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FIRST SUPPLEMENTAL INDENTURE (this "First Supplemental
Indenture"), dated as of July , 1997, among HARCOURT GENERAL, INC.
(formerly known as General Cinema Corporation), a Delaware corporation
(the "Company"), and Bankers Trust Company, a banking corporation
organized and existing under the laws of the State of New York, as
trustee (the "Trustee").
WHEREAS, the Company has executed and delivered to the Trustee an Indenture
(the "Indenture"), dated as of April 23, 1992, providing for the issuance and
sale by the Company from time to time of its senior debt securities (the
"Securities"), which term shall include any Securities issued under the
Indenture after the date hereof;
WHEREAS, clause (3) of Section 901 of the Indenture permits the Company,
when authorized by a resolution of the Board of Directors of the Company, and
the Trustee, at any time and from time to time, to enter into one or more
indentures supplemental to the Indenture, in form satisfactory to the Trustee,
for the purpose of making any other provision with respect to matters or
questions arising under the Indenture and the last paragraph in Section 901
provides that, with respect to clause (3) of Section 901, no supplemental
indenture shall adversely affect the interest of the Holders of Securities of
any series;
WHEREAS, all terms used in this First Supplemental Indenture which are
defined in the Indenture shall have the meanings assigned to them in the
Indenture;
WHEREAS, the Company has requested that the Trustee execute and deliver
this First Supplemental Indenture; and
WHEREAS, all requirements necessary to make this First Supplemental
Indenture a valid instrument in accordance with its terms and to make the
amendments provided for herein have been fulfilled, and the execution and
delivery of this First Supplemental Indenture has been duly authorized in all
respects.
NOW THEREFORE, the Company and the Trustee hereby agree that the following
Sections of this First Supplemental Indenture supplement the Indenture with
respect to Securities issued thereunder:
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SECTION 1. DEFINITIONS. Capitalized terms used herein and not defined
herein have the meanings ascribed to such terms in the Indenture.
SECTION 2. AMENDMENT TO "CONSOLIDATED NET ASSETS" DEFINITION. With respect
to any series of Securities issued on or after the date hereof, the definition
of "Consolidated Net Assets" in Section 101 is hereby deleted and the following
is substituted in lieu thereof:
"'Consolidated Net Assets' means the total amount of all assets
appearing on the consolidated balance sheet of the Company and its
Restricted Subsidiaries (at their net book values, after deducting
related depreciation, amortization and all other valuation reserves
which have been set aside in connection with the business conducted
and which are reflected on the aforementioned consolidated balance
sheet), less total current liabilities other than long-term
liabilities due within one year."
SECTION 3. AMENDMENT TO "RESTRICTED SUBSIDIARY" DEFINITION. With respect to
any series of Securities issued on or after the date hereof, the definition of
"Restricted Subsidiary" in Section 101 is hereby deleted and the following is
substituted in lieu thereof:
"'Restricted Subsidiary' means any Subsidiary of the Company
(other than Neiman Marcus and other than a Subsidiary that is
principally engaged in the business of owning or investing in real
estate (a 'Real Estate Subsidiary'), finance, credit, leasing,
financial services or other similar operations, or any combination
thereof), which itself, or with one or more other Restricted
Subsidiaries, owns or leases a Principal Property; PROVIDED, HOWEVER,
that in the event that (a) any Restricted Subsidiary, in a single
transaction or through a series of related transactions, shall (i) be
consolidated with or merge with or into Neiman Marcus or any of its
subsidiaries or a Real Estate Subsidiary or any of its subsidiaries or
(ii) transfer (by lease, assignment, sale or otherwise) all or
substantially all of its properties and assets to Neiman Marcus or a
Real Estate Subsidiary or (b) Neiman Marcus or a Real Estate
Subsidiary shall become a wholly owned subsidiary of the Company, then
the term 'Restricted Subsidiary' shall include Neiman Marcus or a Real
Estate Subsidiary, as applicable."
SECTION 4. AMENDMENT TO LIMITATION ON LIENS. With respect to any series of
Securities issued on or after
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the date hereof, Section 1006 is hereby deleted and the following is substituted
in lieu thereof:
"SECTION 1006. LIMITATION ON LIENS. The Company shall not create
or assume any Lien upon any Principal Property of the Company or any
Restricted Subsidiary or shares of capital stock or indebtedness of
any Subsidiary (other than any Subsidiary of Neiman Marcus until such
time as Neiman Marcus shall become a Restricted Subsidiary) to secure
any debt of any Person, 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 by
the Lien equally and ratably with such debt for so long as such debt
shall be so secured, except that the foregoing shall not prevent the
Company or any Restricted Subsidiary from creating or assuming Liens
of the following character:
(1) with respect to any series of Securities, any Lien
existing on the date of issuance of the series;
(2) any Lien existing 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 Lien existing on property at the time of the
acquisition or lease thereof by the Company or a Restricted
Subsidiary;
(4) any 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 Lien to secure any debt on property or assets
incurred prior to, at the time of, or within 180 days after, or
pursuant to financing arrangements for which a firm commitment is
made by a bank, insurance company or other lender or investor
(not including the Company or any Restricted Subsidiary) within
180 days after, the acquisition of capital stock, property or
assets for the purpose of financing all or any part of the
purchase price thereof;
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(6) any Lien to secure any debt incurred prior to, at the
time of, or within 180 days after, or pursuant to financing
arrangements for which a firm commitment is made by a bank,
insurance company or other lender or investor (not including the
Company or any Restricted Subsidiary) within 180 days after, the
completion of the construction and commencement of commercial
operation, alteration, repair or improvement of property or
assets for the purpose of financing all or any part of the cost
thereof;
(7) any Lien securing debt of a Restricted Subsidiary owing
to the Company or to another Restricted Subsidiary;
(8) any Lien in favor of any customer arising in respect of
performance deposits and partial, progress, advance or other
payments made by or on behalf of such customer for goods produced
or to be produced for or services rendered or to be rendered to
such customer in the ordinary course of business, which Lien
shall not exceed the amount of such deposits or payments;
(9) mechanics', xxxxxxx'x, repairman's, materialman's,
carriers' and other similar Liens arising in the ordinary course
of business;
(10) any Lien created by or resulting from any litigation or
proceedings which are being contested in good faith by
appropriate proceedings; any Lien arising out of a judgment or
award against the Company and/or one or more Restricted
Subsidiaries with respect to which the Company and/or such
Restricted Subsidiary or Subsidiaries are in good faith
prosecuting an appeal or proceedings for review; or any Lien
incurred by the Company and/or Restricted Subsidiaries for the
purpose of attaining a stay or discharge in the course of any
legal proceedings to which the Company and/or Restricted
Subsidiary or Subsidiaries are a party; or
(11) any Lien for taxes or assessments or governmental
charges or levies not yet due or delinquent, or which can
thereafter be paid without penalty or which are being contested
in good faith by appropriate proceedings; any landlord's Lien on
property held under lease and tenants' rights under leases;
easements and any
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other liens of a nature similar to those hereinabove described in
this clause (11) which do not, in the opinion of the Company,
materially impair the use of such property in the operation of
the business of the Company or any Restricted Subsidiary or the
value of such property for the purposes of such business;
(12) any Lien which may be deemed to result from an
agreement or commitment to exchange securities of a Subsidiary
for other securities of the Company, whether or not such
securities of a Subsidiary are placed in escrow for such purpose;
(13) 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 or any of the foregoing,
to secure partial, progress, advance or other payments or
performance pursuant to the provisions of any contract or
statute, or any Liens securing industrial development, pollution
control, or similar revenue bonds;
(14) any extension, renewal or replacement (or successive
extensions, renewals or replacements) in whole or in part of any
Lien referred to in clauses (1) through (13) above, so long as
the principal amount of the debt secured thereby does not exceed
the principal amount of debt so secured at the time of the
extension, renewal or replacement (except that, where an
additional principal amount of debt is incurred to provide funds
for the completion of a specific project, the additional
principal amount, and any related financing costs, may be secured
by the Lien as well) and the Lien is limited to all or part of
the same property subject to the Lien so extended, renewed or
replaced (plus improvements on the property); and
(15) any Lien not permitted by clauses (1) through (14)
above securing debt which, together with the aggregate
outstanding principal amount of all other debt of the Company and
its Restricted Subsidiaries which would otherwise be subject to
the foregoing restrictions and the aggregate Value of existing
Sale and Leaseback Transactions which would be subject to the
restrictions of Section 1007 but for this clause (15), does not
at the
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time of incurrence exceed 15% of Consolidated Net Assets."
SECTION 5. THIS FIRST SUPPLEMENTAL INDENTURE. Nothing in this First
Supplemental Indenture shall apply to, or alter the rights and remedies
conferred by the Indenture upon, any Securities created and issued prior to the
date hereof. With respect to any series of Securities issued on or after the
date hereof, this First Supplemental Indenture shall be construed as
supplemental to the Indenture and shall form a part of it, and the Indenture is
hereby incorporated by reference herein and each is hereby ratified, approved
and confirmed.
SECTION 6. GOVERNING LAW. THIS FIRST SUPPLEMENTAL INDENTURE SHALL BE
CONSTRUED IN ACCORDANCE WITH AND GOVERNED BY THE LAWS OF THE STATE OF NEW YORK.
SECTION 7. COUNTERPARTS. This First Supplemental Indenture 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.
SECTION 8. HEADINGS. The headings of this First Supplemental Indenture are
for convenience only and shall not affect the construction hereof.
SECTION 9. SEPARABILITY. In case any provision in this First Supplemental
Indenture or in the Securities shall be invalid, illegal, or unenforceable, the
validity, legality or enforceability of the remaining provisions shall not in
any way be affected or impaired thereby.
IN WITNESS WHEREOF, the parties hereto have caused this First Supplemental
Indenture to be duly executed by their respective authorized officers as of the
date first written above.
HARCOURT GENERAL, INC.,
by
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Name:
Title:
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BANKERS TRUST COMPANY,
as Trustee,
by
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Name:
Title:
