECTION 1001. Payment of Principal, Premium and Interest . . . . . . . . . . . . SECTION 1002. Maintenance of Office or Agency . . . . . . . . . . . . . . . . . . SECTION 1003. Money for Securities Payments to Be Held in Trust . . . . . . . . . . . . . . . . . . . . . . . . . . . . . SECTION 1004. Statement by Officers as to Default . . . . . . . . . . . . . . . . SECTION 1005. Existence . . . . . . . . . . . . . . . . . . . . . . . . . . . . . SECTION 1006. Limitation on Secured Funded Debt . . . . . . . . . . . . . . . . . SECTION 1007. Limitation on Sale and Leasebacks . . . . . . . . . . . . . . . . . SECTION 1008. Limitation on Designation of Unrestricted Subsidiary as Restricted Subsidiary . . . . . . . . . . . . . . . . SECTION 1009. Waiver of Certain Covenants . . . . . . . . . . . . . . . . . . . . ARTICLE ELEVEN REDEMPTION OF SECURITIES SECTION 1101. Applicability of Article . . . . . . . . . . . . . . . . . . . . . SECTION 1102. Election to Redeem; Notice to Trustee . . . . . . . . . . . . . . . SECTION 1103. Selection by Trustee of Securities to Be Redeemed . . . . . . . . . . . . . . . . . . . . . . . . . . . . . SECTION 1104. Notice of Redemption . . . . . . . . . . . . . . . . . . . . . . . SECTION 1105. Deposit of Redemption Price . . . . . . . . . . . . . . . . . . . . SECTION 1106. Securities Payment on Redemption Date . . . . . . . . . . . . . . . SECTION 1107. Securities Redeemed in Part . . . . . . . . . . . . . . . . . . . . ARTICLE TWELVE SINKING FUNDS SECTION 1201. Applicability of Article . . . . . . . . . . . . . . . . . . . . . SECTION 1202. Satisfaction of Sinking Fund Payments with Securities . . . . . . . . . . . . . . . . . . . . . . . . . . . . SECTION 1203. Redemption of Securities for Sinking Fund . . . . . . . . . . . . . TESTIMONIUM . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . SIGNATURES AND SEALS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . ACKNOWLEDGMENTS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
-v- 9 INDENTURE, dated as of May __, 1995, between EG&G, Inc., a corporation duly organized and existing under the laws of the Commonwealth of Massachusetts (herein called the "Company"), having its principal office at 45 William Street, Wellesley, Massachusetts 02181, and The First National Bank of Boston, a national banking association, as Trustee (herein called the "Trustee"). RECITALS OF THE COMPANY The Company has duly authorized the execution and delivery of this Indenture to provide for the issuance from time to time of its unsecured debentures, notes or other evidences of indebtedness (herein called the "Securities"), to be issued in one or more series as in this Indenture provided. All things necessary to make this Indenture a valid agreement of the Company, in accordance with its terms, have been done. NOW, THEREFORE, THIS INDENTURE WITNESSETH: For and in consideration of the premises and the purchase of the Securities by the Holders thereof, it is mutually agreed, for the equal and proportionate benefit of all Holders of the Securities or of series thereof, as follows: ARTICLE ONE DEFINITIONS AND OTHER PROVISIONS OF GENERAL APPLICATION SECTION 101. Definitions. For all purposes of this Indenture, except as otherwise expressly provided or unless the context otherwise requires: (1) the terms defined in this Article have the meanings assigned to them in this Article and include the plural as well as the singular; (2) all other terms used herein which are defined in the Trust Indenture Act, either directly or by reference therein, have the meanings assigned to them therein; (3) all accounting terms not otherwise defined herein have the meanings assigned to them in accordance with generally accepted accounting principles, and, except as otherwise herein expressly provided, the term "generally 10 accepted accounting principles" with respect to any computation required or permitted hereunder shall mean such accounting principles as are generally accepted at the date of such computation; and (4) the words "herein", "hereof" and "hereunder" and other words of similar import refer to this Indenture as a whole and not to any particular Article, Section or other subdivision. "Act", when used with respect to any Holder, has the meaning specified in Section 104. "Affiliate" of any specified Person means any other Person directly or indirectly controlling or controlled by or under direct or indirect common control with such specified Person. For the purposes of this definition, "control" when used with respect to any specified Person means the power to direct the management and policies of such Person, directly or indirectly, whether through the ownership of voting securities, by contract or otherwise; and the terms "controlling" and "controlled" have meanings correlative to the foregoing. "Attributable Debt" means with respect to any Sale and Leaseback Transaction (i) the balance sheet liability amount of any capital lease entered into pursuant to such Sale and Leaseback Transaction determined under generally accepted accounting principles, plus (ii) the present value at the time of determination of (a) the amount of future minimum lease payments under any operating lease entered into pursuant to such Sale and Leaseback Transaction required to be disclosed by generally accepted accounting principles, less (b) any amounts required to be paid on account of maintenance and repairs, insurance, taxes, assessments, water rates and similar charges, calculated using a discount rate equivalent to the Company's weighted average cost of funds for borrowed money at the time of the commencement of each such operating lease. "Authenticating Agent" means any Person authorized by the Trustee pursuant to Section 614 to act on behalf of the Trustee to authenticate Securities of one or more series. "Board of Directors" means either the board of directors of the Company or any duly authorized committee of that board. "Board Resolution" means a copy of a resolution certified by the Clerk or an Assistant Clerk of the Company to have been duly adopted by the Board of Directors (which resolution may delegate to specified officers of the Company the power to determine the forms of series of Securities pursuant to Sections 201 and 202 and -2- 11 the terms and provisions of series of Securities pursuant to Section 301, such determination to be evidenced by an Officers' Certificate) and to be in full force and effect on the date of such certification, and delivered to the Trustee. "Business Day", when used with respect to any Place of Payment, means each Monday, Tuesday, Wednesday, Thursday and Friday which is not a day on which banking institutions in that Place of Payment are authorized or obligated by law or executive order to close. "Commission" means the Securities and Exchange Commission, as from time to time constituted, created under the Securities Exchange Act of 1934, or, if at any time after the execution of this instrument such Commission is not existing and performing the duties now assigned to it under the Trust Indenture Act, then the body performing such duties at such time. "Company" means the Person named as the "Company" in the first paragraph of this instrument until a successor Person shall have become such pursuant to the applicable provisions of this Indenture, and thereafter "Company" shall mean such successor Person. "Company Request" or "Company Order" means a written request or order signed in the name of the Company by its Chairman of the Board of Directors, its Vice Chairman of the Board of Directors, its President or a Vice President, and by its Treasurer, an Assistant Treasurer, its Clerk or an Assistant Clerk, and delivered to the Trustee. "Consolidated Net Tangible Assets" means the total amount of assets on a consolidated balance sheet of the Company and its Restricted Subsidiaries (less applicable reserves and other properly deductible items and after excluding any investments made in Unrestricted Subsidiaries) after deducting (i) all liabilities, including Attributable Debt and including all other amounts in respect of obligations under leases (or guaranties thereof), which under generally accepted accounting principles would be included as liabilities on such balance sheet, but excluding all Funded Debt, accrued liabilities with respect to any pension plans or post-retirement medical plans, capital stock and surplus, surplus reserves and provisions for deferred income taxes, and (ii) goodwill, tradenames, trademarks, patents, unamortized debt discount and expense and other intangible items. "Corporate Trust Office" means the office of the Trustee of the Indenture at which at any particular time its corporate trust business shall be administered, which at the date of the Indenture -3- 12 is 150 Royall Street, Mail Stop 45-02-15, Canton, Massachusetts 02021, Attn: Corporate Trust Division. "Corporation" means a corporation, association, company, joint-stock company or business trust. "Defaulted Interest" has the meaning specified in Section 307. "Depositary" means, unless otherwise specified by the Company pursuant to either Section 204 or 301, with respect to Securities of any series issuable or issued as a Global Security, The Depository Trust Company, New York, New York, or any successor thereto registered as a clearing agency under the Securities Exchange Act of 1934, as amended, or other applicable statute or regulation. "Discharged" means, with respect to Securities of a series, that the Company shall be deemed to have paid and discharged the entire indebtedness represented by, and obligations under, the Securities of such series and to have satisfied all the obligations under this Indenture relating to the Securities of such series, except (A) the rights of Holders of Securities to receive, from the trust fund described in Section 403(1), payment of the principal and any premium of and any interest on such Securities when such payments are due; and (B) the Company's obligations with respect to such Securities under Sections 305, 306, 402, 1002 and 1003. "Event of Default" has the meaning specified in Section 501. "Funded Debt" means indebtedness of the Company or any Restricted Subsidiary for borrowed money maturing more than 12 months after the time of computation thereof, guaranties of indebtedness for borrowed money maturing more than 12 months after the time of computation thereof of any other Person (except guaranties in connection with the sale or discount of accounts receivable, trade acceptances and other instruments arising in the ordinary course of business) and indebtedness for borrowed money maturing more than 12 months after the time of computation thereof secured by a Lien on the property of the Company or any Restricted Subsidiary, whether or not such indebtedness is assumed by the Company or such Restricted Subsidiary. Funded Debt does not include any amount in respect of obligations under leases of real or personal property, or guaranties thereof, including Attributable Debt, and any accrued liabilities with respect to any pension plans or post-retirement medical plans, whether or not any such obligations would be included as liabilities on a consolidated balance sheet of the Company and its Restricted Subsidiaries. -4- 13 "Global Security," when used with respect to any series of Securities issued hereunder, means a Security which is executed by the Company and authenticated and delivered by the Trustee to the Depositary or pursuant to the Depositary's instruction, all in accordance with this Indenture and an indenture supplemental hereto, if any, or Board Resolution and pursuant to a Company Request, which shall be registered in the name of the Depositary or its nominee and which shall represent, and shall be denominated in an amount equal to the aggregate principal amount of all of the Outstanding Securities of such series or any portion thereof, in either case having the same terms, including, without limitation, the same original issue date, date or dates on which principal is due, and interest rate or method of determining interest. "Holder" means a Person in whose name a Security is registered in the Security Register. "Indenture" means this instrument as originally executed or as it may from time to time be supplemented or amended by one or more indentures supplemental hereto entered into pursuant to the applicable provisions hereof, including, for all purposes of this instrument and any such supplemental indenture, the provisions of the Trust Indenture Act that are deemed to be a part of and govern this instrument and any such supplemental indenture, respectively. The term "Indenture" shall also include the terms of particular series of Securities established as contemplated by Section 301. "Interest", when used with respect to an Original Issue Discount Security which by its terms bears interest only after Maturity, means interest payable after Maturity. "Interest Payment Date", when used with respect to any Security, means the Stated Maturity of an installment of interest on such Security. "Lien" means any mortgage, pledge, lien, encumbrance, charge or security agreement. "Maturity", when used with respect to any Security, means the date on which the principal of such Security or an installment of principal becomes due and payable as therein or herein provided, whether at the Stated Maturity or by declaration of acceleration, call for redemption or otherwise. "Officers' Certificate" means a certificate signed by the Chairman of the Board of Directors, a Vice Chairman of the Board of Directors, the President or a Vice President, and by the Treasurer, an Assistant Treasurer, the Clerk or an Assistant Clerk of the Company, and delivered to the Trustee. -5- 14 "Opinion of Counsel" means a written opinion of counsel, who may be counsel for the Company, and who shall be acceptable to the Trustee. "Original Issue Discount Security" means any Security which provides for an amount less than the principal amount thereof to be due and payable upon a declaration of acceleration of the Maturity thereof. "Outstanding", when used with respect to Securities, means, as of the date of determination, all Securities theretofore authenticated and delivered under this Indenture, except: (i) Securities theretofore cancelled by the Trustee or delivered to the Trustee for cancellation; (ii) Securities for whose payment or redemption money in the necessary amount has been theretofore deposited with the Trustee or any Paying Agent (other than the Company) in trust or set aside and segregated in trust by the Company (if the Company shall act as its own Paying Agent) for the Holders of such Securities; provided that, if such Securities are to be redeemed, notice of such redemption has been duly given pursuant to this Indenture or provision therefor satisfactory to the Trustee has been made; and (iii) Securities which have been paid pursuant to Section 306 or in exchange for or in lieu of which other Securities have been authenticated and delivered pursuant to this Indenture, other than any such Securities in respect of which there shall have been presented to the Trustee proof satisfactory to it that such Securities are held by a bona fide purchaser in whose hands such Securities are valid obligations of the Company; provided, however, that in determining whether the Holders of the requisite principal amount of the Outstanding Securities have given any request, demand, authorization, direction, notice, consent or waiver hereunder, (i) the principal amount of an Original Issue Discount Security that shall be deemed to be Outstanding shall be the amount of the principal thereof that would be due and payable as of the date of such determination upon acceleration of the Maturity thereof pursuant to Section 502, (ii) the principal amount of a Security denominated in one or more foreign currencies or currency units shall be the U.S. dollar equivalent, determined in the manner provided as contemplated by Section 301 on the date of original issuance of such Security, of the principal amount (or, in the case of an Original Issue -6- 15 Discount Security, the U.S. dollar equivalent on the date of original issuance of such Security of the amount determined as provided in (i) above) of such Security, and (iii) Securities owned by the Company or any other obligor upon the Securities or any Affiliate of the Company or of such other obligor shall be disregarded and deemed not to be Outstanding, except that, in determining whether the Trustee shall be protected in relying upon any such request, demand, authorization, direction, notice, consent or waiver, only Securities which the Trustee knows to be so owned shall be so disregarded. Securities so owned which have been pledged in good faith may be regarded as Outstanding if the pledgee establishes to the satisfaction of the Trustee the pledgee's right so to act with respect to such Securities and that the pledgee is not the Company or any other obligor upon the Securities or any Affiliate of the Company or of such other obligor. "Paying Agent" means any Person authorized by the Company to pay the principal of or any premium or interest on any Securities on behalf of the Company. "Person" means any individual, corporation, partnership, joint venture, trust, unincorporated organization or government or any agency or political subdivision thereof. "Place of Payment", when used with respect to the Securities of any series, means the place or places where the principal of and any premium and interest on the Securities of that series are payable as contemplated by Section 301. "Predecessor Security" of any particular Security means every previous Security evidencing all or a portion of the same debt as that evidenced by such particular Security; and, for the purposes of this definition, any Security authenticated and delivered under Section 306 in exchange for or in lieu of a mutilated, destroyed, lost or stolen Security shall be deemed to evidence the same debt as the mutilated, destroyed, lost or stolen Security. "Principal Property" means any real property of the Company or any Restricted Subsidiary (and all equipment located at or comprising a part of such property) that has a net book value, as of the date of determination, in excess of the larger of 5% of the Consolidated Net Tangible Assets of the Company and $20,000,000. "Redemption Date", when used with respect to any Security to be redeemed, means the date fixed for such redemption by or pursuant to this Indenture. -7- 16 "Redemption Price", when used with respect to any Security to be redeemed, means the price at which it is to be redeemed pursuant to this Indenture. "Regular Record Date" for the interest payable on any Interest Payment Date on the Securities of any series means the date specified for that purpose as contemplated by Section 301. "Restricted Subsidiary" means any Subsidiary of the Company other than an Unrestricted Subsidiary. "Sale and Leaseback Transaction" means any arrangement with any Person pursuant to which the Company or any Restricted Subsidiary sells or transfers any Principal Property, more than 120 days after the acquisition thereof or, if later, the completion of construction and commencement of full operations thereof, to such Person and leases the Principal Property so sold or transferred from such Person, other than (i) leases for a term, including renewals at the option of the lessee, of not more than three years, and (ii) leases between the Company and a Restricted Subsidiary or between Restricted Subsidiaries. "Secured Funded Debt" means Funded Debt that is secured by a Lien upon any assets of the Company or any Restricted Subsidiary. "Securities" has the meaning stated in the first recital of this Indenture and more particularly means any Securities authenticated and delivered under this Indenture. "Security Register" and "Security Registrar" have the respective meanings specified in Section 305. "Special Record Date" for the payment of any Defaulted Interest means a date fixed by the Trustee pursuant to Section 307. "Stated Maturity", when used with respect to any Security or any installment of principal thereof or interest thereon, means the date specified in such Security as the fixed date on which the principal of such Security or such installment of principal or interest is due and payable. "Subsidiary" means a corporation more than 50% of the outstanding voting stock of which is owned, directly or indirectly, by the Company or by one or more other Subsidiaries, or by the Company and one or more other Subsidiaries. For the purposes of this definition, "voting stock" means stock which ordinarily has voting power for the election of directors, whether at all times or only so long as no senior class of stock has such voting power by reason of any contingency. -8- 17 "Trustee" means the Person named as the "Trustee" in the first paragraph of this instrument until a successor Trustee shall have become such pursuant to the applicable provisions of this Indenture, and thereafter "Trustee" shall mean or include each Person who is then a Trustee hereunder, and if at any time there is more than one such Person, "Trustee" as used with respect to the Securities of any series shall mean the Trustee with respect to Securities of that series. "Trust Indenture Act" means the Trust Indenture Act of 1939 as in force at the date as of which this instrument was executed; provided, however, that in the event the Trust Indenture Act of 1939 is amended after such date, "Trust Indenture Act" means, to the extent required by any such amendment, the Trust Indenture Act of 1939 as so amended. "Unrestricted Subsidiary" means a Subsidiary of the Company designated as an Unrestricted Subsidiary by the Board of Directors from time to time, in each case unless and until designated as a Restricted Subsidiary by the Board of Directors, and any Subsidiary a majority of the voting stock of which is owned by Unrestricted Subsidiaries. "U.S. Government Obligations" means direct obligations of, or obligations the principal of and interest on which are fully guaranteed by, the United States of America. "Value" means, with respect to a Sale and Leaseback Transaction, an amount equal to the greater of (i) the net proceeds of the sale or transfer of the property leased pursuant to such Sale and Leaseback Transaction or (ii) the fair value, as determined by the Company, of such property at the time of entering into such Sale and Leaseback Transaction. "Vice President", when used with respect to the Company or the Trustee, means any vice president, whether or not designated by a number or a word or words added before or after the title "vice president". "Wholly-owned Restricted Subsidiary" means a Restricted Subsidiary all of the capital stock of which (except directors' qualifying shares) is owned by the Company and its other Wholly-owned Restricted Subsidiaries. SECTION 102. Compliance Certificates and Opinions. Upon any application or request by the Company to the Trustee to take any action under any provision of this Indenture, the Company shall furnish to the Trustee such certificates and opinions as may be required under the Trust Indenture Act. Each -9- 18 such certificate or opinion shall be given in the form of an Officers' Certificate, if to be given by an officer of the Company, or an Opinion of Counsel, if to be given by counsel, and shall comply with the requirements of the Trust Indenture Act and any other requirements set forth in this Indenture. Every certificate or opinion with respect to compliance with a condition or covenant provided for in this Indenture shall include: (1) a statement that each individual signing such certificate or opinion has read such covenant or condition and the definitions herein relating thereto; (2) a brief statement as to the nature and scope of the examination or investigation upon which the statements or opinions contained in such certificate or opinion are based; (3) a statement that, in the opinion of each such individual, he has made such examination or investigation as is necessary to enable him to express an informed opinion as to whether or not such covenant or condition has been complied with; and (4) a statement as to whether, in the opinion of each such individual, such condition or covenant has been complied with. SECTION 103. Form of Documents Delivered to Trustee. In any case where several matters are required to be certified by, or covered by an opinion of, any specified Person, it is not necessary that all such matters be certified by, or covered by the opinion of, only one such Person, or that they be so certified or covered by only one document, but one such Person may certify or given an opinion with respect to some matters and one or more other such Persons as to other matters, and any such Person may certify or give an opinion as to such matters in one or several documents. Any certificate or opinion of an officer of the Company may be based, insofar as it relates to legal matters, upon a certificate or opinion of, or representations by, counsel, unless such officer knows, or in the exercise of reasonable care should know, that the certificate or opinion or representations with respect to the matters upon which his certificate or opinion is based are erroneous. Any such certificate or opinion of counsel may be based, insofar as it relates to factual matters, upon a certificate or opinion of, or representations by, an officer or officers of the Company stating that the information with respect -10- 19 to such factual matters is in the possession of the Company, unless such counsel knows, or in the exercise of reasonable care should know, that the certificate or opinion or representations with respect to such matters are erroneous. Where any Person is required to make, give or execute two or more applications, requests, consents, certificates, statements, opinions or other instruments under this Indenture, they may, but need not, be consolidated and form one instrument. SECTION 104. Acts of Holders; Record Dates. (a) Any request, demand, authorization, direction, notice, consent, waiver or other action provided by this Indenture to be given or taken by Holders may be embodied in and evidenced by one or more instruments of substantially similar tenor signed by such Holders in person or by agent duly appointed in writing; and, except as herein otherwise expressly provided, such action shall become effective when such instrument or instruments are delivered to the Trustee and, where it is hereby expressly required, to the Company. Such instrument or instruments (and the action embodied therein and evidenced thereby) are herein sometimes referred to as the "Act" of the Holders signing such instrument or instruments. Proof of execution of any such instrument or of a writing appointing any such agent shall be sufficient for any purpose of this Indenture and (subject to Section 601) conclusive in favor of the Trustee and the Company, if made in the manner provided in this Section. (b) The fact and date of the execution by any Person of any such instrument or writing may be provided by the affidavit of a witness of such execution or by a certificate of a notary public or other officer authorized by law to take acknowledgments of deeds, certifying that the individual signing such instrument or writing acknowledged to him the execution thereof. Where such execution is by a signer acting in a capacity other than his individual capacity, such certificate or affidavit shall also constitute sufficient proof of his authority. The fact and date of the execution of any such instrument or writing, or the authority of the Person executing the same, may also be proved in any other manner which the Trustee deems sufficient. (c) The Company may, in the circumstances permitted by the Trust Indenture Act, fix any day as the record date for the purpose of determining the Holders of Securities of any series entitled to give or take any request, demand, authorization, direction, notice, consent, waiver or other action, or to vote on any action, authorized or permitted to be given or taken by Holders of Securities of such series. If not set by the Company prior to the first solicitation of a Holder of Securities of such -11- 20 series made by any Person in respect of any such action, or, in the case of any such vote, prior to such vote, the record date for any such action or vote shall be the 30th day (or, if later, the date of the most recent list of Holders required to be provided pursuant to Section 701) prior to such first solicitation or vote, as the case may be. With regard to any record date for action to be taken by the Holders of one or more series of Securities, only the Holders of Securities of such series on such date (or their duly designated proxies) shall be entitled to give or take, or vote on, the relevant action. (d) The ownership of Securities shall be proved by the Security Register. (e) Any request, demand, authorization, direction, notice, consent, waiver or other Act of the Holder of any Security shall bind every future Holder of the same Security and the Holder of every Security issued upon the registration of transfer thereof or in exchange therefor or in lieu thereof in respect of anything done, omitted or suffered to be done by the Trustee or the Company in reliance thereon, whether or not notation of such action is made upon such Security. SECTION 105. Notices, Etc., to Trustee and Company. Any request, demand, authorization, direction, notice, consent, waiver or Act of Holders or other document provided or permitted by this Indenture to be made upon, given or furnished to, or filed with, (1) the Trustee by any Holder or by the Company shall be sufficient for every purpose hereunder if made, given, furnished or filed in writing to or with the Trustee at its Corporate Trust Office, or (2) the Company by the Trustee or by any Holder shall be sufficient for every purpose hereunder (unless otherwise herein expressly provided) if in writing and mailed, first-class postage prepaid, to the Company addressed to it at the address of its principal office specified in the first paragraph of this instrument or at any other address previously furnished in writing to the Trustee by the Company. SECTION 106. Notice to Holders; Waiver. Where this Indenture provides for notice to Holders of any event, such notice shall be sufficiently given (unless otherwise herein expressly provided) if in writing and mailed, first-class postage prepaid, to each Holder affected by such event, at his -12- 21 address as it appears in the Security Register, not later than the latest date (if any), and not earlier than the earliest date (if any), prescribed for the giving of such notice. In any case where notice to Holders is given by mail, neither the failure to mail such notice, nor any defect in any notice so mailed, to any particular Holder shall affect the sufficiency of such notice with respect to other Holders. Where this Indenture provides for notice in any manner, such notice may be waived in writing by the Person entitled to receive such notice, either before or after the event, and such waiver shall be the equivalent of such notice. Waivers of notice by Holders shall be filed with the Trustee, but such filing shall not be a condition precedent to the validity of any action taken in reliance upon such waiver. In case by reason of the suspension of regular mail service or by reason of any other cause it shall be impracticable to give such notice by mail, then such notification as shall be made with the approval of the Trustee shall constitute a sufficient notification for every purpose hereunder. SECTION 107. Conflict with Trust Indenture Act. If any provision hereof limits, qualifies or conflicts with a provision of the Trust Indenture Act that is required under such Act to be a part of and govern this Indenture, the latter provision shall control. If any provision of this Indenture modifies or excludes any provision of the Trust Indenture Act that may be so modified or excluded, the latter provision shall be deemed to apply to this Indenture as so modified or to be excluded, as the case may be. SECTION 108. Effect of Headings and Table of Contents. The Article and Section headings herein and the Table of Contents are for convenience only and shall not affect the construction hereof. SECTION 109. Successors and Assigns. All covenants and agreements in this Indenture by the Company shall bind its successors and assigns, whether so expressed or not. SECTION 110. Separability Clause. In case any provision in this Indenture or in the Securities shall be invalid, illegal or unenforceable, the validity, legality and enforceability of the remaining provisions shall not in any way be affected or impaired thereby. -13- 22 SECTION 111. Benefits of Indenture. Nothing in this Indenture or in the Securities, express or implied, shall give to any Person, other than the parties hereto and their successors hereunder and the Holders, any benefit or any legal or equitable right, remedy or claim under this Indenture. SECTION 112. Governing Law. This Indenture and the Securities shall be governed by and construed in accordance with the laws of the Commonwealth of Massachusetts. SECTION 113. Legal Holidays. In any case where any Interest Payment Date, Redemption Date or Stated Maturity of any Security shall not be a Business Day at any Place of Payment, then (notwithstanding any other provision of this Indenture or of the Securities (other than a provision of the Securities of any series which specifically states that such provision shall apply in lieu of this Section)) payment of interest or principal (and premium, if any) need not be made at such Place of Payment on such date, but may be made on the next succeeding Business Day at such Place of Payment with the same force and effect as if made on the Interest Payment Date or Redemption Date, or at the Stated Maturity, provided that no interest shall accrue for the period from and after such Interest Payment Date, Redemption Date or Stated Maturity, as the case may be. ARTICLE TWO SECURITY FORMS SECTION 201. Forms Generally. The Securities of each series shall have such appropriate insertions, omissions, substitutions and other variations as are required or permitted by this Indenture, and may have such letters, numbers or other marks of identification and such legends or endorsements placed thereon as may be required to comply with the rules of any securities exchange or as may, consistently herewith, be determined by the officers executing such Securities, as evidenced by their execution of the Securities. Any portion of the text of any Security may be set forth on the reverse thereof, with an appropriate reference thereto on the face of the Security. The definitive Securities shall be printed, lithographed or engraved on steel engraved borders or may be produced in any other -14- 23 manner, all as determined by the officers executing such Securities, as evidenced by their execution of such Securities. SECTION 202. Forms of Securities. Each Security shall be in one of the forms approved from time to time by or pursuant to a Board Resolution, or established in one or more indentures supplemental hereto. Prior to the delivery of a Security to the Trustee for authentication in any form approved by or pursuant to a Board Resolution, the Company shall deliver to the Trustee the Board Resolution by or pursuant to which such form of Security has been approved, which Board Resolution shall have attached thereto a true and correct copy of the form of Security which has been approved thereby or, if a Board Resolution authorizes a specific officer or officers to approve a form of Security, a certificate of such officer or officers approving the form of Security attached thereto. Any form of Security approved by or pursuant to a Board Resolution must be acceptable as to form to the Trustee, such acceptance to be evidenced by the Trustee's authentication of Securities in that form or a certificate signed by the Trustee and delivered to the Company. SECTION 203. Form of Trustee's Certificate of Authentication. The form of Trustee's Certificate of Authentication for any Security issued pursuant to this Indenture shall be substantially as follows: TRUSTEE'S CERTIFICATE OF AUTHENTICATION This is one of the Securities referred to in the within-mentioned Indenture. THE FIRST NATIONAL BANK OF BOSTON, as Trustee By:________________________ Authorized Signatory SECTION 204. Securities Issuable in the Form of a Global Security. (a) If the Company shall establish pursuant to Sections 202 and 301 that the Securities of a particular series are to be issued in whole or in part in the form of one or more Global Securities, then the Company shall execute and the Trustee or its agent shall, in accordance with Section 303 and the Company Order delivered to the Trustee or its agent thereunder, authenticate and -15- 24 make available for delivery, such Global Security or Securities, which (i) shall represent, and shall be denominated in an amount equal to the aggregate principal amount of, the Outstanding Securities of such series to be represented by such Global Security or Securities, or such portion thereof as the Company shall specify in a Company Order, (ii) shall be registered in the name of the Depositary for such Global Security or Securities or its nominee, (iii) shall be delivered by the Trustee or its agent to the Depositary or pursuant to the Depositary's instruction and (iv) shall bear a legend substantially to the following effect: "Unless this certificate is presented by an authorized representative of the Depositary to the Company or its agent for registration of transfer, exchange, or payment, and any certificate issued is registered in the name of the nominee of the Depositary or in such other name as is requested by an authorized representative of the Depositary (and any payment is made to the nominee of the Depositary or to such other entity as is requested by an authorized representative of the Depositary), ANY TRANSFER, PLEDGE, OR OTHER USE HEREOF FOR VALUE OR OTHERWISE BY OR TO ANY PERSON IS WRONGFUL inasmuch as the registered owner hereof, the nominee of the Depositary, has an interest herein." (b) Notwithstanding any other provision of this Section 204 or of Section 305, and subject to the provisions of paragraph (c) below, unless the terms of a Global Security expressly permit such Global Security to be exchanged in whole or in part for individual Securities, a Global Security may be transferred, in whole but not in part and in the manner provided in Section 305, only to a nominee of the Depositary for such Global Security, or to the Depositary, or a successor Depositary for such Global Security selected or approved by the Company, or to a nominee of such successor Depositary. (c) (i) If at any time the Depositary for a Global Security notifies the Company that it is unwilling or unable to continue as Depositary for such Global Security or if at any time the Depositary for the Securities for such series shall no longer be eligible or in good standing under the Securities Exchange Act of 1934, as amended, or other applicable statute or regulation, the Company shall appoint a successor Depositary with respect to such Global Security. If a successor Depositary for such Global Security is not appointed by the Company within 90 days after the Company receives such notice or becomes aware of such ineligibility, the Company will execute, and the Trustee or its agent, upon receipt of a Company Request for the authentication and delivery of individual Securities of such series in exchange for such Global Security, will authenticate and make available for delivery individual Securities of such series of like tenor and terms in an aggregate principal amount equal to the principal -16- 25 amount of the Global Security in exchange for such Global Security. (ii) The Company may at any time and in its sole discretion determine that the Securities of any series or portion thereof issued or issuable in the form of one or more Global Securities shall no longer be represented by such Global Security or Securities. In such event the Company will execute, and the Trustee, upon receipt of a Company Request for the authentication and delivery of individual Securities of such series in exchange in whole or in part for such Global Security, will authenticate and make available for delivery individual Securities of such series of like tenor and terms in definitive form in an aggregate principal amount equal to the principal amount of such Global Security or Securities representing such series or portion thereof in exchange for such Global Security or Securities. (iii) If specified by the Company pursuant to Sections 202 and 301 with respect to Securities issued or issuable in the form of a Global Security, the Depositary for such Global Security may surrender such Global Security in exchange in whole or in part for individual Securities of such series of like tenor and terms in definitive form on such terms as are acceptable to the Company and such Depositary. Thereupon the Company shall execute, and the Trustee or its agent shall authenticate and make available for delivery, without service charge, (1) to each Person specified by such Depositary a new Security or Securities of the same series of like tenor and terms and of any authorized denomination as requested by such Person in aggregate principal amount equal to and in exchange for such Person's beneficial interest as specified by such Depositary in the Global Security; and (2) to such Depositary a new Global Security of like tenor and terms and in an authorized denomination equal to the difference, if any, between the principal amount of the surrendered Global Security and the aggregate principal amount of Securities delivered to Holders thereof pursuant to clause (1) above. (iv) In any exchange provided for in any of the preceding three paragraphs, the Company will execute and the Trustee or its agent will authenticate and make available for delivery individual Securities in definitive registered form in authorized denominations. Upon the exchange of the entire principal amount of a Global Security for individual Securities, such Global Security shall be cancelled by the Trustee or its agent. Except as provided in the preceding paragraph, Securities issued in exchange for a Global Security pursuant to this Section shall be registered in such names and in such authorized denominations as the Depositary for such Global Security, pursuant to instructions from its direct or indirect participants or otherwise, shall instruct the Trustee or the Security Registrar. -17- 26 The Trustee shall deliver at its Corporate Trust Office such Securities to the Persons in whose names such Securities are so registered. ARTICLE THREE THE SECURITIES SECTION 301. Amount Unlimited; Issuable in Series. The aggregate principal amount of Securities which may be authenticated and delivered under this Indenture is unlimited. The Securities may be issued in one or more series. The terms of each series of Securities shall be either (i) established in or pursuant to a Board Resolution and set forth, or determined in the manner provided, in an Officers' Certificate, or (ii) established in one or more indentures supplemental hereto, prior to the issuance of Securities of any series. The Securities of each such series may bear such date or dates, be payable at such place or places, have such Stated Maturity or Maturities, be issuable at such premium over or discount from their face value, bear interest at such rate or rates, from such date or dates, payable in such installments and on such dates and at such place or places to the Holders of Securities registered as such on such Regular Record Dates, or may bear no interest, and may be redeemable or repayable at such Redemption Price or Prices, whether at the option of the Holder or otherwise, and upon such terms, all as shall be provided for in or pursuant to the Board Resolution, and set forth, or determined in the manner provided, in an Officers' Certificate, or in the supplemental indenture creating that series. There may also be established in or pursuant to a Board Resolution and set forth, or determined in the manner provided, in an Officers' Certificate, or established in a supplemental indenture prior to the issuance of Securities of each such series, provision for: (1) the title of the Securities of the series (which shall distinguish the Securities of the series from Securities of any other series); (2) any limit upon the aggregate principal amount of the Securities of the series which may be authenticated and delivered under this Indenture (except for Securities authenticated and delivered upon registration of transfer of, or in exchange for, or in lieu of, other Securities of the series pursuant to Section 304, 305, 306, 906 or 1107 and except for any Securities which, pursuant to Section 303, are -18- 27 deemed never to have been authenticated and delivered hereunder); (3) the Person to whom any interest on a Security of the series shall be payable, if other than the Person in whose name that Security (or one or more Predecessor Securities) is registered at the close of business on the Regular Record Date for such interest; (4) the date or dates on which the principal of the Securities of the series is payable and the date on which the Securities of the series will mature; (5) the price (expressed as a percentage of the aggregate principal amount thereof) at which the Securities of the series will be issued; (6) the rate or rates at which the Securities of the series shall bear interest, if any, the date or dates from which such interest shall accrue, the Interest Payment Dates on which any such interest shall be payable and the Regular Record Date for any interest payable on any Interest Payment Date; (7) the place or places where the principal of and any premium and interest on Securities of the series shall be payable; (8) the period or periods within which, the price or prices at which and the terms and conditions upon which Securities of the series may be redeemed, in whole or in part, at the option of the Company; (9) the obligation, if any, of the Company to redeem or purchase Securities of the series pursuant to any sinking fund or analogous provisions or at the option of a Holder thereof and the period or periods within which, the price or prices at which and the terms and conditions upon which Securities of the series shall be redeemed or purchased, in whole or in part, pursuant to such obligation; (10) the application of defeasance provisions of the Indenture to the Securities of the series and the terms and conditions under which the Company may substitute money or U.S. Government Obligations for money or U.S. Government Obligations previously deposited pursuant to Section 403, provided that the substituted money or U.S. Government Obligations, together with money or U.S. Government Obligations previously deposited and not substituted for, -19- 28 will be sufficient to satisfy the Company's payment obligations as contemplated by Section 403(1); (11) if other than denominations of $1,000 and any integral multiple thereof, the denominations in which Securities of the series shall be issuable; (12) the currency, currencies or currency units in which payment of the principal of and any premium and interest on any Securities of the series shall be payable if other than the currency of the United States of America and the manner of determining the equivalent thereof in the currency of the United States of America for purposes of the definition of "Outstanding" in Section 101; (13) if the amount of payments of principal of or any premium or interest on Securities of the series may be determined with reference to an index, the manner in which such amounts shall be determined; (14) if the principal of or any premium or interest on any Securities of the series is to be payable, at the election of the Company or a Holder thereof, in one or more currencies or currency units other than that or those in which the Securities are stated to be payable, the currency, currencies or currency units in which payment of the principal of and any premium and interest on Securities of such series as to which such election is made shall be payable, and the periods within which and the terms and conditions upon which such election is to be made; (15) if other than the principal amount thereof, the portion of the principal amount of Securities of the series which shall be payable upon declaration of acceleration of the Maturity thereof pursuant to Section 502; (16) any Event of Default with respect to the Securities of such series, in addition to any set forth herein, and any deletions or other changes to the Events of Default set forth herein that shall be applicable to the Securities of such series; (17) any covenant solely for the benefit of the Securities of such series and any additions, deletions or other changes to the provisions of Sections 801, 1006, 1007 and 1008 that shall be applicable to the Securities of that series; (18) if the Securities of the series shall be issued in whole or in part in the form of a Global Security or -20- 29 Securities, the terms and conditions, if any, upon which such Global Security or Securities may be exchanged in whole or in part for other individual Securities; and the Depositary for such Global Security or Securities; and (19) any other terms of the series. All Securities of any one series shall be substantially identical except as to denomination and except as may otherwise be provided in or pursuant to the Board Resolution referred to above and set forth, or determined in the manner provided, in the Officers' Certificate referred to above or in any such indenture supplemental hereto. If any of the terms of the series are established by action taken pursuant to a Board Resolution, a copy of an appropriate record of such action shall be certified by the Clerk or an Assistant Clerk of the Company and delivered to the Trustee at or prior to the delivery of the Officers' Certificate setting forth the terms of the series. SECTION 302. Denominations The Securities of each series shall be issuable in registered form without coupons in such denominations as shall be specified as contemplated by Section 301. In the absence of any such provisions with respect to the Securities of any series, the Securities of such series shall be issuable in denominations of $1,000 and any integral multiple thereof. SECTION 303. Execution, Authentication, Delivery and Dating. The Securities shall be executed on behalf of the Company by its Chairman of the Board, its Vice Chairman of the Board, its President or one of its Vice Presidents, under its corporate seal reproduced thereon attested by its Clerk or one of its Assistant Clerks. The signature of any of these officers on the Securities may be manual or facsimile. Securities bearing the manual or facsimile signatures of individuals who were at any time the proper officers of the Company shall bind the Company, notwithstanding that such individuals or any of them have ceased to hold such offices prior to the authentication and delivery of such Securities or did not hold such offices at the date of such Securities. At any time and from time to time after the execution and delivery of this Indenture, the Company may deliver Securities of any series executed by the Company to the Trustee for authentication, together with a Company Order for the -21- 30 authentication and delivery of such Securities, and the Trustee in accordance with the Company Order shall authenticate and deliver such Securities. If the form or terms of the Securities of the series have been established in or pursuant to one or more Board Resolutions as permitted by Sections 202 and 301, in authenticating such Securities, and accepting the additional responsibilities under this Indenture in relation to such Securities, the Trustee shall be entitled to receive, and (subject to Section 601) shall be fully protected in relying upon, an Opinion of Counsel stating, (a) if the form of such Securities has been established by or pursuant to a Board Resolution and set forth, or determined in the manner provided, in an Officers' Certificate as permitted by Section 202, that such form has been established in conformity with the provisions of this Indenture; (b) if the terms of such Securities have been established by or pursuant to a Board Resolution and set forth, or determined in the manner provided, in an Officers' Certificate as permitted by Section 301, that such terms have been established in conformity with the provisions of this Indenture; and (c) such Securities, when completed by appropriate insertions and executed by the Company and delivered to the Trustee for authentication in accordance with this Indenture, authenticated and delivered by the Trustee in accordance with this Indenture and issued by the Company in the manner and subject to any conditions specified in such Opinion of Counsel, will constitute legal, valid and binding obligations of the Company enforceable in accordance with their terms (subject, as to enforcement of remedies, to applicable bankruptcy, reorganization, insolvency, moratorium or other laws and legal principles affecting creditors' rights generally from time to time in effect and to general equitable principles, whether applied in an action at law or in equity). The Trustee shall not be required to authenticate such Securities if the issue of such Securities pursuant to this Indenture will affect the Trustee's own rights, duties or immunities under the Securities and this Indenture or otherwise in a manner which is not reasonably acceptable to the Trustee. Notwithstanding the provisions of Section 301 and of the preceding paragraph, if all Securities of a series are not to be originally issued at one time, it shall not be necessary to deliver the Officers' Certificate otherwise required pursuant to -22- 31 Section 301 or the Company Order and Opinion of Counsel otherwise required pursuant to such preceding paragraph at or prior to the time of authentication of each Security of such series if such documents are delivered at or prior to the time of authentication upon original issuance of the first Security of such series to be issued. Unless otherwise provided in the form of Security for any series, each Security shall be dated the date of its authentication. No Security shall be entitled to any benefit under this Indenture or be valid or obligatory for any purpose unless there appears on such Security a certificate of authentication substantially in the form provided for herein executed by the Trustee by manual signature, and such certificate upon any Security shall be conclusive evidence, and the only evidence, that such Security has been duly authenticated and delivered hereunder. Notwithstanding the foregoing, if any Security shall have been authenticated and delivered hereunder but never issued and sold by the Company, and the Company shall deliver such Security to the Trustee for cancellation as provided in Section 309, for all purposes of this Indenture such Security shall be deemed never to have been authenticated and delivered hereunder and shall never be entitled to the benefits of this Indenture. SECTION 304. Temporary Securities. Pending the preparation of definitive Securities of any series, the Company may execute, and upon Company Order the Trustee shall authenticate and deliver, temporary Securities which are printed, lithographed, typewritten, mimeographed or otherwise produced, in any authorized denomination, substantially of the tenor of the definitive Securities in lieu of which they are issued and with such appropriate insertions, omissions, substitutions and other variations as the officers executing such Securities may determine, as evidenced by their execution of such Securities. If temporary Securities of any series are issued, the Company will cause definitive Securities of that series to be prepared without unreasonable delay. After the preparation of definitive Securities of such series, the temporary Securities of such series shall be exchangeable for definitive Securities of such series upon surrender of the temporary Securities of such series at the office or agency of the Company in a Place of Payment for that series, without charge to the Holder. Upon surrender for cancellation of any one or more temporary Securities of any series the Company shall execute and the Trustee shall authenticate and deliver in exchange therefor one or more definitive Securities of -23- 32 the same series, of any authorized denominations and of a like aggregate principal amount and tenor. Until so exchanged the temporary Securities of any series shall in all respects be entitled to the same benefits under this Indenture as definitive Securities of such series and tenor. SECTION 305. Registration, Registration of Transfer and Exchange. The Company shall cause to be kept at the Corporate Trust Office of the Trustee a register (the register maintained in such office and in any other office or agency of the Company in a Place of Payment being herein sometimes collectively referred to as the "Security Register") in which, subject to such reasonable regulations as it may prescribe, the Company shall provide for the registration of Securities and of transfers of Securities. The Trustee is hereby appointed "Security Registrar" for the purpose of registering Securities and transfers of Securities as herein provided. Subject to Section 204, upon surrender for registration of transfer of any Security of any series at the office or agency in a Place of Payment for that series, the Company shall execute, and the Trustee shall authenticate and deliver, in the name of the designated transferee or transferees, one or more new Securities of the same series, of any authorized denominations and of a like aggregate principal amount and tenor. Subject to Section 204, at the option of the Holder, Securities of any series may be exchanged for other Securities of the same series, of any authorized denominations and of a like aggregate principal amount and tenor, upon surrender of the Securities to be exchanged at such office or agency. Whenever any Securities are so surrendered for exchange, the Company shall execute, and the Trustee shall authenticate and deliver, the Securities which the Holder making the exchange is entitled to receive. All Securities issued upon any registration of transfer or exchange of Securities shall be the valid obligations of the Company, evidencing the same debt, and entitled to the same benefits under this Indenture, as the Securities surrendered upon such registration of transfer or exchange. Every Security presented or surrendered for registration of transfer or for exchange shall (if so required by the Company or the Trustee) be duly endorsed, or be accompanied by a written instrument of transfer in form satisfactory to the Company and the Security Registrar duly executed, by the Holder thereof or his attorney duly authorized in writing. -24- 33 No service charge shall be made for any registration of transfer or exchange of Securities, but the Company may require payment of a sum sufficient to cover any tax or other governmental charge that may be imposed in connection with any registration of transfer or exchange of Securities, other than exchanges pursuant to Section 304, 906 or 1107 not involving any transfer. The Company shall not be required (i) to issue, register the transfer of or exchange Securities of any series during a period beginning at the opening of business 15 days before the day of the mailing of a notice of redemption of Securities of that series selected for redemption under Section 1103 and ending at the close of business on the day of such mailing, or (ii) to register the transfer of or exchange any Security so selected for redemption in whole or in part, except the unredeemed portion of any Security being redeemed in part. SECTION 306. Mutilated, Destroyed, Lost and Stolen Securities. If any mutilated Security is surrendered to the Trustee, the Company shall execute and the Trustee shall authenticate and deliver in exchange therefor a new Security of the same series and of like tenor and principal amount and bearing a number not contemporaneously outstanding. If there shall be delivered to the Company and the Trustee (i) evidence to their satisfaction of the destruction, loss or theft of any Security and (ii) such security or indemnity as may be required by them to save each of them and any agent of either of them harmless, then, in the absence of notice to the Company or the Trustee that such Security has been acquired by a bona fide purchaser, the Company shall execute and the Trustee shall authenticate and deliver in lieu of any such destroyed, lost or stolen Security, a new Security of the same series and of like tenor and principal amount and bearing a number not contemporaneously outstanding. In case any such mutilated, destroyed, lost or stolen Security has become or is about to become due and payable, the Company in its discretion may, instead of issuing a new Security, pay such Security. Upon the issuance of any new Security under this Section, the Company may require the payment of a sum sufficient to cover any tax or other governmental charge that may be imposed in relation thereto and any other expenses (including the fees and expenses of the Trustee) connected therewith. Every new Security of any series issued pursuant to this Section in lieu of any destroyed, lost or stolen Security shall -25- 34 constitute an original additional contractual obligation of the Company, whether or not the destroyed, lost or stolen Security shall be at any time enforceable by anyone, and shall be entitled to all the benefits of this Indenture equally and proportionately with any and all other Securities of that series duly issued hereunder. The provisions of this Section are exclusive and shall preclude (to the extent lawful) all other rights and remedies with respect to the replacement or payment of mutilated, destroyed, lost or stolen Securities. SECTION 307. Payment of Interest; Interest Rights Preserved. Except as otherwise provided as contemplated by Section 301 with respect to any series of Securities, interest on any Security which is payable, and is punctually paid or duly provided for, on any Interest Payment Date shall be paid to the Person in whose name that Security (or one or more Predecessor Securities) is registered at the close of business on the Regular Record Date for such interest. Any interest on any Security of any series which is payable, but is not punctually paid or duly provided for, on any Interest Payment Date (herein called "Defaulted Interest") shall forthwith cease to be payable to the Holder on the relevant Regular Record Date by virtue of having been such Holder, and such Defaulted Interest may be paid by the Company, at its election in each case, as provided in Clause (1) or (2) below: (1) The Company may elect to make payment of any Defaulted Interest to the Persons in whose names the Securities of such series (or their respective Predecessor Securities) are registered at the close of business on a Special Record Date for the payment of such Defaulted Interest, which shall be fixed in the following manner. The Company shall notify the Trustee in writing of the amount of Defaulted Interest proposed to be paid on each Security of such series and the date of the proposed payment, and at the same time the Company shall deposit with the Trustee an amount of money equal to the aggregate amount proposed to be paid in respect of such Defaulted Interest or shall make arrangements satisfactory to the Trustee for such deposit prior to the date of the proposed payment, such money when deposited to be held in trust for the benefit of the Persons entitled to such Defaulted Interest as in this Clause provided. Thereupon the Trustee shall fix a Special Record Date for the payment of such Defaulted Interest which shall be not more than 15 days and not less than l0 days prior to the date of the proposed payment and not less than 10 days -26- 35 after the receipt by the Trustee of the notice of the proposed payment. The Trustee shall promptly notify the Company of such Special Record Date and, in the name and at the expense of the Company, shall cause notice of the proposed payment of such Defaulted Interest and the Special Record Date therefor to be mailed, first-class postage prepaid, to each Holder of Securities of such series at his address as it appears in the Security Register, not less than 10 days prior to such Special Record Date. Notice of the proposed payment of such Defaulted Interest and the Special Record Date therefor having been so mailed, such Defaulted Interest shall be paid to the Persons in whose names the Securities of such series (or their respective Predecessor Securities) are registered at the close of business on such Special Record Date and shall no longer be payable pursuant to the following Clause (2). (2) The Company may make payment of any Defaulted Interest on the Securities of any series in any other lawful manner not inconsistent with the requirements of any securities exchange on which such Securities may be listed, and upon such notice as may be required by such exchange, if, after notice given by the Company to the Trustee of the proposed payment pursuant to this Clause, such manner of payment shall be deemed practicable by the Trustee. Subject to the foregoing provisions of this Section, each Security delivered under this Indenture upon registration of transfer of or in exchange for or in lieu of any other Security shall carry the rights to interest accrued and unpaid, and to accrue, which were carried by such other Security. SECTION 308. Persons Deemed Owners. Prior to due presentment of a Security for registration of transfer, the Company, the Trustee and any agent of the Company or the Trustee may treat the Person in whose name such Security is registered as the owner of such Security for the purpose of receiving payment of principal of and any premium and (subject to Section 307) any interest on such Security and for all other purposes whatsoever, whether or not such Security be overdue, and neither the Company, the Trustee nor any agent of the Company or the Trustee shall be affected by notice to the contrary. SECTION 309. Cancellation. All Securities surrendered for payment, redemption, registration of transfer or exchange or for credit against any sinking fund payment shall, if surrendered to any Person other than the Trustee, be delivered to the Trustee and shall be -27- 36 promptly cancelled by it. The Company may at any time deliver to the Trustee for cancellation any Securities previously authenticated and delivered hereunder which the Company may have acquired in any manner whatsoever, and may deliver to the Trustee (or to any other Person for delivery to the Trustee) for cancellation any Securities previously authenticated hereunder which the Company has not issued and sold, and all Securities so delivered shall be promptly cancelled by the Trustee. No Securities shall be authenticated in lieu of or in exchange for any Securities cancelled as provided in this Section, except as expressly permitted by this Indenture. All cancelled Securities held by the Trustee shall be disposed of as directed by a Company Order. SECTION 310. Computation of Interest. Except as otherwise specified as contemplated by Section 301 for Securities of any series, interest on the Securities of each series shall be computed on the basis of a 360-day year of twelve 30-day months. SECTION 311. CUSIP Numbers. The Company in issuing the Securities may use "CUSIP" numbers (if then generally in use), and, if so, the Trustee shall use "CUSIP" numbers in notices of redemption as a convenience to Holders; provided that any such notice may state that no representation is made as to the correctness of such numbers either as printed on the Securities or as contained in any notice of a redemption and that reliance may be placed only on the other identification numbers printed on the Securities, and any such redemption shall not be affected by any defect in or omission of such numbers. ARTICLE FOUR SATISFACTION AND DISCHARGE SECTION 401. Satisfaction and Discharge of Indenture. This Indenture shall upon Company Request cease to be of further effect with respect to any series of Securities (except as to any surviving rights of conversion, transfer or exchange of Securities of such series expressly provided for herein or in the form of Security for such series), and the Trustee, at the expense of the Company, shall execute proper instruments acknowledging satisfaction and discharge of this Indenture as to such series, when -28- 37 (1) either (A) all Securities of that series theretofore authenticated and delivered (other than (i) Securities which have been destroyed, lost or stolen and which have been replaced or paid as provided in Section 306 and (ii) Securities of such series for whose payment money has theretofore been deposited in trust or segregated and held in trust by the Company and thereafter repaid to the Company or discharged from such trust, as provided in Section 1003) have been delivered to the Trustee for cancellation; or (B) all such Securities of that series not theretofore delivered to the Trustee for cancellation (i) have become due and payable, or (ii) will become due and payable at their Stated Maturity within one year, or (iii) are to be called for redemption within one year under arrangements satisfactory to the Trustee for the giving of notice of redemption by the Trustee in the name, and at the expense, of the Company, and the Company, in the case of (i), (ii) or (iii) above, has deposited or caused to be deposited with the Trustee as trust funds in trust for the purpose of and in an amount sufficient to pay and discharge the entire indebtedness on such Securities not theretofore delivered to the Trustee for cancellation, for principal and any premium and interest to the date of such deposit (in the case of Securities which have become due and payable) or to the Stated Maturity or Redemption Date, as the case may be; (2) the Company has paid or caused to be paid all other sums payable hereunder by the Company; and (3) the Company has delivered to the Trustee an Officers' Certificate and an Opinion of Counsel, each stating that all conditions precedent herein provided for relating to the satisfaction and discharge of this Indenture have been complied with. Notwithstanding the satisfaction and discharge of this Indenture, the obligations of the Company to the Trustee under Section 607, the obligations of the Trustee to any Authenticating -29- 38 Agent under Section 614 and, if money shall have been deposited with the Trustee pursuant to subclause (B) of Clause (1) of this Section, the obligations of the Trustee under Section 402 and the last paragraph of Section 1003 shall survive. SECTION 402. Application of Trust Money. All money deposited with the Trustee pursuant to Section 401 and all U.S. Government Obligations deposited with the Trustee pursuant to Section 403 shall be held in trust and the deposited money and the money from the U.S. Government Obligations shall be applied by the Trustee, in accordance with the provisions of the series of Securities in respect of which it was deposited and this Indenture, to the payment, either directly or through any Paying Agent (including the Company acting as its own Paying Agent) as the Trustee may determine, to the Persons entitled thereto, of the principal (and premium, if any) and interest for whose payment such money or U.S. Government Obligations has been deposited with the Trustee; but such money and U.S. Government Obligations need not be segregated from other funds except to the extent required by law. Any money received from principal or interest payments on any U.S. Government Obligations in excess of the amount needed or to be needed to pay the Securities with respect to which such U.S. Government Obligations were deposited as provided in Section 403 shall be paid over to the Company upon receipt of a Company Request together with the opinion of a nationally recognized firm of independent public accountants expressed in a written certification thereof delivered to the Trustee to the effect that such money is in excess of the amount needed or to be needed to pay such Securities. SECTION 403. Defeasance Upon Deposit of Funds or Government Obligations. Unless pursuant to Section 301 provision is made that this Section shall not be applicable to the Securities of any series, at the Company's option, either (a) the Company shall be deemed to have been Discharged from its obligations with respect to any series of Securities after the applicable conditions set forth below have been satisfied or (b) the Company shall cease to be under any obligation to comply with any term, provision or condition set forth in, at the election of the Company, any or all of Sections 801, 1006, 1007, 1008 and subsections (4) through (8) of Section 501 (and any other Sections applicable to such Securities that are determined pursuant to Section 301 to be subject to this provision) with respect to any series of Securities at any time after the applicable conditions set forth below have been satisfied: -30- 39 (1) the Company shall have deposited or caused to be deposited irrevocably with the Trustee as trust funds in trust, specifically pledged as security for, and dedicated solely to, the benefit of the Holders of the Securities of such series (i) money in an amount, or (ii) the equivalent in U.S. Government Obligations which through the payment of interest and principal in respect thereof in accordance with their terms will provide, not later than one day before the due date of any payment, money in an amount, or (iii) a combination of (i) and (ii), sufficient, in the opinion (with respect to (ii) and (iii)) of a nationally recognized firm of independent public accountants expressed in a written certification thereof delivered to the Trustee, to pay and discharge each installment of principal (including mandatory sinking fund payments) and any premium of, interest on and any repurchase obligations with respect to the outstanding Securities of such series on the dates such installments of interest or principal or repurchase obligations are due; (2) no Event of Default or event (including such deposit) which with notice or lapse of time would become an Event of Default with respect to the Securities of such series shall have occurred and be continuing on the date of such deposit; and (3) the Company shall have delivered to the Trustee an Opinion of Counsel to the effect that Holders of the Securities of such series will not recognize income, gain or loss for Federal income tax purposes as a result of the Company's exercise of its option under this Section 403 and will be subject to Federal income tax on the same amount and in the same manner and at the same times as would have been the case if such option had not been exercised, and, in the case of Securities being Discharged, such opinion shall be based upon at least one of the following authorities (issued, enacted or promulgated after the date of this Indenture), substantially on point and to the foregoing effect: (i) a public ruling of the Internal Revenue Service, (ii) a private ruling of the Internal Revenue Service issued to the Company with respect to the Securities, (iii) a provision of the Internal Revenue Code, or (iv) a final regulation promulgated by the Department of the Treasury. Upon a Company Request, the Trustee shall execute and deliver to the Company instruments acknowledging the discharge of any series of Securities under this Section 403. -31- 40 ARTICLE FIVE REMEDIES SECTION 501. Events of Default. "Event of Default", wherever used herein with respect to Securities of any series, means any one of the following events (whatever the reason for such Event of Default and whether it shall be voluntary or involuntary or be effected by operation of law or pursuant to any judgment, decree or order of any court or any order, rule or regulation of any administrative or governmental body), unless such event is either inapplicable to a particular series of Securities or it is specifically deleted or modified in or pursuant to the supplemental indenture or Board Resolution creating such series of Securities or in the form of Security for such series: (1) default in the payment of any interest upon any Security of that series when it becomes due and payable, and continuance of such default for a period of 30 days; or (2) default in the payment of the principal of (or premium, if any, on) any Security of that series at its Maturity; or (3) default in the deposit of any sinking fund payment, when and as due by the terms of a Security of that series; or (4) default in the performance, or breach, of any covenant or warranty of the Company in this Indenture (other than a covenant or warranty a default in whose performance or whose breach is elsewhere in this Section specifically dealt with or which has expressly been included in this Indenture solely for the benefit of a series of Securities other than that series), and continuance of such default or breach for a period of 90 days after there has been given, by registered or certified mail, to the Company by the Trustee or to the Company and the Trustee by the Holders of at least 25% in principal amount of the Outstanding Securities of that series a written notice specifying such default or breach and requiring it to be remedied and stating that such notice is a "Notice of Default" hereunder; or (5) a default under any bond, debenture, note or other evidence of indebtedness for money borrowed by the Company (including a default with respect to Securities of any series other than that series) or under any mortgage, indenture or instrument under which there may be issued or by which there may be secured or evidenced any indebtedness for money -32- 41 borrowed by the Company, whether such indebtedness now exists or shall hereafter be created, which default shall have resulted in indebtedness in excess of $15,000,000 in aggregate principal amount becoming or being declared due and payable prior to the date on which it would otherwise have become due and payable, without such indebtedness having been discharged, or such acceleration having been rescinded or annulled within a period of 20 days after there shall have been given, by registered or certified mail, to the Company by the Trustee or to the Company and the Trustee by the Holders of at least 25% in principal amount of the Outstanding Securities of that series a written notice specifying such default and requiring the Company to cause such indebtedness to be discharged or cause such acceleration to be rescinded or annulled and stating that such notice is a "Notice of Default" hereunder; or (6) the entry by a court having jurisdiction in the premises of (A) a decree or order for relief in respect of the Company in an involuntary case or proceeding under any applicable Federal or state bankruptcy, insolvency, reorganization or other similar law or (B) a decree or order adjudging the Company a bankrupt or insolvent, or appointing a custodian, receiver, liquidator, assignee, trustee, sequestrator or other similar official of the Company or of any substantial part of its property, or ordering the winding up or liquidation of its affairs, and the continuance of any such decree or order for relief or any such other decree or order unstayed and in effect for a period of 60 consecutive days; or (7) the commencement by the Company of a voluntary case or proceeding under any applicable Federal or state bankruptcy, insolvency, reorganization or other similar law or of any other case or proceeding to be adjudicated a bankrupt or insolvent, or the consent by it to the entry of a decree or order for relief in respect of the Company in an involuntary case or proceeding under any applicable Federal or state bankruptcy, insolvency, reorganization or other similar law or the consent by it to the commencement of any bankruptcy or insolvency case or proceeding against it, or the filing by it of a petition or answer or consent seeking reorganization or relief under any applicable Federal or state law, or the consent by it to the filing of such petition or to the appointment of or taking possession by a custodian, receiver, liquidator, assignee, trustee, sequestrator or other similar official of the Company or of any substantial part of its property, or the making by it of an assignment for the benefit of creditors, or the admission -33- 42 by it in writing of its inability to pay its debts generally as they become due; or (8) any other Event of Default provided with respect to Securities of that series. SECTION 502. Acceleration of Maturity; Rescission and Annulment. If an Event of Default with respect to Securities of any series at the time Outstanding occurs and is continuing, then in every such case the Trustee or the Holders of not less than 25% in principal amount of the Outstanding Securities of that series may declare the principal amount (or, if any of the Securities of that series are Original Issue Discount Securities, such portion of the principal amount of such Securities as may be specified in the terms thereof) of all of the Securities of that series to be due and payable immediately, by a notice in writing to the Company (and to the Trustee if given by Holders), and upon any such declaration such principal amount (or specified amount) shall become immediately due and payable. At any time after such a declaration of acceleration with respect to Securities of any series has been made and before a judgment or decree for payment of the money due has been obtained by the Trustee as hereinafter in this Article provided, the Holders of a majority in principal amount of the Outstanding Securities of that series, by written notice to the Company and the Trustee, may rescind and annul such declaration and its consequences if (1) the Company has paid or deposited with the Trustee a sum sufficient to pay (A) all overdue interest on all Securities of that series, (B) the principal of (and premium, if any, on) any Securities of that series which have become due otherwise than by such declaration of acceleration and any interest thereon at the rate or rates prescribed therefor in such Securities, (C) to the extent that payment of such interest is lawful, interest upon overdue interest at the rate or rates prescribed therefor in such Securities, and (D) all sums paid or advanced by the Trustee hereunder and the reasonable compensation, expenses, disbursements and advances of the Trustee, its agents and counsel; -34- 43 and (2) all Events of Default with respect to Securities of that series, other than the nonpayment of the principal of Securities of that series which have become due solely by such declaration of acceleration, have been cured or waived as provided in Section 513. No such rescission shall affect any subsequent default or impair any right consequent thereon. SECTION 503. Collection of Indebtedness and Suits for Enforcement by Trustee. The Company covenants that if (1) default is made in the payment of any interest on any Security when such interest becomes due and payable and such default continues for a period of 30 days, or (2) default is made in the payment of the principal of (or premium, if any, on) any Security at the Maturity thereof, the Company will, upon demand of the Trustee, pay to it, for the benefit of the Holders of such Securities, the whole amount then due and payable on Securities of such series for principal and any premium and interest and, to the extent that payment of such interest shall be legally enforceable, interest on any overdue principal and premium and on any overdue interest, at the rate or rates prescribed therefor in such Securities, and, in addition thereto, such further amount as shall be sufficient to cover the costs and expenses of collection, including the reasonable compensation, expenses, disbursements and advances of the Trustee, its agents and counsel. If an Event of Default with respect to Securities of any series occurs and is continuing, the Trustee may in its discretion proceed to protect and enforce its rights and the rights of the Holders of Securities of such series by such appropriate judicial proceedings as the Trustee shall deem most effectual to protect and enforce any such rights, whether for the specific enforcement of any covenant or agreement in this Indenture or in aid of the exercise of any power granted herein, or to enforce any other proper remedy. SECTION 504. Trustee May File Proofs of Claim. In case of any judicial proceeding relative to the Company (or any other obligor upon the Securities), its property or its -35- 44 creditors, the Trustee shall be entitled and empowered, by intervention in such proceeding or otherwise, to take any and all actions authorized under the Trust Indenture Act in order to have claims of the Holders and the Trustee allowed in any such proceeding. In particular, the Trustee shall be authorized to collect and receive any moneys or other property payable or deliverable on any such claims and to distribute the same; and any custodian, receiver, assignee, trustee, liquidator, sequestrator or other similar official in any such judicial proceeding is hereby authorized by each Holder to make such payments to the Trustee and, in the event that the Trustee shall consent to the making of such payments directly to the Holders, to pay to the Trustee any amount due it for the reasonable compensation, expenses, disbursements and advances of the Trustee, its agents and counsel, and any other amounts due the Trustee under Section 607. No provision of this Indenture shall be deemed to authorize the Trustee to authorize or consent to or accept or adopt on behalf of any Holder any plan of reorganization, arrangement, adjustment or composition affecting the Securities or the rights of any Holder thereof or to authorize the Trustee to vote in respect of the claim of any Holder in any such proceeding. SECTION 505. Trustee May Enforce Claims Without Possession of Securities. All rights of action and claims under this Indenture or the Securities may be prosecuted and enforced by the Trustee without the possession of any of the Securities or the production thereof in any proceeding relating thereto, and any such proceeding instituted by the Trustee shall be brought in its own name as trustee of an express trust, and any recovery of judgment shall, after provision for the payment of the reasonable compensation, expenses, disbursement and advances of the Trustee, its agents and counsel, be for the ratable benefit of the Holders of the Securities in respect of which such judgment has been recovered. SECTION 506. Application of Money Collected. Any money collected by the Trustee pursuant to this Article shall be applied in the following order, at the date or dates fixed by the Trustee and, in case of the distribution of such money on account of principal, or any premium or interest, upon presentation of the Securities and the notation thereon of the payment if only partially paid and upon surrender thereof if fully paid: FIRST: To the payment of all amounts due the Trustee under Section 607; and -36- 45 SECOND: To the payment of the amounts then due and unpaid for principal of, and any premium and interest on the Securities in respect of which or for the benefit of which such money has been collected, ratably, without preference or priority of any kind, according to the amounts due and payable on such Securities for principal and any premium and interest, respectively. SECTION 507. Limitation on Suits. No Holder of any Security of any series shall have any right to institute any proceeding, judicial or otherwise, with respect to this Indenture, or for the appointment of a receiver or trustee, or for any other remedy hereunder, unless (1) such Holder has previously given written notice to the Trustee of a continuing Event of Default with respect to the Securities of that series; (2) the Holders of not less than 25% in principal amount of the Outstanding Securities of that series shall have made written request to the Trustee to institute proceedings in respect of such Event of Default in its own name as Trustee hereunder; (3) such Holder or Holders have offered to the Trustee reasonable indemnity against the costs, expenses and liabilities to be incurred in compliance with such request; (4) the Trustee for 60 days after its receipt of such notice, request and offer of indemnity has failed to institute any such proceeding; and (5) no direction inconsistent with such written request has been given to the Trustee during such 60-day period by the Holders of a majority in principal amount of the Outstanding Securities of that series; it being understood and intended that no one or more of such Holders shall have any right in any manner whatever by virtue of, or by availing of, any provision of this Indenture to affect, disturb or prejudice the rights of any other of such Holders, or to obtain or to seek to obtain priority or preference over any other of such Holders or to enforce any right under this Indenture, except in the manner herein provided and for the equal and ratable benefit of all of such Holders. -37- 46 SECTION 508. Unconditional Right of Holders to Receive Principal, Premium and Interest. Notwithstanding any other provision in this Indenture, the Holder of any Security shall have the right, which is absolute and unconditional, to receive payment of the principal of and any premium and (subject to Section 307) any interest on such Security on the Stated Maturity or Maturities expressed in such Security (or, in the case of redemption, on the Redemption Date) and to institute suit for the enforcement of any such payment, and such rights shall not be impaired without the consent of such Holder. SECTION 509. Restoration of Rights and Remedies. If the Trustee or any Holder has instituted any proceeding to enforce any right or remedy under this Indenture and such proceeding has been discontinued or abandoned for any reason, or has been determined adversely to the Trustee or to such Holder, then and in every such case, subject to any determination in such proceeding, the Company, the Trustee and the Holders shall be restored severally and respectively to their former positions hereunder and thereafter all rights and remedies of the Trustee and the Holders shall continue as though no such proceeding had been instituted. SECTION 510. Rights and Remedies Cumulative. Except as otherwise provided with respect to the replacement or payment of mutilated, destroyed, lost or stolen Securities in the last paragraph of Section 306, no right or remedy herein conferred upon or reserved to the Trustee or to the Holders is intended to be exclusive of any other right or remedy, and every right and remedy shall, to the extent permitted by law, be cumulative and in addition to every other right and remedy given hereunder or now or hereafter existing at law or in equity or otherwise. The assertion or employment of any right or remedy hereunder, or otherwise, shall not prevent the concurrent assertion or employment of any other appropriate right or remedy. SECTION 511. Delay or Omission Not Waiver. No delay or omission of the Trustee or of any Holder of any Securities to exercise any right or remedy accruing upon any Event of Default shall impair any such right or remedy or constitute a waiver of any such Event of Default or an acquiescence therein. Every right and remedy given by this Article or by law to the Trustee or to the Holders may be exercised from time to time, and as often as may be deemed expedient, by the Trustee or by the Holders, as the case may be. -38- 47 SECTION 512. Control by Holders. The Holders of a majority in principal amount of the Outstanding Securities of any series shall have the right to direct the time, method and place of conducting any proceeding for any remedy available to the Trustee, or exercising any trust or power conferred on the Trustee, with respect to the Securities of such series, provided that (1) such direction shall not be in conflict with any rule of law or with this Indenture, and (2) the Trustee may take any other action deemed proper by the Trustee which is not inconsistent with such direction. SECTION 513. Waiver of Past Defaults. The Holders of not less than a majority in principal amount of the Outstanding Securities of any series may on behalf of the Holders of all the Securities of such series waive any past default hereunder with respect to such series and its consequences, except a default (1) in the payment of the principal of or any premium or interest on any Security of such series, or (2) in respect of a covenant or provision hereof which under Article Nine cannot be modified or amended without the consent of the Holder of each Outstanding Security of such series affected. Upon any such waiver, such default shall cease to exist, and any Event of Default arising therefrom shall be deemed to have been cured, for every purpose of this Indenture; but no such waiver shall extend to any subsequent or other default or impair any right consequent thereon. SECTION 514. Undertaking for Costs. In any suit for the enforcement of any right or remedy under this Indenture, or in any suit against the Trustee for any action taken, suffered or omitted by it as Trustee, a court may require any party litigant in such suit to file an undertaking to pay the costs of such suit, and may assess costs against any such party litigant, in the manner and to the extent provided in the Trust Indenture Act; provided that neither this Section nor the Trust Indenture Act shall be deemed to authorize any court to require such an undertaking or to make such an assessment in any suit instituted by the Company. -39- 48 SECTION 515. Waiver of Stay or Extension Laws. The Company covenants (to the extent that it may lawfully do so) that it will not at any time insist upon, or plead, or in any manner whatsoever claim or take the benefit or advantage of, any stay or extension law wherever enacted, now or at any time hereafter in force, which may affect the covenants or the performance of this Indenture; and the Company (to the extent that it may lawfully do so) hereby expressly waives all benefit or advantage of any such law and covenants that it will not hinder, delay or impede the execution of any power herein granted to the Trustee, but will suffer and permit the execution of every such power as though no such law had been enacted. ARTICLE SIX THE TRUSTEE SECTION 601. Certain Duties and Responsibilities. The duties and responsibilities of the Trustee shall be as provided by the Trust Indenture Act. Notwithstanding the foregoing, no provision of this Indenture shall require the Trustee to expend or risk its own funds or otherwise incur any financial liability in the performance of any of its duties hereunder, or in the exercise of any of its rights or powers, if it shall have reasonable grounds for believing that repayment of such funds or adequate indemnity against such risk or liability is not reasonably assured to it. Whether or not therein expressly so provided, every provision of this Indenture relating to the conduct or affecting the liability of or affording protection to the Trustee shall be subject to the provisions of this Section. SECTION 602. Notice of Defaults. If a default occurs hereunder with respect to Securities of any series, the Trustee shall give the Holders of such series of notice of such default as and to the extent provided by the Trust Indenture Act; provided, however, that in the case of any default of the character specified in Section 501(4) with respect to Securities of such series, no such notice to Holders shall be given until at least 90 days after the occurrence thereof, and provided further that, except in the case of any defaults of the character specified in clauses (1), (2) and (3) of Section 501, the Trustee may refrain from giving any notice of default to the Holders of Securities if the Trustee considers it in the interests of such Holders to so refrain. For the purpose of this Section, the term "default" means any event which is, or after notice or lapse of time or both would become, an Event of Default with respect to Securities of such series. -40- 49 SECTION 603. Certain Rights of Trustee. Subject to the provisions of Section 601: (a) the Trustee may rely and shall be protected in acting or refraining from acting upon any resolution, certificate, statement, instrument, opinion, report, notice, request, direction, consent, order, bond, debenture, note, other evidence of indebtedness or other paper or document believed by it to be genuine and to have been signed or presented by the proper party or parties; (b) any request or direction of the Company mentioned herein shall be sufficiently evidenced by a Company Request or Company Order and any resolution of the Board of Directors may be sufficiently evidenced by a Board Resolution; (c) whenever in the administration of this Indenture the Trustee shall deem it desirable that a matter be proved or established prior to taking, suffering or omitting any action hereunder, the Trustee (unless other evidence be herein specifically prescribed) may, in the absence of bad faith on its part, rely upon an Officers' Certificate; (d) the Trustee may consult with counsel and the written advice of such counsel or any Opinion of Counsel shall be full and complete authorization and protection in respect of any action taken, suffered or omitted by it hereunder in good faith and in reliance thereon; (e) the Trustee shall be under no obligation to exercise any of the rights or powers vested in it by this Indenture at the request or direction of any of the Holders pursuant to this indenture, unless such Holders shall have offered to the Trustee reasonable security or indemnity against the costs, expenses and liabilities which might be incurred by it in compliance with such request or direction; (f) the Trustee shall not be bound to make any investigation into the facts or matters stated in any resolution, certificate, statement, instrument, opinion, report, notice, request, direction, consent, order, bond, debenture, note, other evidence of indebtedness or other paper or document, but the Trustee, in its discretion, may make such further inquiry or investigation into such facts or matters as it may see fit, and, if the Trustee shall determine to make such further inquiry or investigation, it shall be entitled to examine the books, records and premises of the Company, personally or by agent or attorney; and -41- 50 (g) the Trustee may execute any of the trusts or powers hereunder or perform any duties hereunder either directly or by or through agents or attorneys and the Trustee shall not be responsible for any misconduct or negligence on the part of any agent or attorney appointed with due care by it hereunder. SECTION 604. Not Responsible for Recitals or Issuance of Securities. The recitals contained herein and in the Securities, except the Trustee's certificates of authentication, shall be taken as the statements of the Company, and the Trustee or any Authenticating Agent assumes no responsibility for their correctness. The Trustee makes no representations as to the validity or sufficiency of this Indenture or of the Securities. The Trustee or any Authenticating Agent shall not be accountable for the use or application by the Company of Securities or the proceeds thereof. SECTION 605. May Hold Securities. The Trustee, any Authenticating Agent, any Paying Agent, any Security Registrar or any other agent of the Company, in its individual or any other capacity, may become the owner or pledgee of Securities and, subject to Sections 608 and 613, may otherwise deal with the Company with the same rights it would have if it were not Trustee, Authenticating Agent, Paying Agent, Security Registrar or such other agent. SECTION 606. Money Held in Trust. Money held by the Trustee in trust hereunder need not be segregated from other funds except to the extent required by law. The Trustee shall be under no liability for interest on any money received by it hereunder except as otherwise agreed with the Company. SECTION 607. Compensation and Reimbursement. The Company agrees (1) to pay to the Trustee from time to time reasonable compensation for all services rendered by it hereunder (which compensation shall not be limited by any provision of law in regard to the compensation of a trustee of an express trust); (2) except as otherwise expressly provided herein, to reimburse the Trustee upon its request for all reasonable expenses, disbursements and advances incurred or made by the -42- 51 Trustee in accordance with any provision of this Indenture (including the reasonable compensation and the expenses and disbursements of its agents and counsel), except any such expense, disbursement or advance as may be attributable to its negligence or bad faith; and (3) to indemnify the Trustee for, and to hold it harmless against, any loss, liability or expense incurred without negligence or bad faith on its part, arising out of or in connection with the acceptance or administration of the trust or trusts hereunder, including the costs and expenses of defending itself against any claim or liability in connection with the exercise or performance of any of its powers or duties hereunder. SECTION 608. Disqualification; Conflicting Interests. If the Trustee has or shall acquire a conflicting interest within the meaning of the Trust Indenture Act, the Trustee shall either eliminate such interest or resign, to the extent and in the manner provided by, and subject to the provisions of, the Trust Indenture Act and this Indenture. Nothing herein shall prevent the Trustee from filing with the Commission the application referred to in the second to last paragraph of Section 310(b) of the Trust Indenture Act. SECTION 609. Corporate Trustee Required; Eligibility. There shall at all times be a Trustee hereunder which shall be a Person that is eligible pursuant to the Trust Indenture Act to act as such and has a combined capital and surplus of at least $50,000,000. If such Person publishes reports of condition at least annually, pursuant to law or to the requirements of said supervising or examining authority, then for the purposes of this Section, the combined capital and surplus of such Person shall be deemed to be its combined capital and surplus as set forth in its most recent report of condition so published. If at any time the Trustee shall cease to be eligible in accordance with the provisions of this Section, it shall resign immediately in the manner and with the effect hereinafter specified in this Article. SECTION 610. Resignation and Removal; Appointment of Successor. (a) No resignation or removal of the Trustee and no appointment of a successor Trustee pursuant to this Article shall become effective until the acceptance of appointment by the successor Trustee in accordance with the applicable requirements of Section 611. -43- 52 (b) The Trustee may resign at any time with respect to the Securities of one or more series by giving written notice thereof to the Company. If the instrument of acceptance by a successor Trustee required by Section 611 shall not have been delivered to the Trustee within 30 days after the giving of such notice of resignation, the resigning Trustee may petition any court of competent jurisdiction for the appointment of a successor Trustee with respect to the Securities of such series. (c) The Trustee may be removed at any time with respect to the Securities of any series by Act of the Holders of a majority in principal amount of the Outstanding Securities of such series, delivered to the Trustee and to the Company. (d) If at any time: (1) the Trustee shall fail to comply with Section 608 after written request therefor by the Company or by any Holder who has been a bona fide Holder of a Security for at least six months, or (2) the Trustee shall cease to be eligible under Section 609 and shall fail to resign after written request therefor by the Company or by any such Holder, or (3) the Trustee shall become incapable of acting or shall be adjudged a bankrupt or insolvent or a receiver of the Trustee or of its property shall be appointed or any public officer shall take charge or control of the Trustee or of its property or affairs for the purpose of rehabilitation, conservation or liquidation, then, in any such case, (i) the Company by a Board Resolution may remove the Trustee with respect to all Securities, or (ii) subject to Section 514, any Holder who has been a bona fide Holder of a Security for at least six months may, on behalf of himself and all others similarly situated, petition any court of competent jurisdiction for the removal of the Trustee with respect to all Securities and the appointment of a successor Trustee or Trustees. (e) If the Trustee shall resign, be removed or become incapable of acting, or if a vacancy shall occur in the office of Trustee for any cause, with respect to the Securities of one or more series, the Company, by a Board Resolution, shall promptly appoint a successor Trustee or Trustees with respect to the Securities of that or those series (it being understood that any such successor Trustee may be appointed with respect to the Securities of one or more or all of such series and that at any time there shall be only one Trustee with respect to the Securities of any particular series) and shall comply with the -44- 53 applicable requirements of Section 611. If, within one year after such resignation, removal or incapability, or the occurrence of such vacancy, a successor Trustee with respect to the Securities of any series shall be appointed by Act of the Holders of a majority in principal amount of the Outstanding Securities of such series delivered to the Company and the retiring Trustee, the successor Trustee so appointed shall, forthwith upon its acceptance of such appointment in accordance with the applicable requirements of Section 611, become the successor Trustee with respect to the Securities of such series and to that extent supersede the successor Trustee appointed by the Company. If no successor Trustee with respect to the Securities of any series shall have been so appointed by the Company or the Holders and accepted appointment in the manner required by Section 611, any Holder who has been a bona fide Holder of a Security of such series for at least six months may, on behalf of himself and all others similarly situated, petition any court of competent jurisdiction for the appointment of a successor Trustee with respect to the Securities of such series. (f) The Company shall give notice of each resignation and each removal of the Trustee with respect to the Securities of any series and each appointment of a successor Trustee with respect to the Securities of any series to all Holders of Securities of such series in the manner provided in Section 106. Each notice shall include the name of the successor Trustee with respect to the Securities of such series and the address of its Corporate Trust Office. SECTION 611. Acceptance of Appointment by Successor. (a) In case of the appointment hereunder of a successor Trustee with respect to all Securities, every such successor Trustee so appointed shall execute, acknowledge and deliver to the Company and to the retiring Trustee an instrument accepting such appointment, and thereupon the resignation or removal of the retiring Trustee shall become effective and such successor Trustee, without any further act, deed or conveyance, shall become vested with all the rights, powers, trusts and duties of the retiring Trustee, but, on the request of the Company or the successor Trustee, such retiring Trustee shall, upon payment of its charges, execute and deliver an instrument transferring to such successor Trustee all the rights, powers and trusts of the retiring Trustee and shall duly assign, transfer and deliver to such successor Trustee all property and money held by such retiring Trustee hereunder. (b) In case of the appointment hereunder of a successor Trustee with respect to the Securities of one or more (but not all) series, the Company, the retiring Trustee and each successor -45- 54 Trustee with respect to the Securities of one or more series shall execute and deliver an indenture supplemental hereto wherein each successor Trustee shall accept such appointment and which (1) shall contain such provisions as shall be necessary or desirable to transfer and confirm to, and to vest in, each successor Trustee all the rights, powers, trusts and duties of the retiring Trustee with respect to the Securities of that or those series to which the appointment of such successor Trustee relates, (2) if the retiring Trustee is not retiring with respect to all Securities, shall contain such provisions as shall be deemed necessary or desirable to confirm that all the rights, powers, trusts and duties of the retiring Trustee with respect to the Securities of that or those series as to which the retiring Trustee is not retiring shall continue to be vested in the retiring Trustee, and (3) shall add to or change any of the provisions of this Indenture as shall be necessary to provide for or facilitate the administration of the trusts hereunder by more than one Trustee, it being understood that nothing herein or in such supplemental indenture shall constitute such Trustees co-trustees of the same trust and that each such Trustee shall be trustee of a trust or trusts hereunder separate and apart from any trust or trusts hereunder administered by any other such Trustee; and upon the execution and delivery of such supplemental indenture the resignation or removal of the retiring Trustee shall become effective to the extent provided therein and each such successor Trustee, without any further act, deed or conveyance, shall become vested with all the rights, powers, trusts and duties of the retiring Trustee with respect to the Securities of that or those series to which the appointment of such successor Trustee relates; but, on request of the Company or any successor Trustee, such retiring Trustee shall duly assign, transfer and deliver to such successor Trustee all property and money held by such retiring Trustee hereunder with respect to the Securities of that or those series to which the appointment of such successor Trustee relates. (c) Upon request of any such successor Trustee, the Company shall execute any and all instruments for more fully and certainly vesting in and confirming to such successor Trustee all such rights, powers and trusts referred to in paragraph (a) or (b) of this Section, as the case may be. (d) No successor Trustee shall accept its appointment unless at the time of such acceptance such successor Trustee shall be qualified and eligible under this Article. SECTION 612. Merger, Conversion, Consolidation or Succession to Business. Any corporation into which the Trustee may be merged or converted or with which it may be consolidated, or any corporation -46- 55 resulting from any merger, conversion or consolidation to which the Trustee shall be a party, or any corporation succeeding to all or substantially all the corporate trust business of the Trustee, shall be the successor of the Trustee hereunder, provided such corporation shall be otherwise qualified and eligible under this Article, without the execution or filing of any paper or any further act on the part of any of the parties hereto. In case any Securities shall have been authenticated, but not delivered, by the Trustee then in office, any successor by merger, conversion or consolidation to such authenticating Trustee may adopt such authentication and deliver the Securities so authenticated with the same effect as if such successor Trustee had itself authenticated such Securities. SECTION 613. Preferential Collection of Claims Against Company. If and when the Trustee shall be or become a creditor of the Company (or any other obligor upon the Securities), the Trustee shall be subject to the provisions of the Trust Indenture Act regarding the collection of claims against the Company (or any such other obligor). SECTION 614. Appointment of Authenticating Agent. The Trustee may appoint an Authenticating Agent or Agents with respect to one or more series of Securities which shall be authorized to act on behalf of the Trustee to authenticate Securities of such series issued under original issue and upon exchange, registration of transfer or partial redemption thereof or pursuant to Section 306, and Securities so authenticated shall be entitled to the benefits of this Indenture and shall be valid and obligatory for all purposes as if authenticated by the Trustee hereunder. Wherever reference is made in this Indenture to the authentication and delivery of Securities by the Trustee or the Trustee's certificate of authentication, such reference shall be deemed to include authentication and delivery on behalf of the Trustee by an Authenticating Agent and a certificate of authentication executed on behalf of the Trustee by an Authenticating Agent. Each Authenticating Agent shall be acceptable to the Company and shall at all times be a corporation organized and doing business under the laws of the United States of America, any State thereof or the District of Columbia, authorized under such laws to act as Authenticating Agent, having a combined capital and surplus of not less than $50,000,000 and subject to supervision or examination by Federal or state authority. If such Authenticating Agent publishes reports of condition at least annually, pursuant to law or to the requirements of said supervising or examining authority, then for the purposes of this Section, the combined capital and surplus of such Authenticating Agent shall be deemed to be its combined -47- 56 capital and surplus as set forth in its most recent report of condition so published. If at any time an Authenticating Agent shall cease to be eligible in accordance with the provisions of this Section, such Authenticating Agent shall resign immediately in the manner and with the effect specified in this Section. Any corporation into which an Authenticating Agent may be merged or converted or with which it may be consolidated, or any corporation resulting from any merger, conversion or consolidation to which such Authenticating Agent shall be a party, or any corporation succeeding to the corporate agency or corporate trust business of an Authenticating Agent, shall continue to be an Authenticating Agent, provided such corporation shall be otherwise eligible under this Section, without the execution or filing of any paper or any further act on the part of the Trustee or the Authenticating Agent. An Authenticating Agent may resign at any time by giving written notice thereof to the Trustee and to the Company. The Trustee may at any time terminate the agency of an Authenticating Agent by giving written notice thereof to such Authenticating Agent and to the Company. Upon receiving such a notice of resignation or upon such a termination, or in case at any time such Authenticating Agent shall cease to be eligible in accordance with the provisions of this Section, the Trustee may appoint a successor Authenticating Agent which shall be acceptable to the Company and shall mail written notice of such appointment by first-class mail, postage prepaid, to all Holders of Securities of the series with respect to which such Authenticating Agent will serve, as their names and addresses appear in the Security Register. Any successor Authenticating Agent upon acceptance of its appointment hereunder shall become vested with all the rights, powers and duties of its predecessor hereunder, with like effect as if originally named as an Authenticating Agent. No successor Authenticating Agent shall be appointed unless eligible under the provisions of this Section. The Trustee agrees to pay to each Authenticating Agent from time to time reasonable compensation for its services under this Section, and the Trustee shall be entitled to be reimbursed for such payments, subject to the provisions of Section 607. If an appointment with respect to one or more series is made pursuant to this Section, the Securities of such series may have endorsed thereon, in addition to the Trustee's certificate of authentication, an alternative certificate of authentication in the following form: -48- 57 This is one of the Securities of the series designated therein referred to in the within-mentioned Indenture. THE FIRST NATIONAL BANK OF BOSTON, As Trustee By ................................. As Authenticating Agent By.................................. Authorized Officers ARTICLE SEVEN HOLDERS' LISTS AND REPORTS BY TRUSTEE AND COMPANY SECTION 701. Company to Furnish Trustee Names and Addresses of Holders. The Company will furnish or cause to be furnished to the Trustee (a) semi-annually, not later than June 30 and December 31 in each year, a list, in such form as the Trustee may reasonably require, of the names and addresses of the Holders of Securities of each series as of a date no more than 15 days prior to the date such list is furnished, and (b) at such other times as the Trustee may request in writing, within 30 days after the receipt by the Company of any such request, a list of similar form and content as of a date not more than 15 days prior to the time such list is furnished; excluding from any such list names and addresses received by the Trustee in its capacity as Security Registrar. SECTION 702. Preservation of Information, Communications to Holders. (a) The Trustee shall preserve, in as current a form as is reasonably practicable, the names and addresses of Holders contained in the most recent list furnished to the Trustee as provided in Section 701 and the names and addresses of Holders received by the Trustee in its capacity as Security Registrar. The Trustee may destroy any list furnished to it as provided in Section 701 upon receipt of a new list so furnished. (b) The rights of Holders to communicate with other Holders with respect to their rights under this Indenture or under the -49- 58 Securities, and the corresponding rights and privileges of the Trustee, shall be as provided by the Trust Indenture Act. (c) Every Holder of Securities, by receiving and holding the same, agrees with the Company and the Trustee that neither the Company nor the Trustee nor any agent of either of them shall be held accountable by reason of any disclosure of information as to names and addresses of Holders made pursuant to the Trust Indenture Act. SECTION 703. Reports by Trustee. (a) The Trustee shall transmit to Holders such reports concerning the Trustee and its actions under this Indenture as may be required pursuant to the Trust Indenture Act at the times and in the manner provided pursuant thereto. (b) A copy of each such report shall, at the time of such transmission to Holders, be filed by the Trustee, with each stock exchange upon which any Securities are listed, with the Commission and with the Company. The Company will notify the Trustee when any Securities are listed on any stock exchange. SECTION 704. Reports by Company. The Company shall file with the Trustee and the Commission, and transmit to Holders, such information, documents and other reports, and such summaries thereof, as may be required pursuant to the Trust Indenture Act at the times and in the manner provided pursuant to such Act; provided that any such information, documents or reports required to be filed with the Commission pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934 shall be filed with the Trustee within 15 days after the same is so required to be filed with the Commission. ARTICLE EIGHT CONSOLIDATION, MERGER, CONVEYANCE, TRANSFER OR LEASE SECTION 801. Company May Consolidate, Etc., Only on Certain Terms. The Company, in a single transaction or through a series of related transactions, shall not consolidate with or merge with or into any other Person or transfer (by lease, assignment, sale or otherwise) all or substantially all of its properties and assets to another Person or group of affiliated Persons, unless: (a) either (1) the Company shall be the continuing corporation or (2) the Person (if other than the Company) -50- 59 formed by such consolidation or into which the Company is merged or to which all or substantially all of the properties and assets of the Company are transferred (i) shall be a corporation, partnership or trust organized and validly existing under the laws of the United States or any state thereof or the District of Columbia and (ii) shall expressly assume, by an indenture supplemental hereto, executed and delivered to the Trustee, in form reasonably satisfactory to the Trustee, all of the obligations of the Company under the Securities and this Indenture and the performance of every covenant of this Indenture on the part of the Company to be performed or observed; (b) immediately after giving effect to such transaction, and the assumption contemplated by clause (a) above, no Event of Default, and no event which, after notice or lapse of time, or both, would become an Event of Default, shall have occurred and be continuing; (c) except in the case of a merger or consolidation of the Company and a Restricted Subsidiary, either (i) the Holders of a majority of the Outstanding Securities of each series have consented to such transaction, or (ii) immediately after giving effect to such transaction, the Company or (if other than the Company) such successor Person would be permitted to incur at least $1.00 of Secured Funded Debt under the provisions of Section 1006(9) of the Indenture; and (d) the Company shall have delivered to the Trustee an Officers' Certificate and an Opinion of Counsel, each stating that such consolidation, merger or transfer and, if a supplemental indenture is required in connection with such transaction, such supplemental indenture, comply with this Article Eight and that all conditions precedent herein provided for relating to such transaction have been satisfied. The successor Person formed by such consolidation or into which the Company is merged, or the successor Person to which such conveyance, transfer or lease is made, shall succeed to, and be substituted for, and may exercise every right and power of, the Company under this Indenture with the same effect as if such successor had been named as the Company herein, and thereafter, except in the case of a lease of its properties and assets substantially as an entirety, the Company shall be discharged and released from all obligations and covenants under this Indenture and the Securities. The Trustee shall enter into a supplemental indenture to evidence the succession and substitution of such successor Person and such discharge and release of the Company. -51- 60 ARTICLE NINE SUPPLEMENTAL INDENTURES SECTION 901. Supplemental Indentures Without Consent of Holders. Without the consent of any Holders, the Company, when authorized by a Board Resolution, and the Trustee, at any time and from time to time, may enter into one or more indentures supplemental hereto, in form satisfactory to the Trustee, for any of the following purposes: (1) to evidence the succession of another Person to the Company and the assumption by any such successor of the covenants of the Company herein and in the Securities; or (2) to add to the covenants of the Company for the benefit of the Holders of all or any series of Securities (and if such covenants are to be for the benefit of less than all series of Securities, stating that such covenants are expressly being included solely for the benefit of such series) or to surrender any right or power herein conferred upon the Company; or (3) to add any additional Events of Default (and if such additional Events of Default are to be in respect of less than all series of Securities, stating that such Events of Default are expressly being included solely for the benefit of one or more specified series); or (4) to add to or change any of the provisions of this Indenture to such extent as shall be necessary to permit or facilitate the issuance of Securities in bearer form, registrable or not registrable as to principal, and with or without interest coupons, or to permit or facilitate the issuance of Securities in uncertificated form; or (5) to add to, change or eliminate any of the provisions of this Indenture in respect of one or more series of Securities, provided that any such addition, change or elimination shall not modify the rights of any Holder of an Outstanding Security of a series created prior to the execution of such supplemental indenture and entitled to the benefits of such provisions and shall only become effective with respect to any such previously created series of Securities from and after the date on which there is no Security of such series Outstanding; or (6) to secure the Securities pursuant to the requirements of Section 1006 or otherwise; or -52- 61 (7) to establish the form or terms of Securities of any series as permitted by Sections 201, 202 and 301 and to provide for the issuance thereof; or (8) to evidence and provide for the acceptance of appointment hereunder by a successor Trustee with respect to the Securities of one or more series and to add to or change any of the provisions of this Indenture as shall be necessary to provide for or facilitate the administration of the trusts hereunder by more than one Trustee, pursuant to the requirements of Section 611(b); or (9) to cure any ambiguity, to correct or supplement any provision herein which may be inconsistent with any other provision herein, or to make any other provisions with respect to matters or questions arising under this Indenture, provided that such action pursuant to this clause (9) shall not adversely affect the interests of the Holders of Securities of any series in any material respect. SECTION 902. Supplemental Indentures with Consent of Holders. With the consent of the Holders of not less than a majority in principal amount of the Outstanding Securities of each series affected by such supplemental indenture, by Act of said Holders delivered to the Company and the Trustee, the Company, when authorized by a Board Resolution, and the Trustee may enter into an indenture or indentures supplemental hereto for the purpose of adding any provisions to or changing in any manner or eliminating any of the provisions of this Indenture or of modifying in any manner the rights of the Holders of Securities of such series under this Indenture; provided, however, that no such supplemental indenture shall, without the consent of the Holder of each Outstanding Security affected thereby, (1) change the Stated Maturity of the principal of, or any installment of principal of or interest on, any Security, or reduce the principal amount thereof or the rate of interest thereon or any premium payable upon the redemption thereof, or reduce the amount of the principal of an Original Issue Discount Security that would be due and payable upon a declaration of acceleration of the Maturity thereof pursuant to Section 502, or change any Place of Payment where, or the coin or currency in which, any Security or any premium or, interest thereon is payable, or impair the right to institute suit for the enforcement of any such payment on or after the Stated Maturity thereof (or, in the case of redemption, on or after the Redemption Date), or -53- 62 (2) reduce the percentage in principal amount of the Outstanding Securities of any series, the consent of whose Holders is required for any such supplemental indenture, or the consent of whose Holders is required for any waiver of compliance with certain provisions of this Indenture or certain defaults hereunder and their consequences provided for in this Indenture, or (3) modify any of the provisions of this Section, Section 513 or Section 1009, except to increase any such percentage or to provide that certain other provisions of this Indenture cannot be modified or waived without the consent of the Holder of each Outstanding Security affected thereby, provided, however, that this clause shall not be deemed to require the consent of any Holder with respect to changes in the references to "the Trustee" and concomitant changes in this Section and Section 1009, or the deletion of this proviso, in accordance with the requirements of Sections 611(b) and 901(8). A supplemental indenture which changes or eliminates any covenant or other provision of this Indenture which has expressly been included solely for the benefit of one or more particular series of Securities, or which modifies the rights of the Holders of Securities of such series with respect to such covenant or other provision, shall be deemed not to affect the rights under this Indenture of the Holders of Securities of any other series. It shall not be necessary for any Act of Holders under this Section to approve the particular form of any proposed supplemental indenture, but it shall be sufficient if such Act shall approve the substance thereof. SECTION 903. Execution of Supplemental Indentures. In executing, or accepting the additional trusts created by, any supplemental indenture permitted by this Article or the modifications thereby of the trusts created by this Indenture, the Trustee shall be entitled to receive, and (subject to Section 601) shall be fully protected in relying upon, an Opinion of Counsel stating that the execution of such supplemental indenture is authorized or permitted by this Indenture. The Trustee may, but shall not be obligated to, enter into any such supplemental indenture which affects the Trustee's own rights, duties or immunities under this Indenture or otherwise. SECTION 904. Effect of Supplemental Indentures. Upon the execution of any supplemental indenture under this Article, this Indenture shall be modified in accordance therewith, -54- 63 and such supplemental indenture shall form a part of this Indenture for all purposes; and every Holder of Securities theretofore or thereafter authenticated and delivered hereunder shall be bound thereby. SECTION 905. Conformity with Trust Indenture Act. Every supplemental indenture executed pursuant to this Article shall conform to the requirements of the Trust Indenture Act. SECTION 906. Reference in Securities to Supplemental Indentures. Securities of any series authenticated and delivered after the execution of any supplemental indenture pursuant to this Article may, and shall if required by the Trustee, bear a notation in form approved by the Trustee as to any matter provided for in such supplemental indenture. If the Company shall so determine, new Securities of any series so modified as to conform, in the opinion of the Trustee and the Company, to any such supplemental indenture may be prepared and executed by the Company and authenticated and delivered by the Trustee in exchange for Outstanding Securities of such series. ARTICLE TEN COVENANTS SECTION 1001. Payment of Principal, Premium and Interest. The Company covenants and agrees for the benefit of each series of Securities that it will duly and punctually pay the principal of and any premium and interest on the Securities of that series in accordance with the terms of the Securities and this Indenture. Each installment of interest on each Security may be paid by mailing a check for such interest payable to or upon the written order of the Person to whom such interest is payable in accordance with Section 307. SECTION 1002. Maintenance of Office or Agency. The Company will maintain in each Place of Payment for any series of Securities an office or agency where Securities of that series may be presented or surrendered for payment, where Securities of that series may be surrendered for registration of transfer or exchange and where notices and demands to or upon the Company in respect of the Securities of that series and this Indenture may be served. The Company will give prompt written notice to the Trustee of the location, and any change in the location, of such office or agency. If at any time the Company -55- 64 shall fail to maintain any such required office or agency or shall fail to furnish the Trustee with the address thereof, such presentations, surrenders, notices and demands may be made or served at the Corporate Trust Office of the Trustee, and the Company hereby appoints the Trustee as its agent to receive all such presentations, surrenders, notices and demands. The Company may also from time to time designate one or more other offices or agencies where the Securities of one or more series may be presented or surrendered for any or all such purposes and may from time to time rescind such designations; provided, however, that no such designation or rescission shall in any manner relieve the Company of its obligation to maintain an office or agency in each Place of Payment for Securities of any series for such purposes. The Company will give prompt written notice to the Trustee of any such designation or rescission and of any change in the location of any such other office or agency. SECTION 1003. Money for Securities Payments to Be Held in Trust. If the Company shall at any time act as its own Paying Agent with respect to any series of Securities, it will, on or before each due date of the principal of or any premium or interest on any of the Securities of that series, segregate and hold in trust for the benefit of the Persons entitled thereto a sum sufficient to pay the principal and any premium and interest so becoming due until such sums shall be paid to such Persons or otherwise disposed of as herein provided and will promptly notify the Trustee of its action or failure so to act. Whenever the Company shall have one or more Paying Agents for any series of Securities, it will, prior to each due date of the principal of, or any premium or interest on, any Securities of that series, deposit with a Paying Agent a sum sufficient to pay such amount, such sum to be held as provided by the Trust Indenture Act, and (unless such Paying Agent is the Trustee) the Company will promptly notify the Trustee of its action or failure so to act. The Company will cause each Paying Agent for any series of Securities other than the Trustee to execute and deliver to the Trustee an instrument in which such Paying Agent shall agree with the Trustee, subject to the provisions of this Section, that such Paying Agent will (i) comply with the provisions of the Trust Indenture Act applicable to it as a Paying Agent and (ii) during the continuance of any default by the Company in the making of any payment in respect of the Securities of that series, upon the written request of the Trustee, forthwith pay to the Trustee all sums held in trust by such Paying Agent for payment in respect of the Securities of that series. -56- 65 The Company may at any time, for the purpose of obtaining the satisfaction and discharge of this Indenture or for any other purpose, pay, or by Company Order direct any Paying Agent to pay, to the Trustee all sums held in trust by the Company or such Paying Agent, such sums to be held by the Trustee upon the same trusts as those upon which such sums were held by the Company or such Paying Agent; and, upon such payment by any Paying Agent to the Trustee, such Paying Agent shall be released from all further liability with respect to such money. Any money deposited with the Trustee or any Paying Agent, or then held by the Company, in trust for the payment of the principal of or any premium or interest on any Security of any series and remaining unclaimed for two years after such principal, premium, or interest has become due and payable shall be paid to the Company on Company Request, or (if then held by the Company) shall be discharged from such trust; and the Holder of such Security shall thereafter, as an unsecured general creditor, look only to the Company for payment thereof, and all liability of the Trustee or such Paying Agent with respect to such trust money, and all liability of the Company as trustee thereof, shall thereupon cease; provided, however, that the Trustee or such Paying Agent, before being required to make any such repayment, may at the expense of the Company mail to the Holders of the Securities as to which the money to be repaid was held in trust, as their names and addresses appear in the Security Register, a notice that such moneys remain unclaimed and that, after a date specified in the notice, which shall not be less than 30 days from the date on which the notice was first mailed to the Holders of the Securities as to which the money to be repaid was held in trust, any unclaimed balance of such moneys then remaining will be paid to the Company free of the trust formerly impressed upon it. SECTION 1004. Statement by Officers as to Default. The Company will deliver to the Trustee, within 120 days after the end of each fiscal year of the Company ending after the date hereof, an Officers' Certificate, stating whether or not to the best knowledge of the signers thereof the Company is in default in the performance and observance of any of the terms, provisions and conditions of this Indenture (without regard to any period of grace or requirement of notice provided hereunder) and, if the Company shall be in default, specifying all such defaults and the nature and status thereof of which they may have knowledge. -57- 66 SECTION 1005. Existence. Subject to Article Eight, the Company will do or cause to be done all things necessary to preserve and keep in full force and effect its legal existence. SECTION 1006. Limitation on Secured Funded Debt. The Company shall not create, assume, guarantee, incur or issue any Secured Funded Debt, or permit any Restricted Subsidiary so to do, without making effective provision whereby the Securities then outstanding and having the benefit of this Section shall be secured equally and ratably with (or prior to) such Secured Funded Debt for so long as such debt shall be so secured, except that the foregoing shall not prevent the Company or any Restricted Subsidiary (without providing for any ratable security for the Holders of the Securities) from creating, assuming, guaranteeing, incurring or issuing Secured Funded Debt of the following character: (1) with respect to any series of Securities, any Secured Funded Debt existing on the date of issuance of the series; (2) any Secured Funded Debt secured by a Lien on property owned or leased by, or shares of capital stock or indebtedness of, a Person at the time it becomes a Restricted Subsidiary; (3) any Secured Funded Debt secured by a Lien existing on property at the time of the acquisition or lease thereof by the Company or a Restricted Subsidiary or created or incurred within 120 days after the date of the acquisition (including acquisition through merger or consolidation) or lease thereof; (4) any Secured Funded Debt secured by a Lien on property of a corporation existing at the time such corporation is merged or consolidated with the Company or a Restricted Subsidiary or at the time of a sale, lease or other disposition of the properties of a corporation as an entirety or substantially as an entirety to the Company or a Restricted Subsidiary; (5) any Secured Funded Debt incurred to purchase inventory, equipment or other property acquired or held by the Company or any Restricted Subsidiary that is secured by a Lien on the property so acquired, or to construct or improve any property of the Company or any Restricted Subsidiary; (6) any Secured Funded Debt secured by a Lien incurred or assumed in connection with the issuance of revenue bonds the -58- 67 interest on which is exempt from federal income taxation pursuant to Section 103(a) and related sections of the Internal Revenue Code of 1986, as amended; (7) any Secured Funded Debt of the Company or a Restricted Subsidiary owing to the Company or to another Restricted Subsidiary; (8) any Secured Funded Debt resulting from any Lien in favor of the United States of America or any state thereof or any other country, or any agency, instrumentality or political subdivision of any of the foregoing, to secure partial, progress, advance or other payments or performance pursuant to the provisions of any contract or statute; (9) any Secured Funded Debt if immediately after giving effect to the incurrence or issuance thereof, the sum of the aggregate amount of all outstanding Secured Funded Debt of the Company and its Restricted Subsidiaries incurred under this clause (9) of Section 1006 together with all Attributable Debt of the Company and its Restricted Subsidiaries in respect of Sale and Leaseback Transactions does not exceed 10% of Consolidated Net Tangible Assets. (10) any extension, renewal or replacement (or successive extensions, renewals or replacements) in whole or in part of any any Secured Funded Debt referred to in clauses (1) through (9). For the purposes of determining any particular amount of Secured Funded Debt under this Section 1006, guarantees of or obligations with respect to letters of credit supporting Secured Funded Debt otherwise included in the determination of such amount shall not also be included. In the event that an item of Secured Funded Debt meets the criteria of one or more of the categories of Secured Funded Debt described in the above clauses, the Company, in its sole discretion, shall classify such item of Secured Funded Debt and shall only be required to include such item of Secured Funded Debt in one of such clauses. SECTION 1007. Limitation on Sale and Leasebacks. The Company shall not enter into any Sale and Leaseback Transaction involving a Principal Property of the Company or any Restricted Subsidiary, nor permit any Restricted Subsidiary so to do, unless either: (1) the Company or such Restricted Subsidiary would be entitled under Section 1006(9) to incur Secured Funded Debt, in a -59- 68 principal amount at least equal to the Attributable Debt with respect to such Sale and Leaseback Transaction, secured by Liens on the property to be leased without equally and ratably securing the Outstanding Securities having the benefit of this Section 1007, or (2) the Company during the 120 days immediately following the effective date of such Sale and Leaseback Transaction causes to be applied an amount equal to the Value of such Sale and Leaseback Transaction to either (i) the voluntary retirement of Funded Debt (whether by redemption, defeasance, repurchase, or otherwise), or (ii) the purchase of other property which will constitute "Principal Property" having a fair value, as determined by the Company, at least equal to the Value of such Sale and Leaseback Transaction, or (3) the Company or a Restricted Subsidiary shall deliver to the Trustee or other applicable trustee for cancellation Securities or Funded Debt in an aggregate principal amount at least equal to the Value of such Sale and Leaseback Transaction. SECTION 1008. Limitation on Designation of Unrestricted Subsidiary as Restricted Subsidiary. The Company shall not designate as a Restricted Subsidiary any Subsidiary that, immediately prior to such designation, was an Unrestricted Subsidiary unless, immediately after giving effect to such designation, the Company would be permitted to incur at least $1.00 of Secured Funded Debt under the provisions of Section 1006(9) of the Indenture. SECTION 1009. Waiver of Certain Covenants. The Company may omit in any particular instance to comply with any term, provision or condition set forth in Sections 801, 1006, 1007 and 1008 with respect to the Securities of any series if before the time for such compliance the Holders of at least a majority in principal amount of the Outstanding Securities of such series shall, by Act of such Holders, either waive such compliance in such instance or generally waive compliance with such term, provision or condition, but no such waiver shall extend to or affect such term, provision or condition except to the extent so expressly waived, and, until such waiver shall become effective, the obligations of the Company and the duties of the Trustee in respect of any such term, provision or condition shall remain in full force and effect. -60- 69 ARTICLE ELEVEN REDEMPTION OF SECURITIES SECTION 1101. Applicability of Article. Securities of any series which are redeemable before their Stated Maturity shall be redeemable in accordance with their terms and (except as otherwise specified as contemplated by Section 301 for Securities of any series) in accordance with this Article. SECTION 1102. Election to Redeem, Notice to Trustee. The election of the Company to redeem any Securities shall be evidenced by a Board Resolution. In case of any redemption at the election of the Company of less than all the Securities of any series, the Company shall, at least 60 days prior to the Redemption Date fixed by the Company (unless a shorter notice shall be satisfactory to the Trustee), notify the Trustee of such Redemption Date, of the principal amount of Securities of such series to be redeemed and, if applicable, of the tenor of the Securities to be redeemed. In the case of any redemption of Securities prior to the expiration of any restriction on such redemption provided in the terms of such Securities or elsewhere in this Indenture, the Company shall furnish the Trustee with an Officers' Certificate evidencing compliance with such restriction. SECTION 1103. Selection by Trustee of Securities to Be Redeemed. If less than all the Securities of any series are to be redeemed (unless all of the Securities of such series and of a specified tenor are to be redeemed), the particular Securities to be redeemed shall be selected not more than 60 days prior to the Redemption Date by the Trustee, from the Outstanding Securities of such series not previously called for redemption, by such method as the Trustee shall deem fair and appropriate and which may provide for the selection for redemption of portions (equal to the minimum authorized denomination for Securities of that series or any integral multiple thereof) of the principal amount of Securities of such series of a denomination larger than the minimum authorized denomination for Securities of that series. If less than all of the Securities of such series and of a specified tenor are to be redeemed, the particular Securities to be redeemed shall be selected not more than 60 days prior to the Redemption Date by the Trustee, from the Outstanding Securities of such series and specified tenor not previously called for redemption in accordance with the preceding sentence. The Trustee shall promptly notify the Company in writing of the Securities selected for redemption and, in the case of any -61- 70 Securities selected for partial redemption, the principal amount thereof to be redeemed. For all purposes of this Indenture, unless the context otherwise requires, all provisions relating to the redemption of Securities shall relate, in the case of any Securities redeemed or to be redeemed only in part, to the portion of the principal amount of such Securities which has been or is to be redeemed. SECTION 1104. Notice of Redemption. Notice of redemption shall be given by first-class mail, postage prepaid, mailed not less than 30 nor more than 60 days prior to the Redemption Date, to each Holder of Securities to be redeemed, at his address appearing in the Security Register. All notices of redemption shall state: (1) the Redemption Date, (2) the Redemption Price, (3) the CUSIP number (if any); (4) if less than all the Outstanding Securities of any series are to be redeemed, the identification (and, in the case of partial redemption of any Securities, the principal amounts) of the particular Securities to be redeemed, (5) that on the Redemption Date the Redemption Price will become due and payable upon each such Security to be redeemed and, if applicable, that interest thereon will cease to accrue on and after said date, (6) the place or places where such Securities are to be surrendered for payment of the Redemption Price, and (7) that the redemption is for a sinking fund, if such is the case. Notice of redemption of Securities to be redeemed at the election of the Company shall be given by the Company or, at the Company's request, by the Trustee in the name and at the expense of the Company. -62- 71 SECTION 1105. Deposit of Redemption Price. Prior to any Redemption Date, the Company shall deposit with the Trustee or with a Paying Agent (or, if the Company is acting a its own Paying Agent, segregate and hold in trust as provided in Section 1003) an amount of money sufficient to pay the Redemption Price of, and (except if the Redemption Date shall be an Interest Payment Date) accrued interest on, all the Securities which are to be redeemed on that date. SECTION 1106. Securities Payable on Redemption Date. Notice of redemption having been given as aforesaid, the Securities so to be redeemed shall, on the Redemption Date, become due and payable at the Redemption Price therein specified, and from and after such date (unless the Company shall default in the payment of the Redemption Price and accrued interest) such Securities shall cease to bear interest. Upon surrender of any such Security for redemption in accordance with said notice, such Security shall be paid by the Company at the Redemption Price, together with accrued interest to the Redemption Date; provided, however, that, unless otherwise specified as contemplated by Section 301, installments of interest whose Stated Maturity is on or prior to the Redemption Date will be payable to the Holders of such Securities, or one or more Predecessor Securities, registered as such at the close of business on the relevant Record Dates according to their terms and the provisions of Section 307. If any Security called for redemption shall not be so paid upon surrender thereof for redemption, the principal and any premium shall, until paid, bear interest from the Redemption Date at the rate prescribed therefor in the Security. SECTION 1107. Securities Redeemed in Part. Any Security which is to be redeemed only in part shall be surrendered at a Place of Payment therefor (with, if the Company or the Trustee so requires, due endorsement by, or a written instrument of transfer in form satisfactory to the Company and the Trustee duly executed by, the Holder thereof or his attorney duly authorized in writing), and the Company shall execute, and the Trustee shall authenticate and deliver to the Holder of such Security without service charge, a new Security or Securities of the same series and of like tenor, of any authorized denomination as requested by such Holder, in aggregate principal amount equal to and in exchange for the unredeemed portion of the principal of the Security so surrendered. -63- 72 ARTICLE FIVE SINKING FUNDS SECTION 1201. Applicability of Article. The provisions of this Article shall be applicable to any sinking fund for the retirement of Securities of a series except as otherwise specified as contemplated by Section 301 for Securities of such series. The minimum amount of any sinking fund payment provided for by the terms of Securities of any series is herein referred to as a "mandatory sinking fund payment", and any payment in excess of such minimum amount provided for by the terms of Securities of any series is herein referred to as an "optional sinking fund payment". If provided for by the terms of Securities of any series, the cash amount of any sinking fund payment may be subject to reduction as provided in Section 1202. Each sinking fund payment shall be applied to the redemption of Securities of any series as provided for by the terms of Securities of such series. SECTION 1202. Satisfaction of Sinking Fund Payments with Securities. The Company (1) may deliver Outstanding Securities of a series and (2) may apply as a credit Securities of a series which have been redeemed either at the election of the Company pursuant to the terms of such Securities or through the application of permitted optional sinking fund payments pursuant to the terms of such Securities, in each case in satisfaction of all or any part of any sinking fund payment with respect to the Securities of such series required to be made pursuant to the terms of such Securities as provided for by the terms of such series; provided that such Securities have not been previously so credited. Such Securities shall be received and credited for such purpose by the Trustee at the Redemption Price specified in such Securities for redemption through operation of the sinking fund and the amount of such sinking fund payment shall be reduced accordingly. SECTION 1203. Redemption of Securities for Sinking Fund. Not less than 60 days prior to each sinking fund payment date for any series of Securities, the Company will deliver to the Trustee an Officers' Certificate specifying the amount of the next ensuing sinking fund payment for that series pursuant to the terms of that series, the portion thereof, if any, which is to be satisfied by payment of cash and the portion thereof, if any, which is to be satisfied by delivering and crediting Securities of that series pursuant to Section 1202 and will also deliver to the -64- 73 Trustee any Securities to be so delivered. Not less than 45 days before each such sinking fund payment date the Trustee shall select the Securities to be redeemed upon such sinking fund payment date in the manner specified in Section 1103 and cause notice of the redemption thereof to be given in the name of and at the expense of the Company in the manner provided in Section 1104. Such notice having been duly given, the redemption of such Securities shall be made upon the terms and in the manner stated in Sections ll06 and ll07. This instrument may be executed in any number of counterparts, each of which so executed shall be deemed to be an original, but all such counterparts shall together constitute but one and the same instrument. -65- 74 IN WITNESS WHEREOF, the parties hereto have caused this Indenture to be duly executed, and their respective corporate seals to be hereunto affixed and attested, all as of the day and year first above written. EG&G, INC. By ............................ Attest: .............................. THE FIRST NATIONAL BANK OF BOSTON By ............................ Attest: .............................. -66- 75 COMMONWEALTH OF MASSACHUSETTS ) ) ss: County Of __________________ ) On the ___ day of , , before me personally came to me known, who, being by me duly sworn, did depose and say that he is of EG&G, Inc., one of the corporations described in and which executed the foregoing instrument; that he knows the seal of said corporation; that the seal affixed to said instrument is such corporate seal; that it was so affixed by authority of the Board of Directors of said corporation, and that he signed his name thereto by like authority. .............................. COMMONWEALTH OF MASSACHUSETTS ) ) ss: County Of __________________ ) On the day of , , before me personally came , to me known, who, being by me duly sworn, did depose and say that he is of The First National Bank of Boston, one of the corporations described in and which executed the foregoing instrument; that he knows the seal of said corporation; that the seal affixed to said instrument is such corporate seal; that it was so affixed by authority of the Board of Directors of said corporation, and that he signed his name thereto by like authority. .............................. -67- EX-5.1 4 OPINION OF MURRAY GROSS, ESQ. 1 EXHIBIT 5.1 May 30, 1995 EG&G, Inc. 45 William Street Wellesley, MA 02181 Re: Registration Statement on Form S-3 Ladies and Gentlemen: I am Vice President, General Counsel and Clerk of EG&G, Inc., a Massachusetts corporation (the "Company"). This opinion is being given in connection with the proposed issuance and sale by the Company of $150,000,000 principal amount of Debt Securities (the "Debt Securities"), to be issued under the Indenture between the Company and The First National Bank of Boston, as trustee (the "Trustee"). I am familiar with the proceedings taken by the Company in respect of the Debt Securities and have examined originals or certified or attested copies of such certificates, records and documents as I deem necessary for the purposes of this opinion. I assume that the appropriate action will be taken, prior to the offer and sale of the Debt Securities, to register and qualify the Debt Securities for sale under all applicable state securities or "blue sky" laws. Basing my opinion on the foregoing, I am of the opinion that upon issuance and sale of the Debt Securities in accordance with the terms of the Indenture, the Debt Securities will be validly issued, fully paid and non-assessable. 2 EG&G, Inc. May 30, 1995 Page 2 I understand that this opinion is to be used in connection with the Company's Registration Statement relating to the Debt Securities to be filed with the Securities and Exchange Commission under the Securities Act of 1933, as amended. I consent to the filing of this opinion with and as part of said Registration Statement and the use of my name therein and in the related Prospectus under the caption "Legal Matters". Very truly yours, Murray Gross EX-12.1 5 CALCULATIONS OF RATIO OF EARNINGS 1 EXHIBIT 12.1 EG&G, INC. AND SUBSIDIARIES COMPUTATION OF RATIO OF EARNINGS TO FIXED CHARGES
FISCAL YEARS ENDED QUARTERS ENDED -------------------------------------------------------------- --------------------- DEC. 30, DEC. 29, JAN. 3, JAN. 2, JAN. 1, APRIL 3, APRIL 2, 1990 1991 1993 1994 1995 1994 1995 -------- -------- -------- --------- --------- -------- -------- (UNAUDITED) (IN THOUSANDS WHERE APPLICABLE) Earnings: Income (loss) from continuing operations before income taxes........................ $ 67,022 $ 80,828 $ 66,702 $ 88,492 $ (17,123) $ 12,654 $ 15,473 Add (subtract) adjustments for investments accounted for under the equity method...... (230) 2,885 (232) (384) (248) 80 (311) Add fixed charges: Interest on indebtedness..... 10,528 8,833 7,241 6,264 5,419 965 1,593 Portion of rents representative of the interest factor............ 5,933 6,533 6,867 6,233 6,433 1,535 1,670 -------- -------- -------- --------- --------- -------- -------- Income (loss) as adjusted........ $ 83,253 $ 99,079 $ 80,578 $ 100,605 $ (5,519) $ 15,234 $ 18,425 ======== ======== ======== ========= ========= ======== ======== Fixed charges: Interest on indebtedness..... $ 10,528 $ 8,833 $ 7,241 $ 6,264 $ 5,419 $ 965 $ 1,593 Portion of rents representative of the interest factor............ 5,933 6,533 6,867 6,233 6,433 1,535 1,670 -------- -------- -------- --------- --------- -------- -------- Total fixed charges.............. $ 16,461 $ 15,366 $ 14,108 $ 12,497 $ 11,852 $ 2,500 $ 3,263 ======== ======== ======== ========= ========= ======== ======== Ratio of earnings to fixed charges........................ 5.06x 6.45x 5.71x 8.05x * 6.09x 5.65x ======== ======== ======== ========= ======== ========
- --------------- * Earnings in the fiscal year ended January 1, 1995 were inadequate to cover fixed charges by $17.4 million. Income (loss) from continuing operations before income taxes for this fiscal year includes a goodwill write-down of $40.3 million and restructuring charges of $30.4 million. Without this write-down and these charges, the ratio of earnings to fixed charges would have been 5.50x. EX-23.1 6 CONSENT OF ARTHUR ANDERSEN LLP 1 EXHIBIT 23.1 CONSENT OF INDEPENDENT PUBLIC ACCOUNTANTS As independent public accountants, we hereby consent to the incorporation by reference in this Registration Statement on Form S-3 of our reports dated January 25, 1995 included in EG&G, Inc.'s Annual Report on Form 10-K for the fiscal year ended January 1, 1995 and to all references to our Firm included in the Registration Statement. ARTHUR ANDERSEN LLP Boston, Massachusetts May 30, 1995 EX-23.3 7 CONSENT OF HALE AND DORR 1 EXHIBIT 23.3 CONSENT OF HALE AND DORR We consent to the reference to our firm in this Registration Statement on Form S-3 under the caption "Legal Matters" in the Prospectus Supplement included as a part of this Registration Statement. HALE AND DORR Boston, Massachusetts May 30, 1995 EX-25.1 8 FORM T-1 1 EXHIBIT 25.1 SECURITIES ACT OF 1933 FILE NO: (IF APPLICATION TO DETERMINE ELIGIBILITY OF TRUSTEE FOR DELAYED OFFERING PURSUANT TO SECTION 305(b)(2) ================================================================================ SECURITIES AND EXCHANGE COMMISSION WASHINGTON, D.C. 20549 _______________________ FORM T-1 STATEMENT OF ELIGIBILITY AND QUALIFICATION UNDER THE TRUST INDENTURE ACT OF 1939 OF A CORPORATION DESIGNATED TO ACT AS TRUSTEE CHECK IF AN APPLICATION TO DETERMINE ELIGIBILITY OF A TRUSTEE PURSUANT TO SECTION 305(B) (2)______ ______________________ THE FIRST NATIONAL BANK OF BOSTON (EXACT NAME OF TRUSTEE AS SPECIFIED IN ITS CHARTER) 04-2472499 (I.R.S. EMPLOYER IDENTIFICATION NO.) 100 FEDERAL STREET, BOSTON, MASSACHUSETTS 02110 (ADDRESS OF PRINCIPAL EXECUTIVE OFFICES) (ZIP CODE) GARY A. SPEISS, CASHIER AND GENERAL COUNSEL 100 FEDERAL STREET, 24TH FLOOR, BOSTON, MASSACHUSETTS 02110 (617) 434-2870 (NAME, ADDRESS AND TELEPHONE NUMBER OF AGENT FOR SERVICE) _____________________ EG & G, INC. (EXACT NAME OF OBLIGOR AS SPECIFIED IN ITS CHARTER) MASSACHUSETTS 04-2052042 (STATE OR OTHER JURISDICTION OF (I.R.S. EMPLOYER INCORPORATION OR ORGANIZATION) IDENTIFICATION NO.) 45 WILLIAM STREET WELLESLEY, MASSACHUSETTS 02181 (ADDRESS OF PRINCIPAL EXECUTIVE OFFICES) (ZIP CODE) DEBT SECURITIES (TITLE OF INDENTURE SECURITIES) ================================================================================ 2 1. GENERAL INFORMATION. Furnish the following information as to the trustee: (A) NAME AND ADDRESS OF EACH EXAMINING OR SUPERVISING AUTHORITY TO WHICH IT IS SUBJECT. Comptroller of the Currency of the United States, Washington D.C. Board of Governors of the Federal Reserve System, Washington, D.C Federal Deposit Insurance Corporation, Washington, D.C. (B) WHETHER IT IS AUTHORIZED TO EXERCISE CORPORATE TRUST POWERS. Trustee is authorized to exercise corporate trust powers. 2. AFFILIATIONS WITH OBLIGOR AND UNDERWRITERS. IF THE OBLIGOR OR ANY UNDERWRITER FOR THE OBLIGOR IS AN AFFILIATE OF THE TRUSTEE, DESCRIBE EACH SUCH AFFILIATION. None with respect to the Trustee. (See Notes on page 2) None with respect to Bank of Boston Corporation. 3. THROUGH 11. NOT APPLICABLE. 12. INDEBTEDNESS OF THE OBLIGOR TO THE TRUSTEE
COL. A COL. B COL. C NATURE OF AMOUNT INDEBTEDNESS OUTSTANDING DATE DUE ------------ ----------- -------- N/A N/A N/A
13. THROUGH 15. NOT APPLICABLE. 16. LIST OF EXHIBITS. LIST BELOW ALL EXHIBITS FILED AS PART OF THIS STATEMENT OF ELIGIBILITY AND QUALIFICATION. 1. A COPY OF THE ARTICLES OF ASSOCIATION OF THE TRUSTEE AS NOW IN EFFECT. A certified copy of the Articles of Association of the trustee is filed as Exhibit No. 1 to statement of eligibility and qualification No. 22-9514 and is incorporated herein by reference thereto. 2. A COPY OF THE CERTIFICATE OF AUTHORITY OF THE TRUSTEE TO COMMENCE BUSINESS, IF NOT CONTAINED IN THE ARTICLES OF ASSOCIATION. 3 A copy of the certificate of T. McLean Griffin, Cashier of the trustee, dated February 3, 1978, as to corporate succession containing copies of the Certificate of the Comptroller of the Currency that The Massachusetts Bank, National Association, into which The First National Bank of Boston was merged effective January 4, 1971, is authorized to commence the business of banking as a national banking association, as well as a certificate as to such merger is filed as Exhibit No. 2 to statement of eligibility and qualification No. 22-9514 and is incorporated herein by reference thereto. 3. A COPY OF THE AUTHORIZATION OF THE TRUSTEE TO EXERCISE CORPORATE TRUST POWERS, IF SUCH AUTHORIZATION IS NOT CONTAINED IN THE DOCUMENTS SPECIFIED IN PARAGRAPH (1) OR (2) ABOVE. A copy of a certificate of the Office of the Currency dated February 6, 1978 is filed as Exhibit No. 3 to statement of eligibility and qualification No. 22-9514 and is incorporated herein by reference thereto. 4. A COPY OF THE EXISTING BY-LAWS OF THE TRUSTEE, OR INSTRUMENTS CORRESPONDING THERETO. A certified copy of the existing By-Laws of the trustee dated December 23, 1993 is filed as Exhibit No. 4 to statement of eligibility and qualification No. 22-25754 and is incorporated herein by reference thereto. 5. THE CONSENT OF THE TRUSTEE REQUIRED BY SECTION 321(B) OF THE ACT. The consent of the trustee required by Section 321(b) of the Act is annexed hereto and made a part hereof. 6. A COPY OF THE LATEST REPORT OF CONDITION OF THE TRUSTEE PUBLISHED PURSUANT TO LAW OR THE REQUIREMENTS OF ITS SUPERVISING OR EXAMINING AUTHORITY. A copy of the latest report of condition of the trustee published pursuant to law or the requirements of its supervising or examining authority is annexed hereto as Exhibit 7 and made a part hereof. NOTES In answering any item in this Statement of Eligibility and Qualification which relates to matters peculiarly within the knowledge of the obligor or any underwriter for the obligor, the trustee has relied upon information furnished to it by the obligor and the underwriters, and the trustee disclaims responsibility for the accuracy or completeness of such information. The answer furnished to Item 2 of this statement will be amended, if necessary, to reflect any facts which differ from those stated and which would have been required to be stated if known at the date hereof. 4 SIGNATURE PURSUANT TO THE REQUIREMENTS OF THE TRUST INDENTURE ACT OF 1939, THE TRUSTEE, THE FIRST NATIONAL BANK OF BOSTON, A NATIONAL BANKING ASSOCIATION ORGANIZED AND EXISTING UNDER THE LAWS OF THE UNITED STATES OF AMERICA, HAS DULY CAUSED THIS STATEMENT OF ELIGIBILITY AND QUALIFICATION TO BE SIGNED ON ITS BEHALF BY THE UNDERSIGNED, THEREUNTO DULY AUTHORIZED, ALL IN THE TOWN OF CANTON AND COMMONWEALTH OF MASSACHUSETTS, ON THE 3RD DAY OF MAY, 1995. THE FIRST NATIONAL BANK OF BOSTON, Trustee By: KECIA R. BANKS ----------------------------- KECIA R. BANKS SENIOR ACCOUNT ADMINISTRATOR EXHIBIT 6 CONSENT OF TRUSTEE PURSUANT TO THE REQUIREMENTS OF SECTION 321(B) OF THE TRUST INDENTURE ACT OF 1939 IN CONNECTION WITH THE PROPOSED ISSUE OF EG & G, INC. DEBT SECURITIES, WE HEREBY CONSENT THAT REPORTS OF EXAMINATIONS BY FEDERAL, STATE, TERRITORIAL, OR DISTRICT AUTHORITIES MAY BE FURNISHED BY SUCH AUTHORITIES TO THE SECURITIES AND EXCHANGE COMMISSION UPON REQUEST THEREFOR. THE FIRST NATIONAL BANK OF BOSTON, Trustee By: KECIA R. BANKS ----------------------------- KECIA R. BANKS SENIOR ACCOUNT ADMINISTRATOR 5 EXHIBIT 7 CONSOLIDATED REPORT OF CONDITION, INCLUDING DOMESTIC AND FOREIGN SUBSIDIARIES, OF THE FIRST NATIONAL BANK OF BOSTON In the Commonwealth of Massachusetts, at the close of business on December 31, 1994. Published in response to call made by Comptroller of the Currency, under Title 12, United States Code, Section 161. Charter number 200. Comptroller of the Currency Northeastern District.
ASSETS DOLLAR AMOUNTS IN THOUSANDS ----------- Cash and balances due from depository institutions: Noninterest-bearing balances and currency and coin................................ $ 1,862,093 Interest-bearing balances ........................................................ 1,551,280 Securities ............................................................................ 3,935,691 Federal funds sold and securities purchased under agreements to resell in domestic offices of the bank and of its Edge and Agreement subsidiaries, and in IBF's: Federal funds sold ............................................................... 758,937 Securities purchased under agreements to resell .................................. 0 Loans and lease financing receivables: Loans and leases, net of unearned income ......................................... $25,796,462 LESS: Allowance for loan and lease losses ........................................ 534,630 LESS: Allocated transfer risk reserve ............................................ 0 Loans and leases, net of unearned income, allowance and reserve................... 25,261,832 Assets held in trading accounts ....................................................... 840,348 Premises and fixed assets (including capitalized leases)............................... 398,475 Other real estate owned ............................................................... 48,504 Investments in unconsolidated subsidiaries and associated companies.................... 103,670 Customers' liability to this bank on acceptances outstanding.......................... 304,031 Intangible assets ..................................................................... 651,394 Other assets .......................................................................... 1,170,251 ----------- TOTAL ASSETS .................................................................... $36,886,506 =========== LIABILITIES Deposits: In domestic offices .............................................................. $14,924,310 Noninterest-bearing .............................................................. $ 4,035,673 Interest-bearing ................................................................. 10,888,637 In foreign offices, Edge and Agreement subsidiaries, and IBF's 9,998,764 Noninterest-bearing .............................................................. 570,582 Interest-bearing ................................................................. 9,428,182 Federal funds purchased and securities sold under agreements to repurchase in domestic offices of the bank and of its Edge and Agreement subsidiaries, and in IBF's: Federal funds purchased .......................................................... 2,464,904 Securities sold under agreements to repurchase ................................... 277,077 Demand notes issued to the U.S. Treasury .............................................. 364,045 Trading Liabilities ................................................................... 227,865 Other borrowed money .................................................................. 3,875,462 Mortgage indebtedness and obligations under capitalized leases ........................ 14,007 Bank's liability on acceptances executed and outstanding .............................. 305,512 Subordinated notes and debentures ..................................................... 979,167 Other liabilities ..................................................................... 1,022,105 TOTAL LIABILITIES ................................................................ $34,453,218 =========== Limited-life preferred stock and equity capital 0
6 EQUITY CAPITAL Perpetual preferred stock and related surplus .......................................... $ 0 Common stock ........................................................................... 82,264 Surplus ................................................................................ 987,524 Undivided profits and capital reserves ................................................. 1,408,062 LESS: Net unrealized loss on marketable equity securities .............................. (39,027) Cumulative foreign currency translation adjustments .................................... (5,535) Total equity capital ................................................................... 2,433,288 ----------- TOTAL LIABILITIES, LIMITED-LIFE PREFERRED STOCK, AND EQUITY ...................... $36,866,506 ===========
7 I, Robert T. Jefferson, Comptroller of the above-named bank, do hereby declare that this Report of Condition is true and correct to the best of my knowledge and belief. ROBERT T. JEFFERSON FEBRUARY 13, 1995 We, the undersigned directors, attest to the correctness of this statement of resources and liabilities. We declare that it has been examined by us, and to the best of our knowledge and belief has beenprepared in conformance with the instructions and is true and correct. CHARLES K. GIFFORD IRA STEPANIAN J. DONALD MONAN DIRECTORS FEBRUARY 13, 1995 -----END PRIVACY-ENHANCED MESSAGE-----